Nike Accuses StockX of Selling Counterfeit Sneakers and Engaging in Deceptive Advertising

Footwear corporation Nike filed a lawsuit against online reseller StockX in the New York southern district on February 3, 2022, for using its non-fungible token (NFT) with authorization

Footwear corporation Nike filed a lawsuit against online reseller StockX in the New York Southern District on February 3, 2022, over the use of its non-fungible token (NFT) without authorization. The company alleged trademark infringement and the sale of counterfeit sneakers.

In its updated complaint, Nike stated that StockX's NFTs, which promised buyers a physical product, were insufficient to address the concerns raised by the footwear giant. Nike claimed that it purchased four counterfeit sneakers from the reseller between December 2021 and January 2022, out of which only one was the Jordan 1 Patent Bred.

Media outlets released a picture of the sneaker, which showed a SockX-verified hangtag. Nike included this detail in the filing, highlighting that the shoes came with a receipt that stated they were "100% verified and authentic." The reseller's proprietary authentication service claimed to utilize over 100 data points and boasted that its authenticators were superior to any others.

Nike further noted the reseller's lack of a return policy, which, according to the company, made it crucial for customers to trust the authenticity of the shoes upon purchase. Nike also alleged that the reseller may have sourced its “Vault” shoes from the same marketplace as the counterfeit pairs.

The footwear company highlighted in its updated complaint that the reseller attempted to justify its practices, but Nike maintained that these efforts were insufficient. Nike also stated that StockX had not removed or altered its use of the shoe incorporation's trademarks on its Vault NFTs.

Nike reportedly requested the court to rule in their favor over StockX.

In August 2024, newly unsealed court documents revealed that the shoe incorporation accused the reseller of selling counterfeit sneakers and engaging in deceptive advertising, which Nike described as both harmful and misleading.

The filing also alleged that the reseller knowingly passed off counterfeit Nike products as genuine. It points to internal documents, which reportedly acknowledged the sale of hundreds of fake items, with the reseller attributing the issue to defects approved by the shoe company during manufacturing.

Nike is seeking a ruling in its favor on claims of willful counterfeiting and false advertising before the case goes to trial. The company contends that these practices created consumer confusion about the authenticity of its products. This confusion, according to Nike, can lead to lost sales, negative consumer feedback both directly and on social media, and damage to relationships with business partners and affiliates.

On November 16, 2024, the reseller released a statement on X, writing:

The reseller added that StockX encountered and blocked over $80 million worth of suspected counterfeit sneakers during the period in question. It criticized the shoe incorporation for pursuing costly litigation instead of joining forces to combat fakes.