SAN FRANCISCO (AFP) – Athletics giant Nike filed a lawsuit in New York against shopping platform StockX for creating and marketing NFTs – the tamper-proof digital property certificates – based on the brand’s products without permission.
The company’s lawyers accused US-based StockX of “minting” NFTs using Nike trademarks and trading on the brand’s “goodwill” to market them.
StockX is “selling those NFTs at heavily inflated prices to unsuspecting consumers who believe or are likely to believe that those ‘investible digital assets’ (as StockX calls them) are, in fact, authorised by Nike when they are not,” according to the complaint.
Nike is seeking damages and a court injunction to force StockX to stop the sales.
Barely known a year ago, NFTs (non-fungible tokens) have increasingly become a mainstay of auction houses and the art market, where virtual works have fetched multimillion-dollar prices.
StockX, which buys and resells clothing and technology products, primarily specialises in sneaker auctions, with fans able to snare collectible pairs that can sell for hundreds of thousands of dollars.
But it now also offers NFTs, digital versions of objects whose ownership is traceable.
For example, an image of the “KAWS Sacai Nike Blazer Low Blue (Vault NFT)” sneaker is available for USD549 on StockX.
“Each Vault NFT is backed by a physical item held in StockX’s custody, tied directly one-to-one via the blockchain,” the website states.