Nike sues Detroit-based StockX, says it bought counterfeit shoes on the platform | Metro Detroit News | Detroit

click to enlarge A StockX processing center in Detroit.  - HAPPY PHOTO

Courtesy photo

A StockX processing center in Detroit.

Retail giant Nike is suing Detroit-based company StockX for purchasing four pairs of counterfeit shoes on its sneaker resale platform between December 2021 and January 2022.

“Those four pairs of counterfeit shoes were all purchased on the StockX platform within a short period of two months, they all had StockX’s ‘Verified Authentic’ hangtag on them, and they all came with a paper receipt from StockX in the shoebox that stated that the condition of the shoes is ‘100% Authentic’,” Nike said in a court on Tuesday.

Nike initially filed a copyright infringement lawsuit against StockX in federal court in Manhattan in February. On Tuesday, it asked a federal judge to add claims of forgery and false advertising to the lawsuit.

The copyright infringement claim accuses StockX of “blatant freeriding” of Nike’s trademarks as part of its “Vault NFT” service, or of unique digital versions of the shoes it resells. According to the lawsuit, Nike’s attorneys allege:

“StockX built its secondary market business by leveraging the immense goodwill and reputation that Nike has amassed over many years as the world’s leading designer, developer, marketer and seller of athletic footwear and apparel. of Nike’s brands firsthand, StockX chose to enter the lucrative NFT market, not by taking the time to develop its own intellectual property rights, but rather by blatantly freeriding, almost exclusively, on the back of Nike’s famous trademarks and associated goodwill.”

In a statement shared with Metro timesStockX rejected Nike’s claims, accusing the company of simply not understanding the newfangled NFTs.

“We take protecting customers very seriously and we have invested millions to fight the proliferation of counterfeit products that faces virtually every global market today. Nike’s latest filing is not only groundless, but curious given that their own brand protection team is confident communicated in our authentication program, and that hundreds of Nike employees – including current senior executives – are using StockX to buy and sell products. This latest tactic amounts to nothing more than a panicked and desperate attempt to recover the lost lawsuit against our innovative Vault NFT- “Reviving a program that will revolutionize the way consumers can buy, store and sell collectibles safely, efficiently and sustainably. Nike’s challenge has no merit and clearly demonstrates their lack of understanding of the modern market.”

Nike accuses StockX of “almost exclusively” [using] Nike’s trademarks to launch its Vault NFTs because it knew it would attract attention, boost sales and lead consumers to believe that Nike was partnering with StockX on the Vault NFTs.” As evidence, the company provided examples of social media that showed confusion among customers, regarding Nike’s involvement:

“Nike has not approved or authorized StockX’s Nike-branded Vault NFTs. Those unapproved products are likely to confuse consumers, create a false association between those products and Nike, and tone down Nike’s famous trademarks. Indeed, consumers are asking already questioned whether Nike authorized StockX to sell its infringing NFT products, asking how StockX “got the license to sell NFTs” [N]ike branding.'”

StockX was co-founded in 2015 by billionaire Dan Gilbert, who Inc. reportedly became inspired to create a “stock market of things” after noticing that his teenage sons were spending a lot of time on eBay bidding on sneakers.

As of 2019, the company had more than 800 employees in Detroit and was considered one of the fastest-growing startups in the city. It also has international offices in the UK, the Netherlands and Japan.

The company says it is proud of its transparency and authenticity. “We believe in the power of truth, authenticity and transparency. We’re doing the right thing, and we’re doing it right,” it wrote on its about page.

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