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Nike has asked a New York court to stop StockX from selling NFTs of its shoes.

Nike has launched a civil lawsuit in the US against StockX, a Detroit-based online fashion resale platform, alleging that the latter exploits unlicensed photos of its footwear in non-fungible token (NFT) sales.

Nike’s lawyers alleged in a 50-page complaint filed in the New York Southern District Court that StockX’s Vault NFT services infringe on its trademark rights and may create consumer confusion.

The petition went on to ask for monetary damages and a court order barring StockX from selling the NFTs.

StockX’s “misappropriation of Nike’s iconic trademarks and goodwill to boost its entry into the lucrative NFT and digital collectible industry,” according to the Nike-appointed lawyers. This, according to the lawyers, is aimed at depriving Nike “of its exclusive right to use its marks in connection with this new commercial medium [NFTs].”

The claim did not specify a monetary amount for compensation, but claimed that StockX’s offers had “diluted” its brand, alleging “unfair competition.”

It urged the court to “immediately and permanently halt StockX’s sale of Vault NFTs carrying Nike’s iconic insignia.”

According to the lawyers, “558 individual Nike-branded Vault NFTs” were listed for sale on the StockX website.

Vault NFTs are “backed by a physical asset held in StockX’s custody, tied directly one-to-one via the blockchain,” according to StockX’s website.

As a result, it clarifies,

“If the owner redeems the physical object connected with Vault NFT[s], it is withdrawn from the StockX Vault and sent to the owner. The Vault NFT will then be removed from the owner’s portfolio and from circulation (i.e. “burned”).”

Vault NFTs, according to the company, enable customers to “invest in current culture like never before,” allowing them to own an item “without ever taking possession” of it or paying shipping fees. “You can also sell it without having to deliver it to us and with lower seller fees,” the company noted.

Consumers are “already questioning if Nike permitted StockX to sell its [trademark-]infringing NFT products,” according to the Nike legal team, who also want to know “how StockX acquired” licencing rights to sell NFTs with Nike branding.

Nike has jumped right into the world of NFTs, with its own collections now available on sites like OpenSea. RTFKT, a creator of virtual sneakers and collectibles, as well as shoe-related NFTs, was purchased by the firm in December of last year.

If Nike succeeds in its legal action against the platform, other sportswear companies may follow suit – the platform currently has at least one Adidas NFT available.

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