On Tuesday, Nike Inc. asked the Southern District of New York court overseeing the suit between it and StockX Inc., an online shoe retailer, for permission to file an amended complaint after StockX answered its initial one filed in February. “In the short time since Nike initiated this action, StockX has repeatedly revised its statements to consumers, hoping to erase some of the unsavory conduct that Nike’s Complaint identified,” the motion says.
The action stemmed from StockX’s purportedly unauthorized and infringing use of Nike’s famous marks in connection with Non-Fungible Tokens (NFTs) it began “minting” and selling without Nike’s permission. The filing claimed that StockX used Nike’s goodwill to sell NFTs at heavily inflated prices to unwitting consumers.
Now, Nike claims that three recent occurrences warrant the filing of a new complaint. First, StockX has reportedly engaged in “revisionary conduct” surrounding its NFT offerings to cover up its infringement. Nike says that in its answer, the defendant “obfuscated the fact that it scrambled to revise its representations to consumers in the wake of Nike’s claims of trademark infringement and dilution.”
In addition, Nike asserts that it has now entered the NFT market whereas the action was prospective in its prior pleading. Nike claims that this increases the likelihood of confusion between its legitimate NFTs and the allegedly infringing ones StockX sells.
Lastly, Nike asserts that it has since obtained four pairs of counterfeit “Nike” shoes purchased on StockX’s platform. Because at least one pair of the counterfeit shoes are the same style as one of the infringing Nike-branded NFTs, Nike says it has revised allegations regarding StockX’s counterfeiting activities and its false or misleading claims regarding its “proprietary” authentication process.
Nike argues that it is well established that leave to amend should be granted, as here, where the request comes prior to a scheduling order deadline. The company adds that its motion comes without bad faith, prejudice, or futility, and thus should be freely granted.