Trademark Infringement Case of Nike Inc. vs. MSCHF Product Studio Inc. – An Overview

Nike dragged the company MSCHF Product Studio Inc. before the court on trademark infringement and copying the Nike shoe black Nike Air Max 97s for making the 666 pairs of “Satan shoes.” Therefore, a lawsuit has been filed against the company that sells the LilNas X “Satan Shoes.” pricing at $1,018. Nike filed the suit on the same day when Lil Nas X’s” Satan shoes” launched. The shoes had the feature of a bronze Pentagram, a little bit of human blood, and the number “666” significantly, the Nike Swoosh. MSCHF, a New York-based art collective, teamed up with Lil Nas; he is a viral rapper who recently launched his new track Montero “Call Me by Your Name,” the way he is consistently featured in the billboard hot track 100 lists. The song was promoted as a 21st-century re-creation of the controversy surrounding Madonna’s 1989 video for “Like a Prayer.” As a result of its negative portrayal of the Bible, it was widely panned by the right-wing. This article aims to find out the question of trademark infringement in the case of Nike Inc vs MSCHF Product Studio Inc.

Satan shoes

Satan shoes are a line of special Nike Air Max 97 shoes launched by Lil Nas X and MSCHF in 2021. Limited-edition shoes have been popular for a while, and street wear firm MSCHF seemed to be hitting all the right notes when it partnered with Lil Nas X on Satan Shoes. There were only 666 pairs manufactured since 666 is the number of the beast in the Bible, which refers to the devil or Satan. The shoes are predominantly black with crimson highlights and have references to the devil. Each pair is adorned with a pentagram emblem and the words “Luke 10:18” — a scripture from the Gospel of Luke that effectively says, “I witnessed Satan fall from heaven like lightning.”

No authorization over trademark license

In the matter of Nike Inc vs MSCHF Product Studio Inc. the case implies that Customers are connecting the Satan Shoes with Nike’s brand, even though Nike had no involvement in their construction, and this is damaging Nike’s reputation. According to Nike^[1], the MSCHF product, which uses Nike’s iconic NIKE brand, might significantly negatively impact Nike’s reputation among consumers who now believe Nike supports satanism.

What is the Legal controversy and argument in respect of Nike Inc. vs. MSCHF Product Studio Inc.? 

Nike Inc. filed a complaint against the MSCHF Product Studio Inc. on the issue of infringing the trademark the fact that their branded shoes were materially altered without their permission. As a result, MSCHF has generated confusion among customers about Nike’s affiliation with the Satan sneakers. Because of the armorial character of the shoes, it also brings the Nike brand into disrepute. Nike alleged the MSCHF product Studio Inc. by stating that “By formulating the false impression that MSCHF’s Satan Shoes are production by, authorized by, or otherwise associated with Nike, IMSCHF’s unauthorized use of Nike’s “marks” and confusingly similar marks constitutes a false designation of origin that is to cause confusion, mistake, or deception to the consumer, origin, sponsorship, or approval of MSCHF and MSCHF’s Satan Shoes.’

The respondents reckon on the ‘First Sale Doctrine,’ which states that there can be no cause for trademark violation if the accused offender resells the goods after obtaining them legally, even if no resale license is obtained. This approach, however, was not recognized in the current case since the alterations made to the shoe produced a loss of uniqueness and misled the public into believing Nike’s affiliation with the modified shoes. The company MSCHF released ‘Jesus Shoes,’ which were inspired by Nike’s Air Max 97. Nike did not sue the firm in this case since it received great feedback from it. Predicting that MSCHF may use this as a defense, in this case, Nike clarified its position by declaring that it had not waived its right to sue the firm for the ‘Jesus Shoes,’ and that it would do so; only if the ‘chance of misunderstanding loomed enormously.’

Nike has contended that “Nike has suffered, continues to suffer, or is expected to suffer damage to its trademarks, business image, and goodwill as a direct and proximate result of MSCHF’s illegal activities, according to the lawsuit.” Unless enjoined, MSCHF will continue to use Nike’s Asserted Marks and confusingly similar marks, causing Nike irreparable harm for which there is no viable legal remedy.”

Acts and Section under which Nike filed the complaint

• Trademark Infringement in Violation of 15 U.S.C. & 1114 
• False Designation of Origin / Unfair Competition in Violation of 15 U.S.C. & 1125(a)
• Trademark Dilution in Violation of 15 U.S.C. & 1125(c) 
• Common Law Trademark Infringement and Unfair Competition.

Settlement on the case

In the matter of Nike Inc vs MSCHF Product Studio Inc. the judges, in this case, had to determine if the use of the mark has artistic value, and if so, whether the work is intentionally deceptive. The reaction was that the black and red devil-themed sneakers had violated the Nike trademarks with the Nike ‘Swoosh’ emblem. The judge issued a restraining order, ordering MSCHF to recall all of its 666 pairs of “Satan Shoes” and provide the returnee with a full refund. The parties did, however, reached an agreement to conclude the matter on April 8, 2021. While the majority of the specifics of the deal are being kept under wraps, a Nike representative told Yahoo Finance that the firm asked MSCHF to begin a voluntary restitution program. 

Conclusion

We emphasize the importance of trademark strategy. In the present case of Nike Inc vs MSCHF Product Studio Inc the registration of trademark is only one part of the process. Trademark owners also have a responsibility to safeguard their trademark to the best of their ability. In this instance, Nike deliberately decided not to sue for Jesus Shoes at first, only to later include them in the settlement agreement for Satan Shoes. Such judgments should be well-considered, given those mentioned above. When it comes to policing a brand, there is a fine line to walk because if you want to enjoy your brand, you need to come up with innovation and creation but if it starts to lead consumers to believe that the brand is something it isn’t, or stands for something it doesn’t, the brand can be diluted. Entrepreneurs and beginning firms should consult with an experienced trademark attorney with knowledge in this sector when evaluating what specific marks or designations need to be legally protected under trademark law, as well as how and when to cover these marks.

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