Nike Hit with Lawsuit Over Crypto Business Collapse: Buyers Demand Justice!

So, apparently, Nike decided to shut down its crypto-themed business unit, RTFKT, and now it’s being sued for… wait for it… “causing significant losses” to people who bought NFTs. And not just any NFTs, but Nike-branded ones! I mean, because who wouldn’t want a virtual sneaker collection? (You know, for your invisible feet.)

The lawsuit, filed by Australian resident Jagdeep Cheema, alleges that Nike’s sudden decision to close RTFKT in December 2024 sent the market for Nike NFTs straight into a nosedive. Buyers who thought they were making savvy investments suddenly found themselves holding onto digital assets worth less than the paper it would take to print them (if they were allowed to print them, which they aren’t). Sad times, really.

The plaintiffs are arguing that they wouldn’t have shelled out top dollar for these NFTs—if they had known they were, in fact, unregistered securities. That’s right: NFTs, the same thing we once thought were just pixelated GIFs of an ape, are now considered securities. (Oh, how the mighty have fallen.) They also claim that Nike “pulled the rug out from under them” like some sort of corporate magician, closing down the whole operation without even so much as a warning. Who does that?

As of now, Nike has yet to respond, though we’re all holding our breath, waiting for a corporate lawyer to type out an emotionally neutral “no comment” on the matter. Meanwhile, Phillip Kim, the attorney for the plaintiffs, is also keeping his lips sealed, perhaps hoping for a sudden appearance of a miraculous sneaker-themed crypto comeback.

The plaintiffs want more than $5 million because, apparently, Nike broke consumer protection laws in New York, California, Florida, and Oregon. I’m not sure if they’ve factored in their retail price for running shoes in that total, but I’m guessing that’s coming soon.

But here’s the bigger question: Should NFTs be treated like securities under U.S. law? Yeah, no one really knows yet, but that doesn’t stop lawsuits from popping up like weeds in an untended garden. The crypto market continues to evolve, and with it, the questions around these questionable digital assets keep piling up.

In case you missed it, Nike swooped in and bought RTFKT in December 2021, praising the brand for being “a pioneer in merging culture, gaming, and digital collectibles.” Fast forward three years, and that pioneering spirit has somehow turned into a cautionary tale. On December 2, 2024, Nike announced that RTFKT would be shutting down, but assured the world that its “legacy” would live on through the creators and projects it inspired. (I’m guessing this includes an emotional farewell meme featuring a sad sneaker.)

The case, for those keeping score, is officially known as Cheema v. Nike Inc. and is being heard in the U.S. District Court for the Eastern District of New York. Case number? 25-02305, if you want to follow along at home.

2025-04-27 09:10

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