On March 29, 2021, just hours after MSCHF Product Studio, Inc. sold all 666 existing pairs of limited-edition “Satan Shoes,” Nike filed suit in the Eastern District of New York against MSCHF for trademark infringement and trademark dilution, among other claims. The shoes are a collaboration between MSCHF and rapper Lil Nas X. On March 26, 2021, a Twitter post announced the “Satan Shoes” for sale, describing them as Nike Air Max ’97 shoes with 666 pairs available for sale, individually numbered, at a price of USD $1018 per pair. There are a number of important alterations to the Nike shoes to turn them into “Satan Shoes,” including the addition of red ink and “1 drop of human blood” to the midsole, red embroidered satanical-themed detailing, a bronze pentagram to the laces, and a new sock liner. The shoes also feature embroidery stating, “Luke 10:18,” a reference to the Bible verse that says, “I saw Satan fall like lightning from heaven.” Although MSCHF reportedly purchased authentic Nike Air Max shoes, Nike alleges that these customizations are material alterations to the Nike shoes that were not authorized by Nike, and were made without its approval, authorization, or its control or oversight, in violation of federal trademark law. Nike also alleges that any changes made to the midsole of its shoes could pose a significant safety risk to consumers. MSCHF left the Nike Swoosh logo both on the top of the shoe tongue and along the side of the shoes and advertised the shoes as Nike brand products.
All 666 pairs of the unauthorized “Satan Shoes” sold out within minutes. Social media immediately lit up with calls to boycott, cancel, or ban Nike from consumers’ homes, especially since the satanical shoes were sold during one of the holiest weeks of the year for Christians. In fact, this is precisely the issue of trademark infringement with unauthorized goods – it is the trademark owner who faces the angry consumer backlash and not the infringer. It’s clear that consumers are confused and believe these shoes are associated with or endorsed by Nike, since its logo is all over the unauthorized shoe. In my opinion, there is no coincidence that the sale of the shoes coincides with the release of Lil Nas X’s new video, which also dropped on March 29, 2021. The rapper has not commented on the lawsuit, but most news outlets are talking about the rapper, giving him free publicity. MSCHF is also no stranger to incorporating high profile brands into its products, and MSCHF’s co-founder reportedly has commented he hopes for a legal pushback from one of the brands to drive up the value of his products.
Nike has a colorable case against MSCHF and appears to have suffered actual, reputational harm in only hours following the shoe sales. Moreover, the Nike Swoosh Logo has been found to be a famous trademark by the Ninth Circuit, making this is a textbook case of dilution by tarnishment. Nike seeks injunctive relief along with actual and punitive damages. Nike also seeks the destruction of all the unauthorized products, along with the destruction of all the digital files and various marketing materials used to create the infringing products. Nike’s goal is to ensure these shoes are eradicated from the market, but it may face difficulties in retrieving goods that have already been purchased in good faith by consumers. It will be interesting to see how the court orders already purchased shoes to be returned and if it will order MSCHF to reimburse those consumers.
What about MSCHF’s ability to invoke the first sale doctrine? In my opinion, the first sale doctrine or exhaustion of rights will not be valid defenses for MSCHF as (i) the “Satan Shoes” differ from the authentic Nike Air Max shoes, (ii) the “Satan Shoes” vary from Nike’s established quality control standards, and (iii) consumers are not only likely to be confused, but in this case have actually been confused as to the affiliation between MSCHF and Nike as to the source of the “Satan Shoes.” It seems MSCHF may have gone too far this time and has an uphill battle to escape liability in this case.
Stacey C. Kalamaras is the founding partner of Kalamaras Law Office LLC. She has extensive intellectual property experience with a focus on global trademark protection and enforcement, in more than 150 countries. Her experience includes trademark counseling, prosecution, enforcement, IP due diligence, and IP agreements. She can be reached at email@example.com.