Nike v. Lil Nas’ Satan Shoes

What are Lil Nas X's Satan Shoes?

Lil Nas X recently dropped his latest single, “Montero (Call Me By Your Name)”, with an accompanying controversial video that depicts him being seduced out of the Garden of Eden, falling into hell and giving the devil a lap dance. And, of course, there was a sneaker collaboration.

Specifically, the Brooklyn art collective MSCHF — a company known for creating controversial products — teamed up with Lil Nas X to release “Satan Shoes”. The sneakers are modified Nike Air Max 97s, decorated with a pentagram pendant and a reference to Luke 10:18, a Bible verse about Satan’s fall from heaven. The shoes also contain a drop of human blood inside the sole (drawn from members of the MSCHF team). All 666 pairs of the modified Nikes, priced at $1,018, sold out within a minute of their release..

Not long after, Nike filed suit against MSCHF (notably, Nike did not name Lil Nas X as a defendant) in the U.S. District Court of the Eastern District of New York. The complaint alleges trademark infringement, dilution (blurring and tarnishment), false designation of origin, and unfair competition.

Louis Vuitton x Supreme

This is hardly the first lawsuit of its kind. For instance, in early 2017, Louis Vuitton — the world’s most valuable luxury brand — revealed it would team up with Supreme, the world’s most in-demand streetwear/skatewear brand. The partnership was particularly surprising because in 2000, Louis Vuitton pressured Supreme to stop the production and sale of Supreme’s limited edition skate decks that sported a pattern that looked a lot like Louis Vuitton’s famed Toile Monogram. Similarly, the Harlem-based tailor and designer, Dapper Dan, created highly sought after one-of-a-kind pieces made from counterfeit design materials; his business was summarily sued out of existence by luxury labels (ironically, Dapper Dan later had an official collaboration with Gucci). Indeed, MSCHF co-founder Gabriel Whaley once told Business Insider that “the likelihood of receiving a cease-and-desist letter from at least one of the brands included is high.” In fact, Whaley said that he was actually hoping to drive such attention, noting that formal legal pushback would “help increase the value of the product.” It’s like the Streisand effect for trademarks.

Nevertheless, the lawsuit allows us to dive in and geek out about trademark law, the details of Nike’s case, and the legal defenses available to MSCHF.

Nike v. Satan Shoes

“Nike has not and does not approve or authorize MSCHF’s customized Satan Shoes,” counsel for Nike argues, claiming that while MSCHF may have acquired authentic Nike sneakers, its customization of the sneakers has resulted in shoes that “are not genuine Nike products.” In other words, the MSCHF sneakers may bear Nike’s Swoosh, but the Brooklyn-based collective “has customized them in such a manner that they constitute new, unauthorized products,” thereby, running afoul of federal trademark law by advertising and selling them without Nike’s authorization.

Right out of the gate (literally in the first sentence), Nike characterizes the shoes as “materially altered to prominently feature a satanic theme.” This is key to reject a first sale defense (on which we’ll elaborate on below). As held in Maui Jim, Inc. v. Smartbuy Guru Enters., “An alteration is material if it changes something about a product that is relevant to consumers’ decision to purchase the product.”Maui Jim, Inc. v. Smartbuy Guru Enters., 459 F. Supp. 3d 1058, 1084 (N.D. Ill. 2020). More on this, later.

In order to prevail on a trademark infringement and unfair competition claim, a plaintiff must establish that the defendant’s actions create a “likelihood of confusion” regarding the origin of the good or services offered by the parties. In this lawsuit, Nike not only argues a likelihood of confusion, but alleges “significant” actual confusion already taking place, using social media posts to bolster their arguments.

Nike hits all the marks on the different types of legal confusion it alleges, including:

Nike has also alleged dilution. Unlike trademark infringement (which involves the probability of customer confusion), dilution does not require any confusion. Instead, dilution occurs when someone uses a famous mark in a manner that blurs or tarnishes the mark.

With an assist from the Ninth Circuit Court of Appeals, Nike argues that its Nike Swoosh — and its brand in general — is not only famous, but “exalted”.Au-Tomotive Gold, Inc. v. Volkswagen of Am., Inc., 457 F.3d 1062, 1067 (9th Cir. 2006). Nike alleges dilution of that brand by both blurring and by tarnishment. In a nutshell, blurring is basically harming the strength of a famous mark by associating it with a different source. Tarnishment is harming the reputation of the mark by association with something tawdry or bad, like sex, drugs or — in this case— Satan.

Nike rounds out its suit by asking for injunctive relief, a destruction of all the shoes, an order affirming Nike’s trademark rights, pre-judgment interest, costs, attorneys’ fees and basically every kind of damage the law allows for (statutory, punitive, profit disgorgement, treble damages).

Available Defenses

While Nike’s case is pretty strong, it’s not a slam dunk by any means. Here are some defenses that MSCHF will likely plead.

First Sale

The first-sale doctrine is a defense to infringement subject to certain well-defined exceptions. Under this doctrine, “when a retailer—such as Amazon—‘merely resells a genuine, unaltered good under the trademark of the producer, the use of the producer’s trademark by the reseller will not deceive or confuse the public as to the nature, qualities, and origin of the good.’”Maui Jim, Inc. v. Smartbuy Guru Enters., 459 F. Supp. 3d 1058 (N.D. Ill. 2020). Rather, “the consumer gets exactly what the consumer bargains for, the genuine product of the particular producer.”Id. (quoting Sebastian Int’l, Inc. v. Longs Drug Stores Corp., 53 F.3d 1073, 1074 (9th Cir. 1995)). Thus, resale by the first purchaser of the original article under the producer’s trademark is generally neither infringement nor unfair competition.See id.; see also Enesco Corp. v. K’s Merch. Mart, No. 99-CV-1070, 2000 WL 1800640, at *12 (N.D. Ill. Aug. 29, 2000) ; Brode v. Tax Mgmt., Inc. , No. 88 C 10698, 1990 WL 25691, at *4 (N.D. Ill. Feb. 1, 1990).

The first sale doctrine, however, does not apply to products that have been materially altered from their original form.See, e.g., SoftMan Prods. Co., LLC v. Adobe Sys., Inc., 171 F. Supp. 2d 1075, 1093 (C.D. Cal. 2001); Rockwell Automation, Inc. v. Radwell Int’l, Inc., No. CV 15-05246 (RBK/JS), 2019 WL 7288946, at *3 (D.N.J. Dec. 30, 2019). An alteration is material if it changes something about a product that is relevant to consumers’ decisions to purchase the product. So the question will ultimately come down to whether embroidering a bible reference, adding a pentagram and injecting actual human blood to the midsole are material changes. The changes seem pretty material to us, however.

Fair Use

In some circumstances, someone may use another party’s trademark if the use is considered “fair use.” There are two types of applicable fair use. The first is nominative fair use, where the alleged infringer uses the mark to describe the trademark owner’s product — e.g., when the only practical way to refer to something is to use the trademark. When analyzing nominative fair use, likelihood of confusion is not addressed.

In contract, in classic fair use, the alleged infringer uses the mark to describe its own product only. When such a defense is raised, the likelihood of confusion must be analyzed, but as the Supreme Court has ruled in K.P. Permanent Make-Up, Inv. v. Lasting Impression I, Inc., the party asserting the defense need not entirely negate the likelihood that consumers will be confused about the origin of the goods or services affected.

Parody/Expressive Use

When the unauthorized use of a trademark is for expressive purposes of parody, allusion, criticism or commentary, the law requires a balancing of the rights of the trademark owner against the interests of free speech. A key question for a parody is whether the speaker has created confusion by identifying the mark as the actual source of the message as opposed to simply the target of the parody. When parody is taken to a certain degree, it becomes clear that the trademark owner was not involved in the manufacture or sponsorship of the defendant’s product. When a parody is clear, the parodist is not trading on the good will of the trademark owner. Rather, his sole purpose for using the mark is the parody itself, and for that reason, the risk of consumer confusion is at its lowest. A very strong mark may be a more effective target of parody since its popularity and fame is exactly the mechanism by which likelihood of confusion is avoided. While a parody may engender some initial confusion, an effective parody will diminish the risk of consumer confusion by conveying only enough of the original to allow the consumer to appreciate the point of the parody.

No Likelihood of Confusion

Much of the litigation between MSCHF and Nike will likely be fought on these terms—that is, MSCHF arguing that there simply is no likelihood consumers will confuse MSCHF’s custom-made Satan Shoes with actual, Nike-sanctioned sneakers. Given the evidence that Nike has already proferred from social media in its initial complaint, this will be a fact-based argument for both sides. On April 1st, 2021, a judge ruled in Nike’s favor and ordered a halt on the production of MCHF’s Satan Shoes.

Endnotes