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Nike faces a $5M lawsuit over the abrupt shutdown of RTFKT. It is a virtual fashion and technology brand that creates one-of-a-kind sneakers and NFTs. The shutdown left investors with worthless digital assets.
Nike is in hot water over the NFT shutdown! A lawsuit was filed against the company on April 28, 2025, in Brooklyn, New York. It demands a minimum of US$5 million in damages. Lead plaintiff Jagdeep Cheema and other purchasers claim that Nike broke consumer protection laws in several states. The list of states includes New York, California, Florida, and Oregon.
The Nike Lawsuit also questions whether or not NFTs qualify as securities. The plaintiffs allege the company did not have the NFTs registered with financial regulators. Thus, alleging that they were sold illegally. The suers further claim that they had no knowledge of the NFTs being unregistered securities or that Nike was able to cancel the project.
After the RTFKT shutdown, owners of NFTs have reported technical issues. They reported photos of highly valued assets in the CloneX series vanishing and being substituted with ‘holding page’ messages from Cloudflare.
The technical issues have caused speculation that Nike had ceased paying for servers hosting the photos. Thus, raising concerns over the long-term worth of these digital collectibles. However, recently, the official RTFKT page on X posted that CloneX and Animus Collections will be decentralizing to ArWeave. The post further explained the move in detail:
Nike has made no official statements so far. Although the immediate closure has created backlash. The company bought RTFKT back in December of 2021, framing the move as the company's jump into the next era of fashion and digital collectibles. Investors have criticized the stability and legitimacy of companies venturing out into the unregulated world of NFTs.
