Nike sued for allegedly selling unregistered NFTs, abandoning project

Nike NFT class action lawsuit overview:

• Who: An investor filed a class action lawsuit against Nike Inc.
• Why: The plaintiff claims Nike abandoned a non-fungible token (NFT) project after hyping up its value, leaving investors holding the bag.
• Where: The Nike NFT class action lawsuit was filed in New York federal court.

Nike is facing a nationwide class action lawsuit alleging it abandoned an NFT project after hyping up its value, leaving investors holding the bag.

Plaintiff Jagdeep Cheema claims Nike abruptly shut down its NFT project after initially promoting it as a way for consumers to earn limited edition real-life Nike products and other prizes.

Cheema argues Nike used its “iconic brand and marketing prowess” to promote the unregistered securities and prop up their value.

“Because the Nike NFTs derived their value from the success of a given promoter and project — here, Nike and its marketing efforts — investors purchased this digital asset with the hope that its value would increase in the future as the project grows in popularity based on the Nike brand,” the Nike NFT class action lawsuit states.

Cheema wants to represent a nationwide class of consumers who purchased or otherwise acquired Nike NFTs within applicable limitations periods and were damaged as a result.

Nike NFT project shut down in 2024, class action says

Cheema argues Nike’s NFT project was shut down in December 2024, with the company announcing it was winding down operations on its official Twitter account.

“Investors were decimated,” the Nike NFT lawsuit says. “Predictably, prices plunged and did not recover.”

Cheema claims he and other consumers would not have purchased the Nike NFTs at the prices they did, or at all, if they had known the NFTs were unregistered securities or that Nike would abandon the project.

The Nike NFT class action lawsuit asserts claims for violations of the New York Deceptive Acts and Practices Unlawful Act, California Unfair Competition Law, Florida Deceptive and Unfair Trade Practices Act and Oregon Unlawful Trade Practices Act and unjust enrichment. 

Cheema demands a jury trial and requests declaratory and injunctive relief and an award of damages for himself and all class members.

Just recently, a $10 million DraftKings class action settlement opened up to resolve claims that the sports betting platform violated federal and state securities laws by selling unregistered securities in the form of NFTs.

What do you think of the allegations in this Nike NFT lawsuit? Join the discussion in the comments!

The plaintiff is represented by Laurence M. Rosen, Phillip Kim and Michael Cohen of The Rosen Law Firm P.A.The Nike NFT class action lawsuit is Cheema v. Nike Inc., Case No. 1:25-cv-02305, in the U.S. District Court for the Eastern District of New York.

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