Nike’s Legal Troubles with Lontex Unfold as Revenue Challenges Persist and New Trademark Filings Emerge
Oct/09/2024
Nike recently faced a legal setback when a jury ruled in favor of small Pennsylvania-based company Lontex, finding the sportswear giant had infringed on Lontex’s “Cool Compression” trademark, used for muscle recovery products sold under the “Sweat It Out” brand. The 2021 decision awarded Lontex $791,000 in damages and ordered Nike to pay nearly $7 million in legal fees due to “exceptional circumstances,” citing Nike’s bad faith and attempts to drain Lontex's resources through costly litigation. Although the Third Circuit upheld the infringement ruling, it reversed the legal fees order, finding the case did not meet the threshold for “exceptional” circumstances. This legal dispute emerges as Nike struggles financially, with first-quarter revenue falling 10% to $11.6 billion, driven by a 20% decline in digital sales and an 8% drop in wholesale revenue. Amid these challenges, Nike has been active in brand development, filing new trademarks in late September for “UPTEMPO,” “ROSHE,” and “G.T. HUSTLE” covering clothing, footwear, and headgear, followed by figurative trademarks for footwear in early October. The chart below shows the revenue share of Nike worldwide in the fiscal year of 2024, categorized by product segment, providing context for its performance across various markets.
