Fleet Feet and Nike Trademark Dispute
A Fleet Feet Inc, through franchises, company-owned retail stores, and online stores, sells running and fitness merchandise, and has 182 stores, including franchises, nationwide in the US. Fleet Feet is the owner of trademark “Change Everything” and “Running Changes Everything” used widely for its sports and apparel-related goods and services. Nike, Inc., and Nike Retail Services, Inc. (collectively, “Nike”) is in the business of designing, developing, marketing, and selling athletic footwear, apparel, equipment, accessories, and services. Nike began using the phrase “Sport Changes Everything” on large scale advertising campaigns in 2019. This prompted Fleet Feet to file a lawsuit against the use of the phrase by Nike at the United States District Court for the Middle District of North Carolina (Fleet Feet, Inc. v. Nike Inc. 419 F. Supp. 3d 919 (M.D.N.C. 2019)).
Preliminary Injunction by the District Court
The District Court agreed with Fleet Feet’s contentions regarding the likelihood of success on the merits of its trademark infringement claims and granted a preliminary injunction against Nike. Following the injunction ruling, Nike had to stop the use of the phrase “Sport Changes Everything”. Aggrieved by the ruling, Nike appealed against the District Court ruling at the US Court of Appeal for the Fourth Circuit (Fleet Feet, Inc. v. Nike, Inc. 986 F.3d 458 (4th Cir. 2021)) and pleaded for the vacation of the preliminary injunction. The US Court of Appeals dismissed the appeal and upheld the injunction granted by the District Court.
Fleet Feet’s Trademark Background
Being a major name in the sporting industry, Fleet Feet not only sells Nike’s merchandise in its stores. But has also gained a substantial consumer base across the country and earned more than $940,000,000 in revenue. Fleet Feet has been using the phrase “Running Changes Everything” since 2009 and “Change Everything” since 2013. Having filed for registration of both phrases with the United States Patent and Trademark Office, the latter was registered in 2015 and the former in 2020. Multiple Nike employees were aware of the commercial use of Fleet Feet’s trademarked phrases.
Nike’s Advertising Campaign and Alleged Infringement
Nike launched a major advertising campaign in 2019, which featured various sporting events, with the tagline “Sport Changes Everything”. Reports indicate Nike spent over $16 million on the campaign, including slogans, apparel, events, and social media. Nike specifically undertook to not use the slogans outside the campaign, which lasted seven months and was showcased during the February 2020 Super Bowl. Fleet Feet contended that the phrases used by Nike were confusingly similar to its own trademarked phrases and filed a suit seeking a preliminary injunction against Nike’s use of the tagline.
Allegations in Fleet Feet’s Complaint
The complaint alleged that Nike was well aware of Fleet Feet’s trademark due to their business relationship. The complaint also stated that the tagline used by Nike was initially the exact phrase used by Fleet Feet – “Running Changes Everything” . Which was subsequently changed to “Sport Changes Everything” after Fleet Feet’s complaint. Fleet Feet argued that the revised mark was still “confusingly similar” to its trademark “Running Changes Everything”.
Legal Basis for Injunction
For seeking a preliminary injunction against Nike, Fleet Feet needed to prove that it had suffered irreparable harm and would continue to suffer harm if relief was not provided. It also had to prove that the injunction was in the public interest, as laid down in Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 20 (2008).
District Court’s Analysis
The District Court analyzed the commercial strength of both entities, noting that Fleet Feet’s advertising expenditure was just a “drop in the bucket” compared to Nike’s $16 million campaign. The Court concluded that Nike’s advertisement would likely overwhelm Fleet Feet’s mark, causing consumer confusion.
Nike’s Arguments and Court Response
Nike argued that proof of irreparable harm was required and that Fleet Feet failed to show loss of revenue. The District Court observed that harm does not need to be immediate and could arise over time. The Judge noted that Nike had the option to perform a trademark search in advance to prevent such conflicts. Consequently, the Court sided with Fleet Feet and granted the injunction.
Resulting Injunction
As a result, Nike was prohibited from using the phrase “Sport Changes Everything” or any designation confusingly similar to “RUNNING CHANGES EVERYTHING” and “CHANGE EVERYTHING”. Nike discontinued the campaign two months before its designated end date.
Fourth Circuit Appeal
Nike appealed the injunction to the US Court of Appeals for the Fourth Circuit, arguing that the order restricted free speech and that the phrases were descriptive, used fairly, and without bad faith.
Dismissal of Appeal as Moot
The Fourth Circuit dismissed Nike’s appeal as moot. The Court noted that the Super Bowl event had ended, and Nike had not used the confusingly similar phrases after the campaign. Since the campaign was limited to the 2020 Super Bowl, the Court found no ongoing legal interest, making the appeal unnecessary.
