Adidas has filed a lawsuit against the Beaverton-based company (the first federal lawsuit in history opened against its American competitor) for infringing patents related to the Nike Adapt system and the SNKRS, Run Club and Training Club applications. [Adidas Names Nike in Patent Lawsuit for Allegedly Infringing - The Fashion Law]
In the newly-filed complaint, as first reported by Reuters, adidas asserts that it “has long had a culture of innovation, research and development,” and in furtherance of its efforts “to innovate and change sports through technology, [it] has made continuous investments in sports science, sensor technology, wearables and digital communication platforms.” Among these innovations are “technology related to mobile fitness and mobile purchases, [as] adidas was the first in the industry to comprehensively bring data analytics to athletes.”
As a result of such innovation, adidas owns over 800 patents, including ones for the tech embodied in its various apps, which it claims that Nike is infringing via its Nike Run Club and Training Club, SNKRS, and Nike Adapt apps. Specifically, adidas assets that Nike’s SNKRS app infringes one of its patents (10,275,823) that extends to “a computer-implemented method implemented in a customer device for ensuring customer authenticity of an electronic reservation for a product from a retailer by generating reservations only if threshold authentication conditions are satisfied.” Nike’s Training Club app, on the other hand, allegedly infringes an adidas patent (8,814,755) by providing “a method for sharing information about a first individual who has engaged or is engaging in a first physical activity” by “wirelessly transmitting the first performance information from the first portable performance monitoring system” to “a computing device that is not carried with the first individual during the first physical activity, and generating a visual display” based on that performance information.
Reflecting on Nike’s alleged infringement, adidas contends that the Swoosh “has been aware of its infringement of the patents-in-suit prior to the filing of this lawsuit,” with adidas pointing to the widely-reported patent infringement lawsuit that it filed against Under Armour, Inc. and MapMyFitness, Inc. in 2014, as at least two of the adidas patents that Nike has allegedly infringed were at issue in that case. In addition to allegedly being aware of that lawsuit (and the corresponding patents), adidas contends that Nike almost certainly knew about the lawsuit that it filed against ASICS – and thus, the patents at issue in that case – in 2017, which similarly centered in a number of patents related to the ones at issue in the case at hand. Finally, adidas claims that Nike’s “pre-suit knowledge of its infringement of the patents-in-suit” also extends to Nike’s practice of citing the adidas patents in its own U.S. Patents or published applications.
In addition to being aware of the patents-in-suit, adidas claims that Nike “knowingly and intentionally induces infringement” of those patents. For example, adidas asserts that by “operating the accused [apps] in their default condition,” a customer or end user “will directly practice at least one claim of each of the patents.” Nike “induces infringement,” per adidas, “by, for example, knowing and intending that its customers and end users will commit these infringing acts.” Proof that Nike intends for its customers to use the apps and commit the infringing act? According to adidas, it instructs consumers to download – and use – the apps, stating, for example, that the Nike Run Club app is “everything you need to start running, keep running, and enjoy running more” or that the SNKRS app enables consumers to “get access to the most coveted drops and one-of-a-kind experiences.”
With the foregoing in mind, adidas claims that it “has been and continues to be irreparably injured by [Nike’s] infringement of” the patents at issue, and in addition to injunctive relief, is entitled to recover damages “adequate to compensate it for [Nike’s] infringing activities in an amount to be determined at trial but in no event less than a reasonable royalty.”
The lawsuit is the latest in a string of clashes between Nike and adidas, including a decade-long fight over the two companies’ rival knitted footwear technology, which recently spilled over into a proceeding before the International Trade Commission, with Nike asking the federal trade body last year to block the import of adidas’ Primeknit footwear on the basis that the sneaker tech infringes a number of its utility patents.
Not only does the new lawsuit come against a fractured background between the two titans, it comes as the companies derive notable engagement – and revenue – from their digital offerings and connected products, particularly in the wake of the pandemic. Nike revealed in March, for example, that its Digital division, which consists of various digital channels and applications (including those at issue in this case), accounted for 26 percent of company $10.9 billion in Q3 revenue and that digital sales in the U.S. were up by 33 percent on a year-over-year basis.
