Nike faces lawsuit over greenwashing claims

A Missourian last week filed a complaint against Nike in federal court, alleging the sports apparel maker "falsely and misleadingly markets" products as sustainable and environmentally friendly.

The lawsuit cites the Federal Trade Commission's Green Guides, which educate companies on what could constitute deceptive advertising around sustainability claims. The guidance is limited, though, because it isn't a set of enforceable rules or regulations, according to John Conway, CEO of Astonish Media Group.

"It doesn't mean that you can't be found guilty of a claim, they just don't have legal weight," he said of the guidelines. "But it's supposed to tell both consumers and the industry, ‘This is a line you can't cross.’"

However, the suit, filed at the U.S. District Court for the Eastern District of Missouri on May 10, also alleges that Nike's sales of items that purport to be eco-friendly is a violation of the Missouri Merchandising Practices Act.

The plaintiff, Maria Guadalupe Ellis, also notes that many consumers select eco-friendly products and even pay more for them. Yet the products, part of Nike's sustainability collection, are not in fact sustainable, because they are made from materials that are harmful to the environment and are "predominantly made with virgin synthetic materials." Those include plastic-based materials that, even if recycled, aren't biodegradable, per the lawsuit.

Ellis, who is asking the lawsuit to be certified as a federal and state class action, also said that of the 2,452 products Nike lists in its sustainability collection, "only 239 products are actually made with any recycled materials," or about 10%.

Nike didn't immediately respond to a request for comment on the lawsuit or some of these specifics.

As awareness around the major environmental impact of plastics increases, similar lawsuits may become more common, and regulatory agencies may eventually seek to impose stricter rules.

"Your readers in the apparel industry need to watch this, and watch this closely," Conway said by phone. "If the courts determine that these recycled fibers — assuming the company's using them — are not sustainable materials, that throws out their entire sustainability argument, as long as they're using, essentially, polyester."

Because so many people buy Nike products, the suit may very well be deemed a class action, Conway said, noting that the company has had issues with greenwashing allegations in the past. Moreover, Ellis's claim that less than 10% of Nike's sustainable collection is made of recycled materials probably has more potential to succeed in court than the false advertising claims, he said.

"I think that is the bigger claim, if they can prove it, because that is a more substantial, unfair trade practices and fraud argument," he said.