Nike, Kasky Reach Settlement

NEW YORK The parties to Kasky v. Nike said on Friday that they have agreed to settle the case.

Mark Kasky’s lawsuit against the sneaker manufacturer reached the U.S. Supreme Court, where questions of what constitutes free versus commercial speech were reviewed. On June 26 the high court sent the case back to the California courts, where it was likely to have lingered for some time.

In question were statements Nike made in 1997 about conditions in its factories in Asia and a Nike print ad that said the sneaker company was doing a good job with overseas labor. Kasky argued that Nike’s disclaimers about the working conditions at its overseas factories constituted false advertising under California’s consumer-protection laws [Adweek, March 3].

The case had far-reaching implications for advertisers and other corporations. If Nike had lost, it would have severely limited corporations’ abilities to defend themselves through public speech.

“Ultimately, both Nike and Mr. Kasky agreed that this resolution benefits two key groups: factory workers and consumers worldwide,” said Patrick Coughlin, attorney for Kasky in a statement addressing the settlement.

The two sides agreed on terms that will include greater investment in global worker development programs and corporate accountability to benefit consumers.

In a statement, the parties said they, “mutually agreed that investments designed to strengthen workplace monitoring and factory worker programs are more desirable than prolonged litigation.”

As part of the settlement, Nike has agreed to make additional workplace-related program investments (augmenting the company’s existing expenditures on monitoring, etc.) totaling $1.5 million. Nike’s contribution will go to the Washington, D.C.-based Fair Labor Association for program operations and worker development programs focused on education and economic opportunity.