Pursuit of Big Nike Counterfeit Win Clashes With Banking Law

A Second Circuit conflict involving a $1.8 billion victory by Nike Inc. over Chinese counterfeiters pits international banking against anti-counterfeiting forces, with each side claiming its interpretation of banking jurisdiction is critical to the U.S. economy.

At issue is a request for a $150 million penalty that Next Investments LLC tried to have a court impose on six Chinese banks for allegedly violating a court-ordered asset freeze by shifting $69 million of illicit proceeds beyond the reach of U.S. courts.

Nike had won a $1.8 billion default judgment against a bevy of counterfeiters in New York federal court after they ...