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A new chapter has unfolded in the ongoing legal battle between fast-fashion rivals Temu and Shein. Shein has launched a legal action against Temu in the District Court of Columbia, alleging various forms of intellectual property infringement and deceptive practices.
In the recent complaint, Temu's parent company, PDD Holdings, faces accusations of misrepresenting itself as a legitimate marketplace while allegedly exerting control over the products listed by sellers. The lawsuit claims that Temu encourages sellers to violate intellectual property rights and utilizes Shein's trademarks in sponsored advertisements. Additionally, Temu is accused of creating fake social media accounts to impersonate Shein and mislead consumers.
The complaint alleges that Temu directs its sellers to replicate Shein’s products and provides them with copyrighted images from Shein for marketing purposes. Shein’s legal entity, Roadget, has accused Temu of employing a similar "illegal business model" to establish a substantial counterfeiting operation in the U.S. market. According to the filing, Temu attracts U.S. consumers with promises of exceptionally low prices and absorbs losses on each transaction to sustain its business model.
Shein has also leveled accusations against a Temu employee for allegedly stealing trade secrets to unfairly compete and claims that Temu has impersonated Shein on social media platforms like Twitter/X. The fashion giant is seeking compensation for lost sales, reputational damage, and other financial detriments.
This lawsuit comes at a critical time for Shein, which is preparing for an initial public offering on the London Stock Exchange while working to address various controversies. Allegations against Shein include accusations of using forced labor involving the Chinese Uyghur ethnic minority and employing coercive tactics against suppliers. In a notable 2023 lawsuit, Temu alleged that Shein engages in intimidation and detention tactics against suppliers, including false imprisonment and the seizure of cell phones during meetings held under false pretenses.
Shein also faces multiple design infringement claims. Recently, Uniqlo alleged that Shein was selling imitations of its ‘Mary Poppins’ shoulder bag. In July 2023, H&M sued Shein for copying its designs, and three U.S. designers also filed claims alleging similar issues.
