The rivalry between Chinese fast-fashion giants Shein and Temu has reached new heights as Shein launches a scathing legal action against its competitor in the United States. In a complaint filed with the District Court of Columbia, Shein’s legal entity, Roadget, accuses Temu’s parent company, PDD Holdings, of operating an illegal business model that encourages intellectual property infringement and misleads customers.
According to the lawsuit, Temu allegedly presents itself as a legitimate marketplace while controlling the products sellers can offer and supplying them with Shein’s copyrighted images for marketing purposes. The complaint also alleges that Temu instructs sellers to replicate Shein’s products and uses Shein’s trademarks in sponsored advertisements, creating fake social media accounts to impersonate the company.
Shein claims that Temu entices US consumers by offering extremely low prices, often subsidising sales and losing money on each transaction. The lawsuit also accuses at least one Temu employee of stealing trade secrets to compete unlawfully and impersonating Shein on the social media platform Twitter/X.
As a result of Temu’s alleged actions, Shein is seeking compensation for lost sales, reputational damage, and other financial losses. This legal battle comes as Shein prepares for a planned initial public offering on the London Stock Exchange, aiming to improve its image amidst numerous allegations, including the use of Uyghur ethnic minority slave labour in China and employing Mafia-style intimidation tactics against its suppliers.
Interestingly, Temu had previously accused Shein in a 2023 lawsuit of using “intimidation and detention scare tactics against suppliers who dare to sell to Temu, including false imprisonment and seizure of cell phones during meetings Shein arranges under false pretenses.”
Shein is no stranger to design infringement claims, with recent accusations from Uniqlo, H&M, and three US designers. As the legal battle between these two fast-fashion giants unfolds, the industry watches closely to see how this rivalry will impact their respective futures and the broader fashion landscape.
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