For decades, the fashion industry’s legal battles were primarily about “lookalike” designs or trademark squabbles. However, the emergence of the “ultra fast fashion” model, characterized by hyper speed supply chains and near zero margins, has birthed a new kind of legal warfare.
In 2025, the rivalry between Shein (the established leader) and Temu (the aggressive challenger owned by PDD Holdings) escalated into a series of unprecedented lawsuits in U.S. federal courts. This conflict is unique because it attempts to apply RICO (Racketeer Influenced and Corrupt Organizations Act), a law originally designed to take down the Mafia, to the world of retail.
It marks a shift from defending products to attacking a competitor’s entire business existence. While the public sees a battle over $5 tshirts, the courtrooms see allegations of racketeering, illegal imprisonment, and industrial sabotage.
2. What Happened: The Allegations
The conflict is a “circular” legal battle where both sides…
accuse the other of nearly identical crimes.
The “Mafia-Style” Allegations (Temu’s Claims) In late 2023 and throughout 2025, Temu filed lawsuits alleging that Shein used “mafia style intimidation” to protect its monopoly, claiming that Shein representatives detained Temu affiliated merchants in Shein offices for hours, confiscated their phones, and threatened them with penalties if they continued selling on Temu, that Shein forced thousands of manufacturers to sign “loyalty attestations” that effectively barred them from working with Temu if they wanted to remain on Shein’s platform, and that Shein filed thousands of allegedly bad faith copyright takedown notices targeting Temu’s best selling items to disrupt sales during peak seasons.
The “Industrial Theft” Allegations (Shein’s Claims) In response, Shein launched its own major lawsuits accusing Temu of building its business model on theft, alleging that Temu systematically copied Shein’s proprietary product photos and designs to fill its marketplace, poached key employees and pushed them to reveal Shein’s confidential supplier lists and pricing algorithms, and ran deceptive marketing campaigns by creating “imposter” social media…
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