As of March 27, 2023, the legal battle between Chinese ultra-fast fashion companies Shein and Temu continues to heat up in the U.S. District Court for the Northern District of Illinois. Shein, through its owner Roadget Business Pte. Ltd., has accused Temu, owned by PDD Holdings Inc. and WhaleCo, Inc., of willfully infringing on Shein's trademark and copyright rights. The lawsuit alleges that Temu engaged in unfair competition by impersonating the Shein brand on social media, trading off well-known Shein trademarks, and using copyrighted images owned by Roadget as part of its product listings.
Shein's lawsuit, filed in December, claims that Temu told social media influencers to make disparaging remarks about the fast-fashion retailer and tricked customers into downloading the Temu app using "imposter" social media accounts. Shein seeks to block Temu from using its name for marketing and wants damages from sales that can be shown to have come through deceptive or infringing marketing. Temu has requested the court to dismiss the lawsuit, with a spokesperson stating that the company "strongly and categorically rejects all allegations and is vigorously defending its rights."
Temu has filed a partial motion to dismiss, taking issue with Roadget's copyright claims and asserting that it never impersonated Shein and played no part in the creation of the alleged Twitter accounts. Instead, Temu believes the accounts were created by third parties attempting to game its affiliate program, which violates its Terms of Use and Cash Reward Referral Program Official Rules.
The outcome of this legal skirmish is crucial for U.S. consumers and rival retailers, as it highlights the challenges online retailers with vendors in China face when navigating U.S. intellectual property protections. As the case progresses, both Shein and Temu continue to target a new pool of price-conscious customers, particularly Gen-Zers, who seek novelty and ultra-low prices in their wardrobes.
