Temu took legal action against Shein on Wednesday alleging that Shein had stepped up their activities. "We proceeded with filing a lawsuit because they have started to unlawfully detain traders, coercively request access to their phones, purloin our seller accounts and passwords, purloin our business secrets, and pressure dealers to leave our platform," explained a spokesperson for Temu. This lawsuit follows the October decision by both sides to abandon their prior litigation concerning copyright and antitrust issues.
Temu, a Chinese low-cost online retailer, has filed a lawsuit against its rival Shein alleging copyright infringement and "mafia-style intimidation of suppliers," according to a filing on Wednesday. WhaleCo, which runs Temu in the U.S., stated that Shein has infringed on its intellectual property rights, wrongfully detained merchants, stolen its business secrets, and tried to prevent Temu from expanding in the U.S. "We had to sue Shein as their actions have become excessive," said a Temu spokesperson. Shein has yet to comment on the matter. This lawsuit follows the two firms' decision to drop their previous lawsuits against each other in October, which involved copyright and antitrust issues. Shein sued Temu last December for intellectual-property infringement while Temu accused Shein in July of coercing manufacturers into exclusive contracts.
The two organisations are fierce contenders in the online economy buying market. Temu centres on marketing China-made items, from attire to domestic objects, at reduced costs and caters to overseas clients. Comparably, Shein employs contracted producers, largely in China, to create, fabricate and transport its inexpensive merchandise. Although Temu's company model is quite distinct from the fashion-concentrated, repurchase system employed by Shein, since Temu's introduction in the U.S. in September 2022, the business has been viewed by Shein as its most serious danger — and thus the object of malevolent and illegal behaviour targeted to obstruct Temu's success," as stated in the filing on Wednesday.
Chinese tech giant PDD Holdings, owner of the e-commerce app Pinduoduo, launched Temu as their first international venture.It quickly became popular among price-conscious customers and, within a few weeks, had reached the top of the app store rankings. This enabled the app to expand to countries such as Australia, New Zealand, France, Italy, Germany, the Netherlands, Spain, and the U.K. depending on the accounts, the company Shein was established in China in 2008, although its official history began in 2012.
Shein submitted a confidential offering for an IPO in November, which was last documented with a worth of $66 billion. In June, an American House Committee made known that Shein and Temu took advantage of commerce loopholes in order to bring products into the U.S. without having to pay import taxes or submit shipments for human rights examinations. CNBC's Clement Tan provided help on this coverage.
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