Temu Files New Lawsuit Against Shein After ‘Intensified’ Clash

Sarah Zheng

Thu, December 14, 2023, 11:39 AM GMT+9·3 min read

Temu Files New Lawsuit Against Shein After ‘Intensified’ Clash

(Bloomberg) -- Chinese-owned online marketplace Temu sued fast-fashion rival Shein in the US over what it called “intensified” anticompetitive practices, reviving a legal fight between the e-commerce upstarts after both had dropped earlier lawsuits against each other.

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Whaleco Inc., which operates as Temu, accused Shein of hatching a “desperate plan” to undercut its business in a 100-page filing to the US District Court for the District of Columbia — nearly triple the length of its original lawsuit. The Wednesday complaint alleged that Shein filed tens of thousands of copyright takedown notices against Temu, forced fashion suppliers into exclusive agreements, and threatened or even detained Temu merchants. It detailed allegations about how Chinese suppliers who listed products on both platforms got called into Shein’s offices in Guangzhou and forced to provide phone passwords and transaction records related to Temu.

“Temu has discovered that Shein’s anticompetitive behavior has not only persisted but intensified,” the lawsuit said. “Shein’s persistent and increasingly aggressive use of anticompetitive conduct, coercion, and threatening behavior necessitates this lawsuit.”

Representatives for Shein didn’t respond to a request for comment. A Temu representative said the latest move was a result of Shein’s escalating anticompetitive behavior. “Their actions are too exaggerated; we had no choice but to sue them,” the spokesperson said.

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The two rising stars, both of Chinese origin, pose a growing threat to e-commerce giants from Amazon.com Inc. to Walmart Inc. and fast-fashion incumbents like H&M and Zara. In October, Temu and Shein both dropped previous lawsuits that pulled the curtain back on the combative competition between the two often-secretive companies.