18/07/2023 (Boston) - Chinese e-commerce company Temu has lodged a lawsuit against its competitor Shein, alleging violations of U.S. antitrust laws in relation to dealings with clothing manufacturers. This intensifies the ongoing legal battle between the two fast-fashion giants for market dominance.
The lawsuit, filed in Boston federal court, accuses Shein of exploiting its market power to pressure manufacturers into avoiding business with Temu. The complaint specifically mentions that Shein coerces manufacturers into signing "loyalty oaths" to ensure they do not conduct business with Temu.
Temu, represented by U.S. law firm Boies Schiller Flexner, argues that Shein's business practices have resulted in higher prices and limited choices for consumers. Furthermore, it asserts that Shein has hindered the growth of the ultrafast fashion market in the United States.
Shein, which entered the U.S. market in 2017 and is currently valued at $66 billion, has dismissed the allegations as meritless and pledged to vigorously defend itself. This lawsuit adds to Shein's existing legal challenges, including a recent copyright infringement case filed by a group of designers in Los Angeles federal court.
The two companies are already involved in litigation in Chicago federal court, where Shein has accused Temu of collaborating with influencers to defame Shein on social media. Temu's motion to dismiss that case is still pending.
Temu, which positions itself as a more affordable alternative to Shein, has seen significant growth recently. According to data firm YipitData, Temu's gross merchandise value surged from $3 million in September to $192 million in January.
The case, presided over by U.S. District Judge Denise Casper, seeks unspecified triple damages. As of now, no appearance has been made on behalf of the defendant.