Shein sues Timo over allegations of design theft, intellectual property infringement

(MENAFN) Chinese retail giant Shein has initiated a lawsuit against rival Temu, accusing it of stealing its designs and establishing a business empire through counterfeiting, intellectual property infringement, and fraud. The legal action, filed in a federal court in Washington, D.C., arrives at a time when Shein itself is grappling with similar accusations from various independent brands and artists.

In the lawsuit, Shein alleges that Temu operates under the guise of a legitimate online marketplace, deliberately encouraging its sellers to copy other brands' designs. Shein claims that Temu not only allows these infringing products to remain on its platform but also hinders efforts to remove them, even when the infringement is acknowledged by the sellers. According to Shein, Temu entices U.S. consumers with extremely low prices, but it does not profit from these sales, as the prices are so low that Temu has to subsidize every transaction, resulting in financial losses.

The complaint further argues that Temu’s business model relies on promoting the sale of counterfeit and substandard goods, enabling the company to mitigate its substantial financial losses by encouraging sellers to violate intellectual property rights. This strategy, Shein contends, is key to Temu's survival in the competitive online retail space despite operating at a loss. 

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