Shein and Temu Seek Truce, Ending Legal Battles in the U.S.
Fierce rivals Shein and Temu have filed joint declarations to end their legal fights with each other in the U.S., documents show. This truce comes amidst a global market share battle between the low-price online platforms.
Lawyers representing Shein and Temu, along with their subsidiaries, have filed joint declarations in courts in Chicago and Boston, requesting the dismissal of two legal cases “without prejudice” by their respective judges.
The filings do not provide specific details on the reasons behind dropping the complaints or whether a settlement has been reached. Neither company has immediately responded to requests for comment on the filings.
Shein Accuses Temu of Disparaging Remarks and App Trickery
Last December, Shein filed a lawsuit against Temu in the U.S. District Court for the Northern District of Illinois. The lawsuit alleged that Temu instructed social media influencers to make disparaging remarks about Shein and deceived customers into downloading the Temu app using fake social media accounts.
Temu Countersues, Accusing Shein of Violating U.S. Antitrust Law
In July, Temu retaliated by filing its own lawsuit in a federal court in Boston. Temu accused Shein of violating U.S. antitrust law in its dealings with clothing manufacturers. The complaint claimed that Shein compelled manufacturers to sign loyalty oaths, pledging not to do business with Temu.
Both Companies Deny Wrongdoing
In previous statements, both Shein and Temu have denied any wrongdoing in relation to the lawsuits.
Shein and Temu: Global Retail Disruptors
Shein, a Chinese company valued at $66 billion, has revolutionized the global retail landscape by offering ultra-fast fashion at rock-bottom prices. With items like $10 dresses and $5 bike shorts, Shein primarily produces and sells clothing online in the U.S., Europe, and Asia.
Temu, owned by PDD Holdings, the parent company of Chinese shopping platform Pinduoduo, has a similar business model. While also selling low-priced clothing, Temu is renowned for its affordable headphones and home appliances.
Temu’s Ambitious Growth Targets
According to HSBC analysts, Temu aims to achieve $16 billion in gross merchandising volume (GMV) by 2023, surpassing consensus estimates of $11 billion.
In conclusion, Shein and Temu have decided to end their legal battles in the U.S. This truce comes as both companies continue their global market share battle, offering affordable fashion and disrupting the retail industry.
