Chinese retailer Temu files lawsuit against rival Shein over antitrust laws

In what is set to build on an escalating rivalry, Chinese e-tailer Temu has now filed a lawsuit against Shein accusing its rival of violating US antitrust laws when dealing with clothing manufacturers.

The case has been filed in Boston federal court, and claims that Shein had abused its market power in a bid to coerce manufacturers to shun Temu.

In the complaint, Temu alleged that Shein “forces manufacturers to sign loyalty oaths certifying that they will not do business with Temu”.

According to the firm, Shein’s practices have led to high prices and fewer choices for customers.

A spokesperson for Shein responded to the filing, telling Reuters that the lawsuit was “without merit” and that the company would “vigorously defend” itself.

It is the latest development to be drawn up between the duo as they continue to clash over dominance.

The two fast fashion companies are already battling a case in Chicago, where Shein filed a suit against Temu alleging that it had had worked with influencers to discredit Shein on social media.

Shein is also facing legal pressures from a group of independent designers who sued the company last week, accusing the company of “large-scale and systematic theft of intellectual property”, as well as committing infringement-related extortion.

Alongside the various challenges Shein has faced in the past year, Temu has come out of the woodworks as one of its largest competitors.

So much so that analytics firm YipitData reported that the firm’s gross merchandise value rose from three million dollars in September to 192 million dollars in January.