Chinese e-commerce giants Shein and rival Temu have swapped legal blows at the start of a UK trial that is expected to shine a light on the world of ultra-fast fashion. Shein accused Temu of 'astonishing' levels of copyright infringement, while Temu hit back in court documents, saying its rival waged an 'aggressive and relentless battle' using copyright allegations to undermine competition.
Shein sued Temu in 2023, and Temu counter-sued the following year in 2024, with the duo seeking damages for alleged losses each firm caused the other. The London trial offers a rare window into the supply chains of Shein, founded by billionaire Xu Yangtian, and Temu, founded by Colin Huang, and how the ultra-fast fashion industry competes for shared suppliers and overlapping production networks.
The outcome of the legal battle will influence supplier relationships at the two budget fashion giants, which pose a threat to European retailers. Shein accused Temu of using thousands of photographs from Shein's website for identical products. According to Shein's lawyers, Temu sold copied or identical clothing items using the same images and sought to 'piggy-back off Shein's own investment in building up its supply chain and training and up-skilling suppliers.' Temu's lawyers denied the allegations, saying merchants — who were responsible for the use of images — had the required consent.
From a supply chain perspective, this case exposes the structural fragilities of the ultra-fast fashion model. Both companies source from the same pool of Chinese manufacturers — small workshops concentrated mainly in Guangzhou, Yiwu and Hangzhou — driving brutal competition on design, price and production speed. Our hypothesis is that the case will become a precedent on platform-supplier liability sharing and, alongside the EU Digital Services Act, will intensify regulatory pressure on China-based cross-border e-commerce in the coming year. EU CBAM and the US's de minimis removal reinforce the trend.
Key Takeaways:
1. Shein and Temu trade blows over copyright infringement at the start of the UK trial.
2. Shein sued Temu in 2023 and Temu counter-sued in 2024; both are seeking damages.
3. The case spotlights the shared Chinese supplier pool (Guangzhou, Yiwu, Hangzhou).
4. Shein's Xu Yangtian and Temu's Colin Huang are billionaire e-commerce founders.
5. Ruling could set a precedent on platform-supplier liability; layered regulatory pressure with EU DSA and US de minimis removal.
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