A trial opened at London's High Court on Monday in which online fast-fashion company Shein accused competitor Temu of large-scale copyright infringement and Temu rejected the claims as a tactic to hinder competition.
Shein's case asserts that Temu used thousands of images produced by Shein to advertise items that copied Sheins own-brand clothing on Temu's site, an approach Shein says was intended to "piggy-back" on a better established rival and achieve an unfair commercial advantage. Counsel for Shein, Benet Brandreth, described the conduct to the court as copyright infringement "on an industrial scale" and said it was an attempt "to steal a march on an existing participant in the market."
Temu, which is owned by PDD Holdings, denies the allegations brought by Shein. According to statements made in court, Temu has lodged a counter-claim seeking damages after being required to remove thousands of product listings when Shein secured an injunction.
Brandreth told the court that Temu had dropped its defence to Sheins copyright claims covering nearly 2,300 photographs taken by Shein employees, comparing the move to "the defendant waiting to see if the witnesses will turn up, only to plead guilty."
In addition to copyright litigation, Temu has alleged that Shein breached competition law by tying fast-fashion suppliers into exclusive agreements. That portion of the dispute is scheduled to go to trial next year.
Temu's legal team argues Shein's current action is not primarily a genuine bid to halt copyright breaches but rather a means of securing competitive advantage, according to statements made during the opening of the hearing.
The two-week London trial forms part of a wider global legal confrontation between the fast-growing platforms. The pair have brought cases against one another in the United States as well, and the dispute unfolds amid growing regulatory attention on large e-commerce platforms.
Both Shein and Temu have rapidly expanded into international markets, selling low-cost clothing, accessories and other consumer goods. Market developments could also influence growth prospects: the removal of a U.S. customs exemption for low-value e-commerce parcels last year - with the European Union set to follow in July - is cited as a factor that could weigh on expansion.
($1 = 0.7358 pounds)