Shein Fends Off U.S. Antitrust and Trade-Secret Claims by Temu: Implications For Fair Competition in Fast Fashion

MARK TERRY, ESQ.

A recent ruling in Washington, D.C. dealt a blow to Temu’s lawsuit against Shein. The court dismissed key antitrust and trade-secret allegations on jurisdictional grounds, ruling that the disputed conduct occurred in China and could not be adjudicated in U.S. courts.

Temu’s remaining claims now focus primarily on intellectual property and unfair competition. The development has significant implications for how competition laws and trade-secret statutes may be applied in globalized e-commerce, particularly in fast fashion.

Temu accused Shein of monopolistic behavior, coercive supplier arrangements, exclusive agreements, and misappropriation of trade secrets. It also alleged that Shein used mass copyright takedown demands as part of an anticompetitive strategy.

The court concluded that Temu had not established a sufficient U.S. connection for the antitrust and trade-secret claims because the relevant acts and decisions occurred in China. Copyright and trademark allegations, including claims involving sham takedown notices and promotional content, were allowed to continue.

From a competition-law perspective, the dismissal shows that cross-border e-commerce disputes face substantial jurisdictional hurdles. Even when overseas conduct affects U.S. markets, a plaintiff must connect the challenged conduct to domestic decisions or acts.

The trade-secret ruling likewise emphasizes geography. If crucial acts such as alleged theft, access, or use occur outside the United States, domestic trade-secret remedies may be unavailable even when harm is felt in the U.S. market.

For competitors, innovators, and designers, the decision offers two key lessons. First, allegations of antitrust or trade-secret violations must be tied to a jurisdiction that can provide a remedy. Second, copyright, trademark, and unfair-competition claims remain powerful tools in competitive disputes.

In industries where copying, supplier pressure, and platform takedowns are common, parties may increasingly rely on copyright, DMCA, trademark, and unfair-competition theories rather than broad antitrust claims.

Brands and designers operating globally should document where decisions are made, audit their takedown practices and supplier agreements, and protect copyrights, trademarks, and designs in the markets where enforcement may be needed.