Fast fashion giant Shein has lost the first round of its London copyright battle against its rival Temu after the High Court dismissed claims involving product photographs and upheld its rival’s counterclaim.
Today’s ruling found that Temu had not authorised copyright infringement by third-party merchants on its marketplace. It also determined that the platform lacked knowledge of, or reason to believe, any infringement of Shein’s copyright by the photographs at issue.
The decision comes as Shein prepares for a potential initial public offering in Hong Kong. The company is reportedly showing investors a mid-to-high $20 billion valuation, down from the $30 billion to $40 billion range it was seeking as recently as last week.
The trial formed part of a global legal battle between the two Chinese retailers, with previous trials in the US, according to Reuters.
Shein had alleged that Temu merchants had used photographs from its website to advertise close copies of Shein’s own-brand clothing. When the trial began in May, Shein accused its rival of breaching copyright “on an industrial scale” and seeking to “piggy-back” on its established market position.
Temu had rejected the allegations, arguing that its third-party merchants were responsible for listing content and that Shein was using legal action to restrict competition.
Court rejects platform liability claim
In her written ruling, Judge Kelyn Bacon said that she had found no evidence that Temu’s platform included tools intended to help merchants upload infringing images, or that the company encouraged such activity.
Copyright ownership was also disputed. When Shein UK demanded that Temu remove the photographs in June 2023, it did not own the copyright in images taken by staff because those employees worked for Chinese affiliate Guangzhou Shein. The UK company later obtained a licence covering the images through an agreement finalised on 19 July 2023.
A Shein spokesperson said the company was surprised by the decision. “We do not believe that is the right outcome for brands and rights holders seeking to protect their copyright online.”
Elise Cant, Associate and Trademark attorney at intellectual property law firm Marks & Clerk, commented on the decision would:”likely to be welcomed by market-place based retailers although traditional retailers may view it less favourably.”
She added that the ruling “provides greater legal certainty for online marketplaces by confirming that platforms such as Temu which play a passive intermediary role in the advertisement and sale of goods on their website are less likely to face liability for infringing content uploaded by third-party sellers. This strengthens the legal position of marketplace operators and supports the continued growth of platform-based retail models.
“However, the decision may make it more difficult for traditional retailers and rights holders to pursue infringement claims against marketplace operators where infringing product listings are uploaded by independent sellers, potentially shifting the focus of enforcement efforts towards the sellers themselves rather than the platforms that host their listings.”
Damages and competition claim remain unresolved
Temu’s UK operating company, Whaleco UK, counterclaimed over losses caused when product listings were removed following Shein’s notices and two court orders. The High Court found that Temu had suffered a loss, but the damages will be determined at a later trial.
Temu’s separate claim alleges that Shein breached competition law by requiring fast fashion suppliers to sign exclusive agreements; it is scheduled for trial in November. The two retailers have also sued each other in the US.
Shein’s 2025 revenue rose 8% to $41.8 billion (£31 billion), but net profit declined 38.7% to $2.06 billion (£1.52 billion). The company posted a $99 million (£74 million) net loss in the first quarter of 2026, when changes to US import rules affected its direct-to-consumer model.