Scams and phishing schemes add to Temu’s legal battles, unveiling a new wave of challenges

The rapid expansion of Temu, a Chinese budget shopping platform owned by PDD Holdings (which also operates Pinduoduo), has propelled its meteoric rise but has also exposed the platform to a new and concerning challenge: scams and phishing schemes seeking to exploit its popularity.

In early November, a Temu spokesperson reached out to KrASIA, sharing that Temu has taken legal action against fraudulent websites mimicking its domain and engaging in unauthorized activities. According to the spokesperson, an increasing number of apps, websites, and product listings have been created using Temu’s trademark, diverting sales to their sites, offering products and services independent of Temu, or promoting phishing and online fraud schemes.

“Fraudsters are posing as Temu on fake apps and websites to scam consumers. This not only damages our reputation but also hurts consumers who have been deceived into believing that they were engaging with genuine Temu platforms. We will take swift legal action to defend our rights and shield our customers from such malicious and unlawful activities,” the Temu spokesperson told KrASIA.

Recent legal proceedings in the US have brought to light the scope of Temu’s battle against allegedly fraudulent websites such as “temuapp.biz” and “temucouponcodes.com.” These sites stand accused not only of infringing on Temu’s trademark by mimicking its domain name and falsely representing themselves as Temu representatives but also of attempting to evade liability through elaborate efforts to conceal both their identities and the full extent of their activities. Temu’s filed complaint specifically charges these sites with trademark infringement, unfair competition, and false designation of origin. In seeking damages, Temu is pursuing compensation at the rate of USD 100,000 for each unauthorized use of its trademark.

Additionally, Temu has been pushing for preliminary injunctions to be imposed against the accused sites while the lawsuit remains ongoing. On November 29, Temu released a statement announcing that these injunctions have been granted by a US court, marking “a victory in Temu’s legal efforts to shield consumers from shopping scams.”

However, Temu is not only battling against malicious actors aiming to lure consumers into making purchases or divulging personal information for fraudulent reasons. It is also facing a new threat on social media platforms, particularly TikTok, where deceptive tactics are employed to manipulate individuals into using Temu referral codes. Such actors leverage tactics claiming the provision of “leaked” or explicit content, gaming perks, or discount codes to mislead individuals, posing an additional challenge for Temu in maintaining the integrity of its referral program.

Temu has also been embroiled in several lawsuits with online fast fashion retailer Shein. In August this year, Shein filed documents in London’s high court, alleging that numerous Temu sellers have stolen images from its platform to sell their products. Shein and Temu had already undergone several courtroom confrontations in the US prior to this.

Relatedly, critics have been raising concerns about Temu’s data practices, prompting the company to address these allegations by outlining the permissions it seeks from users.

Temu’s legal battles unfold against the backdrop of its rapid global growth, having entered the US e-commerce market in September last year before expanding into Europe, Asia, and the Middle East. With a presence in 48 countries, Temu is competing with industry giants like Sea in Southeast Asia.

As Temu continues its global expansion, its unwavering commitment to legal action and user education will be pivotal in upholding its reputation and trustworthiness in the ever-evolving e-commerce landscape.

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