Texas Border Business
AUSTIN – Texas Attorney General Ken Paxton filed suit against PDD Holdings, Inc. and WhaleCo Inc., doing business as the global online shopping platform “Temu,” for unlawfully deceiving consumers while covertly harvesting Texans’ personal data and exposing it to the Chinese Communist Party (“CCP”).
Temu operates under PDD Holdings Inc., a company founded in China that relocated its principal executive offices from Shanghai to Dublin, Ireland, but continues to maintain significant operations in China. As of May 2023, the United States accounted for over 40% of Temu downloads worldwide, with 82.4 million active users in the United States as of September 2023.
When operating on the Temu site or app, consumers are exposed to a digital security threat. Temu utilizes dangerous software functions that are completely inappropriate for a simple e-commerce retailer. These functions expose the Temu app for what it is—a trojan horse that allows the app to bypass security protocols and create a backdoor into user’s private data. While Temu represents to consumers that it offers “affordable great products,” it is simultaneously turning the consumer into the product and harvesting vast swaths of data to be stored on servers in China.
“Temu is Chinese Communist spyware disguised as a shopping app. Texans deserve transparency, privacy, and protection from foreign adversaries that exploit their personal data,” said Attorney General Paxton. “I will not allow foreign corporations to lie to Texas consumers with misleading marketing and then steal their data with the intent to hand it over to our nation’s enemies.”
The lawsuit seeks relief under the Texas Deceptive Trade Practices Act (“DTPA”) and monetary relief for the state, including the recovery of up to $10,000 for each violation of the DTPA—with as much as a $250,000 per violation of the DTPA when the illegal action targeted consumers who were 65 years of age or older.
This action is the fourth one announced by Attorney General Paxton this week that is part of a coordinated effort to hold China accountable under Texas law. The OAG has filed lawsuits against TP Link, Anzu Robotics, and Lorex.
To read the lawsuit, click here.
