Shopping app Temu’s alleged data collection practices gain attention of states across US

WASHINGTON (TND) – Arkansas Attorney General Tim Griffin is the latest government official to speak out about how the popular online shopping app Temu allegedly collects and uses shoppers’ personal data.

Last week, Griffin’s office filed a lawsuit against Temu’s Chinese parent company PDD Holdings Inc., seeking damages and injunctive relief for allegedly violating state trade and privacy laws.

Temu, which launched in 2022, has quickly become famous for its broad range of household and fashion products for extremely low prices that often seem too good to be true, like a five-pack of microfiber dish towels for 39 cents.

“You may be thinking, how can they sell that so low? Because it’s not their business. Their business is the data,” Griffin said.

The suit alleges Temu uses spyware and malware to collect sensitive personal data, including biometric information and a user’s location, designed to evade security reviews.

A Temu spokesperson said the company was “surprised and disappointed” by Griffin’s decision to sue.

“The allegations in the lawsuit are based on misinformation circulated online, primarily from a short-seller, and are totally unfounded. We categorically deny the allegations and will vigorously defend ourselves. We understand that as a new company with an innovative supply chain model, some may misunderstand us at first glance and not welcome us. We are committed to the long-term and believe that scrutiny will ultimately benefit our development. We are confident that our actions and contributions to the community will speak for themselves over time,” the spokesperson said in a statement.

Two separate class action lawsuits filed against the company in Illinois and New York make almost identical allegations, which Temu also denied, claiming safeguarding privacy is one of the company’s core values.

In Washington, Temu and other apps owned by Chinese companies–most famously, Bytedance’s TikTok–have been scrutinized for potential threats to national security because Chinese law requires its companies to comply with Chinese Communist Party Operations. U.S. officials fear that may include handing over Americans’ personal data.

Because of a bipartisan law passed earlier this year, TikTok, and potentially other Chinese-owned apps in the future, must be sold from its parent company or face a ban in the U.S.

“Foreign adversaries use technology for social and political control,” Commerce Committee Chair Maria Cantwell, D-Wash., said at the time.

Griffin is not seeking a Temu ban for Arkansas but suggested injunctive relief to stop the company’s alleged practices would dismantle its business model.