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What the High Court Decision Means for Online Marketplaces

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INTRODUCTION The High Court has dismissed Shein’s copyright infringement claims

against its online fast-fashion rival, Temu, in a decision which limits the

circumstances in which online marketplaces may be liable for copyright infringement.

In a judgment handed down on 13 August 2026, Mrs Justice Bacon

held that Temu neither committed nor authorised acts of copyright

infringement in relation to photographs uploaded to its platform by third-party merchants: (1) Roadget Business PTE Ltd and (2) Shein

Distribution UK Ltd v Whaleco UK Ltd - EWHC 216 (Ch) – Courts and

Tribunals Judiciary [2026] EWHC 2165 (Ch) (the “Decision”). The High

Court also held that, even if infringement had been established, Temu

would have benefited from the hosting defence under Regulation 19 of the Electronic Commerce (EC Directive) Regulations 2002.

As Alec Cameron, IP Partner and Head of IP Disputes, and Chloe Hay, Trainee in the Disputes and IP Disputes team, explore below, the

judgment highlights the difficulty of establishing platform liability for

having clear evidence of chain of title in mass copyright infringement actions.

BACKGROUND The first claimant, Roadget, and second claimant, Shein UK, form part of the SHEIN group, the well-known

OWNERSHIP FIRST, INFRINGEMENT SECOND: A Warning for Rights Holders

global online fast-fashion retailer founded in China in 2012, which expanded into the UK market around 2014. Shein operates an Original Design Manufacturer (ODM) model, relying on suppliers to design and manufacture products sold via its platform. The defendant, Whaleco UK Ltd, operates the UK arm of Temu’s global online shopping marketplace, which expanded into the UK in 2023. Unlike Shein, Temu is principally an online platform / marketplace through which independent merchants sell goods Shein’s suppliers frequently retain the right to sell surplus stock through alternative sales channels, including Temu. Crucially, the merchants doing so may reuse existing product photographs when listing their goods for sale.

THE DISPUTE Shein alleged that more than 2,500 product listings on Temu’s UK platform used photographs copied from the SHEIN website without its permission, in respect of which it claimed to be the copyright owner. Shein alleged that Temu was liable for various acts of copyright infringement by authorising merchants to use the photographs on its platform. Temu denied the allegations, maintaining that responsibility lay with the independent merchants who uploaded the content. It also challenged Shein’s claimed copyright ownership in the works complained of.

Shein’s June 2023 letter of claim identified more than 8,000 allegedly infringing Temu URLs and asserted ownership of the copyright in more than 2,559 images. These images fell into three categories: 2,285 photographs created by Shein employees, 263 supplier photographs and 11 agency photographs. Given the scale of the alleged infringement, the court directed that the trial proceed by way of a sample of 20 images. However, Shein was unable to establish its ownership of copyright in many of these images. It admitted that it could not verify ownership of photographs supplied by agencies and third-party suppliers, and that copyright in certain employeecreated photographs had not been validly assigned to it. As a result, only five photographs were used at trial: four employee photographs and one supplier photograph, known as the “Strawberry Nightdress” (respectively, the “Employee Images” and the “Strawberry Nightdress Image”).

THE STRAWBERRY NIGHTDRESS The Strawberry Nightdress Image was commissioned by the merchant from a freelance photographer, who retained copyright in the image and was unaware that the images were intended for Shein. As a result, Shein only held a non-exclusive licence to use them. In relation to this image, Shein’s claim ultimately failed because the merchant later authorised Temu to list the Strawberry Nightdress in order to clear surplus stock, thereby consenting to the upload and use of the photographs.

EMPLOYEE IMAGES

Secondary Infringement

Shein also alleged that Temu had infringed copyright

Shein’s claim of secondary infringement by Temu under

in the Employee Images on multiple grounds under the Copyright, Designs and Patents Act 1988 (CDPA). However, for the reasons set out below, all claims were dismissed by the High Court.

ACTS OF PRIMARY INFRINGEMENT Reproduction under Section 17 CDPA Shein discontinued a claim based on Temu’s reproduction of the photographs on its website, as Temu’s servers were located in Ireland, placing the alleged acts of infringement outside the High Court’s jurisdiction. Shein instead argued that Temu authorised reproduction of the Employee Images by enabling users of its UK site to view the photographs, thereby creating temporary copies in device RAM. However, the court rejected this submission, holding that Temu could rely on the temporary copies defence under Section 28A CDPA and that merely operating a platform on which merchants upload images did not amount to authorising infringement.

Communication to the Public Shein’s claim that Temu had infringed its rights under Section 20 CDPA to control the communication to the public of the Employee Images also failed. The court held that Temu had not deliberately intervened to provide the public with access to the protected works, in full knowledge of the relevant consequences. Although it was aware that some merchants might upload infringing material, Temu contractually prohibited such conduct and operated a notice-and-takedown procedure for copyright infringement complaints.

Section 23 CDPA also failed. The court held that Temu did not know, nor had reason to believe, that the Employee Images were infringing copies before notification from Shein and that it subsequently removed them.

HOSTING DEFENCE

KEY TAKEAWAYS

Mrs Justice Bacon further held that, in the event that

The Decision is another salutary tale about the pitfalls

Shein had established any acts of infringement, Temu

of bringing mass copyright infringement actions

would have been entitled to rely on the “hosting

against platform operators. Key takeaways for

defence” under Regulation 19 of the Electronic

potential claimants include:

Commerce (EC Directive) Regulations 2002. She observed:

“In so far as any infringements could be established in this case, Temu did not have either actual knowledge of the infringements or awareness of facts or circumstances from which the infringements would have been apparent.” Shein argued that Temu’s involvement in pricing,

Chain of copyright title Establishing a clear chain of title in the protected works complained of remains a crucial step in a copyright infringement claim. Claimants often underestimate the difficulties of meeting this requirement in mass copyright infringement claims.

Platform liability remains limited

promotions, listings and fulfilment made it an active participant rather than a passive host. However, the court rejected this approach, emphasising that the key question was Temu’s role in relation to the specific infringing content. As the photographs were uploaded through Temu’s standard systems, alongside millions of other thirdparty images, and were subject only to automated checks, Temu’s conduct was held to be “of a mere technical, automatic and passive nature”, allowing it to rely on the hosting defence.

TEMU’S COUNTERCLAIM Temu also succeeded on its counterclaim under the cross-undertaking in damages given by Shein when it obtained interim injunctions in 2023 requiring certain listings to be removed. The court accepted that removing the disputed photographs inevitably required the removal of the associated listings and rejected the suggestion that Temu could have mitigated its losses within the twoday takedown period. Damages will be determined at a later hearing.

The judgment reaffirms that online marketplaces are generally not liable for infringing content uploaded by independent sellers unless they actively contribute to the infringement. It also emphasises that the operation of an effective notice and takedown system remains a pre-requisite for any platform seeking to rely on the hosting defence. Given the fact that direct action against multiple individual merchants was no doubt highly unat-tractive to Shein, given time and costs involved, the Decision again highlights the limi-tations of remedies available to copyright owners who suffer acts of copyright infringe-ment online. Finally, the Decision highlights the potential future sting for a party securing a preliminary injunction against copyright infringement if they are required to give a cross-undertaking in damages and liability is held not to be established at final hearing.

FALLOUT FROM DECISION A representative for Shein maintained that Shein owned the photographs at the centre of the claim and that they had been used on Temu’s website.

“Yet despite copying ‌on an industrial scale, it has avoided liability in the UK simply because the servers supporting its UK website happen to sit in Ireland,” Shein’s representative said. Shein has yet to announce whether it will seek leave to appeal the Decision. Temu has not issued a substantive public statement in response to the Decision. In any event, wider litigation between the parties continues with Temu pursuing a competition law counterclaim alleging that Shein sought unfairly to restrict its expansion in the UK fastfashion market. This claim is due to be heard by the Competition Appeal Tribunal in March 2027.

The authors: Alec Cameron IP Partner | Head of IP Disputes alec.cameron@laytons.com +44 (0)20 7842 5404

Chloe Hay Trainee Solicitor | Disputes and IP Disputes chloe.hay@laytons.com +44 (0)20 7842 8000

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