LITTLE ROCK, Ark. – Arkansas is filing suit against a foreign-owned online retailer claiming the service is illegally trying to get users’ private information.
Attorney General Tim Griffin filed the suit Tuesday in Cleburne County Circuit Court against the parent companies of Chinese-owned Temu, claiming the retailer is violating the Arkansas Deceptive Trade Practices Act and the Arkansas Personal Information Protection Act.
In a statement, Griffin called Temu “functionally malware and spyware,” adding that the app was “purposefully designed to gain unrestricted access to a user’s phone operating system.”
The AG also said the company, owned by PDD Holdings Inc. and WhaleCo Inc., is actually led by a cadre of former Chinese Communist Party officials, which Griffin claims puts Arkansas and the United States at risk in terms of security and privacy rights.
Griffin noted that while this suit is the first time a state has taken Temu to court over its operations, both federal officials and private companies have challenged the digital seller before.
“While this is the first state lawsuit against Temu over its deceptive trade practices, it is not the first time Temu’s tactics have been called into question,” he explained. “Apple suspended Temu from its digital app store in 2023, prompting multiple investigations into the company’s dealings, including an ongoing investigation being conducted by the U.S. Congress.”
In a statement sent to NewsNation affiliate KARK 4 News, a Temu spokesperson said in part that the company was “surprised and disappointed” by the suit, which it contends was filed “without any independent fact-finding.”
The company went on say that “scrutiny will ultimately benefit our development” while denying the allegations in the suit and pledging to “vigorously defend ourselves.”
This suit is not the first time Arkansas has challenged Chinese business interests. During the 2023 Regular Session, the Arkansas General Assembly passed Act 636, which revised land ownership regulations in the state and prohibited ownership of real estate by foreign-party-controlled businesses.
State officials have already used the law to order Syngenta Seeds, which is now a subsidiary of the Chinese company ChemChina, to sell land in Craighead County.
Arkansas also investigated two other companies for possibly violating the law, crypto-mining firm Jones Digital, LLC near DeWitt and Jonesboro-based Risever Machinery, LLC.
In December of 2023, Griffin said his office had determined that Risver had not violated the foreign-owned regulations.
According to lawsuit documents, Arkansas wants a jury trial for the case and is seeking a permanent block from Temu’s data-gathering actions, as well as $10,000 fines for each violation of the Deceptive Practices Act.
