Arkansas Attorney General Sues Chinese Company Temu for Deceiving Arkansans, Illegally Accessing Personal Data

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Last week Arkansas Attorney General Tim Griffin sued Chinese e-commerce platform Temu for

The A.G.’s legal team brought the lawsuit under the Arkansas Deceptive Trade Practices Act, which carries a penalty of $10,000 per violation.

Temu is marketed as an online shopping platform launched in 2022, and it is widely regarded as similar to Amazon or Walmart.com. In 2023, the Temu was reported to be the most widely downloaded app in the U.S., and its multibillion dollar marketing campaign — which included an advertisement during the 2024 Super Bowl — has contributed to its success.

But as a Chinese-based tech company, the Arkansas Attorney General’s office has pointed out that security and privacy experts are concerned about Temu.

The A.G.’s lawsuit asserts that Temu “collects a shocking amount of sensitive user data” beyond what is necessary for an online shopping app — including users’ GPS locations and fingerprint data. The lawsuit alleges that the Temu app is able to bypass phone security systems, which potentially grants Temu access to a user’s private messages.

The A.G. says these security concerns are compounded by the fact that Temu is owned by a Chinese company subject to Chinese laws — including “laws that mandate secret cooperation with China’s intelligence apparatus regardless of any data protection guarantees existing in the United States.”

The A.G.’s allegations against Temu are very similar to points the A.G.’s office has made in its lawsuits against TikTok — a widely popular social media platform that is also owned by a Chinese company.

Below is a statement from Attorney General Tim Griffin regarding the lawsuit against Temu.

Griffin: ‘Temu is not an online marketplace like Amazon or Walmart. It is a data-theft business that sells goods online as a means to an end’

LITTLE ROCK – After announcing he is suing Chinese e-commerce company Temu for violations of the Arkansas Deceptive Trade Practices Act (ADTPA) and the Arkansas Personal Information Protection Act (PIPA), Attorney General Tim Griffin issued the following statement:

“Temu is not an online marketplace like Amazon or Walmart. It is a data-theft business that sells goods online as a means to an end. Today I have filed a first-of-its-kind state lawsuit against the parent companies of Temu—PDD Holdings Inc. and WhaleCo Inc.—for violating the ADTPA and PIPA. Though it is known as an e-commerce platform, Temu is functionally malware and spyware. It is purposefully designed to gain unrestricted access to a user’s phone operating system. It can override data privacy settings on users’ devices, and it monetizes this unauthorized collection of data.

“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. 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. 

“Temu is led by a cadre of former Chinese Communist Party officials, which raises significant security risks to our country and our citizens. For my part, I will aggressively fight Temu’s efforts to profit at the expense of Arkansans’ privacy rights.”

The lawsuit, filed in Cleburne County Circuit Court, seeks an order enjoining Temu’s deceptive trade practices and violations of users’ privacy, imposing civil penalties, and providing all other monetary and equitable relief to which the State is entitled.

To read a copy of the lawsuit, click here.

For a printer-friendly version of this release, click here.

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Governor Sanders Asks A.G. to Investigate Two Companies in Arkansas with Ties to China

China

The following is a press release from Governor Sarah Huckabee Sanders.

LITTLE ROCK, Ark.— Governor Sarah Huckabee Sanders’ Administration today alerted Attorney General Tim Griffin’s office of two companies that may be in violation of Act 636, which prohibits foreign-party-controlled businesses from owning Arkansas land.

“China is a hostile foreign adversary and under my administration, we will follow the law and not allow companies controlled by the Chinese Communist Party to buy up and exploit Arkansas land,” said Governor Sanders.

As part of Secretary Wes Ward’s ongoing investigations, the Department of Agriculture discovered that two companies, Risever Machinery LLC in Craighead County and Jones Digital LLC near the City of DeWitt, may have significant ties to China. Jones Digital LLC may also have significant ownership interest in digital asset and crypto-mining operations in other parts of the state under different names.

In October, Governor Sanders became the first governor in the country to kick a Chinese state-owned company off American farmland. Her administration is forcing Syngenta to sell its land in Craighead County and received a $280,000 fine from the company.

Secretary Ward’s letter on Risever Machinery LLC in Craighead County is below:

Attorney General Griffin,

During the 2023 Regular Session of the Arkansas General Assembly the state legislature passed Act 636 which amends the law concerning ownership and possession of real property; the law had an effective date of August 1, 2023.  Act 636 provides that a “prohibited foreign-party controlled business” shall not acquire by grant, purchase, devise, descent, or otherwise any interest in public or private land in this state.  

In accordance with Act 636, the Arkansas Department of Agriculture is directed to collect and analyze information concerning the unlawful sale or possession of agricultural land by prohibited foreign parties and report violations to the Arkansas Attorney General. 

Since the passage of Act 636, one entity that has come to the attention of the Department is Risever Machinery LLC which has a facility in Craighead County.  A review of Risever Machinery LLC’s ownership indicates that the entity has significant ties to China.  

As of the date of this letter, China continues to be a country subject to the International Traffic in Arms Regulations (ITAR) and is subject to the prohibitions of Act 636.  

The Arkansas Department of Agriculture believes that Risever Machinery LLC may be operating in violation of Act 636.  As a result, we are reporting the potential violations to your office and requesting that you utilize the authority granted under A.C.A. 18-11-704(c)(2) to determine if a violation of Act 636 has in fact occurred, and if so, commence appropriate legal action.   

Respectfully,

Wesley W. Ward
Secretary of Agriculture

Secretary Ward’s letter on Jones Digital LLC near the City of DeWitt is below:

Attorney General Griffin,

During the 2023 Regular Session of the Arkansas General Assembly the state legislature passed Act 636 which amends the law concerning ownership and possession of real property; the law had an effective date of August 1, 2023.  Act 636 provides that a “prohibited foreign-party controlled business” shall not acquire by grant, purchase, devise, descent, or otherwise any interest in public or private land in this state.

In accordance with Act 636, the Arkansas Department of Agriculture is directed to collect and analyze information concerning the unlawful sale or possession of agricultural land by prohibited foreign parties and report violations to the Arkansas Attorney General. 

Throughout the course of this year there have been a growing number of entities in the process of creating digital asset or crypto-mining operations across the state of Arkansas.  One of these facilities is located on agricultural land near the city of DeWitt and is operated by Jones Digital LLC. A review of Jones Digital’s ownership indicates that the entity may have significant ties to China.  Further, it is believed that the individuals or entities involved in the ownership of Jones Digital LLC may also have significant ownership interest in other digital asset or crypto-mining operations in other parts of the state under different names. 

As of the date of this letter, China continues to be a country subject to the International Traffic in Arms Regulations (ITAR) and is subject to the prohibitions of Act 636.  

The Arkansas Department of Agriculture believes that Jones Digital LLC and potentially other similarly situated digital asset or crypto-mining operations may be operating in violation of Act 636.  As a result, we are reporting the potential violations to your office and requesting that you utilize the authority granted under A.C.A. 18-11-704(c)(2) to determine if a violation of Act 636 has in fact occurred, and if so, commence appropriate legal action.   

Respectfully,

Wesley W. Ward
Secretary of Agriculture

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