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Texas Settlement Requires Temu to Protect Data and Improve Product Safety

PDD Holdings, Inc. and WhaleCo Inc. (doing business as Temu)October 16, 2026Texas Attorney General

Penalty Amount

$3,000,000

Summary

Texas Attorney General Ken Paxton announced a settlement requiring Temu to protect Texans’ sensitive personal data from exposure to the Chinese Communist Party and to strengthen product-safety practices. Temu must pay Texas $3 million, comply with data-security requirements backed by a potential $8 million annual penalty, conduct annual independent product testing, and take specified action on products found to contain harmful substances.

Remedy

Temu must store Texans’ personal data on American-owned and controlled U.S. servers and restrict access from China, subject to essential business functions. It must pay Texas $3 million; violations of specified data-security provisions may trigger an $8 million penalty for each year they occur. Temu must conduct annual independent product-safety testing and, for confirmed harmful products, remove the product, terminate the seller and affiliated stores, notify affected Texas consumers, and issue full refunds.

Monetary PenaltyInjunctionAudit RequirementConsumer RefundsCorrective Notice

Contract Impact

Review vendor and data-processing agreements for requirements governing U.S. data storage, foreign-person access, access controls, security safeguards, and penalties or termination rights for noncompliance. For marketplace, seller, and product-sourcing agreements, check obligations to conduct independent product-safety testing, disclose or remediate hazardous materials, remove unsafe products, terminate noncompliant sellers, notify affected customers, and provide refunds. Customer-facing terms and privacy notices should align with actual data handling and any required consumer notifications.

Contract Search Terms

data localization and storage locationcross-border data access restrictionsdata security safeguardsproduct safety testing and auditshazardous materials and chemical testingseller termination rightsconsumer notification obligationsconsumer refund obligations

Violation Types

Entity Details

Entity

PDD Holdings, Inc. and WhaleCo Inc. (doing business as Temu)

Industry

Retail

Official Sources

Source Evidence

Entity Name
"PDD Holdings, Inc. and WhaleCo Inc., doing business as the global online shopping platform “Temu,”"
Fine Amount
"Temu will also pay $3 million to the State of Texas."
Fine Amount
"Failure to abide by various data security provisions would result in an $8,000,000 penalty each year a violation occurs."
Violation Types
"claiming that Temu unlawfully deceived consumers by exposing Texans’ sensitive personal data to the CCP."
Remedy Summary
"The company must store Texans’ personal data on American-owned and controlled servers located in the United States. They must restrict access to that data by individuals and entities based in China, subject to essential business functions."
Event Date
"October 16, 2026 | Press Release"

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