$500M Lawsuit Targets Shein’s Influencer Marketing Practices

Predicting an influencer marketing class action lawsuit these days is simple: have a brand growing exponentially online, go viral, make money.

High probability risk.

Spoiler alert: fashion brands get hit harder.

The last few months have been especially tense for brands thriving on social media.

If you’ve scrolled through a few news articles, or doomscrolled just a little, you’ve probably seen stories about brands being sued for millions over deceptive practices, often with a clearly justifiable premise.

The common theme has always revolved around

1. Sponsorship tags buried in walls of hashtags.
2. Using “thanks Shein” instead of "Sponsored by Shein.”
3. Improper Sponsorship Disclaimer from the bigger picture of FTC’s guidelines.

There haven’t been this many class actions in years.

Alo Yoga, Celsius, Revolve, Beach Bunny Swimwear—the list of brands caught in this trap keeps growing.

Today, it’s Shein. Here’s why.

We fixed it.

There are 3 things we like to do at SWAYID.

1. Pre-screen influencer & UGC content for FTC compliance before it's published.
2. Trains creators with short, easy-to-follow disclosure and compliance modules.
3. Create audit trails with timestamped records and signature logs for legal protection.

SWAYId built the first AI-powered compliance platform helping brands, agencies, and creators manage influencer marketing and UGC in alignment with legal guidelines.

This solves the biggest issue with influencer marketing — ensuring and tracking FTC compliance while maintaining legal proof of enforcement.

This creates a defensible audit trail for brands.

Influencer marketing without compliance is a ticking time bomb in 2025. 

And we’ve helped brands fix that.

SHEIN’s Offence

A sweeping new class action lawsuit has named fast-fashion giant Shein and seven individual influencers, accusing them of promoting Shein products on social media without properly disclosing that they were being paid to do so.

The complaint lists Bianca Anastasia Arcori, Abby Bagley, Manuela Brit, Tala Golzar, Anastasia Karanikolaou, Cydney Moreau, and Cindy Prado.

It alleges that they helped Shein manufacture the illusion of widespread interest in its products while failing to disclose their material relationships with the brand.

The case was filed in the U.S. District Court for the Northern District of Illinois, where plaintiffs argue these undisclosed endorsements violate FTC guidelines on influencer marketing.

The Allegations in a Nutshell

The lawsuit charges that:

• Shein supplied products to these influencers and paid them, yet the posts did not clearly state that the content was sponsored.
• The marketing strategy deceived consumers into thinking these endorsements were genuine, unbiased opinions.
• As a result, consumers allegedly paid inflated prices for low‑quality items based on misleading endorsements.

The lawsuit seeks damages and injunctive relief, aiming to hold both Shein and the influencers accountable for deceptive advertising practices that allegedly misled millions of consumers. 

The plaintiffs are asking for more than $500 million in total damages

A Roaster of Class Actions

Until recently, enforcement actions against brands for influencer marketing compliance were primarily initiated by the Federal Trade Commission (FTC) and the National Advertising Division (NAD).

However, the recent wave of lawsuits is now being driven by consumers themselves, in the form of class actions.

Class actions are the new trend 📈.

Worse still, class actions often attract intense media scrutiny beyond the courtroom.

A single case can trigger a domino effect, and encourage more consumers to file suit. 

Of course, there's the money factor. $500M is a lot.

Shein, for instance, has faced roughly five class actions in the past year alone, with a new one filed as recently as July 2025. 

Shein was also recently ordered to pay over $700,000 to settle a California lawsuit over shipping delays, yet another class action that ended in the plaintiffs’ favor.

This is not a Shein thingy. Influencer Marketing class actions are on the rise.

Finally: Prevent Influencer Marketing Class Actions✅

It’s simple.

Build a structured process for onboarding and managing influencers.

Gaps in your records are open invitations for class action lawyers.

Lock every decision with time-stamps and signed trails.

When your compliance is bulletproof, so is your brand.

If all this sounds like hard work and you want the results without the hassle, head over to SwayID.

Disclaimer: This article was authored by Kaeya Majmundar, Founder & CEO. While not a licensed attorney, she has successfully addressed over $4 million in legal threats using the methods described herein. The information provided is for general informational purposes only and does not constitute legal advice. Please consult a qualified legal professional for advice specific to your circumstances.

‍