By David Shepardson
WASHINGTON (Reuters) -TikTok and its Chinese parent company ByteDance filed a lawsuit in U.S. federal court on Tuesday to block a law signed by President Joe Biden that would allow the divestment of the short-form video app used by 170 million Americans. would enforce or prohibit.
The companies filed their lawsuit in the U.S. Court of Appeals for the District of Columbia Circuit, arguing that the law violates the U.S. Constitution on a number of grounds, including violating the First Amendment’s protections of free speech. Amendment. The law, which was signed by Biden on April 24, gives ByteDance until January 19 to sell TikTok or face a ban.
“For the first time in history, Congress has passed a law that subjects a single speech platform to a permanent, nationwide ban,” the companies said in the lawsuit.
The lawsuit stated that the divestiture “is simply not possible: not commercially, not technologically, not legally.” …There is no doubt about it: the bill (law) will force a shutdown of TikTok by January 19, 2025, silencing its 170 million Americans. who use the platform to communicate in ways that cannot be replicated elsewhere.”
The White House has said it wants Chinese ownership to end for national security reasons, but not through a ban on TikTok. The White House and Justice Department declined to comment on the lawsuit.
The lawsuit is the latest move by TikTok to get ahead of efforts to shut it down in the United States, as companies like Snap and Meta look to take advantage of TikTok’s political uncertainty to steal advertising dollars from their rival.
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Driven by concerns among U.S. lawmakers that China could access data on Americans or spy on them with the app, the measure passed overwhelmingly in Congress just weeks after its introduction. TikTok has denied that it has or will ever share U.S. user data, accusing U.S. lawmakers in the lawsuit of fueling “speculative” concerns.
Rep. Raja Krishnamoorthi, the top Democrat on a House committee on China, said the legislation is “the only way to address the national security threat posed by ByteDance’s ownership of apps like TikTok.”
“Rather than continue its deceptive tactics, it is time for ByteDance to start the divestment process,” he said.
The law bans app stores such as Apple (NASDAQ:) and Alphabet’s Google (NASDAQ:) from offering TikTok and prohibits internet hosting services from supporting TikTok unless ByteDance divests TikTok before January 19.
The lawsuit said the Chinese government “has made it clear that it would not allow a divestiture of the recommendation engine that is a key to TikTok’s success in the United States.” The companies have asked the D.C. Circuit to block U.S. Attorney General Merrick Garland from enforcing the law, saying “a future preliminary injunction” is warranted.
According to the lawsuit, 58% of ByteDance is owned by global institutional investors, including BlackRock (NYSE:), General Atlantic and Susquehanna International Group, 21% is owned by the company’s Chinese founder, and 21% is owned by employees – including approximately 7,000 Americans.
TENSION ABOUT THE INTERNET AND TECHNOLOGY
The four-year battle over TikTok is a major front in the ongoing conflict over the internet and technology between the United States and China. In April, Apple said China had ordered the removal of Meta Platforms (NASDAQ:)’ WhatsApp and Threads from the App Store in China due to Chinese national security concerns.
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TikTok has spent $2 billion to implement measures to protect U.S. users’ data and made additional commitments in a 90-page draft national security agreement developed through negotiations with the Committee on Foreign Investment in the United States (CFIUS) , the lawsuit said.
That pact included TikTok agreeing to a “shutdown option” that would give the U.S. government the authority to suspend TikTok in the United States if it violates certain obligations, the lawsuit said.
According to the lawsuit, CFIUS stopped engaging in meaningful discussions about the agreement in August 2022, and in March 2023 CFIUS “insisted that ByteDance would be required to divest its U.S. TikTok business.” CFIUS is an interagency committee, chaired by the U.S. Treasury Department, that reviews foreign investments in U.S. companies and real estate that raise national security concerns.
In 2020, then-President Donald Trump was blocked by the court in his attempt to ban TikTok and China’s WeChat, part of Tencent, in the United States. Trump, the Republican candidate who challenged Democrat Biden in the November 5 US election, has since changed course, saying he does not support a ban but that security concerns need to be addressed.
Biden could extend the Jan. 19 deadline by three months if he determines ByteDance is making progress. The lawsuit said the fact that Biden’s presidential campaign continues to use TikTok “undermines the claim that the platform poses an actual threat to Americans.” Trump’s campaign does not use TikTok.
Many experts wonder whether a potential buyer has the financial resources to buy TikTok and whether Chinese and U.S. government agencies would approve a sale.
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Moving the TikTok source code to the United States “would take years for an entirely new group of engineers to gain sufficient prominence,” the lawsuit said.
