Court blocks part of TikTok's $400 million settlement with U.S. government
A federal judge in California has tentatively refused to lift some requirements imposed on TikTok under a settlement with the U.S. government over alleged violations of children's privacy. The decision affects a $400 million settlement, including $100 million in payments that depend on the existing court order being vacated.
According to official court documents, U.S. District Judge George Wu of the Central District of California said he intends to maintain oversight of TikTok's compliance with requirements protecting data belonging to users under 13. A final hearing on the request to vacate the order is scheduled for September 21.
The restrictions were originally imposed on Musical.ly, the service that ByteDance acquired and later transformed into TikTok. The court said neither the company nor the U.S. government has yet demonstrated that the measures imposed under the previous order are no longer necessary.
Court maintains oversight of TikTok's privacy practices
In his tentative ruling, Wu said changes to TikTok's ownership structure, new compliance mechanisms and the recent settlement with authorities do not by themselves demonstrate compliance with the previous court order.
The judge also found insufficient grounds to conclude that the protections required under the order are no longer necessary. He therefore tentatively denied the request to vacate the decree, which remained in effect after Musical.ly became TikTok.
In August, TikTok agreed to pay $400 million to settle claims brought by the U.S. Department of Justice related to children's privacy. The case was initiated under the previous administration, while $100 million of the total settlement was made contingent on the earlier court order being vacated.
The court's decision creates uncertainty over that portion of the settlement. Wu's ruling remains tentative, however, and a hearing on the government's request to lift the existing requirements is scheduled for September 21.
U.S. eases restrictions on TikTok
The dispute follows a major restructuring of TikTok's U.S. business. In January, ByteDance transferred part of its U.S. operations to American investors under an agreement with the Donald Trump administration aimed at addressing concerns over Chinese control of the platform.
At the same time, U.S. authorities have begun easing some restrictions on the platform. Federal employees were allowed to install TikTok on government devices after the Justice Department concluded that the 2022 ban no longer applied following the transfer of control over U.S. user data and TikTok USDS operations.
The change marked another sign of Washington reassessing its approach to the platform following the restructuring of its U.S. business. However, the dispute over children's data protection remains a separate issue: the court's tentative ruling indicates that a change in ownership structure does not by itself eliminate previously imposed requirements.
Earlier, we reported that TikTok is developing a peer-to-peer payment feature for U.S. users through direct messages. The feature would allow users to send money to others directly within the platform.
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