Federal lawsuit against TikTok to focus on children's privacy: report

The Department of Justice (DOJ) is planning to focus an upcoming lawsuit against TikTok on allegations that the company violated the privacy rights of children, according to a new report.

The DOJ's lawsuit will focus on children's privacy rights rather than claims the social media platform misled adult users about data privacy practices, Reuters reported. The news comes after the Federal Trade Commission (FTC) announced that it investigated potential violations by TikTok and its China-based parent company ByteDance and referred the case to the DOJ on Tuesday.

"The investigation uncovered reason to believe named defendants are violating or are about to violate the law and that a proceeding is in the public interest," the FTC said in a statement at the time. "Although the Commission does not typically make public the fact that it has referred a complaint, we have determined that doing so here is in the public interest."

FTC REFERS COMPLAINT AGAINST TIKTOK TO JUSTICE DEPARTMENT OVER CHILD PRIVACY VIOLATIONS

In 2020, Reuters first reported the FTC and DOJ were investigating allegations that TikTok failed to comply with a 2019 agreement aimed at protecting children's privacy.

"We've been working with the FTC for more than a year to address its concerns," a TikTok spokesperson told FOX Business in a statement. "We're disappointed the agency is pursuing litigation instead of continuing to work with us on a reasonable solution. We strongly disagree with the FTC's allegations, many of which relate to past events and practices that are factually inaccurate or have been addressed."

"We're proud of and remain deeply committed to the work we've done to protect children and we will continue to update and improve our product. We offer an age-appropriate experience with stringent safeguards, proactively remove underage teenagers, and have voluntarily launched safety features such as default screentime limits, family pairing, and privacy by default for minors under 16," TikTok's statement continued.

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The FTC's probe is distinct from concerns that prompted Congress to pass a bill requiring that TikTok be divested from China-based parent company ByteDance or face a potential U.S. ban over concerns about the ability of the Chinese government to improperly access data from American users or to use the platform to spread propaganda or stifle certain viewpoints. 

Those concerns prompted the enactment of a law earlier this year that requires ByteDance to divest TikTok's U.S. operations or face a ban effective early next year.

Under the law, TikTok and ByteDance have until Jan. 19, 2025, to decide whether to sell the company to an owner who isn't from a foreign country considered to be an adversary of the U.S. or else a ban of the platform would take effect, with app store operators like Apple and Google and internet service providers barred from enabling access to the platform.

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TikTok has denied those allegations and filed a lawsuit to block the law. In a filing last week, ByteDance said divesting TikTok's U.S. assets is "not possible technologically, commercially, or legally." It added that the "Chinese government has made clear in public statements that it would not permit a forced divestment of the recommendation engine." 

Uncertainty surrounding TikTok's fate has spurred interest from investors who are considering bids to acquire the social media platform to prevent it from being banned. 

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Billionaire real estate developer Frank McCourt formed a consortium of investors looking to buy TikTok from ByteDance. Former Treasury Secretary Steven Mnuchin and Kevin O'Leary, chair of O'Leary Ventures and star of the TV show "Shark Tank," have also said they're interested in forming investment groups to acquire TikTok.

Reuters contributed to this report.