ByteDance, the Chinese parent company of video-sharing app TikTok, filed a request late on Tuesday with a US Appeals Court challenging a Trump government order set to take effect on Thursday requiring it to divest TikTok.
President Donald J Trump in an Aug. 14 order led ByteDance to divest the app within 90 days, which falls on Thursday. The Trump administration claims TikTok poses national security concerns as the private data of US users could be obtained by China’s authorities. TikTok, that has over 100 million US users, denies the allegations.
In the request filed with the US Court of Appeals for the District of Columbia, ByteDance stated it is looking for a court review of this divestment order, asserting that the purchase and a finding by a US bureau which TikTok represented a safety threat were unlawful and violated rights under the US Constitution.
ByteDance, that has been in talks for a deal with Walmart Inc and Oracle Corp to shift TikTok’s US assets into a new thing, also said it is asking a 30-day expansion on the Aug. 14 divestment order, so it can finalize conditions of the deal.
“Facing continual new requests and no clarity on whether our proposed solutions would be accepted, we requested the 30-day extension that is expressly permitted in the August 14 order,” TikTok stated in a statement.
The White House and Treasury declined to comment. The Justice Department didn’t immediately comment.
In September, TikTok declared it had a preliminary deal for Walmart and Oracle to take bets in a new company to oversee US operations. Trump has said the deal had his “blessing.”
One large issue that has persisted is over the ownership structure of the new firm, TikTok Global, which could own TikTok’s US assets.
In its court filing, ByteDance stated it submitted a fourth suggestion on Friday that contemplated addressing US concerns “by creating a new entity, wholly owned by Oracle, Walmart and existing US investors in ByteDance, that would be responsible for handling TikTok’s US user data and content moderation.”
ByteDance said in its court filing it plans to file a request “to stay enforcement of the Divestment order only if discussions reach an impasse and the government indicates an intent to take action to enforce the order.”
The petition names Trump, Attorney General William Barr, Treasury Secretary Steven Mnuchin along with the Committee on Foreign Investment in the United States (CFIUS), the inter-agency panel which reviews certain transactions involving overseas investment on national security concerns.
A person briefed about the issue told Reuters CFIUS stopped responding to ByteDance shortly after Trump’s last public TikTok comments on Sept. 19. TikTok said Tuesday it has “received no substantive feedback on our extensive data privacy and security framework.”
The purchase was founded on a government overview of ByteDance’s 2017 acquisition of US social media app Musical.ly, which ByteDance merged into TikTok.
ByteDance’s lawsuit also retrieved Trump’s comments at a September campaign rally the parties to the agreement would “pay $5 billion into a fund for education” to ensure “we can educate people as to the real history of our country.”
ByteDance and Tiktok stated in the court filing they have not agreed “to contribute to such a fund.”
Independent restrictions on TikTok from the US Commerce Department have been obstructed by national courts, such as restrictions on trades which were scheduled to take effect Thursday which TikTok cautioned could effectively ban the app’s usage in the United States.
The team at Platform Executive hope you have enjoyed the ‘ByteDance challenges Trump’s TikTok divestiture order‘ article. Initial reporting via our official content partners at Thomson Reuters. Reporting by Echo Wang in New York and David Shepardson in Washington. Editing by Leslie Adler and Christopher Cushing.
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