President Trump exceeded his legal authority in issuing an executive order that would ban TikTok in the U.S., the Chinese-owned video app company said in a lawsuit Monday against the administration.
That’s because Trump’s ban is “not based on a bona fide national emergency and authorizes the prohibition of activities that have not been found to pose ‘an unusual and extraordinary threat,’” as required under U.S. law, TikTok alleged in the federal lawsuit.
TikTok argued that Trump falsely invoked national-security concerns as a “pretext for furthering the President’s broader campaign of anti-China rhetoric in the run-up to the U.S. election” and that his actions against the app company “were heavily politicized.”
TikTok’s lawsuit names as defendants Trump, U.S. Commerce Secretary Wilbur Ross and the Commerce Department. The Justice Department declined to comment on TikTok’s lawsuit. The White House also declined to comment, according to media reports.
According to TikTok, the Trump administration “ignored our extensive efforts to address its concerns,” failed to act in good faith, and violated TikTok’s Fifth Amendment due-process rights through Trump’s ban.
The lawsuit challenges Trump’s Aug. 6 executive order that effectively would ban TikTok unless it is sold to an American buyer by Sept. 20. In the order, invoking the International Emergency Economic Powers Act (IEEPA), the president alleged that TikTok “continues to threaten the national security, foreign policy, and economy of the United States” based on the possibility that Chinese authorities could force TikTok to divulge user data.
TikTok, in its legal filing, said, “The executive order seeks to ban TikTok purportedly because of the speculative possibility that the application could be manipulated by the Chinese government. But, as the U.S. government is well aware, Plaintiffs have taken extraordinary measures to protect the privacy and security of TikTok’s U.S. user data,” including by storing that data on servers located outside of China (in the U.S. and Singapore).
While TikTok is owned by a Chinese company, it continues to insist that the “key personnel responsible for TikTok” are all American citizens based in the U.S. “and therefore are not subject to Chinese law.” Those executives include CEO Kevin Mayer, who joined TikTok and ByteDance in June, as well as TikTok’s global chief security officer and general counsel.
How the Trump Aug. 6 order will be applied to TikTok has yet to be determined by the Commerce Department. In its lawsuit, TikTok said it plans to seek a preliminary injunction blocking the enforcement of the executive order once the Commerce Department issues its regulations.
In a separate executive order issued Aug. 14, Trump set a 90-day deadline for Beijing-based ByteDance to divest TikTok’s U.S. assets, also purportedly to protect U.S. national security interests. That officially forces the unwinding of ByteDance’s 2017 acquisition of Muiscal.ly, whose users were migrated to TikTok the following year.
If TikTok fails in its legal effort to stop the Trump administration from imposing the ban, it seems all but likely ByteDance will be forced to try to clinch a deal to sell the popular video-sharing app.
Microsoft confirmed it was in talks to buy TikTok, while other U.S. buyers reportedly interested in TikTok include Twitter and software giant Oracle, led by chairman Larry Ellison, who has said he is a supporter of Trump.
TikTok said it has more than 1,500 employees in the U.S. and that it plans to hire 10,000 more employees in California, Texas, New York, Tennessee, Florida, Michigan Illinois, and Washington State.
“To be clear, we far prefer constructive dialogue over litigation,” TikTok said in a statement announcing the Trump lawsuit. “But with the Executive Order threatening to bring a ban on our U.S. operations — eliminating the creation of 10,000 American jobs and irreparably harming the millions of Americans who turn to this app for entertainment, connection, and legitimate livelihoods that are vital especially during the pandemic — we simply have no choice.”
In its lawsuit, TikTok disclosed specific usage numbers in the U.S. As of June 2020, the company said, it has 91 million monthly active users — up from 11 million in January 2019. Currently, TikTok says it has more than 100 million U.S. monthly active users and over 50 million daily users. Worldwide, TikTok said it had almost 700 million monthly active users in July 2020. To date, the app has been downloaded more than 2 billion times.
Trump, in publicly commenting on TikTok over the last several weeks, has repeatedly insisted that the U.S. government deserves a cut of the proceeds of any sale of the app company’s business. However, experts say there’s no legal precedent for that.
In its lawsuit, TikTok said, “The President’s demands for payments have no relationship to any conceivable national security concern and serve only to underscore that Defendants failed to provide Plaintiffs with the due process required by law.”
TikTok filed the suit in the U.S. District Court for the Central District of California Western Division. The docket number is 2:20-CV-07672.