TikTok Launches Legal Action Against US Executive Order

Video-sharing app TikTok is mounting a legal challenge against a US presidential executive order against it and its parent company, China’s ByteDance, as it seeks leverage in the sale of its US operations.

The lawsuit targets a 6 August executive order issued by US president Donald Trump prohibiting US companies from carrying out TikTok-related deals with ByteDance after 45 days.

The order, along with one issued on 14 August that gave ByteDance 90 days to divest its US TikTok operations, were issued on national security grounds.

TikTok has been in talks with potential acquirers including Microsoft, Oracle and Twitter, while some of its US investors may also join the bid.

Due process

“To ensure that the rule of law is not discarded and that our company and users are treated fairly, we have no choice but to challenge the executive order through the judicial system,” TikTok said in a statement.

The company said it expects the action to begin this week.

TikTok plans to challenge the 6 August order on the grounds that its reliance on the International Emergency Economic Powers Act deprives it of due process, Reuters reported, citing unnamed sources.

The company also reportedly plans to challenge the US administration’s classification of it as a national security threat.

The administration has charged that data on TikTok users could be passed on to the Chinese government.

“This data collection threatens to allow the Chinese Communist Party access to Americans’ personal and proprietary information,” the exective order states.

TikTok had previously said it planned to sue over the order, while TikTok’s employees were also considering legal recourse.

The US administration declined to comment.

Trade war

The legal action would not relieve ByteDance of the obligation to sell TikTok’s US operations, as it does not challenge the 14 August order.

However, it indicates that TikTok is using any legal means at its disposal as it tries to retain as much value as possible in the transaction.

The US administration has taken aim at “untrusted” Chinese apps as part of a broader trade war with China that has notably also focused on telecommunications equipment giant Huawei.

The 6 August executive order also targets Tencent’s WeChat, a communications tool that is more widely used in China than email.

A group of Chinese-Americans filed a lawsuit against the WeChat order on Friday.