TikTok to pay $400m to US in one of largest child privacy settlements
The deal stems from a 2024 lawsuit alleging TikTok and its parent company ByteDance collected "vast amounts of data" on millions of users under the age of 13.
TikTok is set to pay $400 million to the United States, resolving a lawsuit that accused the platform of violating children's privacy. This settlement, one of the largest of its kind, comes after TikTok has faced scrutiny in the U.S. since 2024.
The agreement stems from a 2024 lawsuit initiated by the Department of Justice under former President Joe Biden. The suit alleged that TikTok and its parent company, ByteDance, unlawfully gathered "vast amounts of data" from millions of users under the age of 13. This conduct was deemed a breach of the Children's Online Privacy Protection Act (COPPA), a federal law established in 2000. This same law is currently the basis for lawsuits filed against Meta by numerous U.S. states.
Assistant Attorney General Brett Shumate commented, "Children and parents are better protected today than they were when this case began."
Other companies that have incurred penalties from the U.S. government for COPPA violations include Google, which paid $170 million in 2019, and Epic Games, which paid $275 million in 2022.
While the lawsuit predates the 2024 separation of TikTok's U.S. business and operations from its original base in China, the settlement specifically addresses TikTok's operations in China.
Under the terms of the deal, TikTok and ByteDance will make an immediate payment of $300 million to the DOJ. An additional $100 million will be paid once the government vacates a 2019 consent decree.
As part of the agreement, Musical.ly, the predecessor to ByteDance, was previously required to pay a $5.7 million fine for COPPA violations and ensure parental consent for users under 13.
On Friday, the justice department did not detail any further actions against TikTok beyond the fine. However, the department noted that since the lawsuit was filed, TikTok has undergone "significant changes," including modifications to its ownership, privacy practices, and platform controls for young users.
When the lawsuit was initially filed, U.S. attorneys stated that over 170 million teenagers were using TikTok and that the app was "directed to children." Despite this, it reportedly failed to effectively verify user ages or obtain parental consent for underage users.
In 2024, former President Biden advocated for either a ban on TikTok or a divestment of its U.S. operations. President Donald Trump subsequently supported the app's divestment, which took place last year.
Currently, TikTok's U.S. operations are 81% owned by a consortium of investors, with ByteDance retaining a 19% stake.
A representative for TikTok did not provide a comment to the BBC.