TikTok’s parent company to pay $92 million in US privacy suit

TikTok parent company ByteDance to pay $92M in US privacy suit
1 year ago
2 mins read

TikTok‘s parent company ByteDance has agreed to pay $92 million over a data violation claim from the United States. Court documents indicate that the Chinese firm failed to get consent from users on data collection and sharing.

A filing at the U.S. District Court in Illinois shows that the litigation has lasted almost a year. However, the settlement still requires approval from a federal judge.

The lawsuit claims that TikTok violated the strict Illinois biometric privacy law by sharing the user data with third parties like Facebook and Google.

The state further alleges that ByteDance failed to adequately disclose where the collected data was stored or shared.

TikTok has since denied the allegations. The company states that:

“While we disagree with the assertions, rather than go through lengthy litigation, we’d like to focus our efforts on building a safe and joyful experience for the TikTok community.”

In settling the suit, experts examined the TikTok source code followed by lengthy mediation efforts. Based on the Illinois laws, affected users can also file for monetary damages for unauthorized data collection.

Lawyers representing the users in a joint statement welcomed the settlement. Led by Katrina Carroll, the attorneys stressed that the agreement would ensure TikTok adheres to user privacy.

“Social media seems so innocuous, but troubling data collection, storage, and disclosure can happen behind the scenes. This settlement sets out to prevent that,” said Carroll.

New terms of agreement

The court also proposed terms of the agreement that TikTok is compelled to implement. The company is barred from collecting or storing biometric information and tracking users’ GPS data.

Furthermore, all new TikTok employees and contractors will undergo annual training on compliance with data privacy laws and company procedures.

TikTok, which enjoys close to 100 million users in the United States, was almost shut down by then President Donald Trump over claims of sharing user information with China. To continue operating in the U.S., Oracle (NYSE: ORCL) bought a stake in the company.

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Jordan Major

Jordan is an investor and market analyst. He's passionate about stocks, ETFs, blockchain, and digital assets. At Finbold.com, he delves into the technicalities to obtain future trends for new market traders and gives insights into user-friendly platforms for beginners.