US Judge Signals Rejection of Key Part of TikTok's $400 Million Privacy Settlement

A proposed $400 million settlement between TikTok, its parent company ByteDance, and the U.S. Justice Department has encountered a significant obstacle. A federal judge has signaled he will likely reject a key provision of the agreement designed to resolve allegations of child privacy violations, according to a report from Reuters.

Details of the Settlement

The agreement, reached in August, stems from a 2024 Justice Department lawsuit accusing TikTok and ByteDance of violating U.S. laws by illegally collecting personal information from children under the age of 13. The settlement was structured to resolve these claims.

Under the proposed terms, the deal included:

• An immediate payment of $300 million.
• A conditional payment of $100 million, which was contingent on a court terminating a separate 2019 consent decree.

Judge's Scrutiny

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U.S. District Judge George H. Wu in Los Angeles stated in a tentative ruling on Friday that he was "inclined to reject" the request to end the 2019 consent decree. The judge noted that without further details, the court "cannot determine that it constitutes a durable remedy or that termination is suitably tailored to the asserted change in circumstance."

A hearing on the matter was scheduled for Monday, according to the report. The judge's hesitation places the finality of the entire $400 million agreement in question, as a portion of the payment is directly tied to the termination of the prior order.

Context of the 2019 Decree

The 2019 consent decree was imposed by the Federal Trade Commission (FTC) on Musical.ly, TikTok's predecessor. That action followed allegations that the app knowingly collected personal information from young children without obtaining parental consent. Musical.ly paid a $5.7 million fine to settle those charges.

That decree requires TikTok to maintain certain reporting and record-keeping obligations through 2029. The current settlement's attempt to dissolve this long-standing order is the primary point of contention for the court.