TikTok Sues US Government to Block Divest-or-Ban Law (3)

TikTok sued the US government over a new law that will force its Chinese parent company ByteDance Ltd. to divest the popular video app or face a ban across the country.

The lawsuit marks the first legal challenge since Congress passed the law in April. The measure is meant to address national security concerns that the Chinese government could access user data or influence what’s seen on the app, which would face a shutdown by January in the absence of a sale.

TikTok has argued that the law will stifle free speech and hurt creators and small business owners who benefit economically from the the platform. The company previously said that it spent more than $1.5 billion to isolate its US operations and agreed to oversight by American company Oracle Corp.

“For the first time in history, Congress has enacted a law that subjects a single, named speech platform to a permanent, nationwide ban, and bars every American from participating in a unique online community with more than 1 billion people worldwide,” the company said in a Tuesday filing in the US Court of Appeals in the District of Columbia.

The legal battle comes after President Joe Bidensigned into law a Ukraine-Israel aid package that includes the TikTok provision, which requires the app to be sold or shut down in the US by January. A lobbying push by TikTok Chief Executive Officer Shou Chew failed to persuade US lawmakers who worry about the national security threat of China potentially accessing user data and disseminating propaganda to 170 million Americans — about half the US population.

How TikTok Became a US-China National Security Issue: QuickTake

TikTok has asked the court to issue a judgment that the law violates the Constitution and to prohibit the Justice Department from enforcing it. TikTok is being represented by Covington and Burling LLP and Mayer Brown LLP.

The lawsuit indicates that ByteDance doesn’t have any intention of trying to find a buyer for TikTok as the deadline approaches. For now, the app is allowed to operate in the US, meaning the company doesn’t need to seek an immediate injunction against the US. But as the deadline draws near for the company to sell the app or face a ban, the company might try to seek an emergency injunction.

For the US, the lawsuit means government officials may be forced to publicly reveal classified or sensitive information in court as to why the law is justified and needed. Until now, US officials have said the algorithm powering the app represents a national security threat that could be used by the Chinese government to carry out mass influence operations in America. However, the administration hasn’t publicly presented specific evidence to back up those claims.

The two sides could end up in prolonged legal battle that could go all the way to the Supreme Court.

TikTok could also ask the judge overseeing the case to speed up the briefing timeframe, which could give the Supreme Court time to weigh in on the issue.

“TikTok is the underdog here,” said Matthew Schettenhelm, an analyst for Bloomberg Intelligence. “It is really tough to overcome Congress’ judgment on national security.” If the US has a weakness, it is the lack of record it has developed here in terms of what exactly is the risk, he said.

Read More: TikTok Ready to Fight US Ban With 170 Million Users at Stake

TikTok’s links to China have faced scrutiny under previous administrations. Former President Donald Trump used an executive order to try to force a sale of the app to an American company or face a ban. But his administration also faced multiple legal challenges and judges blocked the ban from taking place. When Biden became president, he put Trump’s ban under fresh review.

“Make no mistake, this is a ban, a ban on you and your voice,” Chew said in a video on the app the day the bill was signed. “Politicians may say otherwise, but don’t get confused. Many who signed the bill say the TikTok ban is the ultimate goal.”

TikTok has argued that a ban would devastate 7 million businesses and shutter a platform that contributes $24 billion annually to the US economy.

Toward the end of last year, legislative efforts to ban or force a sale of TikTok stalled. But classified briefings that raised national security concerns prompted a bipartisan group of US lawmakers in March to plan legislation.

Bloomberg Intelligence

“We give TikTok a 30% shot to win and expect a ruling in an expedited case in 4Q. The D.C. Circuit judges aren’t national-security experts, and they’re likely to defer to Congress’ judgment unless they find a clear First-Amendment violation.”

— Matthew Schettenhelm, litigation analyst

For a full report click here

Meanwhile, TikTok and other platforms have been hit with hundreds of lawsuits blaming them for addicting young people to social media and causing mental distress. Montana became the first US state to enact a law that would ban residents from using the app. In December, a federal judge sympathized with TikTok’s free-speech argument in blocking the Montana measure while the legal challenge plays out.

The initial divestiture deadline is set for Jan. 19, which is a day before the next presidential inauguration. Biden will be able to push back the deadline by another 90 days.

(Updates with impact of lawsuit starting in the seventh paragraph.)

To contact the reporters on this story:
Chris Strohm in Washington at cstrohm1@bloomberg.net;
Sabrina Willmer in Washington at swillmer2@bloomberg.net

To contact the editors responsible for this story:
Misyrlena Egkolfopoulou at megkolfopoul@bloomberg.net;
Sara Forden at sforden@bloomberg.net

Peter Blumberg, Peter Jeffrey

© 2025 Bloomberg L.P. All rights reserved. Used with permission.