TikTok
MIAMI – A group of American investors is asking a Florida federal court to issue a declaratory judgment clarifying Chinese-owned ByteDance’s obligations – and others’ – following a U.S. Supreme Court ruling that upheld a law banning TikTok’s operation in the U.S. upon refusal to divest its operations.
In TikTok v. Garland, the nation’s high court upheld the Protecting Americans from Foreign Adversary Controlled Applications Act. The federal law, enacted in April 2024, addresses concerns about data privacy and national security related to social media applications controlled by foreign adversaries. The law takes aim at TikTok, in particular.
The Supreme Court, in its January ruling, rejected the argument that the law violated First Amendment rights by limiting free speech.
The ruling was followed by an executive order by President Donald Trump delaying enforcement of the TikTok ban for 75 days – as permitted under the law. Trump previously, in August 2020, issued an order effectively banning TikTok in the U.S. unless its Chinese parent company, ByteDance, divested its U.S. operations to an American company.
Last month, Trump again extended the deadline of the TikTok sale to September 17.
Plaintiff TikTok Global LLC filed its newest complaint July 15 in the U.S. District Court for the Southern District of Florida, Miami Division.
In its 55-page complaint, Beijing Telecommunications Co. Ltd. was added to the list of named defendants. In a previous complaint, filed in April, the investors named ByteDance Ltd., TikTok Inc., and ByteDance founder Yiming Zhang.
The investors argue in their newest filing that they should become the successor to any U.S. assets the banned companies abandon. They continue to accuse the companies of a conspiracy to maintain control over TikTok’s U.S. operations and violating antitrust laws.
They allege the banned companies are operating a criminal enterprise known as the Z-BOT RICO Enterprise.
“The Z-BOT RICO Enterprise was formed in 2019 during anxiety-fraught meetings where Chinese executives conspired with American cloud server providers to undermine any U.S. legal ban requiring ByteDance to divest its TikTok subsidiary to American majority ownership,” the complaint states.
TikTok Global argues what should have been a “straightforward process of acquisition and divestment” has become a “twisted tale” of corporate intrigue, conspiracy, and antitrust violations.
The investors allege the “game was rigged from the start” because Beijing Telecoms and ByteDance “had other plans.”
These plans, they contend, circumvent proper procedures, stifle competition, and maintain their control over TikTok's U.S. operations – “all under the guise of [Executive Order] compliance.”
“With TikTok effectively banned in the United States unless divested from Chinese control, Defendants face a stark choice: divest TikTok's U.S. operations to a qualified American buyer or cease operations in the United States entirely,” the investors’ complaint states, again pointing to the Supreme Court ruling.
“Plaintiff stands ready, as it has since 2020, to acquire TikTok's U.S. operations and fulfill the requirements of the Act, ensuring that millions of Americans can continue to use the platform while addressing legitimate national security concerns.”
The investors, similar to their April filing, seek $58 billion in compensatory damages for financial losses; punitive damages; treble damages for antitrust violations; injunctive relief; attorneys’ fees; and pre-judgment and post-judgment interest.
The Miami firm of Reiner & Reiner PA is representing the investors in the action.
Last week, U.S. Commerce Secretary Howard Lutnick said on CNBC that TikTok will “go dark” if China doesn’t approve a deal for the sale of the app that has become popular because of its addictive, short-form videos.
More than 170 million Americans and more than one billion people worldwide use the app..
“If that deal gets approved, by the Chinese, then that deal will happen,” he said, according to a Reuters report. “If they don't approve it, then TikTok is going to go dark, and those decisions are coming very soon.”
According to Reuters, a deal had been in the works this spring; however, that deal stalled following Trump’s announcements of tariffs on Chinese goods.
ByteDance, in April, said it has been “in discussion” with the U.S. government regarding a potential solution, but said an agreement “has not been executed.”
“There are key matters to be resolved,” a ByteDance spokesperson said in a statement.
The company thanked Trump following his most-recent reprieve last month.
“We are grateful for President Trump’s leadership and support in ensuring that TikTok continues to be available for more than 170 million American users and 7.5 million U.S. businesses that rely on the platform as we continue to work with Vice President Vance’s Office.”
