TikTok and its parent company, ByteDance, have agreed to pay $400 million to resolve a federal lawsuit that accused the video app of breaking U.S. children’s privacy law, the Justice Department announced on Friday, August 21.
Under the terms of the deal, TikTok will pay $300 million right away. A further $100 million is due once an order is entered vacating an earlier consent decree against Musical.ly, the lip-sync video app that ByteDance acquired in 2017 and later folded into TikTok, according to The Associated Press and CNN.
The Justice Department described the agreement as “one of the largest recoveries ever obtained in a COPPA case,” referring to the Children’s Online Privacy Protection Act, CNN reported. CNN also noted that there has been no determination of liability on the government’s claims.
What the government alleged
The department sued TikTok in 2024. That lawsuit accused TikTok and ByteDance of violating the 1998 federal law, which requires apps and websites aimed at children to obtain a parent’s consent before collecting personal information from users younger than 13.
According to the AP, the complaint alleged that the companies let children open accounts without that consent, failed to act on requests from parents who wanted their children’s accounts deleted, and kept some accounts active even when they knew the users were under 13.
The 2024 case grew out of a 2019 Federal Trade Commission order involving Musical.ly. That order required the company to take specific steps to comply with COPPA. CNN reported that the government alleged TikTok kept gathering information from children, including email addresses, phone numbers and location data, and did not honor parents’ deletion requests, in violation of that agreement.
When the lawsuit was filed, TikTok said many of the allegations “relate to past events and practices that are factually inaccurate or have been addressed,” CNN reported.
Justice Department reaction
Associate Attorney General Stanley E. Woodward Jr. called the agreement a win for families. “This settlement is a major victory for American children and parents,” Woodward said in a statement quoted by the AP. “The Department’s priority is ensuring that children are protected online and that companies entrusted with their personal information meet their legal obligations. This resolution secures a substantial recovery while reinforcing the protections that families expect and deserve.”
The department said TikTok has adopted changes since the suit was filed, including “extensive measures designed to strengthen safeguards for younger users, improve age-related controls, and enhance parental oversight,” according to CNN.
TikTok did not immediately respond to requests for comment from the AP or CNN on Friday.
A changed company
The TikTok settlement comes after a major shift in TikTok’s corporate structure in the United States. In January, the company signed agreements with investors including Oracle, the private equity firm Silver Lake and the Emirati investment firm MGX to create a new TikTok U.S. joint venture, the AP reported. CNN noted that the spinoff of TikTok’s American assets to mostly American investors was a deal pushed by President Donald Trump.
Wider pressure on social media platforms
The TikTok agreement is the latest in a long run of legal actions targeting technology companies over the safety and privacy of young users. Platforms face a wave of lawsuits from governments and families, and a growing number of countries have moved to bar young children and teenagers from social media apps, the AP reported.
Meta Platforms, the parent company of Instagram, is currently on trial in federal court in Oakland, California, over allegations that it violated COPPA as well as several state laws, according to the AP.
COPPA has been in force for more than two decades. It generally applies to online services directed at children under 13 and to general-audience services that have actual knowledge they are collecting personal information from children in that age group. Enforcement is shared by the Federal Trade Commission and the Justice Department, which can bring civil penalty actions in federal court on the commission’s behalf.
The agreement ends the government’s 2024 lawsuit, according to the AP, with the second payment tied to a court order on the Musical.ly decree.
