ByteDance Agrees to $92 Million Settlement in US TikTok Privacy Lawsuits

The settlement with US TikTok users still requires approval from a Chicago federal judge.
The settlement with US TikTok users still requires approval from a Chicago federal judge. (Source: SEJ)

ByteDance has agreed to pay US$92 million to settle a class-action lawsuit over data privacy claims from some US TikTok users, following a year of litigation.

The lawsuits allege that the TikTok app “infiltrates its users’ devices and extracts a broad array of private data” including facial-scan images of users, which is used to track and profile them. The data is then exploited for profit-driven targeted ad campaigns, among other uses, according to documents filed Thursday in a US District Court in Illinois and cited by Reuters.

The viral short video app owned by Beijing-based ByteDance boasts more than 100 million users in America.

“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,” a spokesperson for the app said in a statement on Thursday.

The settlement was reached after “an expert-led inside look at TikTok’s source code” and extensive mediation efforts. It still requires approval from a Chicago federal judge.

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Known as DouYin in its home market, the app was launched by Zhang Yiming in September 2016, expanding to the global market as TikTok the following year. Both apps employ the same software, but operate separate networks in order to comply with Chinese censorship restrictions.

Its short video and sharing format is widely popular among young people, allowing users to create, share, and view viral content including singing, pranks and skits. In order to facilitate the Chinese app’s entrance to the US market, TikTok merged with Musical.ly in August 2018.

In China, DouYin has more than 600 million daily active users as of August 2020.

Since last August, TikTok has faced a series of ban threats from the Trump administration, which contended that the app posed a serious national security concern, as the personal data of US users could be obtained by the Chinese government. The company has denied the allegations.

In June, TikTok was included in a list of banned apps in India, where it has 200 million users. At one point, downloads in India made up nearly 30% of the app’s overall downloads.

Reuters reported on Thursday that ByteDance plans to move the chief manager of its Chinese news aggregator Jinri Toutiao, Zhu Wenjia, to Singapore to head global research and development for TikTok, citing individuals familiar with the matter.

In the newly created role, Zhu will oversee the app’s overall product and digital technologies, including its recommendation algorithms, the report added.