The Trump administration chose not to grant ByteDance, a Beijing-based Chinese Company owning Tik-Tok, another extension to divest their U.S. assets, but talks continue over the short video-sharing app’s fate. Judge Carl Nichols, the U.S. District Judge for the District of Columbia was uncertain about a legal basis to bar the U.S. Commerce Department from imposing restrictions on the popular video-sharing application TikTok after Pennsylvania judge Beetlestone blocked the government’s plan.
ByteDance Ltd. argues the previous ruling could be overturned on appeal. U.S. if TikTok can establish “irreparable harm” to bag a new injunction against the federal order that Alphabet Inc and Apple Inc’s Google app stores remove the TikTok app for download for new users. Judge Wendy Beetlestone of the U.S. District Court stopped the US Commerce Department from banning TikTok’s data hosting services within the US and other technical transactions that would effectively ban the app use in the country. The restrictions would take effect on Nov. 12. A lawyer from the Justice Department told Nichols that the government had yet to decide about appealing Beetlestone’s order in a new lawsuit filed by 3 TikTok users. On Sept. 27, Judge Nichols issued a prelim injunction against the federal order.
Is National Security Involved?
The Justice Department would not immediately comment, while the White House and TikTok did not comment at all. The POTUS Trump administration contends that TikTok poses credible national security concerns as the data of US citizens could be used by China’s government. TikTok, that has more than 100 million American users, denies these allegation.
Under considerable pressure from the government, ByteDance indulged in many talks for months now to bag a deal with Oracle Corp and Walmart Inc to shift TikTok’s US assets into a brand new entity to align the divestiture order. ByteDance proposes that it submitted four earlier proposals, to address US concerns by creating a new company, wholly owned by Walmart, Oracle and existing American investors in ByteDance to handle TikTok’s American users’ data and content moderation. ByteDance said the POTUS’s order seeks the divestment of TikTok, which is a billion dollar company built on tech developed by ByteDance, based on purported national security review of a three-year-old transaction involved in a different business.
CFIUS Concerns?
The petition carries the names of Donald Trump, William Barr – the Attorney General, Steven Mnuchin – the Treasury Secretary and the entire CFIUS or the Committee on Foreign Investment in the United States, which is the panel that ultimately reviews particular transactions involving foreign investments of national security concerns. A CFIUS representative is engaging with ByteDance to complete the divestment process to resolve national security risks. CFIUS granted ByteDance a week’s extension over the released order to rid of TikTok’s US assets. President Trump’s order from August gave the Department of Justice, power to enforce this divestiture order when the first deadline expired, but is unclear how the federal government may compel divestiture. Trump personally decided against approving additional extensions at a meeting of senior U.S. officials. The government had previously issued a fortnight and 7-day extension after the first 90-day deadline, that ended on Nov. 12, 2020, in Trump’s original order. A US appeals court heard arguments on the app store ban on Dec. 14. With President Trump losing in the elections on November 3, smart delaying tactics by ByteDance lawyers could now follow.
