Business News Digital Legal

TikTok tries to get Donald Trump’s second executive order paused while it still seeks approval for an Oracle/Walmart alliance

By | Published on Wednesday 11 November 2020


TikTok owner ByteDance has asked a court in Washington DC to pause the second of Donald Trump’s executive orders against the video-sharing app, which ordered China-based Bytedance to divest itself of any US-based assets.

Trump issued two orders targeting TikTok back in August, both based on concerns that – because the app is ultimately Chinese-owned – the Chinese government has access to its global userbase and user-data. The first order, originally due to come into effect in September, banned Americans from transacting with Bytedance. The second, due to come into effect this month, ordered the divestment of US assets.

Bytedance got the first executive order put on hold by the courts. That was based on the argument that, in the order, Trump was using powers granted to the US President by the country’s International Emergency Economic Powers Act. But that act includes limitations on stopping “personal communications” or the sharing of “informational materials”.

Concurrent to its legal efforts to stop Trump’s ban, Bytedance has also been busy trying to placate its critics in Washington via a deal with US firms Oracle and Walmart. That deal would see those two companies get a minority stake in the TikTok business outside of China, and take responsibility for ensuring user-data was held in a way that complies with American law.

The hope was that that deal would lead to Trump voluntarily calling off his two TikTok bans. The President initially did indicate his support for the Oracle and Walmart alliance, although also made some statements about that deal that weren’t correct.

Bytedance has been liaising with the US government ever since seeking confirmation that the Oracle/Walmart proposal addresses its concerns and will result in the executive orders being revoked. However, with the deadline for the second order looming, it seems the TikTok owner is yet to get clarity on the US government’s position. Needless to say, other events in Washington in the last week haven’t helped.

Which is why Bytedance wants the DC court to pause the second executive order while it continues to seek clarity and support from the outgoing (but in denial about that fact, of course) US government.

Having filed legal papers to that effect yesterday, TikTok said in a statement: “We remain committed to working with the administration – as we have all along – to resolve the issues it has raised, but our legal challenge today is a protection to ensure these discussions can take place”.

There are some extra complexities in all this, partly because there are two executive orders, but also because there are two legal challenges. In addition to Bytedance’s legal effort, three TikTok users also successfully sought a court order pausing any ban against the app in the US. That case was pursued through a federal court in Pennsylvania.

Elsewhere in sort of TikTok news, the former Disney exec who ran the global TikTok business for a few months earlier this year, Kevin Mayer, has just popped up as a senior advisor on media assets at Warner Music owner Access Industries.

Having only started his TikTok CEO role in May, Mayer quit in August as the company’s political woes mounted, and it increasingly looked like the TikTok company would be carved up around the world, meaning the US-based boss of TikTok Global might not control the app within the US. As it turns out, such a carve-up is not currently looking likely.