$400 Million Settlement for TikTok’s Child Privacy Lawsuit

TikTok, along with its parent company ByteDance, has reached a settlement agreement with the Department of Justice (DoJ) to resolve allegations regarding violations of children’s privacy laws. This settlement marks one of the most substantial recoveries ever achieved in connection with the Children’s Online Privacy Protection Act (COPPA), according to a statement from the DoJ.

This legal action stems from a lawsuit initiated in 2024 by the Justice Department during the administration of President Joe Biden. The lawsuit accused TikTok of breaching the stipulations of a previous settlement with the Federal Trade Commission (FTC) linked to its acquisition of Musical.ly. The DoJ’s claims included allegations that TikTok permitted children under 13 to create accounts and improperly gathered data from users in “Kids Mode.” It was also noted that TikTok often did not honor parental requests to delete their children’s data, as highlighted by the DoJ at that time.

In its announcement regarding the settlement, the Justice Department emphasized that TikTok has made considerable improvements to its management, ownership structure, compliance protocols, and privacy policies. Earlier this year, TikTok established a new entity for its United States operations called TikTok USDS Joint Venture, which is now managed by a consortium of investors including Oracle, Silver Lake, and MGX, while ByteDance retains a 19.9 percent ownership stake.

The DoJ stated, “The company has enacted comprehensive measures aimed at bolstering protections for younger users, enhancing age verification processes, and increasing parental oversight.” These advancements are viewed as significant progress in serving the public interest and improving safeguards for millions of families across America.

As part of the terms of the settlement, TikTok will make an immediate payment of $300 million and an additional $100 million once its prior agreement with the FTC is annulled, as stated by the DoJ. TikTok and ByteDance have not yet provided comments in response to this announcement.

This settlement represents another milestone for TikTok after enduring extensive scrutiny regarding its privacy practices and connections to China. Earlier this month, the Office of Management and Budget (OMB) officially approved the use of the app by federal employees, reversing a 2022 law that prohibited it on most government-issued devices.