Thu, 11/12/2020 – 16:29
Interestingly, the stay cited an injunction issued by a judge in Phialdelphia in a suit brought by three TikTok users who had become “stars” on the platform. In that case, Judge Wendy Beetlestone argued that the government action “presents a threat to the ‘robust exchange of informational materials’ and therefore likely exceeds the government’s authority under the International Emergency Economic Powers Act.
In a filing last week, TikTok said it still wants a final ruling on its request for an injunction from Washington DC judge Nichols, who blocked the initial TikTok ban just before that deadline back in September, since Nichols’ ruling was expressly temporary.
Though public attention has mostly drifted away from TikTok, it’s still reportedly in the process of divesting its popular US social media app.
Under a preliminary deal approved by President Trump back in September, Oracle Corp. and Walmart were supposed to take a combined 20% in a new TikTok Global, a US-based company, which would run the app’s global business (most of its business outside China, that is). However, the size of ByteDance’s stake in the new company has been a major point of conflict, as both Beijing and Washington are insisting on majority control for their side’s investors.
In a recent filing for the appeals court case, TikTok said ByteDance recently submitted a 4th version of its proposal for addressing US security concerns. The proposal called for creating “a new entity, wholly owned by Oracle, Walmart and existing US investors in ByteDance, that would be responsible for handling TikTok’s U.S. user data and content moderation.” The company said it had been in extensive discussions with CFIUS, the committee that does a national security review of deals involving foreign buyers, but that feedback from American officials had stopped in recent weeks, even as the Nov. 12 “deadline” approached.
In response to the action, TikTok told WSJ that it’s “focused on continuing to engage CFIUS and look forward to reaching a resolution that addresses their concerns, even as we disagree with them.”
Fox Business’ reporter Charlie Gasparino tweeted the other day that a Biden Administration might be planning another look at the TikTok deal. But with the stay in place, it’s also extremely possible that this whole issue could just blow over, especially since the deal no longer appears to be a priority for CFIUS.
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Author: Tyler Durden