TikTok to pay $400m to US in one of largest child privacy settlements

TikTok has reached a massive $400 million settlement with the United States to resolve a lawsuit alleging the platform violated children's privacy. This settlement represents one of the largest of its kind. The case stemmed from a 2024 Department of Justice lawsuit under former President Joe Biden, claiming TikTok and its parent company ByteDance had collected vast amounts of data from millions of users under the age of 13, in violation of the Children's Online Privacy Protection Act (COPPA) enacted in 2000.

Assistant Attorney General Brett Shumate stated that children and parents are better protected today than when the case began. Other companies have also paid penalties to the US government for COPPA violations, such as Google's YouTube ($170 million in 2019) and Epic Games ($275 million in 2022). Meta, meanwhile, faces potentially hundreds of billions in penalties over alleged COPPA violations by 29 US states.

The TikTok lawsuit commenced before the platform's US business and operations were split from its Chinese base last year. However, the settlement only applies to TikTok's operations in China. ByteDance, valued at $550 billion, will pay $300 million immediately and another $100 million upon the government's vacating a 2019 consent decree with the Federal Trade Commission.

Under the agreement, ByteDance's predecessor, Musical.ly, already paid a $5.7 million fine for COPPA violations and ensured parental consent for users under 13. While the justice department did not specify any further action against TikTok, it noted significant changes, including ownership, privacy practices, and platform controls for young users, since the lawsuit was filed.