Trade Law Daily is a Warren News publication.

DC Circuit Says US Security Concerns Justify TikTok Ban

The U.S. Court of Appeals for the D.C. Circuit on Dec. 6 upheld the Protecting Americans from Foreign Adversary Controlled Applications Act, which bans the social media application TikTok in the U.S. or forces its parent company, Chinese tech giant ByteDance, to divest its ownership share in the application in the U.S. Judges Douglas Ginsburg, Sri Srinivasan and Neomi Rao said the ban survived constitutional scrutiny (TikTok Inc. and ByteDance Ltd. v. Merrick Garland, D.D.C. # 24-1113).

Sign up for a free preview to unlock the rest of this article

Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.

The court was tasked with reviewing whether the law's restrictions on the app's and its users' First Amendment free speech protections were sufficiently justified.

Ginsburg wrote for the majority, weighing in on what level of review should apply to the restriction, given that free speech restrictions that discriminate based on their content are subject to the strictest level of scrutiny. The judge said that because the government "arguably based" one of the justifications for the ban -- the Chinese government's ability to manipulate the content on the app -- on the "content on the platform," the court applied the stricter standard of review without deciding affirmatively that it applies.

With this standard, Ginsburg turned to the government's two justifications for the law: China's efforts to collect data of and about U.S. individuals and the risk of China manipulating content on TikTok. The judge said each is an "independently compelling national security interest."

Regarding the collection of U.S. users' data, the court first noted the Chinese government's "extensive and years-long efforts to accumulate structured datasets" of U.S. individuals "to support its intelligence and counterintelligence operations," including through cyberattacks on the Office of Personnel Management, a U.S. credit-reporting agency and a health insurance provider. China "poses a particularly significant hybrid commercial threat because it has adopted laws that enable it to access and use data held by Chinese companies," the court said.

The court noted TikTok's automatic collection of user data as well as the reams of data voluntarily provided by users. Given the "magnitude" of this data, coupled with TikTok's ties to the Chinese government, "two consecutive presidents understandably identified TikTok as a significant vulnerability," the court said. Access to this information could let the Chinese government track federal employees' locations, build dossiers for blackmail and "conduct corporate espionage."

Ginsburg said TikTok's claims that the U.S. misunderstands the app's data collection practices "fall flat," adding that the government's data-related justification for the act doesn't turn on the "details of TikTok's mitigation measures." The court said it doesn't doubt the app could mitigate the government's concerns to some extent. However, the problem "is that the Government exercised its considered judgment and concluded that mitigation efforts short of divestiture were insufficient."

The court said the U.S. "has drawn reasonable inferences based upon the evidence it has." The evidence includes Chinese government attempts to collect data by leveraging investments and partnerships with U.S. firms and recent disclosures from former TikTok employees that the app shares user data on a China-based internal communications systems that ByteDance employees can access, the court said.

Regarding the content manipulation justification for the law, Ginsburg said this rationale was equally sufficient. While TikTok said the ban will stifle free expression, Ginsburg said the opposite is true, due to efforts to free the speech marketplace from foreign influence.

The judge noted that the Chinese government "has positioned itself to manipulate public discourse on TikTok in order to serve its own end." This posture "is at odds with free speech fundamentals," the court held.

Ginsburg rejected TikTok's claims that the act is truly meant to curb free expression and that the content-manipulation justification is "speculative." The judge said the inclusion of the divestiture provision is enough to show that "ending foreign adversary control, not content censorship, was the Government's objective."

TikTok never squarely denied that it ever manipulated content on TikTok at the direction of the Chinese government, the court said. Ginsburg called this silence "striking," noting that while the Chinese government may not have yet manipulated content on the app, this lack of evidence "may simply reflect limitations on its ability to monitor TikTok."

The court said the act is "narrowly tailored" to these interests -- the second element of strict scrutiny review -- because the law is "limited to foreign adversary control of a substantial medium of communication" and includes a divestiture exemption. Ginsburg also dismissed TikTok's claim that the law violates equal protection requirements given that it uniquely targets TikTok. The judge said the legislation appropriately singled out the platform due to its "known characteristics and history."

Srinivasan issued a concurring opinion, agreeing with all points except the one as to which standard to apply. He said an intermediate standard of review should be applied because the activity addressed by the act "is that of a foreign nation rather than a domestic speaker" and because the divestment mandate is for reasons "lying outside the First Amendment's heartland."