TikTok, ByteDance Agree to $400M Settlement in U.S. Children’s Privacy Case

TikTok and its parent company, ByteDance, have agreed to pay up to $400 million to settle a U.S. government lawsuit alleging violations of federal protections for children’s online privacy.

Under the settlement announced by the Justice Department, TikTok will pay $300 million immediately. An additional $100 million will be due if a court vacates a previous consent decree involving Musical.ly, TikTok’s predecessor. The DOJ described the agreement as one of the largest recoveries obtained in a case involving the Children’s Online Privacy Protection Act, or COPPA.

Settlement resolves lawsuit filed in 2024

The Justice Department filed the case in 2024 following a referral from the Federal Trade Commission. The government alleged that TikTok knowingly allowed children under 13 to create standard accounts while collecting and retaining personal information without obtaining the parental consent required by COPPA.

The allegations included claims that children could create, view and share videos and messages with adults on TikTok’s regular platform. The government also accused the company of improperly retaining children’s email addresses and other personal information.

TikTok had previously faced federal action involving children’s privacy. In 2019, Musical.ly agreed to pay $5.7 million to resolve FTC allegations that it illegally collected personal information from children. The 2024 lawsuit alleged that TikTok later violated obligations arising from that earlier action.

TikTok has changed protections for younger users.

The DOJ said TikTok has made significant changes to its ownership, management, compliance operations and privacy practices since the 2024 lawsuit was filed. Those changes include stronger safeguards for younger users, improved age-related controls and additional tools intended to give parents greater oversight.

The settlement resolves the federalgovernment’ss claims without a finding that TikTok or ByteDance violated the law. The Justice Department said the allegations have not resulted in a determination of liability.

Axios first reported the settlement before the Justice Department’s public announcement.

TikTok faces separate scrutiny over safety experiment

The privacy settlement arrives as TikTok faces additional questions from lawmakers over the operation of its recommendation system. Bloomberg reported that TikTok intentionally withheld an algorithmic safety feature from about 10% of U.S. users as part of an experiment.

The safeguard was designed to reduce repetitive exposure to potentially harmful content. Republican Sen. Marsha Blackburn of Tennessee and Democratic Sen. Richard Blumenthal of Connecticut subsequently sent a letter to TikTok CEO Shou Chew and Adam Presser, who leads the company’s U.S. business, demanding information about the experiment and why users, including minors, were included in it.

The senators gave TikTok until Sept. 1 to respond to questions about the test, including which employees knew about it and whether other experiments had similarly withheld or reduced safety features.