ByteDance confirmed that it will sue the Trump administration next Monday and is actively preparing for the shutdown plan
ByteDance will formally sue the Trump administration of the United States, and at the same time begin preparations for the "shutdown plan" for US operations.
On August 23, Bytedance officially announced that the first executive order issued by US President Trump on August 6 will formally sue Trump on August 24, US time (August 25, Beijing time). government.
According to CNBC reports, at the same time, TikTok is preparing for the worst to ensure that even if the app is shut down in the United States, its employees can continue to get paid. This shows that while ByteDance is suing the US government, it is also actively preparing for the "shutdown plan."
TikTok has more than 100 million users, more than 1,500 employees, and thousands of partners in the United States. TikTok's US business was previously rumored to sell for between US$20 billion and US$50 billion.
ByteDance confirmed the prosecution to reporters. Bytedance said: "In the past year, we have sought to communicate with the U.S. government with a sincere attitude and provide solutions to their concerns. However, the U.S. government ignored the facts and did not follow due process, and even tried to intervene forcibly. Commercial companies negotiate. To ensure that the rule of law is not abandoned and to ensure that companies and users are treated fairly, we will defend our rights and interests through litigation."
According to the Presidential Executive Order issued by Trump on August 6, any transaction between any person or company under the jurisdiction of the United States and TikTok's parent company will be banned after 45 days. The full scope of the ban is not yet clear, and the Secretary of Commerce will have the authority to determine the scope of the transaction.
The transaction ban may cause Bytedance to be unable to pay wages to American employees after September 15. It is understood that as part of the shutdown plan, ByteDance is actively contacting overseas banks and credit investment institutions to seek the possibility of paying wages for American employees and safeguarding other legitimate rights and interests of employees when the presidential decree takes effect.
TikTok has achieved great success globally in the past year, with more than 2 billion downloads. Data from Sensor Tower shows that in June 2020, TikTok is the most downloaded non-game app in the world. In the first and second quarters of 2020, TikTok's downloads in the United States far exceeded Facebook, Instagram, and YouTube.
Due to Bytedance's Chinese ancestry, TikTok has been continuously investigated and questioned in the United States for "impacting national security". In August of this year, US President Trump issued two consecutive executive orders to block Bytedance on the grounds of "national security".
In addition to the trading ban on August 6, Trump also issued an executive order on August 14, requiring ByteDance to sell or divest the company’s TikTok business in the United States within 90 days. Trump also authorized the attorney general to take any necessary measures to implement this order. The executive order is based on an investigation by the Committee on Foreign Investment in the United States (CFIUS).
Vanessa Pappas, the general manager of TikTok USA, strongly opposed CFIUS's conclusion in an interview on August 20. She said that she has not seen any evidence that supports TikTok's threat to US national security, and she is disappointed with CFIUS's ruling.
After the United States issued a ban on Bytedance, it has been reported that companies such as Microsoft, Twitter, Oracle, and Google are interested in bidding for TikTok's US business. However, due to the wide scope of the US presidential decree against Bytedance and the highly uncertain content, Bytedance cannot guarantee that within the time limit of the US government, a solution acceptable to all parties will be reached.
Once the deadline for the ban is reached, the US government will be able to forcibly shut down or divest TikTok's US business. This may be the reason why Bytedance began to prepare the "shutdown plan".
In addition to official lawsuits, ByteDance's American employees are also launching their own lawsuits against Trump. Mike Godwin, an Internet policy lawyer who filed a lawsuit on behalf of employees, said Trump’s ban was an administrative ultra vires and would damage the constitutional rights of TikTok US employees.
Reporter Chen Yuxi comprehensive report