Court upholds US federal TikTok ban

• A panel of judges has ruled a law forcing the sale or ban of TikTok in the US is constitutional.
• The panel heard arguments around national security and the First Amendment.
• The case is likely to be appealed to the Supreme Court, and once in office, President-elect Trump may also intervene.

TikTok's future in the US is looking dimmer.

A three-judge panel from the US Court of Appeals for the District of Columbia Circuit ruled on Friday that a law designed to force a TikTok sale or ban is constitutional.

The Protecting Americans from Foreign Adversary Controlled Applications Act passed through Congress in April. The bill made it illegal for companies like Apple and Google to host apps owned by a foreign adversary that permit users to "create an account or profile to generate, share, and view text, images, videos, real-time communications, or similar content."

It named TikTok and its owner ByteDance as covered companies. ByteDance operates in China, which the US has deemed a foreign adversary.

The law gave ByteDance until January 19 to either divest itself from TikTok's US assets or be booted from app stores.

TikTok challenged the law in May, arguing it violated the First Amendment rights of its users. It's argument failed.

"The First Amendment exists to protect free speech in the United States," the court ruling says. "Here the Government acted solely to protect that freedom from a foreign adversary nation and to limit that adversary's ability to gather data on people in the United States."

Why was TikTok targeted by the US government?

US officials in both parties have worried that the app poses a national security risk due to its Chinese owner. Some have raised concerns that ByteDance could be required to pass along US user data to the Chinese Communist Party, as mandated by a National Intelligence Law. Members of Congress have also feared that TikTok could be deployed as a propaganda tool to push narratives favorable to the CCP.

TikTok has previously said it does not share information with the Chinese government and emphasized that its content moderation is managed by a US-based team that "operates independently from China."

After today's ruling, TikTok is likely to appeal the decision, and it may end up in front of the Supreme Court. If the Supreme Court upholds its constitutionality, TikTok may have a final savior in President-elect Donald Trump.

Trump once tried to ban TikTok, but he's since flip-flopped and said he would try to rescue the app once in office.

Legal experts previously told BI that the incoming president could instruct his Justice Department to not enforce the divest-or-ban law, or make a claim that it simply does not apply to TikTok. Both strategies may be tough to defend against a legal challenge, particularly if the Supreme Court rules against TikTok.

Trump could also attempt to broker a sale of TikTok to a new owner that is not tied to a foreign adversary.

ByteDance has previously said it wouldn't sell TikTok's US assets, but it may be more open to the idea if all other options are off the table.

A TikTok sale seems to be the preferred path among some members of Congress. Rep. John Moolenaar, chairman of the House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party, told BI in November that the Trump administration "will have a unique opportunity to broker an American takeover of the platform, allowing TikTok users to continue to enjoy a safer, better version of the app free from foreign adversary control."