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TikTok and the Sell-or-Ban Law

Eric Fogle

  Anytime SCOTUS and popular culture meet, the public gets a look into the kaleidoscope of legal reasoning and analysis. Recently, SCOTUS has entered the public eye with its ruling on TikTok, upholding a controversial law requiring either TikTok’s sale or its ban. A court decision that could shut down an app used by roughly 170 million Americans is sure to stir some conversation.  

  Though conversations about TikTok and data privacy date back to at least 2020, the issue rapidly accelerated through the Supreme Court. SCOTUS granted certiorari on December 18th, and issued its opinion on January 17th. Needless to say, that sort of efficiency suggests that the issues of data privacy and national security presented in the opinion were of great interest and importance to the Court. 

  Using the January 17th per curiam opinion as a guide, this column gives a basic overview of the parties, the federal law at issue, and how SCOTUS applied that law to the facts at hand.  

 

The Parties

 

  Petitioner, TikTok Inc., is incorporated in California, and by reason of its incorporation in the U.S., it is subject to federal laws. TikTok argues that the law violated its First Amendment rights. The Attorney General represents the U.S. government, arguing for the constitutionality of the federal law at issue. 

  To clarify, TikTok is a subsidiary of a Chinese-owned technology company called ByteDance. ByteDance is bound by Chinese laws requiring assistance and cooperation with the Chinese government to ensure that the Chinese government can access and control the data ByteDance holds. This thread connecting TikTok to the Chinese government is the foundation of national security concerns upon which SCOTUS heavily relies.  

 

The Law at Issue

TikTok Logo
TikTok Logo

 

  The law at issue is The Protecting Americans from Foreign Adversary Controlled Applications Act ("the Act"), passed in 2024. In fewer syllables, consider it an “enemy app” ban. The Act prohibits American companies from distributing, maintaining, or updating apps controlled by foreign adversaries, naming TikTok directly in the black letter. It restricts American companies from providing TikTok, whose proprietary algorithm is developed and maintained by ByteDance. Known in shorthand as the Sell-or-Ban law, the Act requires ByteDance to be divested of TikTok (through a sale to Elon Musk or Mark Zuckerberg, for example) or face a ban in the United States.  

  TikTok Inc. argues that the Act’s prohibitions, the divestiture requirement, and TikTok’s explicit designation as a foreign adversary-controlled application are unconstitutional under the First Amendment. 

 

SCOTUS Weighs In

 

  As a threshold matter, the Court assumed without deciding that First Amendment scrutiny applied to the challenged provisions of the Act. This was a small victory for TikTok because it required SCOTUS to then determine the amount of scrutiny it would apply. The next question is whether the contested provisions of the Act are content-based or content-neutral.  

Content-based laws regulate substantive material. The No Protests About Wages Act (this is not real) would regulate based on the substance within (here, wages) and would face strict judicial scrutiny due to its suppression of specific viewpoints. Content-neutral laws, such as the No Protests At Night Act (also not real), do not target specific content, ideas, or viewpoints, and are subject to more forgiving intermediate scrutiny. 

  SCOTUS found the prohibitions to be content neutral. In its view, the Act’s prohibitions are based on a foreign adversary’s control over the platform, rather than the content itself. The Act (1) does not target particular speech based on its content; (2) does not regulate speech based on its function; and (3) does not impose a burden by reason of content on TikTok. In other words, TikTok cannot alter or avoid the effects of the Act by changing its speech. For each of these three examples, SCOTUS provides cases where content-based prohibitions were invalidated. 

  Because the prohibitions are facially content-neutral, they face intermediate judicial scrutiny. A law will survive this level of scrutiny if it advances a governmental interest and is not unnecessarily burdensome in its furtherance that interest.  

  Here, says SCOTUS, the compelling governmental interest is national security. Preventing China from collecting data from 170 million Americans is both compelling and content-neutral. Crucial to the Court’s decision were the sheer magnitude of TikTok users (and their sensitive data) and, more importantly, China’s collection of that data.  

  Moreover, SCOTUS defends the divestiture requirement, arguing that the law is not an outright ban, which may have required strict scrutiny, but is instead conditional upon the severance of TikTok from its Chinese-controlled parent company.  

  To SCOTUS, national security is compelling enough to justify the prohibitions of the law, including the divestiture requirement. For these reasons, the Court concluded that the contested provisions of the Act did not violate TikTok Inc.'s First Amendment rights. In the name of data integrity and national security, the law survived intermediate scrutiny and was accordingly upheld. 

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