TikTok Suffers New Blow as Lawsuit Reinstated

The Indiana Court of Appeals overturned a judge in Allen County’s ruling to dismiss the state’s lawsuit against TikTok on September 30.
Indiana’s lawsuit against the short-form video social media app, filed in late 2022, accused TikTok of deceiving app users regarding child safety, inappropriate content for children and the security of users’ personal information, according to the Associated Press.
The 3-0 ruling reversed the judge’s November 2023 dismissal of the lawsuit, alleging that TikTok violated Indiana’s Deceptive Consumer Sales Act (DCSA).
The lawsuit against TikTok alleges that the app contains “salacious and inappropriate content,” in contrast to the company’s assurance that the content is safe to view for those 13 and under.
It also alleges that user information is not secure within the app and that TikTok deceives users into believing so.
Indiana’s lawsuit was initially dismissed after TikTok argued that the state lacked jurisdiction over the video-sharing app and that “the State failed to make a claim of a ‘consumer transaction’ between the company and end-users under the DCSA.”
This is in reference to a previous ruling that under the Indiana Deceptive Consumer Sales Act, “downloading a free app does not count as a consumer transaction.”
The social media app also stated that another reason to reject the lawsuit was that a consumer transaction requires an exchange of funds.
The Indiana Court of Appeals found that the state of Indiana does have jurisdiction over the app due to the number of users in the state, and the company reported $46 million in Indiana-based income in the 2021 tax year.
Newsweek reached out to TikTok for comment via its website outside of business hours.
The appeals court’s ruling read, “We reject TikTok’s arguments accordingly, and we conclude that [Allen Superior Court] erred in both cause numbers when it dismissed the State’s amended complaints of the theory that the State had failed to identify a requisite consumer transaction under the DCSA,” as reported by WXIN in Indianapolis.
The judge also ruled that the app’s receipt of a user’s personal information in exchange for watching videos on the social media platform is a form of consumer transaction under the law, as he wrote, “The plain and ordinary definition of the word ‘sale,’ which is not otherwise defined in the DCSA, includes any consideration to effectuate the transfer of property, not only an exchange for money.”
A spokesperson for Indiana Attorney General Todd Rokita’s office told Newsweek, “The Indiana Court of Appeals took a common sense approach and agreed with our office’s argument that there’s simply no serious question that Indiana has established specific personal jurisdiction over TikTok.
“By earning more than $46 million dollars from Hoosier consumers in 2021, TikTok is doing business in the state and is therefore subject to this lawsuit. We were the first state in the nation to file suit against TikTok and look forward to continuing this fight.”
TikTok, founded in 2016, is owned by the Chinese internet company ByteDance.
The social media platform has previously been the subject of lawsuits and calls for removal by lawmakers and politicians in the United States. In August, the Department of Justice and the Federal Trade Commission sued TikTok and ByteDance for alleged violations of the Children’s Online Privacy Protection Act.
Former President Donald Trump also called for banning the app due to its links to China, which he considered a security risk. He tried to pass an executive order banning it in 2020, but U.S. courts blocked it.
Trump has since stopped supporting legislation to ban the app, as he believes its ban would increase Facebook’s owner Meta’s growth.
President Joe Biden approved a law in April that will block the app in the U.S. if ByteDance does not sell TikTok to a non-Chinese company. In May, TikTok and ByteDance filed a lawsuit against this new law, citing that it infringes upon Americans’ rights to free speech, as defined by the First Amendment.
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