In what could be a turnaround move for TikTok owner ByteDance, the Chinese company agreed to pay $92 million to settle with American users who filed a lawsuit related to data privacy, but a potential stumbling block is on the way.
ByteDance Settles, But What's Next?
In an emailed statement regarding the million-dollars settlement, TikTok said that it still disagrees "with the assertions" but would rather "focus on building a safe and joyful experience" for its users.
While ByteDance has agreed to settle with the U.S. TikTok users who alleged that the app did not get their consent in collecting their data, a federal judge has yet to approve the settlement.
Law experts said settlement approval processes could take months. TikTok has already been dealing with the suit for over a year.
A strict Illinois biometric privacy law- the only state in the U.S. that has such law, allows complainants to file lawsuits with monetary consequences against companies or apps that collect user information without consent.
In the case of TikTok, a federal judge will review the settlement and determine whether the proposed settlement is reasonable and fair for the parties involved. If an objection from the complainants arise, the judge will mediate. Objections could cause delays in the settlement's approval.
Another potential obstacle in ByteDance's path is that a federal judge has the power to change the proposed settlement amount before the final approval is announced.
Where Everything Started
The class-action lawsuit is the product of 21 separate complaints filed last year in Illinois and California. The complaints were on behalf of young TikTok users, some as young as 8 years old.
The plaintiffs' attorneys alleged that TikTok harvested the young users' biometric data to further improve its targeted advertising systems and recommendations. The lawsuit also alleged that the app transmitted the plaintiffs' private viewing histories to third-party apps.
TikTok has previously denied that the app has data-collection features such as face scans.
TikTok's Recent Troubles
Aside from the lawsuit that it has been trying to get done with, the popular video-sharing app has also been questioned regarding misleading topics from some users, with the latest being personal finance.
In a study of 1,212 posts from TikTok personal finance influencers by cryptocurrency company Paxful earlier this month, it was revealed that one in seven of the posts contained advice that could mislead viewers.
The British Financial Conduct Authority has already warned citizens about misleading advice among TikTok finance influencers.
The app has since said that it removed content that give off signs of deception and those that are likely to "gain an unlawful financial advantage" over other users.