TikTok to pay $400 million to settle child privacy lawsuit: Details of the agreement

The Department of Justice (DOJ) announced a $400 million settlement with TikTok to resolve a 2024 lawsuit. The social media company must pay that amount to settle a lawsuit that accused it of violating federal regulations designed to protect the privacy of children under 13.

The settlement, announced this Friday by the DOJ, ends the litigation initiated in 2024 over alleged violations of the Children's Online Privacy Protection Act (COPPA), the federal law that sets specific requirements for online platforms to collect personal information from children under 13.

A key point of the agreement is that no court has found TikTok liable for the allegations, nor has it admitted liability.

According to a statement released by the DOJ, TikTok will pay an initial $300 million and an additional $100 million once a court vacates a prior consent decree related to Musical.ly, the platform that preceded TikTok.

According to the DOJ, the agreement "represents one of the largest settlements ever obtained" in a COPPA-related case.

"This settlement is a major victory for American children and parents. The Department's priority is ensuring that children are protected online and that companies entrusted with their personal information meet their legal obligations," Deputy Attorney General Stanley Woodward Jr said. 

"This resolution secures a substantial recovery while reinforcing the protections that families expect and deserve," he added.

Brett Shumate of the DOJ's Civil Division stated that the settlement "secures a significant monetary recovery and reflects the Department's commitment to ensuring children receive the full protections that Congress mandated."

In January of this year, TikTok USDS Joint Venture LLC was established, a new company responsible for TikTok's operations in the United States and majority-owned by U.S. and global investors. ByteDance, the Chinese company that owns TikTok, retains a 19.9% stake.

Recently, following this decision, the White House lifted the ban on federal employees using TikTok on government devices.