Franklin Graves

Senior Technology Counsel at HCA Healthcare

On December 6, the United States Court of Appeals for the District of Columbia Circuit upheld the constitutionality of the Protecting Americans from Foreign Adversary Controlled Applications Act, which requires ByteDance to divest its ownership of TikTok US. The court found that Congress acted reasonably in determining that ByteDance’s ownership of TikTok posed a national security risk because it could allow the Chinese government to collect intelligence on American users and manipulate the content they see.

The case was before Chief Judge Sri Srinivasan, Circuit Judge Neomi Rao, and Senior Circuit Judge Douglas Ginsburg (who filed the opinion). Judge Srinivasan agreed with the outcome, but wrote a concurrence where he disagreed with the level of scrutiny applied (see below).

As I previously reported in September following the oral arguments, the court considered and rejected several constitutional challenges brought by TikTok and creators. Today’s decision doesn’t come as much of a shock to those of us that watched the oral argument session!

Constitutionality of the Ban

The court determined that TikTok had standing to challenge the provisions of the Act that directly affect it and that the challenge was ripe for judicial review. The court then applied strict scrutiny to the Act (which TikTok argued was the appropriate standard), assuming without deciding that the Act’s restrictions trigger this level of scrutiny. The arguments that TikTok was being singled out and target (by legislators or the law itself) seems to have backfired.

The court ultimately held that the Act was narrowly tailored to serve the government’s compelling national security interests. The court writes that “the Act is the least restrictive means of advancing the Government’s compelling national security interests.”

“I agree with my colleagues that the Act does not violate the First Amendment. But I reach that conclusion via an alternate path.”

Chief Judge Srinivasan disagreed with the majority’s decision to assume that strict scrutiny applied. He believed that intermediate scrutiny was the appropriate level of review, which requires a less demanding inquiry into whether the Act was substantially broader than necessary to achieve its national security objectives.

He gives a detailed historical recap of regulating foreign control of communication while pointing to the Act’s central focus of a divestment mandate of a foreign national (who is also a foreign adversary) rather than a domestic speaker, and therefore, should be viewed as content neutral and subject to intermediate scrutiny.

Does the Equal Protection Clause protect TikTok?

Building upon the heightened scrutiny analysis, the court also rejected TikTok’s argument that the Act violates the Equal Protection Clause of the Fifth Amendment because it singles out TikTok for harsher treatment than other social media companies. The court writes, “Merely singling a company out, however, does not amount to an equal protection violation if doing so furthers an appropriate governmental interest.”

The court found that the Act’s generally applicable framework, which allows the President to designate additional apps after notice and a report to Congress, did not afford TikTok less process than other companies might receive. Additionally, the court found that the Act’s differential treatment was justified because of the known security risks associated with TikTok and its parent company’s ties to the PRC.

But what about Project Texas?

TikTok argued that its proposed National Security Agreement (“NSA”), which was also referred to as “Project Texas”, was a less restrictive alternative to divestment. The NSA included various measures, such as data anonymization and oversight by a U.S. security company. However, the court deferred to the government’s conclusion that the NSA was insufficient to address its national security concerns.

“The Executive [Branch] determined the proposed NSA was insufficient for several reasons. Most fundamentally, certain data of U.S. users would still flow to China and ByteDance would still be able to exert control over TikTok’s operations in the United States. The Executive [Branch] also did not trust that ByteDance and [TikTok’s U.S. data security subsidiary] would comply in good faith with the NSA. Nor did the Executive [Branch] have ‘sufficient visibility [into] and resources to monitor’ compliance. In the Executive [Branch]’s view, divestment was the only solution that would adequately address its national security concerns.”

Finally, the court found that the Act was not a bill of attainder, as it did not inflict punishment on TikTok or ByteDance without judicial process. The court also found that the Act does not effect a taking of private property without just compensation.

What’s Next?

TikTok can petition the U.S. Supreme Court to review the court’s decision. SCOTUS has discretion to decide whether or not they will hear the case, but this may provide an opportunity to distinguish its recent decision in NetChoice or let it stand on its own.

The elephant in the room is the upcoming administration change when President Trump takes office in January 2025. Historically, Trump’s actions align with a ban on TikTok (such as in 2020) under similar national security concerns. However, positions have likely changed and it remains to be seen if the Act will be enforced by a Trump 2.0 administration.

I honestly think the court explains the outcome fairly succinctly and in an understandable manner:

We recognize that this decision has significant implications for TikTok and its users. Unless TikTok executes a qualified divestiture by January 19, 2025 — or the President grants a 90-day extension based upon progress towards a qualified divestiture, § 2(a)(3) — its platform will effectively be unavailable in the United States, at least for a time. Consequently, TikTok’s millions of users will need to find alternative media of communication. That burden is attributable to the PRC’s hybrid commercial threat to U.S. national security, not to the U.S. Government, which engaged with TikTok through a multi-year process in an effort to find an alternative solution.

The First Amendment exists to protect free speech in the United States. 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.

Join me next Thursday, December 12th @ 1pm Eastern, for a webinar where we’ll be unpacking all things TikTok ban.

Register now!

This article was originally published on creatoreconomylaw.com. The case is TikTok Inc. v. Merrick Garland, 24-1113, (D.C. Cir.), filed on May 7, 2024. See also the full text of the Protecting Americans from Foreign Adversary Controlled Applications Act.

Full opinion can be downloaded here.