TikTok files for injunction to lift the potential ban

After weeks of going back and forth over the TikTok acquisition deal, President Donald Trump finally gave the approval early this week. However, there’s more and the social video app must act fast if it wants to continue operating in the United States.

On Wednesday, TikTok filed for a preliminary injunction against the Trump administration, as a legal way of protecting its services in the United States.

The request for a preliminary injunction was filed in the District Court for the District of Columbia, against the rules given by the U.S. Commerce Department instructing Apple and Google to remove the social video app from their app stores by Sunday, September 27.

TikTok’s parent company ByteDance has been working tirelessly to complete a deal that would favor its American partners and keep the service operating in the United States. Last month, President Trump issued executive orders to ByteDance, asking it to sell TikTok’s U.S. operations or risk the chance of staying operational in the United States. The Trump administration classified TikTok’s presence in the U.S. as a national security threat to both the citizens and the country.

Late last week, President Trump said he had “blessed” the proposed deal between TikTok, Oracle, and Walmart, in which Oracle and Walmart will get a 20 percent stake in the new entity, TikTok Global. The president later changed his mind on Monday to say that he would not approve the deal if ByteDance continues to own a stake in TikTok.

TikTok said ByteDance will continue to hold an 80 percent stake in the new TikTok Global until the company went public after a year. Oracle also insisted that ByteDance will not retain any part of TikTok outright, but that its investors would be the ones to receive shares in TikTok and hold direct stakes in the app.

On the other hand, there has been much anticipation from the Chinese government as to what decisions it would make regarding the deal and U.S. response. In August, Beijing announced new export restrictions which include the forbiddance of TikTok to sell its valuable algorithm without a license. This means that an outright acquisition by any American company may be quite difficult to secure if at all it happens.

The Chinese government said in the China Daily that the TikTok deal was “dirty and unfair and based on bullying and extortion.”

ByteDance said in a statement on its Toutiao news app, that it has applied for the Chinese license. Although the company previously said the proposed deal with Oracle and Walmart would not include the transfer of algorithms or technology.

In the Wednesday filing, TikTok requested for an expedited hearing for a preliminary injunction before the September 27 deadline as it had made “extraordinary efforts to satisfy the government’s ever-shifting demands and purported national security concerns.”

TikTok said in its filing that there was no justifiable reason for the government’s “precipitous actions” and there was no “plausible reason to insist the prohibitions be enforced immediately.”

A ban on TikTok in the United States would do a lot of “irreparable damage” to the company as it was adding more than 400,000 new users daily before July 1, according to TikTok. It also added that its growth will be greatly affected if the ban is effected.