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TikTok Download Ban Temporarily Blocked by Court

By Rich Duprey – Sep 28, 2020 at 10:26AM

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The video sharing app still faces a presidential executive order that imposes a ban in November.

After hearing the Trump administration's rationale for why it decided to ban downloads of TikTok on Friday, the U.S. District Court for the District of Columbia granted the video sharing app an injunction blocking the ban.

However, the ruling on Sunday, which came just hours before the ban was to go into effect, did not block a separate download ban that Trump imposed via executive order, which is scheduled to go into effect on Nov. 12.

Couple mugging in front of a smartphone

Image source: Getty Images.

Dancing around the issue

The Trump administration has expressed concern about TikTok's parent ByteDance collecting user data, given its relationship with the Chinese governmdnt. 

In response, the administration mandated TikTok be sold to a U.S. company or face being banned from app stores. 

While a deal between Oracle (ORCL 3.79%) and Walmart (WMT 1.42%) to acquire 20% of a new company to be spun off from ByteDance called TikTok Global has been given a cursory "blessing" by Trump, ByteDance will still own 80% of the new company, along with the algorithm that determines what videos will appear in a user's feed. Trump has said ByteDance "will have nothing to do with it. And if they do, we just won't make the deal." Such contradictions leave some worried that the deal could still unravel.

The deal might not pass muster with the Chinese government either. It enacted new rules affecting the transfer of technology to foreign countries. In addition, Chinese state media reports that Beijing won't approve the deal "because the agreement would endanger China's national security, interests and dignity."

Trump, though, signed an executive order on Aug. 14, giving TikTok 90 days to divest its U.S. operations. That order remains in effect.

 

Rich Duprey has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple. The Motley Fool has a disclosure policy.

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