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By Billboard

The video-sharing app and its associated companies were accused of violating child privacy laws by selling minors' personal data.

Just days after TikTok was hit with a class-action lawsuit over alleged child-privacy violations, the video-sharing service has reached an all-cash $1.1 million settlement in the case, according to a new motion filed in U.S. District Court.

The original suit, which was filed on Tuesday (Dec. 3), accused TikTok, its parent company ByteDance Technology and Musical.ly (which was purchased by ByteDance in December 2017 and absorbed into TikTok the following August) of tracking, collecting and disclosing the personal information of minor children without the consent of their parents or guardians and then selling it to third-party advertisers. It argued that by doing so, the company violated a number of state and federal laws including the Video Privacy Protection Act, the California Constitutional Right to Privacy and the Illinois Consumer Fraud and Deceptive Business Practices Act.

The suit also claimed that by failing to put in place appropriate safeguards, the company opened up children using the app to attacks by sexual predators.

According to the new court documents, attorneys for TikTok and the plaintiffs engaged in months-long discussions prior to the filing of the complaint, followed by an all-day mediation session that ultimately resulted in the settlement agreement.

In a statement sent to Billboard earlier today, a TikTok spokesperson said the following:

"TikTok is firmly committed to safeguarding the data of its users, especially our younger users. We were made aware of the allegations in the complaint some time ago and, although we disagree with much of what is alleged in the complaint, we have been working with the parties involved and are pleased to have come to a resolution of the issues.”

This week’s settlement follows one reached back in February with the Federal Trade Commission (FTC), which previously accused TikTok of violating the Children’s Online Privacy Protection Act (COPPA). That case resulted in a $5.7 million settlement, which marked the largest civil penalty ever collected by the FTC in a child privacy case.

“Plaintiffs believe that this settlement -- which partly arises out of COPPA violations and involves the unlawful collection of children’s personally identifiable information and/or viewing data without parental consent -- represents the first settlement of its kind,” the new motion reads. “Plaintiffs therefore believe it is a groundbreaking class action settlement in that respect. Accordingly, under the circumstances, the Parties believe the monetary terms of this proposed settlement fall favorably within the range of related privacy class action settlements.”

The settlement class is defined as all people living in the U.S. who registered for or used Musical.ly and/or TikTok while under the age of 13, along with their parents and/or legal guardians. The size of the class is estimated to be six million people.

The settlement will be paid out to class members on a pro-rata basis, after attorneys’ fees, incentive awards to plaintiffs representing the class and claims administration costs are deducted. Class members will be notified via a designated settlement website and social media advertising.


Billboard

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