TikTok and its parent company ByteDance agreed on August 21 to pay $400 million to settle a lawsuit brought by the US Department of Justice alleging violations of the Children’s Online Privacy Protection Act (COPPA) [1, 2, 3]. The lawsuit, filed in 2024, accused TikTok of collecting personal information from millions of children under age 13 without parental consent [1, 4, 2].
The settlement demands an immediate payment of $300 million, with an additional $100 million to be paid after a court vacates a prior 2019 consent decree involving TikTok’s predecessor company Musical.ly [1, 2, 3]. That FTC decree fined Musical.ly $5.7 million and required parental consent for users under 13 [1, 3].
At the time the lawsuit was filed, there were over 170 million teenage TikTok users in the US, with allegations that TikTok failed to adequately verify ages or obtain parental consent as mandated by COPPA [1]. Since then, TikTok has made significant changes, including restructuring its US operations into a majority U.S.-owned joint venture with ByteDance retaining 19.9% ownership and U.S. investors such as Oracle and Silver Lake holding substantial shares [5, 6].
TikTok has also enhanced its privacy practices, introduced more robust age verification controls, and improved parental oversight features [1, 3, 7]. The company employs hundreds of staff trained to identify and remove underage accounts, having deleted tens of thousands to date [3, 8].
Assistant Attorney General Brett Shumate said, "Children and parents are better protected today than they were when this case began" [1]. Associate Attorney General Stanley Woodward called the settlement "a major victory for American children and parents" and emphasized the Department’s priority to protect children's online privacy and hold companies accountable to their legal obligations [3, 7].
The Department of Justice described the $400 million payment as one of the largest recoveries ever obtained under COPPA [1, 2].
The settlement comes after TikTok's ownership restructuring earlier this year, when ByteDance agreed to establish a majority American-owned joint venture to manage TikTok's US operations amid security concerns [4, 5]. The $100 million portion of the settlement is contingent on the court vacating the 2019 FTC consent decree against Musical.ly.
The settlement resolves allegations brought in 2024 and marks a significant legal and financial step for TikTok amid continued scrutiny of its data practices related to minors in the US.
