WASHINGTON, March 5 (Reuters) - President Donald Trump and Attorney General Pam Bondi were sued Thursday over the U.S. government's approval of a deal by TikTok's Chinese owner ByteDance to establish a majority American-owned joint venture, saying the approval was illegal and did not meet the requirements of a 2024 law.
The lawsuit was filed in the U.S. Court of Appeals for the District of Columbia by the Public Integrity Project on behalf of two retail U.S. investors in rival social media firms. It aims to require a renegotiation of the deal "that doesn't put administration allies in a position to censor political content on one of the world's most popular media platforms."
The lawsuit does not seek to force a ban on TikTok, which is used by 200 million Americans.
Congress passed legislation in April 2024 requiring ByteDance to sell its U.S. assets by January 2025 or face a ban or potentially hundreds of billions of dollars in fines -- but Trump opted not to enforce the law and Bondi told companies they would face no liability for continuing to allow TikTok use.
ByteDance said TikTok USDS Joint Venture LLC -- which was finalized in January and is 80% owned by non-Chinese investors -- would secure U.S. user data, apps and algorithms through data privacy and cybersecurity measures. It disclosed few details about the divestiture or the financial arrangements.
"Under the announced deal, ByteDance would still
control all the essential elements of TikTok. Such a deal would
subvert the very purpose of the TikTok Law, as ByteDance could
continue to push Chinese propaganda and censor the content it does not like," said the lawsuit.
The joint venture deal was a milestone for the social media firm after years of battles that began in August 2020, when President Donald Trump unsuccessfully tried to ban the app over national security concerns.
The suit is the first legal challenge to the deal and could shed light on the new joint venture that is key to TikTok's survival in the United States and that has faced criticism from some lawmakers.
The White House, Justice Department and TikTok did not immediately respond to requests for comment.
Trump declared the deal met the terms of the divestiture law.
(Reporting by David Shepardson; Editing by Chizu Nomiyama and Franklin Paul)
