TikTok moves state's consumer suit to federal court

Attorneys for TikTok have struck back at California Attorney General Rob Bonta's lawsuit accusing its parent company of violating consumer protection laws by moving the state case to federal court.

An email from the state attorney general's media office said it would respond in court and did not say whether it would challenge the TikTok removal.

Daniel M. Petrocelli, a partner with O'Melveny & Myers LLP, argued in a motion Wednesday that California's lawsuit relied so heavily on alleged violation of a federal law, the Children's Online Privacy Protection Act, that it belongs in federal court.

"Because Plaintiff's Section 17200 claim is specifically predicated on alleged violations of COPPA and the COPPA Rule, Plaintiff pleads that alleged violations of federal law form the basis for its claims," he wrote. People of the State of California v. TikTok Inc. et al., 24-CV-07492 (N.D. Cal., filed Nov. 13, 2024).

The company's action tests Bonta's legal strategy, and possibly those of the other states, of filing claims against TikTok to try to take advantage of aggressive state laws instead of pursuing a complaint in federal court.

One question, if the state challenges TikTok on jurisdiction, is whether the references to federal law are enough to force the case to be decided in federal court even though the complaint only includes the two alleged violations of California law.

Twelve other states and the District of Columbia filed similar lawsuits in their own state courts against ByteDance Ltd., which runs TikTok, but there was no word Friday on any attempt to move those cases to federal court as well.

The political dynamics may have shifted as well. President Joe Biden signed a law in April that would ban the video streaming app controlled from the U.S. if ByteDance, its Chinese parent company, doesn't sell it within a year.

President-elect Donald Trump, who will take office in January, promised to oppose the ban during his campaign.

California's lawsuit, filed in Santa Clara County Superior Court on Oct. 8, claims that TikTok violated two state consumer protection statutes: Section 17500 for false and misleading statements, and Section 17200 for unlawful, unfair, and/or fraudulent business acts and practices.

"TikTok preys on young people's unique psychological vulnerabilities through an arsenal of harmful, addictive-by-design features that it targets to exploit and manipulate young users' developing brains," Deputy Attorney General Brendan P. Ruddy wrote.

The complaint only accuses TikTok of violating the two state laws. Petrocelli and the company could not be reached for comment Friday, but his argument relies on Ruddy's references to violations of COPPA, the federal law, by a TikTok acquisition, Music.ly.

ByteDance paid the FTC $5.7 million to settle allegations in the Music.ly case that the company violated COPPA by illegally collecting and using personal information from children without parental consent.

"Those COPPA violations fueled TikTok's growth and immense popularity because the lack of effective age verification made it easier for children under 13 to sign up and consume content," Ruddy wrote. "Additionally, those same users gave TikTok more posts to engage existing users and to attract new users to the platform."

Ruddy declined to allow the case to be heard by a magistrate judge, and it was assigned Thursday to U.S. District Judge Eumi K. Lee of San Jose, who was confirmed to the federal bench by the U.S. Senate in March.

TikTok and other social media companies face consumer lawsuits pending in the Northern District of California. TikTok also was sued by the Biden administration in the Central District of California in August in a lawsuit accusing the company of knowingly violating the COPPA law. U.S. v. ByteDance Ltd. et al., 24-CV-06535 (C.D. Cal., filed Aug. 2, 2024).