TIKTOK INC. et al v. TRUMP et al

Filing 15

MOTION for Preliminary Injunction MOTION to Expedite by BYTEDANCE LTD., TIKTOK INC. (Attachments: #1 Memorandum in Support, #2 Declaration, #3 Declaration, #4 Declaration, #5 Declaration, #6 Exhibit, #7 Exhibit, #8 Exhibit, #9 Exhibit, #10 Exhibit, #11 Exhibit, #12 Exhibit, #13 Exhibit, #14 Exhibit, #15 Exhibit, #16 Exhibit, #17 Exhibit, #18 Exhibit, #19 Exhibit, #20 Exhibit, #21 Exhibit, #22 Exhibit, #23 Exhibit, #24 Exhibit, #25 Exhibit, #26 Exhibit, #27 Exhibit, #28 Exhibit, #29 Exhibit, #30 Exhibit, #31 Exhibit, #32 Exhibit, #33 Exhibit, #34 Exhibit, #35 Exhibit, #36 Exhibit, #37 Exhibit, #38 Exhibit, #39 Exhibit, #40 Exhibit, #41 Exhibit, #42 Exhibit, #43 Text of Proposed Order)(Hall, John). Added MOTION to Expedite on 9/24/2020 (zeg).

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 1 of 50

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

TIKTOK INC., et al.,
Plaintiffs,
v.

Case No. 20-cv-02658 (CJN)

DONALD J. TRUMP, in his official capacity
as President of the United States, et al.,
Defendants.

MEMORANDUM IN SUPPORT OF PLAINTIFFS’
MOTION FOR PRELIMINARY INJUNCTION

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 2 of 50

TABLE OF CONTENTS
INTRODUCTION .......................................................................................................................... 1
STATEMENT OF FACTS ............................................................................................................. 4
A.

TikTok Is a Massively Popular Forum for Creative Expression and
Political Speech, Akin to a Virtual “Town Square” for Over
100 Million Americans. .......................................................................................... 4

B.

TikTok Has Implemented Safeguards to Protect the Security of U.S. User
Data. ........................................................................................................................ 4

C.

For Almost a Year Before the Ban, TikTok Participated Transparently in a
National Security Review and Made Extensive Efforts to Fully Address
All Purported Concerns........................................................................................... 6

D.

The Administration’s Political Focus on China and on TikTok. ............................ 7

E.

President Trump Issues His August 6 Order Premised on a Purported Need
to Ban TikTok, but Subsequent Administration Actions Immediately
Undercut That Justification. .................................................................................... 8

F.

The Commerce Department Issues Prohibitions That Will Ban TikTok in
the United States. .................................................................................................. 11

G.

The Prohibitions Are Causing Plaintiffs Irreparable Harm. ................................. 13

ARGUMENT ................................................................................................................................ 15
I.

Plaintiffs Are Likely to Succeed on the Merits of Their Claims. ..................................... 15
A.

The Prohibitions Violate IEEPA Because They Regulate and Prohibit
“Personal Communication” and “Informational Materials.” ................................ 15
1.
2.

B.

IEEPA Prohibits the Commerce Department from Regulating
“Personal Communication” and “Informational Materials.” .................... 15
The Prohibitions Unlawfully Regulate “Personal Communications”
and “Informational Materials.” ................................................................. 18

The Prohibitions Are Arbitrary and Capricious Because the Agency Failed
to Consider Reasonable Alternatives and Offered a Pretextual Justification
for Its Action. ........................................................................................................ 20
1.
2.

C.

The Agency Ignored the Evidence Before It and Failed to Consider
Reasonable Alternatives to the Ban on TikTok. ....................................... 20
The Stated Justification for the Prohibitions Is Pretextual........................ 23

The Prohibitions Violate Plaintiffs’ Constitutional Rights. .................................. 27
1.

The Prohibitions Infringe on Core Protected Speech in Violation of
the First Amendment................................................................................. 27
i

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 3 of 50

2.
D.
II.

The Prohibitions Deprive Plaintiffs of Their Constitutional Right to
Due Process. .............................................................................................. 30

The Prohibitions and August 6 Order Violate IEEPA in Other Respects............. 31

The Remaining Factors Require Injunctive Relief. .......................................................... 33
A.

The Prohibitions and August 6 Order Are Inflicting, and Will Continue to
Inflict, Irreparable Harm. ...................................................................................... 33

B.

The Balance of Equities and Public Interest Require Injunctive Relief. .............. 36

CONCLUSION ............................................................................................................................. 38

ii

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 4 of 50

TABLE OF AUTHORITIES
Page(s)
Cases
Al Haramain Islamic Found., Inc. v. U.S. Dep’t of Treasury,
686 F.3d 965 (9th Cir. 2012) ...................................................................................................31
Ala. Power Co. v. EPA,
40 F.3d 450 (D.C. Cir. 1994) ...................................................................................................31
Alexander v. United States,
509 U.S. 544 (1993) .................................................................................................................28
Allied Local & Reg’l Mfrs. Caucus v. EPA,
215 F.3d 61 (D.C. Cir. 2000) ...................................................................................................20
Bantam Books, Inc. v. Sullivan,
372 U.S. 58 (1963) ...................................................................................................................28
Bayer HealthCare, LLC v. FDA,
942 F. Supp. 2d 17 (D.D.C. 2013) ...........................................................................................34
Beacon Theatres v. Westover,
359 U.S. 500 (1959) .................................................................................................................36
Bernstein v. Dep’t of State,
974 F. Supp. 1288 (N.D. Cal. 1997) ........................................................................................16
Bernstein v. U.S. Dep’t of State,
922 F. Supp. 1426 (N.D. Cal. 1996) ........................................................................................28
Bracco Diagnostics, Inc. v. Shalala,
963 F. Supp. 20 (D.D.C. 1997) ................................................................................................36
Brodie v. Dep’t of Health and Human Servs.,
715 F. Supp. 2d 74 (D.D.C. 2010) ...........................................................................................35
Cernuda v. Heavey,
720 F. Supp. 1544 (S.D. Fla. 1989) .........................................................................................16
Corp. of Presiding Bishop of Church of Jesus Christ
of Latter-Day Saints v. Hodel, 637 F. Supp. 1398 (D.D.C. 1986) ...........................................25
*Dep’t of Commerce v. New York,
139 S. Ct. 2551 (2019) .................................................................................................23, 24, 26

iii

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 5 of 50

Edwards v. District of Columbia,
755 F.3d 996 (D.C. Cir. 2014) .................................................................................................29
Elrod v. Burns,
427 U.S. 347 (1976) .................................................................................................................33
Feinerman v. Bernardi,
558 F. Supp. 2d 36 (D.D.C. 2008) ...........................................................................................36
Gordon v. Holder,
721 F.3d 638 (D.C. Cir. 2013) .................................................................................................36
Grace v. District of Columbia,
187 F. Supp. 3d 124, 149 (D.D.C. 2016) .................................................................................33
Greatness v. Fed. Election Comm.,
831 F.3d 500 (D.C. Cir. 2016) .................................................................................................36
*Holy Land Found. for Relief and Dev. v. Ashcroft,
333 F.3d 156 (D.C. Cir. 2003) .................................................................................................30
Home Box Office, Inc. v. FCC,
567 F.2d 9 (D.C. Cir. 1977) .....................................................................................................24
Junger v. Daley,
209 F.3d 481 (6th Cir. 2000) ...................................................................................................28
*Kalantari v. NITV, Inc.,
352 F.3d 1202 (9th Cir. 2003) .....................................................................................16, 17, 19
KindHearts v. Geithner,
647 F. Supp. 2d 857 (N.D. Ohio 2009) ....................................................................................31
League of Women Voters of U.S. v. Newby,
838 F.3d 1 (D.C. Cir. 2016) ...............................................................................................36, 37
Mathews v. Eldridge,
424 U.S. 319 (1976) .................................................................................................................30
Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co.,
463 U.S. 29 (1983) .............................................................................................................21, 22
N.E. Coal. v. NRC,
727 F.2d 1127 (D.C. Cir. 1984) ...............................................................................................27
Nalco Co. v. EPA,
786 F. Supp. 2d 177 (D.D.C. 2011) ...................................................................................31, 34

iv

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 6 of 50

New York Times Co. v. United States,
403 U.S. 713 (1971) .................................................................................................................29
Packingham v. North Carolina,
137 S. Ct. 1730 (2017) .......................................................................................................27, 29
Planned Parenthood v. Heckler,
712 F.2d 650 (D.C. Cir. 1983) .................................................................................................15
R.I.L-R v. Johnson,
80 F. Supp. 3d 164 (D.D.C. 2015) ...........................................................................................37
Ralls Corp. v. CFIUS,
758 F.3d 296 (D.C. Cir. 2014) .................................................................................................30
Se. Promotions, Ltd. v. Conrad,
420 U.S. 546 (1975) .................................................................................................................28
Smoking Everywhere, Inc. v. FDA,
680 F. Supp. 2d 62 (D.D.C. 2010) .....................................................................................35, 36
Sterling Com. Credit-Michigan, LLC v. Phoenix Industries I, LLC,
762 F. Supp. 2d 8 (D.D.C. 2011) .............................................................................................35
Tummino v. Torti,
603 F. Supp. 2d 519 (E.D.N.Y. 2009) .....................................................................................24
Turner Broad. Sys., Inc. v. FCC,
512 U.S. 622 (1994) .................................................................................................................29
U.S. WeChat Users Alliance v. Trump,
No. 3:20-cv-05910-LB (N.D. Cal. Nov. 19, 2020) ..................................................................27
*United States v. Amirnazmi,
645 F.3d 564 (3d Cir. 2011).....................................................................................................17
United States v. Playboy Entm’t Grp.,
529 U.S. 803 (2000) .................................................................................................................28
United States v. Robel,
389 U.S. 258 (1967) .................................................................................................................30
Walter O. Boswell Mem’l Hosp. v. Heckler,
749 F.2d 788 (D.C. Cir. 1984) ...........................................................................................21, 22
Winter v. NRDC,
555 U.S. 7 (2008) .....................................................................................................................15

v

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 7 of 50

Woods Petroleum Corp. v. U.S. Dep’t of Interior,
18 F.3d 854 (10th Cir. 1994) ...................................................................................................23
Yakima Valley Cablevision, Inc. v. FCC,
794 F.2d 737 (D.C. Cir. 1986) .................................................................................................20
Statutes
5 U.S.C. § 706(2) ................................................................................................................... passim
50 U.S.C. § 1701(a) .................................................................................................................31, 32
50 U.S.C. § 1702(b) ............................................................................................................... passim
50 U.S.C. § 4305 ............................................................................................................................17
50 U.S.C. § 4565 ..............................................................................................................................7
5 U.S.C. § 702 ........................................................................................................................ passim
50 U.S.C. § 1601 ............................................................................................................................31
Other Authorities
31 C.F.R. § 560.210 .......................................................................................................................19
31 C.F.R. § 560.315 .......................................................................................................................19
31 CFR § 560.540(a)(1) .................................................................................................................19
Dep’t of Justice Press Release (June 7, 2017), available at
https://www.justice.gov/opa/pr/attorney-general-jeff-sessions-ends-thirdparty-settlement-practice..........................................................................................................26
Office of the Attorney General, Prohibition on Settlement Payments to Third
Parties (June 5, 2017), available at https://www.justice.gov/opa/pressrelease/file/971826/download ..................................................................................................25

vi

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 8 of 50

INTRODUCTION
This motion seeks to enjoin the government from unlawfully banning TikTok—a mobile
software application and online communication forum used by over 100 million Americans—from
the United States. On August 6, 2020, President Trump issued an executive order that invoked the
International Emergency Economic Powers Act (“IEEPA”) and purported to ban “any
transactions” with TikTok in 45 days (“August 6 order”). The order directed the Department of
Commerce to identify the specific transactions prohibited by the order. On September 18, the
Department of Commerce issued a list of the prohibited transactions (“the Prohibitions”), which it
ordered to be implemented in two phases: (i) an initial prohibition that prevents TikTok from
being available for download or update in the United States on mobile application stores as of
September 20, 2020; and (ii) a subsequent set of prohibited transactions necessary to maintain and
support TikTok’s core functionality that will force the complete shut-down of the application in
the United States on November 12, 2020. Thereafter, on September 21, 2020, the Commerce
Department withdrew the above notice. Then, on September 22, 2020, the Commerce Department
issued a new notice, which will be published in the Federal Register on September 24, 2020, that
extends the effective date of the initial Prohibition by one week, from September 20 to September
27, 2020. As explained herein, Plaintiffs have made extraordinary efforts to try to satisfy the
government’s ever-shifting demands and purported national security concerns, including through
changes in the ownership and structure of their business, and they are continuing to do so.
However, because the Prohibitions and the August 6 order dramatically exceed the agency’s and
the President’s lawful power as authorized by Congress and permitted by the U.S. Constitution,
they should be enjoined.

1

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 9 of 50

First, IEEPA specifically states that the President’s authority does not extend to the direct
or indirect regulation or prohibition of “personal communication” and the international flow of
“information or informational materials” such as film, photographs, and artwork, regardless of the
“format or medium of transmission.” 50 U.S.C. § 1702(b)(1), (3). Here, the Prohibitions expressly
violate this statutory command by prohibiting TikTok’s users—including Plaintiffs—from (1)
sending personal communications to one another over the platform, and (2) sharing with other
users, including users in other countries, the very content (videos and artwork) that the statute
identifies as beyond the President’s authority.
Second, the Prohibitions are unlawful under the Administrative Procedure Act (“APA”),
5 U.S.C. § 702(2)(A), which prohibits agency action that is “arbitrary, capricious, or otherwise not
in accordance with law.” 5 U.S.C. § 706(2)(A). The government’s conduct is neither reasonable
nor reasonably explained, and so is arbitrary and capricious in multiple respects. The Commerce
Department ignored the evidence before it and failed to consider reasonable alternatives to the
Prohibitions that would have addressed its purported national security concerns. Moreover, as the
President’s and other agency officials’ confusing and contradictory statements about TikTok over
many months demonstrate, the Prohibitions were not motivated by a genuine national security
concern, but rather by political considerations relating to the upcoming general election.
Third, the Prohibitions violate the First and Fifth Amendments. Plaintiffs—as well as
millions of Americans every day—engage in core protected speech on TikTok in pursuit of a wide
variety of political, social, and cultural ends. The Prohibitions unlawfully restrict this speech in
violation of the First Amendment. Furthermore, by prohibiting TikTok from operating in the
United States without providing Plaintiffs notice or opportunity to be heard, the Commerce
Department violated the due process protections of the Fifth Amendment.

2

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 10 of 50

Fourth, the Prohibitions and August 6 order exceed the Commerce Department’s lawful
authority because they are not based on a bona fide national emergency and prohibit activities that
have not been found to pose “an unusual and extraordinary threat,” as IEEPA requires.
Plaintiffs are likely to succeed on the merits of each of these claims, any of which would
support a preliminary injunction enjoining the Prohibitions and August 6 order pending the
resolution of this action. There is simply no genuine emergency here that would justify the
government’s precipitous actions, as evidenced by the Commerce Department’s 45-day delay in
issuing the Prohibitions after the President identified the purported national security threat, as well
as the additional one-week delay in implementing the first Prohibition, and the further seven-week
delay in fully implementing the Prohibitions’ restrictions. And there is no plausible reason to insist
the Prohibitions be enforced immediately. This is particularly true for the first Prohibition, which
eliminates only new TikTok users and allows continued use of the application in the United States
for existing users, but does not allow updates (including security updates) to maintain that
service—an action that will contribute to a data privacy risk instead of ameliorating it,
undermining the very reason the Prohibitions were purportedly issued.
Meanwhile, if the Prohibitions are not enjoined, the harm to Plaintiffs will be irreparable.
When the Prohibitions first take effect on September 27, 2020, hundreds of millions of Americans
who have not yet downloaded TikTok will be shut out of this large and diverse online
community—six weeks before a national election. And an American company that employs
thousands of individuals will suffer devastating harm to its business, from which it cannot recover
even if this Court concludes the government’s conduct was unlawful.
The Prohibitions and August 6 order should accordingly be preliminarily enjoined pending
the resolution of this action.

3

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 11 of 50

STATEMENT OF FACTS
A.

TikTok Is a Massively Popular Forum for Creative Expression and Political
Speech, Akin to a Virtual “Town Square” for Over 100 Million Americans.

TikTok is a social media application (or “app”) that provides an online communication
platform for users to create and share short-form videos. See Decl. of Vanessa Pappas (“Pappas
Decl.”) ¶¶ 4, 17. In this respect, TikTok operates much like other apps such as Snapchat, YouTube,
and Instagram, in that users create and post content on the platform. Id. ¶ 19. Since its global
launch in September 2017, TikTok’s popularity has exploded, both in the United States and around
the world. Today, based on quarterly usage, over 100 million Americans use TikTok, and until
recently, TikTok was adding 424,000 new daily U.S. users each day. Id. ¶¶ 9, 18. While many
users are attracted to TikTok because of the blend of entertainment, creativity, and humor that the
application provides, TikTok also is used to discuss more serious subjects, including political and
social issues of all types and from all perspectives. Ex. 1.
TikTok is operated by Plaintiff TikTok Inc., a California corporation headquartered in Los
Angeles with a U.S.-based management team, and its parent company, Plaintiff ByteDance Ltd.,
is incorporated in the Cayman Islands, with offices in the United States, China, and elsewhere.
TikTok was designed from the ground up to serve a user base outside of China and to be completely
separate from ByteDance’s China-facing applications. Declaration of Roland Cloutier (“Cloutier
Decl.”) ¶ 8. TikTok is not and never has been offered in China. Id. ¶ 4.
B.

TikTok Has Implemented Safeguards to Protect the Security of U.S. User
Data.

An important public policy issue affecting all social media companies is the security of
user data. Declaration of Steven Weber (“Weber Decl.”) ¶ 4. Security risks are indisputably an
industry-wide issue. Id. Sophisticated organizations and information security professionals
understand that malicious actors are constantly evolving, which means the data security threat

4

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 12 of 50

landscape is always changing. Id. ¶ 5. Even an organization that maintains best-in-class security
practices across the board can never eliminate the risk that its data may be inadvertently accessed
or disclosed. Id.
The industry has developed a range of safeguards and best practices that can effectively
counter these risks. Id. ¶¶ 4, 9. For example, it is preferable from a data security perspective to
segment and tightly control access to sensitive data in order to minimize unauthorized access or
other deviations from expected behaviors. Id. Sensitive user data should also be stored in
encrypted form using industry-standard methods, so that even if the data is subject to unauthorized
access, it will be indecipherable to the person or organization who lacks the encryption key. Id.
TikTok’s approach for dealing with data security risks is consistent with these industry best
practices. Weber Decl. ¶ 10. For example, TikTok segments U.S. user data and imposes access
control and auditing policies that limit and track access to customer data. Id. TikTok also encrypts
user data in storage and during transmission using the same industry-standard protocols as major
banks and e-commerce platforms, and limits management of encryption keys to TikTok’s U.S.based security team. Cloutier Decl. ¶¶ 8-9; see Weber Decl. ¶ 10.
The corporate officer entrusted with protecting TikTok user data, Chief Security Officer
Roland Cloutier, is an American citizen based in Florida. Cloutier Decl. ¶¶ 1-2. Vanessa Pappas,
ByteDance’s interim head of the global TikTok business, also is based in the United States. Pappas
Decl. ¶ 6. As Mr. Cloutier and Ms. Pappas explain in their declarations, neither TikTok Inc. nor
ByteDance provides TikTok user data to the Chinese government, and the Chinese government
has never asked for data on TikTok users or to moderate TikTok content. Cloutier Decl. ¶¶ 1-2;
Pappas Decl. ¶ 15. If they were to do so, Plaintiffs would reject such a request. Cloutier Decl.
¶ 12; Pappas Decl. ¶ 15. Moreover, before any ByteDance China-based engineering personnel

5

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 13 of 50

may access encrypted TikTok user data, they must receive express permission through a process
overseen by TikTok’s U.S.-based team. Cloutier Decl. ¶ 12; Weber Decl. ¶ 10.
Another industry-wide policy issue raised by social media companies is the integrity of
algorithms that are used to recommend content to users. Weber Decl. ¶¶ 4, 13. Here too, the
industry has developed best practices to combat the use of algorithms to manipulate opinions or
change perspectives in illegitimate ways. Id. ¶ 13. Consistent with these industry standards,
TikTok maintains safeguards to protect the integrity of its source code, or “recommendation
algorithm.”

Cloutier Decl. ¶¶ 14-17.

There is no evidence that its source code has been

compromised such that the app is being used to censor content or spread misinformation. See
Weber Decl. ¶¶ 14-17. Like many multinational technology corporations, TikTok Inc. relies on
engineers in China to help develop its code. Cloutier Decl. ¶ 14. To protect the integrity of its
source code, TikTok Inc. deploys industry standard workflow systems that require employees to
obtain appropriate authorizations to access source code. Id. Such access is continually monitored
and logged, and TikTok’s source code undergoes both internal and third-party reviews to guard
against any potential vulnerabilities. Id. ¶ 16. Even further, in late July 2020, TikTok announced
the creation of a “Transparency and Accountability Center,” where outside experts will have the
opportunity to examine the TikTok code, including the code driving the recommendation
algorithms that determine what content is shown to users—an unprecedented step for a technology
or social media company. Ex. 2; see Weber Decl. ¶ 17.
C.

For Almost a Year Before the Ban, TikTok Participated Transparently in a
National Security Review and Made Extensive Efforts to Fully Address All
Purported Concerns.

In 2019, ByteDance was notified that the Committee on Foreign Investment in the United
States (“CFIUS”) was considering whether to review a 2017 acquisition by ByteDance of
Musical.ly, a China-based video-sharing application that was merged with TikTok and largely
6

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 14 of 50

abandoned.1

From October 2019 through August 2020, Plaintiffs provided voluminous

documentation in response to CFIUS’s questions, including about Plaintiffs’ data security
safeguards that help ensure TikTok’s U.S. user data is appropriately safeguarded in the United
States and cannot be accessed by any unauthorized person.

Notwithstanding the U.S.

government’s failure to identify any security risk, Plaintiffs engaged extensively with the
government in good faith to provide a constructive solution to any conceivable concerns the
government may have. Ex. 3. Such a solution would have allowed the U.S. government to
mitigate national security risks around data and algorithms beyond what it could achieve with
TikTok’s domestic competitors. See Weber Decl. ¶ 18.
D.

The Administration’s Political Focus on China and on TikTok.

While the CFIUS negotiations were ongoing, the political climate changed, and China, and
ultimately TikTok, became an increasingly prominent political focus of the President. In January
2020, President Trump stated on Twitter that the recently signed trade deal between the United
States and China would “bring both the USA & China closer together in so many other ways” and
that it was “[t]errific working with President Xi [Jinping], a man who truly loves his country.”
Ex. 4 at 3. Even as the COVID-19 pandemic emerged, the President stated that he had “a great
relationship with President Xi,” Ex. 5 at 1, and that “[t]he United States greatly appreciates
[China’s] efforts and transparency [on the Coronavirus],” Ex. 4 at 3.

1

CFIUS is an interagency committee of the executive branch tasked with reviewing foreign
acquisitions of U.S. businesses to determine their impact on national security. See 50 U.S.C.
§ 4565. CFIUS is empowered to mitigate these risks by imposing or otherwise reaching agreement
with the transaction parties on conditions to address national security concerns. Id. If the risks to
a particular transaction cannot be mitigated, the President is empowered to prohibit the transaction
to the extent otherwise authorized by CFIUS. Id.

7

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 15 of 50

As the COVID-19 pandemic spread across the United States and the domestic economy
worsened, however, the President and members of his administration began to use increasingly
harsh anti-Chinese political rhetoric and repeatedly sought to blame China for all of the manifest
ills of the pandemic. See, e.g., Ex. 6 at 18 (“China sent us the plague, thank you very much.”);
Ex. 7 at 11 (“The fact is, people don’t like saying it—they know it’s true: It’s China’s fault.
Okay?”). On July 31, 2020, in a series of remarks he made in Florida, the President said: “We
will make America great again, you’ve heard that before. And we were there until the virus came
upon us and we’ll soon be there again. And China, we have not forgotten.” Ex. 8 at 5.
In the summer of 2020, the President and his campaign began targeting TikTok, shortly
after it surfaced in public reporting that TikTok users had claimed they used the app to coordinate
mass ticket reservations for the President’s campaign rally in Tulsa, resulting in an embarrassment
for the President’s campaign when significantly fewer persons appeared for the rally than the
campaign had projected in the days leading up to the event. Ex. 9. Shortly thereafter, Secretary
of State Pompeo announced that the Administration was “looking at” banning TikTok, Ex. 10, and
the President’s re-election campaign ran negative Facebook advertisements targeting the app and
asking supporters to “sign the petition now to ban TikTok,” Ex. 11.
E.

President Trump Issues His August 6 Order Premised on a Purported Need to
Ban TikTok, but Subsequent Administration Actions Immediately Undercut
That Justification.

On August 6, 2020, President Trump issued an executive order entitled “Addressing the
Threat Posed by TikTok.” See Ex. 12. The order speculated—without any evidentiary support—
that ByteDance’s ownership of TikTok could allow China to access and misuse U.S. user data,
and that the Chinese government may censor or use TikTok content for propaganda purposes.
Invoking IEEPA, the order prohibits “any transaction” by “any person, or with respect to any
property, subject to the jurisdiction of the United States,” with “ByteDance Ltd. (a.k.a. Zìjié
8

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 16 of 50

Tiàodòng), Beijing, China, or its subsidiaries, in which any such company has any interest, as
identified by the Secretary of Commerce.” Id. It further directs the Secretary of Commerce to
“identify the transactions subject to” the ban 45 days after the date of the order, and declares that
the transactions are prohibited “beginning 45 days after” the August 6 order, i.e., September 20,
2020. Id.
The August 6 order was issued suddenly and without warning, on the heels of the antiTikTok statements by the Administration and the Trump campaign. The order reflects nothing of
the then-ongoing CFIUS process, and, indeed, the order’s facial assertion that a complete U.S. ban
is required is directly rebutted by those efforts. See id.
In the aftermath of the TikTok ban, senior government officials made statements
demonstrating that the August 6 order was animated by China-focused considerations unrelated to
Plaintiffs. On August 20, 2020, for example, Undersecretary of State Keith Krach candidly
acknowledged that the TikTok ban is “really about . . . three things”—none of which have anything
to do with the supposed national security threat alleged in the August 6 order: (i) “the Communist
Party’s surveillance state and 5G is the backbone”; (ii) “that great China Firewall where all data
can go in, but none come out”; and (iii) “reciprocity, because our apps aren’t allowed in China . . .
look at YouTube or Google search.” Ex. 13.
Meanwhile, on August 14, 2020, invoking CFIUS, the President issued a separate
executive order titled “Regarding the Acquisition of Musical.ly by ByteDance Ltd.,” which orders
ByteDance to divest the U.S. TikTok business. Ex. 14 (“CFIUS order”). In the weeks following
the CFIUS order, the President asserted that for him to approve a restructuring that would avoid
the ban, the Treasury Department had to receive a “substantial portion” of any price paid by the
U.S. acquirer or partner. Ex. 15; see Ex. 16 at 2. It is entirely improper for the President to demand

9

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 17 of 50

a payment in these circumstances—as the President himself has since admitted.

Ex. 17

(“Amazingly, I find that you’re not allowed to do that — you’re not allowed to accept money. . . .
There’s no legal path to doing that.”).
On September 3, 2020, Plaintiffs received an 18-item administrative subpoena from the
Department of Commerce. Ex. 18. This subpoena, issued nearly a month after the August 6 order,
requested broad categories of records regarding, among other topics, Plaintiffs’ data centers,
domain names, business partners, content moderation, data collection, and employees—exactly
the sort of information one would expect the government to assess before issuing anything as
sweeping as the August 6 order. Id.
On August 28, 2020, China’s Ministry of Commerce and Ministry of Science and
Technology issued regulations that prevent “technology based on data analysis for personalized
information recommendation services” from being exported without a license. Ex. 19; see Exs. 20,
21. TikTok’s recommendation engine technology was part of the contemplated restructuring of
TikTok’s U.S. operations, and this regulatory requirement accordingly affected the negotiations
that Plaintiffs were then pursuing.
In light of this changing landscape, and even though Plaintiffs believed the August 6 order
to be unlawful, they continued to work in good faith to explore alternative measures that might
satisfy the Administration. To this end, on September 13, Plaintiffs submitted another proposal to
the U.S. government setting forth additional details on a multi-layered approach to security of the
app and user data to fully address any concerns claimed in the August 6 and CFIUS orders. See
Ex. 22.

10

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 18 of 50

F.

The Commerce Department Issues Prohibitions That Will Ban TikTok in the
United States.

With the discussions between TikTok and the U.S. government still ongoing, on
September 18, 2020, the Department of Commerce issued a list of prohibited transactions to
implement the August 6 ban. Ex. 23 (“Prohibitions”). The Prohibitions simply incorporate by
reference the President’s purported justifications for the August 6 order, and offer no additional
factual support for the ban. The Prohibitions identify a series of prohibited transactions that were
to take effect on September 20, 2020 and November 12, 2020, first requiring the removal of
TikTok from U.S. app stores, and, then shutting down TikTok in the United States entirely.
On September 19, 2020, the President informed reporters that he had given his “blessing”
and “approve[d] . . . in concept” an agreement between TikTok, Oracle, and Walmart to create a
new U.S.-based entity called TikTok Global. Ex. 24. The President indicated that the agreement
involved “about a $5 billion contribution toward education,” but did not specify the source of the
investment or the purpose for which it would be used. Ex. 25. The Commerce Department also
issued a press release stating that, “in light of recent positive developments,” the first phase of the
Prohibitions banning TikTok from U.S. app stores would be postponed from September 20 until
September 27, 2020. Ex. 26.
The same day, TikTok released a statement regarding its proposed agreement to address
the U.S. government’s national security concerns. Ex. 22. Under the proposal, (1) Oracle would
host all U.S. user data and secure associated computer systems to ensure that U.S. national security
requirements are satisfied, (2) TikTok would enter into a commercial partnership with Walmart,
and (3) both Oracle and Walmart would receive up to a 20 percent stake in TikTok Global. Id.
During a campaign rally in Fayetteville, North Carolina that evening, however, the
President announced to supporters what he alleged to be a new term of the proposed TikTok

11

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 19 of 50

agreement. Specifically, he stated that the U.S. government had a “deal worked out,” in which the
parties to the deal would “pay $5 billion into a fund for education” so that “we can educate people
as to the real history of our country.” Ex. 27. Plaintiffs had not agreed to contribute to any such
fund. The following day, on September 20, 2020, ByteDance released a statement confirming it
had first heard about the $5 billion education fund from media reports. See Ex. 28.
On September 21, 2020, the Department of Commerce withdrew the September 18
document setting forth the Prohibitions. Then, on September 22, 2020, it promulgated a new
document that moved the implementation date for the initial Prohibition from September 20 to
September 27, 2020. Ex. 29. The September 22 document, which will be published in the Federal
Register on September 24, 2020, was otherwise identical to the Prohibitions. Id.
As of September 27, 2020, the Prohibitions forbid transactions involving “[a]ny provision
of services to distribute or maintain the TikTok mobile application, constituent code, or application
updates through an online mobile application store” available to individuals in the United States,
which prevents TikTok from being available for download on U.S. app stores. Id.
As of November 12, 2020, the Prohibitions prohibit transactions involving:


“[a]ny provision of internet hosting services enabling the functioning or
optimization of the TikTok mobile application,”



“[a]ny provision of content delivery network services enabling the functioning or
optimization of the TikTok mobile application within the [United States],”



“[a]ny provision of directly contracted or arranged internet transit or peering
services enabling the functioning or optimization of the TikTok mobile application
within the [United States],” and



“[a]ny utilization of the TikTok mobile application’s constituent code, functions,
or services in the functioning of software or services developed and/or accessible
within the [United States].”

12

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 20 of 50

Id. This second set of Prohibitions will prevent Plaintiffs and their commercial partners from
providing the services that enable the TikTok application to function, and will effectively shut
down TikTok in the United States.
G.

The Prohibitions Are Causing Plaintiffs Irreparable Harm.

Absent preliminary injunctive relief, the Prohibitions will inflict devastating and
irreparable harm on Plaintiffs during the pendency of this case.
The Prohibitions will decimate the app’s user base, even ahead of the shut-down. Until the
Administration’s intervention, TikTok was one of the fastest growing apps in the United States,
and its continued rapid growth is necessary to maintain its competitive market position. Pappas
Decl. ¶ 17. As a consequence of the Prohibitions, TikTok will no longer be available on the U.S.
app stores as of September 27, which halts the daily influx of new U.S. users. Id. ¶ 18. Hundreds
of millions of Americans who have not yet downloaded the app will thereby be prevented from
joining and communicating with the TikTok community, and many instead are already beginning
to build relationships with competing platforms, where content creators will follow in order to
attract new audiences. Id. ¶¶ 18-19, 21. And on November 12, 2020, the app will not be useable
by existing U.S. users. See Ex. 29. Competitors are already taking, and will continue to take,
advantage of this impending shutdown to entice TikTok creators and users to switch platforms.
Pappas Decl. ¶¶ 21-22. Even if the ban is lifted after a period of weeks or months, the harm to
TikTok’s user base and competitive position will be permanent. Id. ¶ 19.
The Prohibitions also will destroy the goodwill that Plaintiffs need to partner with other
businesses and advertisers. Id. ¶ 23. Once TikTok is removed from the app stores, commercial
partners will increasingly move away from TikTok, leading not just to a loss of revenue but also
extraordinary harm to Plaintiffs’ reputation and goodwill, making it unlikely that these
relationships could be salvaged even if the ban is later lifted. Id. Indeed, as a result of the market
13

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 21 of 50

uncertainty generated by the government’s decision to target Plaintiffs, major commercial partners
have already backed out of partnerships with TikTok, resulting in millions of dollars in losses and
damage to Plaintiffs’ relationships with these key business partners. Id. ¶¶ 23-24. This trend will
accelerate as the ban against new users is imposed and the full ban against the app in the U.S.
approaches. Id.
Even though the Prohibitions are limited to the United States, they will impact TikTok’s
business globally. Pappas Decl. ¶ 20. Because content created by U.S. users can comprise as
much as 60 percent of the content in non-U.S. markets, the shutdown of the app in the United
States will result in a massive decrease in global content, which in turn will negatively impact user
and partner attraction and retention. Id. The harms explained above will have a devastating impact
on Plaintiffs, completely destroying their business.
The Prohibitions also will greatly harm Plaintiffs’ U.S. workforce. Id. ¶ 26. TikTok is a
technology business; it competes fiercely for software engineers and other talent, and many of its
employees are currently being aggressively recruited by competitors. Id. Given that the U.S.
TikTok business will be shut down as a result of the ban, it will be impossible to recruit and retain
employees devoted to maintaining the service. Id.
Finally, wholly independent of these harms to the TikTok business, the Prohibitions also
cause irreparable harm to Plaintiffs’ First Amendment rights. They will prevent TikTok Inc. from
continuing to create and share messages about a variety of issues and current events, and from
expressing its ideas through dissemination and use of its code. The Prohibitions also will have a
profoundly negative impact on the public interest, unlawfully restricting core protected speech by
millions of Americans in violation of their First Amendment rights at one of the most critical
times—during the run-up to a national election.

14

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 22 of 50

ARGUMENT
A preliminary injunction should issue because Plaintiffs have established that (1) there is
a likelihood of success on the merits, (2) they will face irreparable harm in the absence of
preliminary relief, (3) the balance of equities favors preliminary relief, and (4) an injunction is in
the public interest. See, e.g., Winter v. NRDC, 555 U.S. 7, 20 (2008).
I.

Plaintiffs Are Likely to Succeed on the Merits of Their Claims.
As explained below, the Prohibitions and August 6 order (1) violate the express terms of

IEEPA by exceeding the executive branch’s delegated authority, (2) are arbitrary and capricious
under the APA, (3) violate Plaintiffs’ First and Fifth Amendment rights, and (4) otherwise violate
IEEPA because they are not based on a bona fide national emergency and prohibit activities that
have not been found to pose “an unusual and extraordinary threat,” as IEEPA requires.
A.

The Prohibitions Violate IEEPA Because They Regulate and Prohibit
“Personal Communication” and “Informational Materials.”

Agency action must be set aside if it is “in excess of statutory jurisdiction, authority, or
limitations.” 5 U.S.C. § 706(2)(C). Thus, it is “[a]n essential function of the reviewing court . . .
to guard against bureaucratic excesses by ensuring that administrative agencies remain within
the bounds of their delegated authority.” Planned Parenthood v. Heckler, 712 F.2d 650, 655
(D.C. Cir. 1983). Here, the Prohibitions squarely conflict with the limits placed on the Commerce
Department’s authority under IEEPA—a conclusion reinforced by the serious constitutional
problems that would be created by the agency’s reading of the Act.
1.

IEEPA Prohibits the Commerce Department from Regulating “Personal
Communication” and “Informational Materials.”

In enacting and amending IEEPA, Congress carefully limited the powers delegated to the
Executive Branch. Specifically, Section 1702(b) provides, in relevant part, that the authority
granted to the President under IEEPA “does not include the authority to regulate or prohibit,

15

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 23 of 50

directly or indirectly … [any] personal communication, which does not involve a transfer of
anything of value” or the importation or exportation “regardless of format or medium of
transmission, of any information or informational materials, including but not limited to,
publications, films, posters, phonograph records, photographs, microfilms, microfiche, tapes,
compact disks, CD ROMs, artworks, and news wire feeds.” 50 U.S.C. § 1702(b)(1), (3) (emphasis
added).2 Through multiple statutory amendments, Congress repeatedly underscored that these
limitations on the President’s regulatory authority are to be given “broad scope.” Kalantari v.
NITV, Inc., 352 F.3d 1202, 1205 (9th Cir. 2003) (quoting H.R. Conf. Rep. No. 103–482, at 239
(1994)). Such an interpretation “avoids serious questions about the constitutionality” of IEEPA,
and “prevent[s] the statute from running afoul of the First Amendment.” Cernuda v. Heavey, 720
F. Supp. 1544, 1553 (S.D. Fla. 1989).
As originally enacted in 1977, Section 1702(b) excluded from the President’s IEEPA
authority the ability to regulate or prohibit “directly or indirectly” any “personal communication,
which does not involve a transfer of anything of value.” 50 U.S.C. § 1702(b); see also Bernstein
v. Dep’t of State, 974 F. Supp. 1288 (N.D. Cal. 1997) (analyzing limit on authority related to
personal communications as applied to encryption software), aff’d, 176 F.3d 1132 (9th Cir.
1999), reh’g granted, opinion withdrawn, 192 F.3d 1308 (9th Cir. 1999); Declaration of Amanda
L. Tyler (“Tyler Decl.”) ¶ 19.
In 1988, Congress amended the statute to “expressly revoke[] presidential authority to
regulate or prohibit the importation or exportation” of “information or informational materials.”
Cernuda, 720 F. Supp. at 1547 (citing Pub. L. No. 100–418, § 2502(a), 102 Stat. 1107, 1371

2

The full text of 50 U.S.C. § 1702 is attached hereto in the Addendum.

16

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 24 of 50

(1988)).3 That amendment (the “Berman Amendment”) “was designed to prevent the executive
branch from restricting the international flow of materials protected by the First Amendment.”
Kalantari, 352 F.3d at 1205. See also Tyler Decl. ¶ 25 (“[The Berman Amendment] is the
product of a Congress’s determination that the authority granted to the President under the IEEPA
should not be invoked in a way that undermines the free exchange of ideas and information.”).
Six years later, Congress once again “expanded this limitation on executive authority by
enacting the Free Trade in Ideas Act [‘FTIA’].” United States v. Amirnazmi, 645 F.3d 564, 585
(3d Cir. 2011) (citing Pub. L. No. 103–236, § 525, 108 Stat. 382, 474 (1994)). The FTIA
amendment further “restrict[ed] the Executive from regulating transactions concerning
informational materials ‘regardless of format or medium of transmission,’” id. (quoting Pub. L.
No. 103–236, § 525(c)(1)), and expanded the statute’s “nonexclusive list of informational
materials to include new media, such as compact discs and CD ROMs,” Kalantari, 352 F.3d at
1205. See also Tyler Decl. ¶¶ 23-24. The Conference Report accompanying the FTIA reaffirmed
that Section 1702(b) “was explicitly intended, by including the words ‘directly or indirectly,’ to
have a broad scope.” Amirnazmi, 645 F.3d at 585 (quoting H.R. Conf. Rep. No. 103–482, at 239
(1994)).

3

The amendment added identical text to IEEPA and the Trading with the Enemy Act of
1917, Pub. L. No. 65–91, § 5, 40 Stat. 411, 415 (1917), as amended, 50 U.S.C. § 4305
(“TWEA”). See Kalantari, 352 F.3d at 1205 n.3.

17

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 25 of 50

2.

The Prohibitions Unlawfully Regulate “Personal Communications” and
“Informational Materials.”

Notwithstanding this unambiguous statutory language and clear Congressional intent, the
Prohibitions directly contravene Section 1702(b) by regulating personal communications and the
international transmittal of informational materials.4
Millions of TikTok users rely on TikTok to send “personal communication[s]” that “do[]
not involve a transfer of anything of value.” 50 U.S.C. § 1702(b)(1). TikTok is a social media
platform—an online community where millions of Americans come together to express
themselves, share video content, and make connections with each other. Pappas Decl. ¶¶ 4, 17.
The Prohibitions will destroy this online community, first by requiring the removal of TikTok from
the U.S. app stores, and, when the remaining Prohibitions come into effect on November 12, 2020,
shutting down TikTok entirely.

The Prohibitions will prevent TikTok’s users—including

Plaintiffs themselves—from expressing their viewpoints, interests, and beliefs with one another.
The regulation and prohibition of such communications—precisely what the Prohibitions do
here—is not permitted by IEEPA under the plain language of Section 1702(b)(1).
TikTok users also use the platform to share “information or informational materials” with
users around the world. Pappas Decl. ¶¶ 4, 20. Section 1702(b)(3) provides a non-exclusive list
of such materials over which the executive branch has no IEEPA authority, including “films . . .
photographs . . . [and] artworks”—the exact media shared on TikTok. The Commerce Department
lacks the authority to even regulate the international flow of these materials—either “directly or
indirectly,” and “regardless of format or medium of transmission”—let alone prohibit it. 50 U.S.C.

4

This is true for both the ban on new U.S. users, which will begin when the first
Prohibition goes into effect on September 27, 2020, as well as the broader set of Prohibitions,
which will go into effect on November 12, 2020.

18

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 26 of 50

§§ 1702(b)(3). The Prohibitions violate this statutory command by banning U.S. users—first new
U.S. users on September 27, and then all U.S. users on November 12—from sharing content with
TikTok users in other countries, and receiving content from such users.5 See Pappas Decl. ¶¶ 4,
20. At a minimum, the Prohibitions indirectly regulate this conduct, in direct violation of Section
1702(b)(3).
Furthermore, the TikTok application—a social media platform over which information is
shared—is closely analogous to the “news wire feed” included in Section 1702(b)(3)’s nonexhaustive list of items over which the President lacks regulatory authority. See Oxford English
Dictionary (Sept. 2003), available at www.oed.com/view/Entry/255044 (defining “newswire” as
“a service which transmits up-to-the-minute news, usually electronically (esp. via the internet), to
news media and the general public”). And blocking access to TikTok’s platform for personal
communication and information exchange undoubtedly raises the First Amendment concerns
Section 1702(b) was designed to address. See Kalantari, 352 F.3d at 1205.
Apart from the plain language of the statute, which is dispositive, the Prohibitions conflict
with the executive branch’s historical practice of implementing its IEEPA authority. For example,
the Treasury Department’s Office of Foreign Assets Control (“OFAC”), which frequently
implements IEEPA sanctions programs, recognizes that its prohibitions do not apply to the
importation or exportation of information or informational materials, “regardless of the format or
medium of transmission.” See, e.g., 31 C.F.R. § 560.210 (exempting “informational materials,”
as defined in 31 C.F.R. § 560.315, from the list of prohibited transactions); 31 C.F.R. § 560.315(a)
(featuring same definition of “informational materials” as Section 1702(b), with such materials

5

U.S. content can comprise as much as 60% of the content in TikTok’s non-U.S. markets.
Pappas Decl. ¶ 20.

19

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 27 of 50

defined as including, but not limited to, films, photographs, and artworks, among others); Tyler
Decl. ¶ 45. And to the extent social media platforms are affected by sanctions programs, OFAC
often incorporates general licenses to ensure those platforms remain available for personal
communications. See, e.g., 31 CFR § 560.540(a)(1) (authorizing “[t]he exportation from the
United States or by U.S. persons, wherever located, to persons in Iran of services incident to the
exchange of personal communications over the Internet, such as instant messaging, chat and email,
social networking, sharing of photos and movies, web browsing, and blogging, provided that such
services are publicly available at no cost to the user”); Tyler Decl. ¶ 45. OFAC has never used its
authorities to target social media platforms used by millions of U.S. users. Tyler Decl. ¶ 46.
B.

The Prohibitions Are Arbitrary and Capricious Because the Agency Failed to
Consider Reasonable Alternatives and Offered a Pretextual Justification for
Its Action.

Under the APA, a court must set aside agency action if it is “arbitrary, capricious, an
abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A). Here, the
Prohibitions are arbitrary and capricious because the Commerce Department (1) ignored the
evidence before it and failed to consider reasonable alternatives to the Prohibition’s sweeping
ban on TikTok, including the extensive mitigation measures Plaintiffs proposed, and (2) offered
a pretextual national security justification that is unsupported and belied by the political
motivations that prompted the August 6 order and the Prohibitions.
1.

The Agency Ignored the Evidence Before It and Failed to Consider
Reasonable Alternatives to the Ban on TikTok.

To survive review under the APA, an agency must “consider significant alternatives to
the course it ultimately chooses,” and explain its rejection of those alternatives. Allied Local &
Reg’l Mfrs. Caucus v. EPA, 215 F.3d 61, 80 (D.C. Cir. 2000). “[T]he failure of an agency to

20

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 28 of 50

consider obvious alternatives has led uniformly to reversal.” Yakima Valley Cablevision, Inc. v.
FCC, 794 F.2d 737, 746 n.36 (D.C. Cir. 1986).
Here, the Prohibitions’ stated justification is that TikTok poses a “threat” to the national
security, foreign policy, and economy of the United States, as set forth in the August 6 order.
Ex. 29. That order, in turn, states that because TikTok is “owned by the Chinese company
ByteDance Ltd.,” there is a “potential” risk (i) that the “Chinese Communist Party [could] access
. . . Americans’ personal and proprietary information”; and (ii) that TikTok could “censor content
that the Chinese Communist Party deems politically sensitive” or “for disinformation campaigns
that benefit the Chinese Communist Party.” Ex. 12.
But the speculative language of the Prohibitions demonstrates that the government does
not have any evidence that the Chinese government has ever obtained any TikTok U.S. user data.
See Ex. 30. Indeed, the evidence shows that TikTok stores that data outside of China, subjects it
to robust data security safeguards that are “consistent with industry best practice,” Weber Decl.
¶ 10, and keeps it under the control of a U.S.-based leadership team, Cloutier Decl. ¶¶ 7-13. Nor
is there any evidence that the platform has been used for censorship by the Chinese government.
See Weber Decl. ¶¶ 10-17; Pappas Decl. ¶ 15. Thus, the government’s conduct does not reflect
“a rational connection between the facts found and the choice made,” as the APA requires. Motor
Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)
(agency action is arbitrary if it “failed to consider an important aspect of the problem [or] offered
an explanation for its decision that runs counter to the evidence before [it]”).
Moreover, even if the Court were to credit the faulty conclusion that TikTok’s data
security safeguards are inadequate, the Prohibitions are arbitrary and capricious because the
Commerce Department failed to “consider reasonably obvious alternatives to [its] proposed rule”

21

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 29 of 50

and explain its reasons for rejecting those alternatives. Walter O. Boswell Mem’l Hosp. v.
Heckler, 749 F.2d 788, 797, 803 (D.C. Cir. 1984). Indeed, there is no indication that the agency
even considered Plaintiffs’ extensive data security protections and the range of tools available
pursuant to the CFIUS process—including the extensive measures suggested by Plaintiffs—let
alone provided a sound explanation for rejecting them.
These measures are wide-ranging and robust. For example, on September 13, 2020,
Plaintiffs offered to provide a trusted U.S. technology provider operational control over the
infrastructure that services U.S. users and stores U.S. TikTok user data, and to give the
government oversight of TikTok’s U.S. information security. See Ex. 22. Plaintiffs further
proposed that they restructure their business to create a separately-governed U.S.-based TikTok
business with responsibility for all TikTok operations in the United States and all matters
involving TikTok’s U.S. users. See id. And they offered to implement other data security
measures to fully address the purported concerns outlined in the August 6 and CFIUS orders.
See id. These measures would have allowed the government to mitigate its purported concerns
beyond what could be achieved with others in the industry. See Weber Decl. ¶¶ 11, 17, 18.
Moreover, to the extent the ban is premised on TikTok’s ownership “by the Chinese company
ByteDance,” Ex. 12, that can also be addressed by measures short of shutting down the app.
Indeed, the CFIUS order mandates that ByteDance sell TikTok Inc. by November 12, 2020,
Ex. 14, and, while a severe and manifestly unjustified order, with which Plaintiffs vehemently
disagree, this measure is still less extreme than a total ban on TikTok operations in the United
States.
“At the very least th[ese] alternative way[s] of achieving the [government’s] objectives
. . . should have been addressed and adequate reasons given for [their] abandonment.” State

22

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 30 of 50

Farm, 463 U.S. at 48. Instead, the government chose the harshest measure possible—a ban on
TikTok in the U.S.—without considering these alternatives or trying to craft a narrower solution
to addresses its purported national security concerns. This failure, standing alone, renders the
Prohibitions arbitrary and capricious—and therefore unlawful—under the APA. See Heckler,
749 F.2d at 797.
2.

The Stated Justification for the Prohibitions Is Pretextual.

The Commerce Department’s failure to consider reasonable alternatives to a complete ban
on TikTok evinces not only a lack of rigor in the agency’s process. It also makes clear that the
real reason for the agency’s decision was something other than the stated national security
concerns. This is another, wholly independent ground on which to invalidate the Prohibitions. See
Dep’t of Commerce v. New York, 139 S. Ct. 2551, 2575 (2019); Woods Petroleum Corp. v. U.S.
Dep’t of Interior, 18 F.3d 854, 859-60 (10th Cir. 1994) (setting aside agency action because the
“sole reason” for the action was “to provide a pretext” for the agency’s “ulterior motive”).
The Prohibitions purportedly target TikTok because of the speculative possibility (asserted
in the August 6 order) that U.S. user data from the app could be manipulated by the Chinese
government. Ex. 29. But, as discussed above, Plaintiffs have taken measures to protect the privacy
and security of TikTok’s U.S. user data, including by storing such data outside of China and by
erecting software barriers that help ensure that TikTok stores its U.S. user data separately from the
user data of other ByteDance products. See supra pp. 4-7. Moreover, the eagerness of a number
of U.S. companies to serve as TikTok’s trusted technology partner in the United States—and
public statements confirming these companies’ beliefs that such measures could address the
government’s purported national security concerns, see Exs. 31, 32—underscore the many
options, short of a total ban on TikTok, that were available to the government.

23

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 31 of 50

Virtually every company, governmental entity, and non-governmental organization,
regardless of ownership, faces risks to the security of the data it stores—whether on behalf of
employees, customers, or others. Weber Decl. ¶ 4. Indeed, TikTok’s approach for dealing with
these issues is generally in line with—and in some respects markedly better than—industry best
practices, even for companies that hold significant sensitive user data. Id. ¶¶ 4, 10, 18; see also
id. ¶ 17 (TikTok’s Transparency and Accountability Center “sets a new ‘gold standard’ that other
social media companies will be pressured to meet, to the overall good of the industry”). Thus,
TikTok poses no national security concerns beyond the data security issues inherent in any social
media platform, id. ¶¶ 4, 10, 18; Cloutier Decl. ¶¶ 4-18, and the divergent approach the agency
took toward TikTok compared to other platforms suggests that “the sole stated reason [for the
Prohibitions] seems to have been contrived,” Dep’t of Commerce, 139 S. Ct. at 2575. ¶
The Prohibitions were issued against the backdrop of a political reelection campaign in
which the President has increasingly relied on anti-Chinese rhetoric. See, e.g., Ex. 7. And there
is no question that the first mention of the Trump Administration possibly banning TikTok came
on the heels of the episode in which TikTok users claimed to have used the app to make it appear
to the President’s campaign that attendance for the President’s Tulsa rally in June would be vastly
larger than it actually was, Ex. 9, an embarrassment that led to the campaign running ads against
TikTok, Ex. 11. The record will make clear that these issues—not any purported national security
concerns—were the actual rationale for the Prohibitions. See, e.g., Home Box Office, Inc. v. FCC,
567 F.2d 9, 54-55 (D.C. Cir. 1977) (when an agency sets forth a “fictional account of the actual
decisionmaking process” a reviewing court “must perforce find its actions arbitrary”); Tummino
v. Torti, 603 F. Supp. 2d 519, 544-46 (E.D.N.Y. 2009) (agency action is arbitrary when articulated
basis is “fanciful and wholly unsubstantiated” and other considerations are evident from record).

24

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 32 of 50

The claim that national security concerns were the agency’s actual motivation for requiring
a total ban of TikTok in the United States is contradicted by the President’s persistent focus on
extracting some type of financial bounty in exchange for permitting Plaintiffs to continue their
lawful business in the United States. On August 3, 2020—three days before the August 6 order
was issued—the President stated that TikTok “[doesn’t] have any rights” and that he would ban
the company unless it were acquired through “an appropriate deal” in which “the Treasury . . . of
the United States gets a lot of money.” Exs. 15, 16. This demand for a payment to the Treasury
is at odds with notion that banning TikTok is necessary to protect national security.
The President also demanded that the parties involved in the TikTok-Oracle-Walmart deal
“pay $5 billion into a fund for education” so that “we can educate people as to the real history of
our country.” Ex. 27. Such a demand not only is completely untethered to the national security
concerns on which the Prohibitions were purportedly based, but is entirely inappropriate. Indeed,
in analogous contexts, courts—as well as the government itself—have recognized the impropriety
of the government demanding that a private party make a payment to a third party. For example,
the Supreme Court has long recognized that the government “effects an unconstitutional taking
when it transfers property, without any justifying public purpose, from one private party to
another.” Corp. of Presiding Bishop of Church of Jesus Christ of Latter-Day Saints v. Hodel, 637
F. Supp. 1398, 1406 (D.D.C. 1986), aff’d, 830 F.2d 374 (D.C. Cir. 1987) (citing Hawaii Housing
Auth. v. Midkiff, 467 U.S. 229, 241 (1984) and Thompson v. Cons. Gas Corp., 300 U.S. 55, 80
(1937)).
Likewise, the Department of Justice’s Justice Manual explains that, except in limited
contexts not relevant here, it is “not appropriate” for the government “to use a settlement agreement
to require, as a condition of settlement, payment to non-governmental, third-party organizations

25

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 33 of 50

who are not victims or parties to the lawsuit.” Justice Manual § 1-17.000. The Justice Manual
accordingly instructs that “Department attorneys shall not enter into any agreement on behalf of
the United States in settlement of federal claims or charges, including agreements settling civil
litigation, accepting plea agreements, or deferring or declining prosecution in a criminal matter,
that directs or provides for a payment to any non-governmental person or entity that is not a party
to the dispute.” Id.; see also Office of the Attorney General, Prohibition on Settlement Payments
to

Third

Parties

(June

5,

2017),

available

at

https://www.justice.gov/opa/press-

release/file/971826/download (same).6
Furthermore, after expressing its purported national security concerns in the August 6
order, the government waited an additional 43 days to issue the Prohibitions, and a further 55 days
beyond that before the Prohibitions go into full effect. Ex. 22. It also extended the first
Prohibition’s ban on TikTok from U.S. app stores for a week, from September 20 to September 27.
Ex. 26. If pressing national security concerns were the true motive for the agency’s conduct, such
a long delay would have been intolerable. Likewise, when it finally did issue the Prohibitions,
those restrictions were not crafted to respond to any purported national security threat. The
Prohibitions do not, for example, immediately ban TikTok throughout the United States. Instead,
they bar TikTok from mobile app stores, preventing new users from downloading the app and
existing users from downloading updates to the app. Ex. 29. Such measures not only fail to
address any pressing national security concerns, but actually undermine the very security concerns

6

In announcing this policy, former Attorney General Jeff Sessions explained that “[w]hen
the federal government settles a case against a corporate wrongdoer, any settlement funds should
go first to the victims and then to the American people—not to bankroll third-party special
interest groups or the political friends of whoever is in power.” Dep’t of Justice Press Release
(June 7, 2017), available at https://www.justice.gov/opa/pr/attorney-general-jeff-sessions-endsthird-party-settlement-practice.

26

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 34 of 50

purportedly animating the agency’s conduct by preventing existing users from downloading
security updates to keep their data secure.
“Altogether, the evidence tells a story that does not match the Secretary’s explanation for
his decision.” Dep’t of Commerce, 139 S. Ct. at 2575. This record makes clear that the
Prohibitions could not have been based upon a good faith belief that banning TikTok was necessary
to protect national security, and that the stated national security justification was a pretext for other
considerations. The Prohibitions should be enjoined. See N.E. Coal. v. NRC, 727 F.2d 1127,
1130-31 (D.C. Cir. 1984) (agency action is arbitrary and capricious where agency’s stated reason
is inconsistent with action taken).
C.

The Prohibitions Violate Plaintiffs’ Constitutional Rights.
1.

The Prohibitions Infringe on Core Protected Speech in Violation of the First
Amendment.

Social media applications like TikTok represent “the modern public square . . . [and]
provide perhaps the most powerful mechanisms available to a private citizen to make his or her
voice heard.” Packingham v. North Carolina, 137 S. Ct. 1730, 1737 (2017). The Prohibitions
have shuttered this “modern public square,” restricting Plaintiffs’ protected speech in violation of
the First Amendment. See Order Granting Mot. for Prelim. Inj., U.S. WeChat Users Alliance v.
Trump, No. 3:20-cv-05910-LB (N.D. Cal. Nov. 19, 2020), ECF 59 (preliminarily enjoining similar
restrictions against WeChat because “plaintiffs have shown serious questions going to the merits
of their First Amendment claim that the Secretary’s prohibited transactions effectively eliminate
the plaintiffs’ key platform for communication, slow or eliminate discourse, and are the equivalent
of censorship of speech or a prior restraint on it”).
Plaintiffs have two interests that are protected under the First Amendment. First, as users
of the platform, Plaintiffs are speakers themselves on the TikTok application, and have the right

27

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 35 of 50

to communicate freely with other individuals over the platform. See Exs. 33, 34. The Supreme
Court has recognized that the “wide array” of speech on social media, on topics as “diverse as
human thought,” is core protected speech. See Packingham, 137 S. Ct. at 1735-36 (“It is
cyberspace—the ‘vast democratic forums of the Internet’ in general, and social media in
particular” that are “the most important places . . . for the exchange of views.” (citation omitted)).
Second, Plaintiffs have a protected First Amendment interest in and to their source code. “Because
computer source code is an expressive means for the exchange of information and ideas about
computer programming . . . it is protected by the First Amendment.” Junger v. Daley, 209 F.3d
481, 485 (6th Cir. 2000); see also Bernstein v. U.S. Dep’t of State, 922 F. Supp. 1426, 1435 (N.D.
Cal. 1996) (similar).
The Prohibitions unlawfully restrict these protected interests, violating Plaintiffs’ First
Amendment rights. Se. Promotions, Ltd. v. Conrad, 420 U.S. 546 (1975) (denial of use of
municipal facility for theater production was an unlawful prior restraint). The Prohibitions will
shut down TikTok, disabling its core functionality and barring its millions of users—including
Plaintiffs themselves—from engaging in speech. These restrictions will impose a prior restraint
by “forbidding certain communications when issued in advance of the time that such
communications are to occur.” Alexander v. United States, 509 U.S. 544, 550 (1993). The
Supreme Court has “consistently” recognized “in a long line of cases” that government actions
that “deny use of a forum in advance of actual expression” or forbid “the use of public places [for
plaintiffs] to say what they wanted to say”—like the Prohibitions do here—are unconstitutional
prior restraints. Se. Promotions, 420 U.S. at 552-53.
Such restraints are reviewed for strict scrutiny and “bear[] a heavy presumption against
[their] constitutional validity.” Bantam Books, Inc. v. Sullivan, 372 U.S. 58, 70 (1963). The

28

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 36 of 50

government bears the burden of proof under strict scrutiny and must prove it has narrowly tailored
the restraint to promote a compelling government interest while treading as lightly as possible on
the right to speak. United States v. Playboy Entm’t Grp., 529 U.S. 803, 816 (2000). “If a less
restrictive alternative would serve the Government’s purpose, the [government] must use that
alternative.” Id. (emphasis added). The government also must present supporting evidence
“demonstrat[ing] that the recited harms are real, not merely conjectural, and that the [restraint] will
in fact alleviate these harms in a direct and material way.” Turner Broad. Sys., Inc. v. FCC, 512
U.S. 622, 664 (1994). At a minimum, the Prohibitions would receive “intermediate scrutiny,”
which requires that a speech restriction must be “narrowly tailored to serve a substantial
government interest” and may not “burden substantially more speech than is necessary to further
the government’s legitimate interests.” Packingham, 137 S. Ct. at 1736 (citation omitted).
The Prohibitions do not satisfy either constitutional standard.

Notwithstanding the

substantial governmental interest in national security, the Prohibitions—banning any download of
the TikTok app and, ultimately, any transactions with TikTok Inc.—are far greater than is
necessary to further any compelling government interest, particularly one premised on such a
speculative basis. See New York Times Co. v. United States, 403 U.S. 713, 725–26 (1971) (“[T]he
First Amendment tolerates absolutely no prior judicial restraints of the press predicated upon
surmise or conjecture that untoward consequences may result.”); see also, e.g., Ex. 12 (noting that
China could “potentially” access TikTok user data, which “may be used for disinformation
campaigns”). Indeed, Plaintiffs offered to implement a range of measures, including restructuring
the U.S. TikTok business, to address the government’s purported national security concerns and
allow the app to continue to be available in the United States. Instead of adopting these less-speech
restrictive measures, the government rejected them out of hand and without explanation, choosing

29

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 37 of 50

instead to extinguish a forum used by millions of Americans, including Plaintiffs. Edwards v.
District of Columbia, 755 F.3d 996, 1009 (D.C. Cir. 2014) (“Even assuming [the asserted] harms
are real,” the government “has provided no convincing explanation as to why a more finely tailored
regulatory scheme would not work”).
“For [more than] two centuries, our country has taken singular pride in the democratic
ideals enshrined in its Constitution, and the most cherished of those ideals have found expression
in the First Amendment.” United States v. Robel, 389 U.S. 258, 264 (1967). Thus, “[i]t would
indeed be ironic if, in the name of national defense, we would sanction the subversion of one of
those liberties—the freedom of association—which makes the defense of the Nation worthwhile.”
Id. Because the scope of the restraint on Plaintiffs’ speech is “greater than essential” to the
furtherance of the purported government interest, the Prohibitions violate the First Amendment.
2.

The Prohibitions Deprive Plaintiffs of Their Constitutional Right to Due
Process.

When the government deprives private parties of their property rights under IEEPA, those
actions must satisfy the Due Process Clause of the Fifth Amendment. See Holy Land Found. for
Relief and Dev. v. Ashcroft, 333 F.3d 156, 163 (D.C. Cir. 2003). “The fundamental requirement
of due process is the opportunity to be heard at a meaningful time and in a meaningful manner.”
Mathews v. Eldridge, 424 U.S. 319, 333 (1976) (citation omitted).

The Supreme Court

“consistently has held that some form of hearing is required before an individual is finally
deprived” of a property or liberty interest. Id. Even in the national security context, “due process
requires, at the least, that an affected party be informed of the official action, be given access to

30

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 38 of 50

the unclassified evidence on which the official actor relied and be afforded an opportunity to rebut
that evidence.” Ralls Corp. v. CFIUS, 758 F.3d 296, 319 (D.C. Cir. 2014).
Here, the government violated these requirements. At no point before or after the issuance
of the Prohibitions have Plaintiffs received an adequate explanation for the government’s action,
let alone been afforded a meaningful opportunity to respond. As noted above, the Prohibitions
rely exclusively on vague and speculative statements about the “possibility” that TikTok might be
misused by the Chinese government, but cite no specific evidence that TikTok could rebut. See
supra pp. 20-21. Nor did the Commerce Department ever give TikTok an opportunity to be heard
on why these purported concerns are misplaced. This is insufficient. See, e.g., Holy Land, 333
F.3d at 163 (to comply with due process requirements, OFAC is required to provide notice and
“the opportunity to present, at least in written form, such evidence as those entities may be able to
produce to rebut the administrative record or otherwise negate the proposition that they are foreign
terrorist organizations”); Al Haramain Islamic Found., Inc. v. U.S. Dep’t of Treasury, 686 F.3d
965, 988, 1001 (9th Cir. 2012) (OFAC violated plaintiff’s due process rights by, among other
things, “failing to provide an adequate statement of reasons for its investigation” and failing to
afford the plaintiff a meaningful opportunity to respond); KindHearts v. Geithner, 647 F. Supp. 2d
857, 905-08 (N.D. Ohio 2009) (similar).
D.

The Prohibitions and August 6 Order Violate IEEPA in Other Respects.

In addition to the infirmities outlined above, the Prohibitions and August 6 order are ultra
vires because they are not based on a bona fide national emergency and prohibit activities that
have not been found to pose “an unusual and extraordinary threat,” as IEEPA requires. Because
the Prohibitions and August 6 order go beyond the scope of the President’s statutory authority,
they should be enjoined. See, e.g., Nalco Co. v. EPA, 786 F. Supp. 2d 177, 187-89 (D.D.C. 2011)
(granting preliminary injunction on this basis); see also Ala. Power Co. v. EPA, 40 F.3d 450, 456
31

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 39 of 50

(D.C. Cir. 1994) (“neither this court nor the agency is free to ignore the plain meaning of the statute
and to substitute its policy judgment for that of Congress”) (quotation marks omitted).
IEEPA provides, in relevant part, that after first declaring a national emergency under the
National Emergencies Act (“NEA”), 50 U.S.C. § 1601 et seq., the President may regulate various
international economic transactions “to deal with any unusual and extraordinary threat” to certain
government interests, including the national security, as the President claimed here. 50 U.S.C.
§ 1701(a). Before the President is empowered to exercise authority under IEEPA, however, he
must first declare a national emergency for purposes of the NEA, 50 U.S.C. § 1601 et seq. See
also Tyler Decl. ¶ 17 (describing President’s IEEPA authority).
The Prohibitions and the August 6 order cite Executive Order 13873 (issued in 2019),
which declared that “the unrestricted acquisition or use in the United States of [certain] information
and communications technology or services . . . augments the ability of foreign adversaries to
create and exploit vulnerabilities in information and communications technology or services . . .
[and] constitutes an unusual and extraordinary threat to the national security, foreign policy, and
economy of the United States.” Ex. 35. But TikTok is not a telecommunications provider and it
does not provide the types of technology and services contemplated by Executive Order 13873.
Id. It does not provide the hardware backbone to “facilitate the digital economy,” and has no role
in providing “critical infrastructure and vital emergency services.” Id. Rather, TikTok Inc. is a
social media company, and the TikTok mobile application is a software platform on which users
express their views and opinions in short form video. Pappas Decl. ¶¶ 4, 17. Thus, the Prohibitions
and the August 6 order are not supported by the emergency declared in Executive Order 13873.
Apart from their misplaced reliance on Executive Order 13873, the Prohibitions and the
August 6 order also fail to identify any actual threat that TikTok poses to U.S. national security.

32

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 40 of 50

The August 6 order states that TikTok (i) engages in data collection practices that “potentially
allow[] China” to make use of U.S. user data, (ii) “reportedly censors content,” and (iii) “may
[also] be used for disinformation campaigns.” Ex. 12. These speculative assertions, made without
evidentiary support, do not constitute a bona fide national emergency. See 50 U.S.C. § 1701(a)
(“emergency” must be an “unusual and extraordinary threat”); Revision of Trading With the
Enemy Act: Markup Before the H. Comm. on Int’l Relations, 95th Cong. 4 (1977) (emergencies
under IEEPA are “rare and brief,” not “normal, ongoing problems”).
Because the Prohibitions and August 6 order were not issued to deal with an “unusual and
extraordinary threat” to the national security of the United States, as IEEPA requires, they are
unlawful and should be enjoined.
II.

The Remaining Factors Require Injunctive Relief.
A.

The Prohibitions and August 6 Order Are Inflicting, and Will Continue to
Inflict, Irreparable Harm.

Absent preliminary injunctive relief, the Prohibitions and August 6 order will inflict
substantial and irreparable harm on Plaintiffs during the pendency of this case.
As discussed above, Plaintiffs face an immediate restriction of their protected First
Amendment rights to speak and receive information. See supra pp. 27-30. The “loss of First
Amendment freedoms, for even minimal periods of time, unquestionably constitutes irreparable
injury.” Elrod v. Burns, 427 U.S. 347, 373 (1976) (plurality opinion). Indeed, “[w]hen an alleged
deprivation of a constitutional right is involved, most courts hold that no further showing of
irreparable injury is necessary.” Grace v. District of Columbia, 187 F. Supp. 3d 124, 149 (D.D.C.
2016) (citation omitted).
Plaintiffs also face a panoply of irreparable harms to their business. If allowed to remain
in place, the Prohibitions will irreversibly destroy the TikTok business in the United States: they

33

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 41 of 50

will devastate TikTok’s user base and competitive position, destroy the goodwill necessary for
TikTok to maintain commercial partners in the United States, and cripple Plaintiffs’ ability to
attract and retain talent.
First, absent a preliminary injunction, Plaintiffs will suffer devastating and irreparable
harm through the loss of TikTok’s user base and the long-term erosion of market share. Until
the August 6 order, TikTok was one of the fastest growing apps in the United States, adding
424,000 new U.S. users each day. See Pappas Decl. ¶ 18. Continued growth is the lifeblood of
a social media company like TikTok and essential to maintain its competitive market position.
See id. ¶ 17. By barring TikTok from U.S. app stores, however, the direct effect of the first
Prohibition is to halt the influx of new users to TikTok, depriving hundreds of millions of U.S.
citizens who have not yet downloaded TikTok of access to the TikTok app. Id. Even before the
Prohibitions were announced, uncertainty over TikTok’s availability in the United States began
to drive prominent TikTok content creators (and their fans) to other platforms. See id. ¶¶ 21-22;
see also Ex. 36. And once users are established on a different application, they are unlikely to
return to TikTok. Pappas Decl. ¶¶ 21-22.
As the November 12th deadline for the remaining Prohibitions approaches, and TikTok is
shut down entirely in the United States, this erosion of TikTok’s competitive position will
accelerate. Even if the shutdown were lifted within two months, 40–50% of daily active users
would be lost permanently, never to return. Pappas Decl. ¶ 19. If the ban is in place for six months,
80–90% of daily active users will not return. Id. Accordingly, even if the TikTok Ban were later
reversed, TikTok would not be able to reverse the loss of users. Id. It is well-established that this
sort of loss of market share to a competitor constitutes irreparable harm. See, e.g., Bayer
HealthCare, LLC v. FDA, 942 F. Supp. 2d 17, 26 (D.D.C. 2013) (“Courts have recognized that

34

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 42 of 50

price erosion and diminished market share can constitute irreparable harm”); Nalco, 786 F. Supp.
2d at 188.
Second, the Prohibitions have already struck a serious blow to Plaintiffs’ reputation and
competitive strength. Pappas Decl. ¶¶ 21-22. TikTok’s commercial partners and U.S. advertisers
want to work with TikTok because of its vibrant community. By destroying that community—
first by shutting TikTok out of the app stores and then by shutting down TikTok entirely—the
Prohibitions have caused and will cause lasting damage to TikTok’s reputation and attractiveness
as a commercial partner, causing current and prospective partners to forge relationships with its
competitors, such as Instagram Reels, instead. Id. ¶¶ 6, 23-25. Businesses like TikTok place a
premium on U.S. advertisers, which are often the most successful at generating revenue for the
company because they typically pay better rates for their advertisements than advertisers in other
markets. Id. ¶ 25. If TikTok is perceived to be an unreliable partner in the marketplace, advertisers
will build partnerships with other platforms instead. Id.; see also Brodie v. Dep’t of Health and
Human Servs., 715 F. Supp. 2d 74, 84 (D.D.C. 2010) (“harm to reputation has been recognized
repeatedly as a type of irreparable injury”).
Indeed, the market uncertainty generated by the government’s decision to target Plaintiffs
has already destabilized TikTok’s business and its strategic partnerships, resulting in millions of
dollars of losses and damage to Plaintiffs’ relationships with major commercial partners and
advertisers who backed out of deals with TikTok after the President issued the August 6 order.
See Pappas Decl. ¶¶ 24–25. Now that the Prohibitions have been issued, Plaintiffs’ business will
be decimated, as the Prohibitions have destroyed Plaintiffs’ ability to engage in the conduct on
which their business depends: growing users and developing good content. Id. ¶ 17. Likewise,
by undercutting Plaintiffs’ U.S. operations, the Prohibitions harm Plaintiffs’ ability to attract and

35

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 43 of 50

retain top employees, some of whom have already rejected offers of employment based on the
government’s actions against TikTok. Id. ¶ 26.
Although economic loss alone generally does not constitute irreparable harm, that is not
so when the harm—as here—“is so severe as to cause extreme hardship to the business or threaten
its very existence.” Sterling Com. Credit-Michigan, LLC v. Phoenix Industries I, LLC, 762 F.
Supp. 2d 8, 15 (D.D.C. 2011) (citation omitted); Smoking Everywhere, Inc. v. FDA, 680 F. Supp.
2d 62, 76 (D.D.C. 2010), aff’d sub nom. Sottera, Inc. v. FDA, 627 F.3d 891 (D.C. Cir. 2010).
Moreover, when sovereign immunity bars a plaintiff from recovering damages from a federal
agency—as is the case here—economic loss suffered by the plaintiff may be irreparable. See
Feinerman v. Bernardi, 558 F. Supp. 2d 36, 51 (D.D.C. 2008); Smoking Everywhere, 680 F.
Supp. 2d at 77 n.19. See also Beacon Theatres v. Westover, 359 U.S. 500, 506-07 (1959) (“The
basis of injunctive relief in the federal courts has always been irreparable harm and inadequacy
of legal remedies.”). The catastrophic economic loss Plaintiffs will suffer in the absence of action
from this Court is thus precisely the type of injury that “tip[s] the balance in favor of injunctive
relief.” Bracco Diagnostics, Inc. v. Shalala, 963 F. Supp. 20, 29 (D.D.C. 1997).
B.

The Balance of Equities and Public Interest Require Injunctive Relief.

The final two elements of the test for provisional relief—the balance of the equities and
the public interest—merge when the government is a party. See Pursuing Am.’s Greatness v.
Fed. Election Comm., 831 F.3d 500, 511 (D.C. Cir. 2016). In assessing these factors, courts
consider the impacts of the injunction on nonparties as well. See id. at 511-12.
The public interest requires an injunction against the Prohibitions’ unlawful restriction of
core protected speech by millions of Americans in violation of their First Amendment rights.
“[E]nforcement of an unconstitutional law is always contrary to the public interest.” Id. at 511.
Moreover, “there is always a strong public interest in the exercise of free speech rights otherwise
36

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 44 of 50

abridged by an unconstitutional regulation.” Id.; see also Gordon v. Holder, 721 F.3d 638, 653
(D.C. Cir. 2013) (similar). Here, absent preliminary injunctive relief, TikTok and its users will
be “unable to exercise those rights.” Pursuing Am.’s Greatness, 831 F.3d at 511.
Similarly, “[t]here is generally no public interest in the perpetuation of unlawful agency
action.” League of Women Voters of U.S. v. Newby, 838 F.3d 1, 12 (D.C. Cir. 2016) (collecting
cases). “To the contrary, there is a substantial public interest ‘in having governmental agencies
abide by the federal laws that govern their existence and operations.’” Id. (citation omitted). See
also, e.g., R.I.L-R v. Johnson, 80 F. Supp. 3d 164, 191 (D.D.C. 2015) (“[A]s courts in this District
have recognized, ‘the public interest is served when administrative agencies comply with their
obligations under the APA.’” (quoting N. Mariana Islands v. United States, 686 F. Supp. 2d 7,
21 (D.D.C. 2009))).
On the other side of the ledger, the government will not face any harm if a preliminary
injunction is granted. The Commerce Department’s 45-day delay before issuing the Prohibitions,
as well as the further delay until November 12 for them to go fully into effect, undercuts any
purported urgency justifying immediate implementation of the Prohibitions. Moreover, the
government “cannot suffer harm from an injunction that merely ends an unlawful practice or
reads a statute as required to avoid constitutional concerns.” R.I.L-R, 80 F. Supp. at 191 (citation
omitted).
Because the harm the Prohibitions inflict on Plaintiffs and third parties grossly outweighs
any purported harm to the government that an injunction would impose, they should be enjoined.

37

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 45 of 50

CONCLUSION
For the foregoing reasons, the Court should grant Plaintiffs’ Motion for a Preliminary
Injunction.
DATED: September 23, 2020

Respectfully submitted,

/s/ John E. Hall
Anders Linderot*
COVINGTON & BURLING LLP
The New York Times Building
620 Eighth Avenue
New York, New York 10018-1405
Telephone: [phone]
Facsimile: + 1 [phone]
Email: [e-mail]
Mitchell A. Kamin*
COVINGTON & BURLING LLP
1999 Avenue of the Stars, Suite 3500
Los Angeles, California 90067-4643
Telephone: + 1 [phone]
Facsimile: + 1 [phone]
Email: [e-mail]

.

John E. Hall (D.C. Bar. No. 415364)
Beth S. Brinkmann (D.C. Bar. No. 477771)
Alexander A. Berengaut (D.C. Bar. No. 989222)
Megan A. Crowley (D.C. Bar. No. 1049027)
Megan C. Keenan (D.C. Bar. No. 1672508)
COVINGTON & BURLING LLP
One CityCenter
850 Tenth Street, NW
Washington, DC 20001
Telephone: [phone]
Facsimile: + 1 [phone]
Email: [e-mail]
[e-mail]
[e-mail]
[e-mail]
[e-mail]

*Pro Hac Vice
Attorneys for Plaintiffs

38

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 46 of 50

Addendum

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 47 of 50

§ 1702. Presidential authorities, 50 USCA § 1702

KeyCite Yellow Flag - Negative Treatment
Proposed Legislation

United States Code Annotated
Title 50. War and National Defense (Refs & Annos)
Chapter 35. International Emergency Economic Powers (Refs & Annos)
50 U.S.C.A. § 1702
§ 1702. Presidential authorities
Effective: October 26, 2001
Currentness
(a) In general
(1) At the times and to the extent specified in section 1701 of this title, the President may, under such regulations as he may
prescribe, by means of instructions, licenses, or otherwise-(A) investigate, regulate, or prohibit-(i) any transactions in foreign exchange,
(ii) transfers of credit or payments between, by, through, or to any banking institution, to the extent that such transfers or
payments involve any interest of any foreign country or a national thereof,
(iii) the importing or exporting of currency or securities,
by any person, or with respect to any property, subject to the jurisdiction of the United States;
(B) investigate, block during the pendency of an investigation, regulate, direct and compel, nullify, void, prevent or prohibit,
any acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in,
or exercising any right, power, or privilege with respect to, or transactions involving, any property in which any foreign
country or a national thereof has any interest by any person, or with respect to any property, subject to the jurisdiction of
the United States; and. 1
(C) when the United States is engaged in armed hostilities or has been attacked by a foreign country or foreign nationals,
confiscate any property, subject to the jurisdiction of the United States, of any foreign person, foreign organization, or foreign
country that he determines has planned, authorized, aided, or engaged in such hostilities or attacks against the United States;
and all right, title, and interest in any property so confiscated shall vest, when, as, and upon the terms directed by the President,
in such agency or person as the President may designate from time to time, and upon such terms and conditions as the
President may prescribe, such interest or property shall be held, used, administered, liquidated, sold, or otherwise dealt with

© 2020 Thomson Reuters. No claim to original U.S. Government Works.

1

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 48 of 50

§ 1702. Presidential authorities, 50 USCA § 1702

in the interest of and for the benefit of the United States, and such designated agency or person may perform any and all acts
incident to the accomplishment or furtherance of these purposes.
(2) In exercising the authorities granted by paragraph (1), the President may require any person to keep a full record of, and
to furnish under oath, in the form of reports or otherwise, complete information relative to any act or transaction referred to in
paragraph (1) either before, during, or after the completion thereof, or relative to any interest in foreign property, or relative to
any property in which any foreign country or any national thereof has or has had any interest, or as may be otherwise necessary
to enforce the provisions of such paragraph. In any case in which a report by a person could be required under this paragraph,
the President may require the production of any books of account, records, contracts, letters, memoranda, or other papers, in
the custody or control of such person.
(3) Compliance with any regulation, instruction, or direction issued under this chapter shall to the extent thereof be a full
acquittance and discharge for all purposes of the obligation of the person making the same. No person shall be held liable in
any court for or with respect to anything done or omitted in good faith in connection with the administration of, or pursuant to
and in reliance on, this chapter, or any regulation, instruction, or direction issued under this chapter.
(b) Exceptions to grant of authority
The authority granted to the President by this section does not include the authority to regulate or prohibit, directly or indirectly-(1) any postal, telegraphic, telephonic, or other personal communication, which does not involve a transfer of anything of
value;
(2) donations, by persons subject to the jurisdiction of the United States, of articles, such as food, clothing, and medicine,
intended to be used to relieve human suffering, except to the extent that the President determines that such donations (A)
would seriously impair his ability to deal with any national emergency declared under section 1701 of this title, (B) are in
response to coercion against the proposed recipient or donor, or (C) would endanger Armed Forces of the United States
which are engaged in hostilities or are in a situation where imminent involvement in hostilities is clearly indicated by the
circumstances; or 2
(3) the importation from any country, or the exportation to any country, whether commercial or otherwise, regardless of format
or medium of transmission, of any information or informational materials, including but not limited to, publications, films,
posters, phonograph records, photographs, microfilms, microfiche, tapes, compact disks, CD ROMs, artworks, and news
wire feeds. The exports exempted from regulation or prohibition by this paragraph do not include those which are otherwise
controlled for export under section 4604 of this title, or under section 4605 of this title to the extent that such controls promote
the nonproliferation or antiterrorism policies of the United States, or with respect to which acts are prohibited by chapter
37 of Title 18;
(4) any transactions ordinarily incident to travel to or from any country, including importation of accompanied baggage for
personal use, maintenance within any country including payment of living expenses and acquisition of goods or services for
personal use, and arrangement or facilitation of such travel including nonscheduled air, sea, or land voyages.

© 2020 Thomson Reuters. No claim to original U.S. Government Works.

2

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 49 of 50

§ 1702. Presidential authorities, 50 USCA § 1702

(c) Classified information.--In any judicial review of a determination made under this section, if the determination was based
on classified information (as defined in section 1(a) of the Classified Information Procedures Act) such information may be
submitted to the reviewing court ex parte and in camera. This subsection does not confer or imply any right to judicial review.
CREDIT(S)
(Pub.L. 95-223, Title II, § 203, Dec. 28, 1977, 91 Stat. 1626; Pub.L. 100-418, Title II, § 2502(b)(1), Aug. 23, 1988, 102
Stat. 1371; Pub.L. 103-236, Title V, § 525(c)(1), Apr. 30, 1994, 108 Stat. 474; Pub.L. 107-56, Title I, § 106, Oct. 26, 2001,
115 Stat. 277.)
EXECUTIVE ORDERS
EXECUTIVE ORDER NO. 13290
<Mar. 20, 2003, 68 F.R. 14307, as amended by Ex. Ord. No. 13350, July 29, 2004, 69 F.R. 46055>
Confiscating and Vesting Certain Iraqi Property
By the authority vested in me as President by the Constitution and the laws of the United States of America, including the
International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (IEEPA), the National Emergencies Act (50 U.S.C.
1601 et seq.), and section 301 of title 3, United States Code, and in order to take additional steps with respect to the national
emergency declared in Executive Order 13303 of March 20, 2003 [set out as a note under 50 U.S.C.A. § 1701], and expanded
in Executive Order 13315 of August 28, 2003 [set out as a note under 50 U.S.C.A. § 1701],
I, GEORGE W. BUSH, President of the United States of America, hereby determine that the United States and Iraq are engaged
in armed hostilities, that it is in the interest of the United States to confiscate certain property of the Government of Iraq and its
agencies, instrumentalities, or controlled entities, and that all right, title, and interest in any property so confiscated should vest
in the Department of the Treasury. I intend that such vested property should be used to assist the Iraqi people and to assist in
the reconstruction of Iraq, and determine that such use would be in the interest of and for the benefit of the United States.
I hereby order:
Section 1. All blocked funds held in the United States in accounts in the name of the Government of Iraq, the Central Bank
of Iraq, Rafidain Bank, Rasheed Bank, or the State Organization for Marketing Oil are hereby confiscated and vested in the
Department of the Treasury, except for the following:
(a) any such funds that are subject to the Vienna Convention on Diplomatic Relations or the Vienna Convention on Consular
Relations, or that enjoy equivalent privileges and immunities under the laws of the United States, and are or have been used
for diplomatic or consular purposes, and
(b) any such amounts that as of the date of this order are subject to post-judgment writs of execution or attachment in aid of
execution of judgments pursuant to section 201 of the Terrorism Risk Insurance Act of 2002 [set out as a note under 15 U.S.C.A.
§ 1610] (Public Law 107-297), provided that, upon satisfaction of the judgments on which such writs are based, any remainder
of such excepted amounts shall, by virtue of this order and without further action, be confiscated and vested.
Sec. 2. The Secretary of the Treasury is authorized to perform, without further approval, ratification, or other action of the
President, all functions of the President set forth in section 203(a)(1)(C) of IEEPA [subsec. (a)(1)(C) of this section] with respect

© 2020 Thomson Reuters. No claim to original U.S. Government Works.

3

Case 1:20-cv-02658-CJN Document 15-1 Filed 09/23/20 Page 50 of 50

§ 1702. Presidential authorities, 50 USCA § 1702

to any and all property of the Government of Iraq, including its agencies, instrumentalities, or controlled entities, and to take
additional steps, including the promulgation of rules and regulations as may be necessary, to carry out the purposes of this order.
The Secretary of the Treasury may redelegate such functions in accordance with applicable law. The Secretary of the Treasury
shall consult the Attorney General as appropriate in the implementation of this order.
Sec. 3. This order shall be transmitted to the Congress and published in the Federal Register.
GEORGE W. BUSH

Notes of Decisions (92)

Footnotes
1
So in original. The period probably should not appear.
2
So in original. The word “or” probably should not appear.
50 U.S.C.A. § 1702, 50 USCA § 1702
Current through P.L. 116-158.
End of Document

© 2020 Thomson Reuters. No claim to original U.S. Government Works.

© 2020 Thomson Reuters. No claim to original U.S. Government Works.

4