• by Wendy Davis , 4 hours ago

A startup law firm is suing the Trump administration for approving the sale of a U.S. version of TikTok to a joint venture of Oracle and other companies, including the China-based ByteDance.

In a  complaint filed Thursday in Washington, D.C. federal court, the Public Integrity Project claims that the $14 billion sale wrongly allows ByteDance to "control all the essential elements of TikTok."

Former Senator Russ Feingold, a Democrat from Wisconsin, is among the leaders of the Public Integrity Project, a two-month old firm that aims to fight corruption.

The lawsuit, brought on behalf of two software engineers and stock investors -- Alphabet investor Zhaocheng Anthony Tan and Meta Platforms investor Garrett Reid -- alleges that the deal "facially violated the TikTok Law" by allowing ByteDance to continue to play a role in TikTok's operations.

"ByteDance could continue to push Chinese propaganda and censor the content it does not like, exactly the harm that the law was intended to prevent," the complaint alleges.

The TikTok law -- officially called the Protecting Americans From Foreign Adversary Controlled Applications Act -- prohibits app stores and websites from distributing apps that are "controlled" by China. An app is considered "controlled" by China when people from the country own at least a 20% stake.

The statute was largely driven by concerns that the Chinese government may be able to access data about TikTok's users, and could use the app to spread propaganda.

If enforced, the law would have effectively banned TikTok in the U.S, unless ByteDance had divested the app by mid-April 2025, at the latest.

ByteDance sold TikTok's U.S. operations to the joint venture in January, but retained 19.9% of ownership. ByteDance also allegedly owns TikTok's algorithm and licenses it to the U.S. venture, according to the complaint.

The allegation regarding the algorithm's ownership has surfaced in press reports, but the official announcement of the deal is silent on that point. Instead, that announcement says the joint venture "will retrain, test, and update the content recommendation algorithm on U.S. user data," and that it "will be secured in Oracle's U.S. cloud environment."

The complaint additionally alleges that Trump violated the law by unilaterally extending ByteDance's deadline to sell TikTok.

The lawsuit also claims that the deal "enriched" Trump allies, including Oracle's Larry Ellison.

"Ellison previously hosted a $100,000-per-person fundraiser for Trump at Ellison’s estate," the complaint alleges. "He and his son David purchased CBS News, which the elder Ellison has assured President Trump he would make a more conservative outlet."

Among other requests, the plaintiffs are seeking a judicial declaration that the Trump administration's approval of the deal was illegal.

Such an order could result in hefty fines, and potentially lead to the deal's unwinding, Public Integrity Project attorney and former federal prosecutor Brendan Ballou tells MediaPost.