Federal Judge Blocks Trump’s TikTok Ban Hours Before Midnight Deadline

Update (2015ET): Judge Nichols has – at least temporarily – blocked the White House’s TikTok ban, and sparred Google and Apple from an order to remove the app from their app stores at midnight.

As we noted below, several reporters believed this was the expected outcome, based on the judge’s questions during today’s emergency hearing. The first of two critical deadlines loomed at mighnight, but it appears the judge has – as expected – adhered to the precedent set in a ruling averting a similar block on WeChat.

Before making his ruling on whether the Trump Administration’s national security concerns were urgent enough to justify the ban, the judge said he would solicit feedback from both parties, which was cited as the primary reason for the delay. The 90-minute hearing took place Sunday morning in a Washington DC courtroom.

What happens next is uncertain, a quality that has permeated the administration’s crackdown and subsequent race for a deal. The administration via the Department of Commerce has set Nov. 12 to be the final post-election deadline, and there’s still plenty of time for appeals should the Trump Administration choose to push ahead with its case. Last week, Chinese media published a series of editorials implying that the TikTok deal was in jeopardy of being quashed by Beijing, while President Trump reiterated demands for American control or TikTok would be shunted out of another massive market (it has already been banned in India, along with hundreds of other Chinese apps). But ByteDance and Oracle and Wal-Mart have issued conflicting statements about the ownership breakdown in a final deal, and there’s still some reason to believe that the US could get what it wants – majority control in the hands of American investors – since American VC firms own more than 40% of TikTok’s paret, ByteDance. But Beijing has hinted that it won’t tolerate such an arrangement.

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The day has finally arrived. During a 90-minute emergency hearing Sunday morning, lawyers from the DoJ faced off with the legal team from ByteDance in arguments before Judge Carl Nichols of the US District Court for the District of Columbia, who has said he release his decision by late Sunday.

That decision comes in response to TikTok’s latest legal action – a request for an emergency injunction – to try and circumvent a series of executive orders signed by President Trump that seek to completely shut down the app by No. 12. If allowed to stand, TikTok would be booted from American app stores, as of midnight, with more restrictions set to come into effect after the election.

The proceedings have been kept mostly under wraps, with a select group of reporters, mostly from various wire services, allowed to report on the hearing. About an hour ago, a redacted brief filed by the government outlining its argument was finally released, after Bloomberg published a preview earlier today which revealed that the DoJ’s argument centered on an earlier ruling from a judge in PA.

So far, this is the biggest hint that we’ve gotten on the judge’s decision, hinting that whether TikTok has been accorded “due process” might be a key issue in the judge’s thinking.

And while a decision might not arrive until late tonight, since the judge is requiring both sides to respond to his opinion before it’s unsealed.

Axios’ editor Dan Primack believes the odds are that TikTok’s request will be granted, given the precedent from the WeChat ruling earlier this month.

Here’s a redacted briefing outlining the rest of the government’s argument, the most thorough explanation yet, which was apparently filed Friday night, but only released Sunday afternoon. In its ruling, the DoJ accuses TikTok of being a “mouthpiece of the Communist Party” and alleges that the company has an “informal” relationship with the state security apparatus due to Chinese laws compelling cooperation by domestic companies.

Doj s Memorandum in Opposition to Tiktok by Zerohedge on Scribd

Beijing-controlled papers published a flurry of editorials opposing the deal last week. ByteDance’s venture investors, including General Atlantic Partners and Sequoia Capital, created the structure that makes it look like TikTok will largely be owned by US investors, though this fact has apparently been disputed as both Beijing and Washington want the other to come away with majority control – one of the key sticking points in the talks, according to press reports. According to the structure, Oracle will manage TikTok in its cloud, a highly lucrative business, while ByteDance would retain control of TikTok’s content-recommendation algorithm, seen as its “secret sauce”. An IPO would then be planned for some time next year.

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