Judge Blocks Key Piece of TikTok’s $400 Million Privacy Settlement Over Older Court Order: And what happens next

A federal judge in California has partially rejected TikTok’s proposed $400 million privacy settlement with the U.S. government, refusing to approve a provision that would have dissolved a separate 2019 court order tied to Musical.ly, the predecessor app that later became TikTok. Judge George H. Wu’s ruling leaves the settlement incomplete and keeps older legal obligations in place, complicating what the Justice Department had pitched as a comprehensive resolution to federal children’s privacy claims against TikTok and its parent company ByteDance.

The financial structure of the proposed deal called for TikTok to pay $300 million upfront, with an additional $100 million contingent on the court agreeing to void the 2019 consent decree stemming from the Musical.ly era. That second tranche remains in limbo following Judge Wu’s decision. The underlying lawsuit, filed by the Justice Department in 2024, accused TikTok and ByteDance of violating the Children’s Online Privacy Protection Act, known as COPPA, which requires platforms to notify parents and obtain verifiable consent before collecting personal data from children under 13. The 2019 order itself followed a Federal Trade Commission finding that Musical.ly had gathered data from young children without proper parental permission, resulting in a $5.7 million fine at the time. Because the newer settlement was structured to extinguish that older order as well, the judge’s refusal to terminate it means TikTok still faces the compliance obligations and oversight requirements that decree imposed years ago. TikTok has argued that the company today bears little resemblance to the one that existed when the 2024 lawsuit was filed, pointing to changes in ownership, management, and privacy practices, including a requirement that all users enter a birthdate before accessing the app and systems designed to detect underage users attempting to circumvent age restrictions. A Justice Department legal opinion issued in July 2026 acknowledged that TikTok’s U.S. Data Security Joint Venture is now majority-owned by American investors and operates independently of ByteDance, and the department has cited those structural shifts as relevant context for the settlement.

Judge Wu wrote that the court could not determine whether the proposed change represented a durable remedy or whether terminating the older order was properly tailored to the asserted change in circumstances.

The judge’s decision does not conclude that TikTok failed to make meaningful improvements, but it sets a higher bar for demonstrating that ending the 2019 oversight framework is warranted. With more than 200 million Americans using the platform, the stakes of the ongoing proceedings extend well beyond the courtroom. TikTok, the Justice Department, and the FTC must now determine how to address the portions of the settlement left unresolved, while the 2019 Musical.ly consent decree continues to govern TikTok’s privacy obligations in parallel with whatever the newer agreement ultimately requires.