A newly formed anti-corruption group has sued President Donald Trump and Attorney General Pam Bondi over the deal that sold TikTok’s U.S. operation to a group of administration-backed investors.
The suit, filed by the Public Integrity Project, a law firm that seeks to raise the “reputational cost of corruption in America,” argues the deal violates a law intended to prevent the spread of Chinese government propaganda and has enriched Trump's allies.
That law, signed by then-President Joe Biden in 2024, said that TikTok couldn’t be distributed in the United States unless the Chinese company ByteDance found an American-based corporate home by the day before Donald Trump returned to office. The law was upheld by the Supreme Court.
“The law was clear, but it was never enforced,” says the lawsuit, filed Thursday in the U.S. Court of Appeals for the District of Columbia Circuit. “Shortly after the deadline to divest passed, President Trump issued an executive order purportedly granting an extension for TikTok to find a domestic owner and directed his Attorney General not to enforce the law.”
The Justice Department declined to comment, while TikTok U.S. did not immediately respond to requests for comment.
The plaintiffs in the suit are two software engineers from California: One is a shareholder in Alphabet Inc., YouTube’s parent company; the other is a shareholder in Meta Platforms, Inc., which is Instagram’s parent company. Both say they suffered financially due to the non-enforcement of the law.
Brendan Ballou, the CEO of the Public Integrity Project and a former Justice Department prosecutor, told NBC News that the Trump deal is bad for TikTok users and the country.
“The original motivation for this law was to prevent the Chinese government from pushing propaganda onto American audiences,” Ballou said. “The deal that the president approved is the absolute worst of all possible worlds, because right now ByteDance continues to own the algorithm, which means that it can censor the content that it doesn’t like, but at the same time Oracle controls the data and it can censor the information that it doesn’t like. Really it’s a situation that’s going to be terrible for users, and terrible for free speech on the platform.”
Trump signed an executive order in September paving the way for the deal, and the White House and China finalized a deal to give control of TikTok’s U.S. operations to a group of investors who were backed by Trump earlier this year.
The deal included investors “Oracle, MGX, and affiliates of Susquehanna International Group, LLP and General Atlantic, among other companies,” which the lawsuit said “have close ties to the President, and have at times personally enriched him.”
Trump has faced criticism over the deal, and the lawsuit notes that Oracle co-founder and chairman Larry Ellison “previously hosted a $100,000-per-person fundraiser for Trump at Ellison’s estate”; that Ellison and his son David Ellison “purchased CBS News, which the elder Ellison has assured President Trump he would make a more conservative outlet”; and that David Ellison, with backing from his father, “is now trying to buy Warner Bros. Discovery, an acquisition requiring approval from the Trump administration.”
The suit is the first filed by the Public Integrity Project, which launched this year. Former Sen. Russ Feingold, D-Wis., who is on the project’s advisory committee, said the group is “uniquely focused on suing to stop the corruption that is exploding in our country.”
