INDIANAPOLIS — The Indiana Court of Appeals has reinstated a lawsuit filed by the state accusing TikTok of deceiving its users about the video-sharing platform's level of inappropriate content for children and the security of its consumers’ personal information.
In a 3-0 ruling issued Monday, a three-judge panel of the state appeals court reversed two November 2023 decisions by an Allen County judge which dismissed a pair of lawsuits the state had filed in December 2022 against TikTok.
Those suits, which have been consolidated, allege the app contains “salacious and inappropriate content” despite the company claiming it is safe for children 13 years and under. The litigation also argues that the app deceives consumers into believing their sensitive and personal information is secure.
In November's ruling, Allen Superior Court Judge Jennifer L. DeGroote found that her court lacked personal jurisdiction over the case and reaffirmed a previous court ruling which found that downloading a free app does not count as a consumer transaction under the Indiana Deceptive Consumer Sales Act.
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But in Monday's ruling, Judge Paul Mathias wrote on behalf of the appeals court that TikTok’s millions of Indiana users and the $46 million in Indiana-based income the company reported in 2021 create sufficient contact between the company and the state to establish the jurisdiction of Indiana’s courts over TikTok, The Times of Northwest Indiana reported.
Mathias also wrote that TikTok’s business model of providing access to its video content library in exchange for the personal data of its Indiana users counts as a “consumer transaction” under the law, even if no payment is involved.
“The plain and ordinary definition of the word ‘sale,’ which is not otherwise defined in the DCSA, includes any consideration to effectuate the transfer of property, not only an exchange for money,” Mathias wrote.
“It is undisputed that TikTok exchanges access to its app’s content library for end-user personal data. That is the bargain between TikTok and its end-users. And, under the plain and ordinary use of the word, that is a ‘sale’ of access to TikTok’s content library for the end-user’s personal data. TikTok’s business model is therefore a consumer transaction under the DCSA.”
A spokesperson for the Indiana Attorney General's office said Tuesday in a statement that the appeals court “took a common sense approach and agreed with our office’s argument that there’s simply no serious question that Indiana has established specific personal jurisdiction over TikTok.”
“By earning more $46 million dollars from Hoosier consumers in 2021, TikTok is doing business in the state and is therefore subject to this lawsuit,” the statement adds.
The Associated Press left a message Tuesday afternoon for a lead attorney for TikTok seeking comment on the appeals court's ruling.
TikTok is owned by ByteDance, a Chinese company that moved its headquarters to Singapore in 2020. The app has been a target over the past year of state and federal lawmakers who say the Chinese government could access the app’s users’ data.
Indiana Attorney General Todd Rokita has repeatedly personally urged Hoosiers to ”patriotically delete″ the TikTok app due to its supposed ties to the Chinese Communist Party.
