‘Something About This Settlement Stinks’ Objector Says of Proposed $92M TikTok Privacy Suit Resolution

According to a filing submitted earlier this week in the Chicago, Illinois consolidated action,  a potential class member contends that there are serious concerns with both the fairness and adequacy of the preliminarily approved settlement.

The case stems from allegations facing the Chinese-owned video sharing mobile application. Chiefly, the filing states that that the company was using hidden technology to collect a huge quantity of data about U.S. consumers and share it with the Chinese government. 

These contentions led to the app’s ban from use on government issued phones, and an order from former President Trump declaring it a national security threat. He also proposed banning the app as well as conditioning its domestic use on its sale to an American company, though that never came to fruition.

Lawsuits streamed in, arguing that TikTok invaded users’ privacy in violation of consumer protection and biometric information privacy laws. Immediately following the cases’ consolidation and transfer, TikTok engaged opposing counsel in mediation in hopes of speedy resolution, allegedly to make the then-pending acquisition more palatable. Then, the parties reached a confidential settlement, the details of which allegedly remained private for months until the plaintiffs moved for preliminary approval in February 2021.

Last September, the court granted the request, finding that the settlement would adequately compensate the approximately 89 million user class. The court highlighted that injunctive relief would prevent recurrences and keep TikTok accountable. It also approved class notice and opt-out procedures.

Now, the objector argues that the settlement grossly under-compensates class members for what he calls “very serious, likely criminal, wrongdoing,” as described in the complaint. The filing also notes that the figure is paltry compared to the company’s $34.3 billion in earnings in 2020 alone.

In addition, non-Illinois class members will receive six times less money than Illinois residents, who are protected by the Illinois Biometric Information Privacy Act, a one-of-a-kind state statute, the filing says. This is despite the fact that “the only thing class members are told for sure is that TikTok didn’t violate BIPA because TikTok has warranted, and Class Counsel has apparently confirmed, that TikTok has ‘not used the App to collect biometric information or [] identifiers as defined by [BIPA].’”

The objection further claims that the settlement process was tainted, in part due to TikTok’s eagerness to settle the dispute and in part due to plaintiffs’ counsel being “simply interested in reaching topline number.”

Additionally, the objector faults the court for setting the objection deadline prior to the deadline for the motion for attorneys’ fees. The filing argues that this leaves litigants with no recourse should they wish to challenge the fee request, which is apparently 30% of the settlement. That figure is too high, given the early stage at which the case settled and the low value of the settlement itself, the objection says.

The objector is represented by Edelson PC.

Co-lead counsel for the plaintiffs and putative class are Carlson Lynch LLP, Fegan Scott LLC, and Bird, Marella, Boxer, Wolpert, Nessim, Drooks, Lincenberg & Rhow P.C. TikTok is represented by Wilson Sonsini Goodrich & Rosati.