TikTok Agrees to Pay $550 Million to Settle Child Data Lawsuit

Social media giant TikTok has agreed to pay $400 million to settle a class-action lawsuit in the United States accusing it of illegally collecting personal information from children under 13 without parental consent. The settlement, announced on February 21, is considered the largest ever in a case involving the Children's Online Privacy Protection Act (COPPA).

The lawsuit, filed in 2024, alleged that TikTok and its parent company, ByteDance, knowingly allowed minors under 13 to use general accounts and collected their personal data without obtaining prior parental consent. The claims also included allegations that TikTok failed to properly honor parental requests to delete accounts and continued to retain personal information. COPPA requires companies to notify parents and obtain their consent before collecting personal data from children under 13 online.

TikTok and ByteDance did not admit wrongdoing as part of the settlement, meaning no court has ruled on the legality of their practices. This case is part of a growing wave of litigation and regulatory action targeting big tech companies over their handling of children's and adolescents' data. For instance, Amazon agreed to pay $25 million in 2023 for allegedly retaining children's Alexa voice data for extended periods, and Meta is currently facing a trial with 29 U.S. states over similar issues.

While the TikTok case primarily focuses on COPPA violations, the Meta lawsuit also addresses concerns about addictive design and deceptive practices. The intensified enforcement of COPPA is partly driven by the increasing use of social media and technology by children. The U.S. Federal Trade Commission (FTC) revised COPPA rules last year, requiring separate parental consent for using children's information for targeted advertising and limiting long-term data retention. In the U.S., the FTC investigates COPPA violations and refers cases to the Department of Justice, which then files civil lawsuits, as seen in the TikTok case initiated in a California federal court.