1 00:00:00,480 --> 00:00:05,720 Speaker 1: You're listening to Bloomberg Law with June Grasso from Bloomberg Radio. 2 00:00:06,519 --> 00:00:09,920 Speaker 1: TikTok is going on the offensive with a high stakes 3 00:00:10,000 --> 00:00:14,200 Speaker 1: lawsuit challenging President Trump's ban on the social media network, 4 00:00:14,440 --> 00:00:17,360 Speaker 1: a move that could deepen what's been described as a 5 00:00:17,440 --> 00:00:21,680 Speaker 1: digital cold war. Trump band US residents from doing business 6 00:00:21,680 --> 00:00:25,880 Speaker 1: with TikTok on August six because of its Chinese parent company, 7 00:00:25,960 --> 00:00:30,240 Speaker 1: Bike Dance. The Trump administration claims the fast growing social 8 00:00:30,280 --> 00:00:34,400 Speaker 1: network is a threat to national security. Here's Acting Deputy 9 00:00:34,440 --> 00:00:38,720 Speaker 1: Secretary of Homeland Security Ken Kuchinelli. Problem is that it 10 00:00:38,760 --> 00:00:42,160 Speaker 1: happens on a mass scale. It isn't one particular kid 11 00:00:42,280 --> 00:00:46,000 Speaker 1: or one particular person. It's the existence in the United 12 00:00:46,040 --> 00:00:50,959 Speaker 1: States of a multimillion person a data collection effort that 13 00:00:51,280 --> 00:00:55,640 Speaker 1: the essentially the spy agencies in the military of communist 14 00:00:55,680 --> 00:01:00,000 Speaker 1: China can tap into. Trump escalated the conflict a week later, 15 00:01:00,440 --> 00:01:03,680 Speaker 1: ordering Byte Dance to sell TikTok and saying that U 16 00:01:03,760 --> 00:01:06,280 Speaker 1: s should receive a cut of the deal. We're making 17 00:01:06,319 --> 00:01:08,560 Speaker 1: it possible for this deal to happen right now. They 18 00:01:08,560 --> 00:01:11,119 Speaker 1: don't have any rights unless we give it to them. 19 00:01:11,160 --> 00:01:13,280 Speaker 1: So if we're going to give them the rights and 20 00:01:13,280 --> 00:01:15,720 Speaker 1: then it has to come into it has to come 21 00:01:15,720 --> 00:01:17,760 Speaker 1: into this country. It's a little bit like the landlord 22 00:01:17,840 --> 00:01:23,000 Speaker 1: tenant without a lease, the tenant has nothing. My guest 23 00:01:23,080 --> 00:01:26,319 Speaker 1: is James Dempsey, executive director of the Berkeley Center for 24 00:01:26,400 --> 00:01:29,800 Speaker 1: Law and Technology at you see Berkeley. Start by telling 25 00:01:29,880 --> 00:01:33,440 Speaker 1: us about the grounds for TikTok's lawsuit. Well, the grounds 26 00:01:33,480 --> 00:01:37,400 Speaker 1: for TikTok lawsuit are based in large part on the 27 00:01:37,480 --> 00:01:40,840 Speaker 1: due process, which is that their property in essence is 28 00:01:40,959 --> 00:01:44,759 Speaker 1: being taken, their business is being harmed by the president 29 00:01:44,880 --> 00:01:49,240 Speaker 1: without due process, without the sound factual basis, and without 30 00:01:49,280 --> 00:01:52,640 Speaker 1: a legitimate basis or a good basis for TikTok to 31 00:01:53,200 --> 00:01:57,400 Speaker 1: in essence defend itself. President Trump's August six order to 32 00:01:57,520 --> 00:02:01,520 Speaker 1: stop US residents from doing business with TikTok and we chet, 33 00:02:01,920 --> 00:02:06,560 Speaker 1: was that an unusual use of executive powers? Yeah, this 34 00:02:06,720 --> 00:02:10,520 Speaker 1: was I think constructing the president's power, which is obviously 35 00:02:10,560 --> 00:02:14,400 Speaker 1: substantial when he claims national security grounds. This really took 36 00:02:14,400 --> 00:02:17,520 Speaker 1: it beyond anything similar anything that has been done in 37 00:02:17,560 --> 00:02:19,600 Speaker 1: the past. So there's ever going to be a case 38 00:02:19,639 --> 00:02:23,720 Speaker 1: in which the president's national security powers are curtailed by 39 00:02:23,760 --> 00:02:27,239 Speaker 1: the courts. This may be the case. Explain that a 40 00:02:27,280 --> 00:02:29,800 Speaker 1: little bit more for example, what's been done before and 41 00:02:29,880 --> 00:02:33,799 Speaker 1: why this is going further. Well, the statute that's an 42 00:02:33,800 --> 00:02:38,239 Speaker 1: issue in the lawsuit at least is the International Economic 43 00:02:38,360 --> 00:02:43,320 Speaker 1: Emergency Powers Act, which gives the President and power to 44 00:02:43,600 --> 00:02:49,800 Speaker 1: block financial transactions and any kind of transaction with an entity, 45 00:02:50,440 --> 00:02:53,600 Speaker 1: foreign government or in person, which would include of course 46 00:02:53,600 --> 00:02:57,360 Speaker 1: a corporation where the President finds that there's an immediate 47 00:02:57,440 --> 00:03:02,520 Speaker 1: and extraordinary threat to the national security. Mainly in the past, 48 00:03:02,760 --> 00:03:05,640 Speaker 1: I think exclusively in the past, that has been used 49 00:03:06,000 --> 00:03:11,000 Speaker 1: against terrorist groups or country supporting terrorism. That used against 50 00:03:11,000 --> 00:03:15,160 Speaker 1: North Korea for its nuclear weapons program, used against Iran 51 00:03:15,360 --> 00:03:18,399 Speaker 1: on the same grounds, used against North Korea for its 52 00:03:18,480 --> 00:03:23,440 Speaker 1: actions attacking Sony during out other cyber attacks. So mainly 53 00:03:23,639 --> 00:03:28,360 Speaker 1: it's been used where the direct threat is coming from 54 00:03:28,680 --> 00:03:32,320 Speaker 1: the nation state, from the foreign government. Here it's an 55 00:03:32,320 --> 00:03:37,160 Speaker 1: indirect threat, theory being that China has control over TikTok's 56 00:03:37,200 --> 00:03:40,840 Speaker 1: parent company, Fight Dance, and that grew that then China 57 00:03:40,920 --> 00:03:43,960 Speaker 1: can control TikTok to the detriment of the US NAS 58 00:03:44,120 --> 00:03:47,640 Speaker 1: security interests. So it's a broader use of the statute 59 00:03:47,680 --> 00:03:51,560 Speaker 1: I think than has been traditional in the past. You 60 00:03:51,600 --> 00:03:55,360 Speaker 1: mentioned that the stated concern of the US is that 61 00:03:55,680 --> 00:03:59,960 Speaker 1: TikTok is collecting huge amounts of data about American citizens 62 00:04:00,080 --> 00:04:04,640 Speaker 1: and that China could force it to turn the data over. 63 00:04:05,000 --> 00:04:09,480 Speaker 1: TikTok has said that it's now storing data on American 64 00:04:09,560 --> 00:04:13,480 Speaker 1: citizens in the US and Singapore, and it's appointed a 65 00:04:13,680 --> 00:04:19,000 Speaker 1: US leadership content moderation team that's not subject to the Chinese. 66 00:04:19,480 --> 00:04:23,320 Speaker 1: Are those good responses and will accord really look into 67 00:04:23,320 --> 00:04:26,880 Speaker 1: the facts here or just say, well, it's national security 68 00:04:27,000 --> 00:04:31,080 Speaker 1: and the president and the executive branch knows better. So 69 00:04:31,360 --> 00:04:34,360 Speaker 1: I do think that there's been a lot of ambiguity, 70 00:04:34,640 --> 00:04:38,560 Speaker 1: a lot of vagueness on the part of the president 71 00:04:38,680 --> 00:04:42,320 Speaker 1: and the administration here they talk about what might happen 72 00:04:42,640 --> 00:04:45,960 Speaker 1: or what its potential. On the other hand, it is 73 00:04:46,040 --> 00:04:50,160 Speaker 1: true that if the software is made a controlled for 74 00:04:50,440 --> 00:04:55,160 Speaker 1: could be altered at the direction of corporate leaders company 75 00:04:55,560 --> 00:04:59,760 Speaker 1: in China, that they could certainly be required by the 76 00:05:00,080 --> 00:05:04,159 Speaker 1: niche government to alter that software, to alter the architecture 77 00:05:04,279 --> 00:05:07,880 Speaker 1: of their system, making data vulnerable. But Ken, I think 78 00:05:07,880 --> 00:05:11,799 Speaker 1: it is this question of how much can the president 79 00:05:11,920 --> 00:05:17,920 Speaker 1: act upon concerns and hypotheticals and maybe versus how much 80 00:05:17,960 --> 00:05:21,000 Speaker 1: does the government actually have to come forward and say 81 00:05:21,120 --> 00:05:25,120 Speaker 1: concretely this is happening, and that will be sort of 82 00:05:25,160 --> 00:05:28,000 Speaker 1: the fight, that is, can the president take this kind 83 00:05:28,040 --> 00:05:32,159 Speaker 1: of action on the basis of a maybe. TikTok also 84 00:05:32,279 --> 00:05:37,200 Speaker 1: says that Trump's actions are in retaliation for the network 85 00:05:37,240 --> 00:05:41,640 Speaker 1: providing a platform for those who opposed Trump. For example, 86 00:05:41,800 --> 00:05:45,840 Speaker 1: that platform disrupted a Trump rally in Oklahoma recently, and 87 00:05:45,920 --> 00:05:50,159 Speaker 1: they also say it's part of his campaign against China 88 00:05:50,320 --> 00:05:54,680 Speaker 1: and Chinese tech designed to help him in the November elections. 89 00:05:55,080 --> 00:05:58,600 Speaker 1: Will the court consider any of those issues? So, I 90 00:05:58,640 --> 00:06:02,080 Speaker 1: think there's definitely in this sort of confusing set are 91 00:06:02,200 --> 00:06:06,359 Speaker 1: collecting or complicated overlapping set motivation on the part of 92 00:06:06,360 --> 00:06:09,040 Speaker 1: the administration in their obviously spent, as there has been 93 00:06:09,080 --> 00:06:12,760 Speaker 1: most every issue, some very broad and unusual statements by 94 00:06:12,800 --> 00:06:15,640 Speaker 1: the president. I think that at the end of the day, 95 00:06:15,680 --> 00:06:18,840 Speaker 1: when it comes to the court case, the government, through 96 00:06:18,880 --> 00:06:22,520 Speaker 1: its lawyers, is going to come forward and focus exclusively 97 00:06:23,040 --> 00:06:26,960 Speaker 1: on the national security ground. Generally, in the past, I 98 00:06:27,000 --> 00:06:29,600 Speaker 1: think the courts have said, you know, the president had 99 00:06:29,600 --> 00:06:31,800 Speaker 1: a wrong reason for doing this and a right reason 100 00:06:31,839 --> 00:06:34,880 Speaker 1: for doing this. We will focus on the right reason. 101 00:06:35,320 --> 00:06:37,800 Speaker 1: So I think the case is going to stand or 102 00:06:37,880 --> 00:06:42,680 Speaker 1: call on the adequacy and legitimacy and coherence of the 103 00:06:42,760 --> 00:06:47,280 Speaker 1: national security argument. Also, a TikTok employee filed the lawsuit 104 00:06:47,600 --> 00:06:52,280 Speaker 1: claiming that the government unconstitutionally deprived him of a job. 105 00:06:52,720 --> 00:06:55,840 Speaker 1: Does that have a better chance than TikTok's lawsuit, Well, 106 00:06:55,880 --> 00:06:59,320 Speaker 1: it'll be interesting to see how the two cases proceed 107 00:06:59,480 --> 00:07:03,159 Speaker 1: in pair. Allull, there's a separate Wheechat case actually, which 108 00:07:03,160 --> 00:07:06,520 Speaker 1: has been brought by Wheechat users challenging an order of 109 00:07:06,680 --> 00:07:10,120 Speaker 1: targeting the Wheechat messaging app, which isn and operated by 110 00:07:10,160 --> 00:07:12,760 Speaker 1: tense Set, the Chinese company. So we now have three 111 00:07:13,040 --> 00:07:17,080 Speaker 1: different lawsuits going there is in the TikTok case itself, 112 00:07:17,160 --> 00:07:19,400 Speaker 1: the one brought by the company. There's some First Amendment 113 00:07:19,520 --> 00:07:23,800 Speaker 1: arguments being raised there as well. So there's a pretty 114 00:07:23,880 --> 00:07:28,480 Speaker 1: interesting mix of issues, both tough process issues as well 115 00:07:28,520 --> 00:07:31,240 Speaker 1: as free expression issues, as well as the sort of 116 00:07:31,320 --> 00:07:34,360 Speaker 1: issues being raised by the employee. Do you think that 117 00:07:34,400 --> 00:07:38,600 Speaker 1: the do process issues or the First Amendment issues are 118 00:07:38,920 --> 00:07:42,960 Speaker 1: stronger for TikTok? Honestly, I don't want to say one 119 00:07:43,240 --> 00:07:46,680 Speaker 1: or the other. This is by any stratechedy imagination, This 120 00:07:46,800 --> 00:07:50,880 Speaker 1: is uncharted territory. People are going to cite different precedents, 121 00:07:50,960 --> 00:07:54,320 Speaker 1: but they are all pretty much not on point to 122 00:07:54,400 --> 00:07:59,320 Speaker 1: what's going on here. This is pretty much uncharted territory. 123 00:07:59,440 --> 00:08:01,880 Speaker 1: I want to try for a moment to President Trump's 124 00:08:01,920 --> 00:08:06,280 Speaker 1: August fourteenth order for Bye Dance to sell its US assets. 125 00:08:06,720 --> 00:08:09,600 Speaker 1: The decision to force the sale of TikTok was based 126 00:08:09,760 --> 00:08:13,760 Speaker 1: on an investigation by SCITHIUS, the Committee on Foreign Investments 127 00:08:13,800 --> 00:08:18,480 Speaker 1: in the US. TikTok has not challenged that August fourteenth order. 128 00:08:18,680 --> 00:08:21,720 Speaker 1: In fact, TikTok has been in negotiations for its sale, 129 00:08:21,800 --> 00:08:25,920 Speaker 1: and Oracle and Microsoft with its partner Walmart, have both 130 00:08:25,960 --> 00:08:29,480 Speaker 1: submitted bids to buy TikTok. Well, Kiktok has not yet 131 00:08:29,680 --> 00:08:34,400 Speaker 1: challenged it. So Scifius, which focuses on acquisition. The separate 132 00:08:34,440 --> 00:08:39,640 Speaker 1: Scifius processes focused on the acquisition of TikTok's predecessor by 133 00:08:39,720 --> 00:08:42,599 Speaker 1: this Chinese company three or four years ago. Now, so 134 00:08:43,360 --> 00:08:47,200 Speaker 1: we now have yes, two different fronts. TikTok so far 135 00:08:47,360 --> 00:08:53,200 Speaker 1: has not challenged the divestiture order, and TikTok had been 136 00:08:53,559 --> 00:08:58,560 Speaker 1: engaged the negotiations to sell TikTok's US operations. That may 137 00:08:58,800 --> 00:09:02,400 Speaker 1: moved everything. So we've got a lot of moving pieces here, 138 00:09:02,440 --> 00:09:05,720 Speaker 1: and obviously we're seeing the administration even coming out with 139 00:09:05,800 --> 00:09:08,240 Speaker 1: a two pronged approach, and which means there's going to 140 00:09:08,320 --> 00:09:10,440 Speaker 1: be a lot of further steps in this process. I 141 00:09:10,440 --> 00:09:13,240 Speaker 1: think there are going to be many other moves, both 142 00:09:13,280 --> 00:09:16,680 Speaker 1: by the company, by employees, potentially by users. So far, 143 00:09:16,880 --> 00:09:21,200 Speaker 1: we don't have any TikTok users that would more likely 144 00:09:21,240 --> 00:09:25,240 Speaker 1: the first Amendment case, So we're only like in you know, 145 00:09:25,480 --> 00:09:28,160 Speaker 1: packed two or three, and this is not a three 146 00:09:28,160 --> 00:09:31,080 Speaker 1: act play. There are certainly a lot of moving parts 147 00:09:31,120 --> 00:09:33,800 Speaker 1: as far as the siffious part of it and the 148 00:09:33,920 --> 00:09:37,440 Speaker 1: order to sell the US assets. Is it difficult to 149 00:09:37,760 --> 00:09:41,520 Speaker 1: challenge that in court? Yeah, I mean whenever the president 150 00:09:41,720 --> 00:09:46,880 Speaker 1: cites national security, and both the Cifious Authorities and the 151 00:09:47,679 --> 00:09:51,920 Speaker 1: Deep National Economic Emergency Powers Act, both of those such 152 00:09:52,000 --> 00:09:55,720 Speaker 1: authorities are based upon national security claims that there's an 153 00:09:55,760 --> 00:09:59,920 Speaker 1: underlying declaration by the president of national emergency. They both 154 00:10:00,080 --> 00:10:04,800 Speaker 1: drawing national security concerns. So generally speaking, the courts have 155 00:10:04,920 --> 00:10:08,280 Speaker 1: been reluctant to intervene in the second guest the president. 156 00:10:08,720 --> 00:10:12,240 Speaker 1: But that's not to say that the president's power is unlimited. 157 00:10:12,600 --> 00:10:16,319 Speaker 1: We saw after nine eleven, for example, with Getanamo the 158 00:10:16,360 --> 00:10:21,079 Speaker 1: courts gave a lot of latitude, but not unlimited latitude. 159 00:10:21,520 --> 00:10:24,600 Speaker 1: And like I say, this is now uncharted territory. This 160 00:10:24,760 --> 00:10:28,840 Speaker 1: is brand new. No president has ever quite tried to 161 00:10:28,880 --> 00:10:33,880 Speaker 1: do this, So there is a limited ability to challenge 162 00:10:34,280 --> 00:10:37,400 Speaker 1: based upon this notion of Okay, Mr President, you have 163 00:10:37,559 --> 00:10:41,240 Speaker 1: these broad powers, but they are not unlimited. You must 164 00:10:41,280 --> 00:10:45,000 Speaker 1: have some basis for this and some opportunity for the 165 00:10:45,160 --> 00:10:48,719 Speaker 1: company to defend itself. We'll see. It's just impossible for 166 00:10:48,840 --> 00:10:51,800 Speaker 1: day tass is going to come out, absolutely impossible. Thanks 167 00:10:51,800 --> 00:10:55,440 Speaker 1: for being on Bloomberg Law. That's James Dempsey, executive director 168 00:10:55,480 --> 00:10:59,360 Speaker 1: of the Berkeley Center for Law and Technology at UC Berkeley. 169 00:10:59,440 --> 00:11:01,880 Speaker 1: And that's a for this edition of Bloomberg Law. I'm 170 00:11:01,960 --> 00:11:04,920 Speaker 1: June Grosso. Thanks so much for listening, and remember to 171 00:11:04,960 --> 00:11:07,080 Speaker 1: tune in to The Bloomberg Law Show every weeknight at 172 00:11:07,120 --> 00:11:09,560 Speaker 1: ten pm Eastern right here on Bloomberg Radio.