Dept. of Commerce Vows to Fight on After Losing Again Against TikTok in Federal Court

The United States Department of Commerce vowed to continue to vigorously defend President Donald Trump’s executive order banning short-form video app TikTok after another defeat in Federal court. A federal judge in Pennsylvania on Friday issued a preliminary injunction blocking the government from barring transactions with TikTok. The Department of Commerce issued an order in September driven by Trump’s August executive order barring U.S. companies from receiving transactions from the app that was set to take effect on Nov. 12.

But in her ruling Friday, U.S. District Judge Wendy Beetlestone said that the president exceeded his powers in the executive order by using the emergency economic powers act to impose sanctions. Beetlestone also noted that the government’s argument about national security risks largely hinge on hypothetical threats and not real ones.

And even though a federal court has already granted a preliminary injunction to stop a ban of financial transactions, TikTok and the government will be in federal court Wednesday for a hearing to argue over a preliminary injunction that covers the same ground.

While the Department of Commerce said it would comply with the order, a spokesperson also vowed to continue the fight.

“The [executive order] is fully consistent with law and promotes legitimate national security interests,” a spokesperson for the department said in a statement to The Hill. “The Government will comply with the injunction and has taken immediate steps to do so, but intends to vigorously defend the [executive order] and the Secretary’s implementation efforts from legal challenges.”

The government has struggled to convey to the courts that there are legitimate national security concerns related to TikTok, and for that matter Tencent’s multi-purpose chat app WeChat.  Several federal courts have granted preliminary injunctions to stop bans of both apps over the last several months.

These court hearings are the result of the U.S. government’s attempts to ban both TikTok and WeChat in the U.S., and part of a larger effort to take aim at Chinese-owned companies operating in the country due to national security concerns. For Tencent, this has major ramifications across a number of industries including film, television, gaming, and esports, among others. Tencent owns Valorant and League of Legends maker Riot Games, owns a large portion of Fortnite maker Epic Games, and has minor investments in companies such as Activision Blizzard and Ubisoft.  If the U.S. government were to successfully force Tencent to divest itself of these and other holdings, it would devastate the esports and gaming industries.