Popular video-sharing platform TikTok and Chinese parent company ByteDance agreed to an out-of-court settlement to resolve an ongoing federal class-action lawsuit filed by US users. The complainants alleged that the short-form video app illegally collected the biometric data of its users and shared the information with third parties.

According to a CNET report, TikTok, under the terms of the settlement, will pay $92 million to a fund for US users who claim that the app improperly used their personally identifiable information. The settlement agreement also requires the popular video-sharing platform to set up a new privacy-compliance training plan and enact other measures for the protection of the privacy of its users going forward.

If the court approves the settlement, affected US TikTok users will receive instructions on how to get a share of the funds. As published in Court Listener, the class-action suit is the result of the consolidation of 21 cases filed in various districts against TikTok, Musical.ly, as well as the platform's affiliates.

The video-sharing platform refused to admit it committed any wrongdoing and denied the alleged privacy violations. "While we disagree with the assertions, rather than go through lengthy litigation, we'd like to focus our efforts on building a safe and joyful experience for the TikTok community," a spokesperson for TikTok declared in a statement.

According to the class-action lawsuit, the video-sharing app gathered and disclosed personal data in violation of the US federal Video Privacy Protection Act, the Illinois Biometric Information Privacy Act (BIPA), as well as other consumer and privacy protection rules. Complainants also alleged that TikTok failed to inform its users that the app's effects and filters used facial scans.

The lawsuit claimed that TikTok subsequently stored and used facial scan biometric data without consent from users for several motives, including the delivery of targeted ads. The video-sharing platform "unjustly profited from the secret harvesting of this massive array of private and personally identifiable TikTok user data and content by using it for targeted advertising," and other purposes, complainants allege in their complaint.

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Kuaishou's rival ByteDance spent most of last year battling a potential US ban on its popular TikTok app. Photo: AFP / LOIC VENANCE

The plaintiffs also claimed that the app secretly collected huge amounts of private and personally identifiable user data and content, which they then allegedly transferred to servers located in China, as well as to other servers accessible from within that country. Tiktok might use such user data "to identify, profile, and track the physical and digital location and activities of United States users now and in the future," the complaint stated.

The popular video-sharing app has repeatedly denied that it shared user data with Chinese authorities. The allegation is among the reasons that forced former President Trump to warn TikTok of a ban unless ByteDance sells its U.S. operations to American buyers. The new Biden administration has set aside that order pending a broader review of the country's cybersecurity measures.