By Diana Novak Jones
Sept 25 (Reuters) - Alabama said on Friday it had reached a settlement with TikTok and its Chinese parent company, ByteDance, that requires the social media platform to impose new usage limits and enhanced age-verification measures for users in the state, resolving claims that the platform endangered children and misled consumers about its safety.
The agreement, which came days before a scheduled trial, calls for TikTok to implement changes for teenagers in Alabama including a two-hour
daily time limit, pauses after 15 minutes of use and stricter age checks.
TikTok will pay Alabama at least $100 million under the settlement, but the state's payout could grow to $300 million if 40 other attorneys general sign on to similar agreements with the company within a specified timeframe, according to the settlement.
"This builds on our commitment and core objective to continually enhance our robust safety tools to protect teens," a spokesperson for TikTok's US operations said in a statement.
The deal marks TikTok's first settlement with a state in the sweeping litigation over social media's impact on teen well-being. Alabama Attorney General Steve Marshall sued the company last year, and at least 27 other states and Washington, D.C., have brought similar lawsuits.
"This is a great day for Alabama parents," Marshall said in announcing the agreement.
The trial, which had been scheduled to kick off Monday in Montgomery state court and expected to last two to three weeks, had been expected to provide a rare look inside TikTok, which has settled prior cases selected for trial and sought to keep details of its operations from public view.
Alabama had claimed TikTok's endless stream of videos makes it the most addictive social media platform and that its algorithm pushes young users toward increasingly intense content about violence and self-harm, contributing to a teen mental health crisis and causing the number of emergency room visits for self-harm in the state to "skyrocket."
The lawsuit accused TikTok of falsely claiming it limits access to sexual and violent content for young users in order to have its app rated safe for teens in app stores run by Google, Apple and Microsoft and of misleading users about the Chinese government's access to US users' data.
TikTok has said it designed its platform with teen safety as a key priority and argued that Section 230 of the federal Communications Decency Act shields online platforms from liability over user-generated content.
REDACTED DOCUMENTS, SEALED FILINGS
In addition to the states' cases, TikTok faces thousands of lawsuits by individuals, school districts and municipalities over its alleged impact on young users' mental health. Meta Platforms, Snap Inc and Alphabet's YouTube are also defendants in many of these cases.
With the settlement in Alabama, TikTok has settled all cases selected for trial against it, including claims by five young people and a Kentucky school district.
Alabama’s lawsuit claimed TikTok asks users to self-report their ages, but it also allows users to evade its questions about their age by viewing videos without creating an account, which still allows the company to collect data on their viewing habits. The lack of an effective age restriction makes things like “Kids Mode,” which curates content for young users, entirely useless, according to the lawsuit.
The state also claimed the platform traps kids in so-called “filter bubbles,” feeding them increasingly intense content on subjects that capture their attention, including violent or harmful material.
Last month, Meta reached a sweeping $17.1 billion settlement with 47 states, Washington, D.C., and US territories. Meta, which did not admit wrongdoing, agreed to make changes to teens' access to Instagram and Facebook as part of the deal and conditioned $5 billion of the payout on TikTok, Snap and YouTube's adoption of those terms. TikTok has not said anything publicly about the deal.
Like the Meta settlement, Alabama's deal with TikTok would require the company to adopt additional restrictions if its rivals Snap, Google and Meta make similar changes.
Those measures could further limit teens' time on social media apps and restrict overnight access, according to the filing.
Although the settlement applies only in Alabama, major platform changes could prove difficult to implement on a state-by-state basis.
(Reporting by Diana Novak Jones; Additional reporting by Mrinmay Dey in Mexico City; Editing by Alexia Garamfalvi and Cynthia Osterman)
