Stubbs Alderton & Markiles Partner Neil Elan recently shared his expertise with Dexerto, offering a comprehensive analysis of the complex legal and business implications of TikTok's potential U.S. ban. As the January 19, 2025 deadline approaches for ByteDance to sell its TikTok shares, Elan provided insight on multiple crucial aspects of this developing situation.
Acquisition Possibilities and Antitrust Considerations
In a recent Dexerto article examining potential TikTok buyers, Elan addressed speculation about Elon Musk acquiring the platform. "Two of the largest social media platforms owned by Elon Musk... I don't think at a common sense level would pass the antitrust test or monopoly test," Elan explained. He emphasized that significant regulatory hurdles would likely prevent such an acquisition, particularly given monopoly concerns.
Legal Risks of VPN Usage
As users contemplate workarounds for a potential ban, Elan provided critical guidance on the legal implications of using VPNs to access TikTok. "If there is a law saying, 'You can't do this,' and you do this by using a VPN to circumvent the law, then you are in violation of the law," he warned. While acknowledging the commonality of VPN usage, he cautioned about potential consequences, including fines, noting that enforcement levels would likely depend on the scale of violation and national security implications.
Impact on TikTok Shop and Creator Economy
In a discussion of TikTok Shop's future, Elan predicted significant disruption to the platform's e-commerce ecosystem. "It would close, and people wouldn't be able to access and monetize via the store, and it would present profound economic ramifications to all those users and creators who have relied so heavily on TikTok," he stated. However, he remained optimistic about creators' future prospects, suggesting that "There will be another platform... even if TikTok was not banned, in five, seven years, I don't think anyone would be surprised if there was a new sheriff in town."
Alternative Platforms and Future Implications
As users migrate to alternative platforms, Elan cautioned about the potential for similar regulatory scrutiny of emerging alternatives. "If the facts for RedNote, Lemon8, and any other similar company are akin to TikTok, then there certainly would be precedent to have those regulated in the same way as TikTok," he explained. His analysis emphasized the importance of examining ownership structures, Chinese government involvement, and national security implications when evaluating these platforms.
Neil Elan is a Partner at Stubbs Alderton & Markiles, LLP, focusing on high-stakes business litigation and intellectual property disputes. He has secured significant victories for clients including a complete defense verdict in a $30 million federal jury trial and represents global private equity firms and ultra-high-net-worth individuals in complex commercial matters.
