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02 september, 2021

New €6b claim should curb trade in TikTok profiles.

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TikTok must pay compensation to its 4.5 million Dutch users for illegally harvesting and auctioning sensitive user data. This is what a Dutch foundation, Stichting Massaschade & Consument, is demanding in a class action against the popular app. With the lawsuit, the foundation wants to encourage TikTok to respect European privacy laws and provide clarity on the logic behind its algorithm.

During the corona period, the use of the Chinese social video platform dramatically increased in The Netherlands. Its free app profits from compiling extremely accurate profiles of its users, offering advertisers a platform which hardly distinguishes between advertising and user-generated content. In addition, the company transfers user data to countries with a more insecure protection regime for personal data, such as China and the United States.

Not only young people suffer

According to the Stichting Massaschade & Consument, TikTok is violating a large number of laws and regulations with its actions. The foundation therefore asked the court in Amsterdam to order the company to pay damages in the amount of over 6 billion euros. This makes this the largest case against TikTok in The Netherlands at present, as the foundation not only represents the interests of young people, but also of (young) adult users. At this moment, more than 70% of TikTok’s Dutch user base is 18 years or older.

"We are particularly concerned about TikTok’s collection of often very personal information," says Lucia Melcherts, chairperson of the foundation. "It is not about what information you share with them, but how much time you spend watching the videos on the platform. Its algorithm keeps track of every second you watch, in order to present you with videos that keep you glued to the app for as long as possible, or lure you into virtual transactions. Not only young people, but also (young) adults are sensitive to this. It exploits weak spots with minute precision. TikTok is not transparent about how personal recommendations are compiled, and it offers users hardly any possibilities to influence this.”

The foundation claims a fixed amount of damage per user, varying from €1.250 - €1.750 depending on age group. These amounts are based on previous Dutch and European judgments in which the privacy of consumers was violated.

About the foundation

Stichting Massaschade & Consument is an independent non-profit organization that defends the rights of consumers in cases of mass damage. Earlier this year, it also launched a class action against Airbnb, claiming compensation for over one million consumers for service fees wrongfully paid. The lawsuit against TikTok is being financed by a litigation financier, IVO Capital, which is underwriting the costs of the proceedings in advance. This allows all TikTok users for whom the foundation is acting to participate free of charge. The case will be handled by the specialized law firm bureau Brandeis and its partners Christiaan Alberdingk Thijm and Louis Berger.