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Case number 20-5302, TikTok, Inc.

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and ByteDance Ltd.

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versus Donald J. Trump, official capacity as president of the United States at all, a balance.

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Mr. Byron for the balance, Ms.

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Brinkman for the appellates.

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Good morning.

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Good morning, Your Honor.

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May it please the court, Thomas Byron from the Department of Justice, here for the government defendants who are appellants in this case.

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The district court's injunction here misunderstands the scope of IEPA's exceptions in section 1702B and plaintiff's interpretation of the language in that provision concerning indirectly regulating or prohibiting conduct.

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would have no limits at all and was indirectly contrary to this court's precedent in Walsh against Brady.

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In that case, this court rejected a similarly broad argument that a substantial burden on importation of informational materials would be a prohibited indirect regulation of that conduct.

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The district court's preliminary injunction here can't be squared with that precedent.

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Regulation of activity on a mobile app is not the equivalent of the, I'm sorry, regulation of the mobile apps availability on an app store, which is the only prohibition at issue here, is not the equivalent of regulating directly or indirectly the activity of users on that app or the platform it serves.

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Here, the prohibitions imposed by the Secretary of Commerce and the President regulate only the commercial transactions that make a particular mobile app available within the United States.

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They do not target in any way the conduct, the protected activity of the users on the Tectonica platform who are able to import and export information or informational materials or exchange personal communications using either that platform, for example, on a web browser or other platforms that are also available to them.

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The fact that the activity of the users is unconstrained by the commercial prohibition at issue here is dispositive.

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It's not enough that there might be an incidental effect, as the plaintiffs argue, that might.

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They don't argue incidental effect.

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They argue indirect regulation.

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And it seems to me, at least me personally, that deciding what indirect regulation

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of informational materials means is critical to this case.

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And Walsh seems less helpful because that was a ban on travel.

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And it just happened in that instance to affect someone who wanted to travel to import.

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But that was sort of a one-off or unusual consequence of the regulation.

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lots of travel wasn't going to be to import material, informational materials.

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But here we have a, for purposes of this stage, a prohibition on people joining an informational community that TikTok has created.

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And so,

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all the time.

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It's not going to be one-off that it affects people's speech.

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On the other hand, as you have argued, TikTok is quite clear that they are just a platform, and at least have not argued here that their own speech is what is at stake.

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And so I'm trying to figure out what the government's definition, not of incidental, but of indirect regulation is, what would be

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and indirect regulation of speech.

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And if you can give me an example in the sort of social media environment, that would be most helpful.

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Sure, Judge Mollett.

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So let me start, if I may, by going back to Walsh itself, which made clear that it was an indirect regulation of importing posters from Cuba when the government required any payment for those posters to be put in a blocked account and prevented the seller from accessing it.

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That was what this court identified there as indirectly regulating and what the court thought that Congress was principally concerned about.

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So translating that to this context is obviously going to be imperfect.

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Congress had nothing like this in mind, obviously, as plaintiff's brief itself points out.

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We would say, however, that there are examples of indirect regulation that effectively prohibit all importation

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or exportation of informational materials.

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And that's what would make them like the blocked account example in Walsh.

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So for example, you could imagine a prohibition imposed by the government.

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It would obviously be a direct regulation, just to start there, your honor, if the government said no importation or exportation of videos to China.

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That would be the kind of direct regulation prohibited by 1702B.

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It would be an indirect regulation.

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For example, if the government said not to users, importers or exporters, Americans, but instead to all internet service providers, ISPs, if the government said to every ISP operating in the United States, you must prohibit the transmission of any video to a Chinese IP address, that it seems to me would be an indirect regulation.

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But what's going on here is quite different because it's a regulation instead of a particular platform leaving available alternatives.

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So just as in Walsh where the plaintiff wanted to travel.

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It's not just a platform.

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Let's just assume, think of this point just so I understand your indirect example.

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Let's assume that what the government were regulating was

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the number one platform for importing or exporting videos between China and the United States.

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Just assume, I'm not saying that is, but let's assume we're dealing with that platform whenever we want a platform queue.

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And it is responsible for 85% of all imported and exported videos from China.

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And the government said that platform is shut down.

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Would that be an indirect regulation at that point because of the volume?

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No, Judge Millett, it wouldn't.

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And the reason is because by engaging in a business that permits Americans to undertake protected activity, a company or a foreign government doesn't insulate itself from regulation concerning national security.

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In other words- My hypothetical were 100%.

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Your answer is the same.

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The same answer, Judge Mollett.

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If, well, let me, let me back up for a moment and just say this.

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We're calling the ISP providers then, so.

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Well, there is, you know, transports that allows the interchange of information, but go ahead.

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So Judge Mollett, I think the same answer, if alternative means remain available.

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So, so I think that the question then becomes, is there a practical imposition of what amounts to

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a prohibition.

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That's what the court in Walsh said, effectively, I think, was true of the blocked account requirement that was an indirect regulation there.

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But it's not enough that a particular preferred method of importing or exporting informational materials might be burdened.

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That's what the court said in Walsh.

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The plaintiff there wanted to travel.

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That method depends on what you mean by alternatives.

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If the alternatives to

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my platform Q, which we'll say for entertainment purposes was 95% of the interchange between China and the United States with videos.

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And it's 95% because platform Q is incredibly good.

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And it has all these kinds of features and allows people to form communities and to conjoin videos and communications in a way that the other platforms, which are all grainy and have very poor editing techniques, do not.

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And so there's alternatives in that sense, but they simply do not allow the same type of interchange and inner communication that Platform Q does.

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So Judge Mudd, first of all, I think it's hard to measure those kinds of comparative qualities, but here I think the answer is revealed in the plaintiff's own evidence.

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I'm just trying really to understand,

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your legal definition of indirect.

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Are you saying that if the other alternatives are just really not that good and don't, yes, you can exchange videos, but you can't have the same type of communications and interchanges and quality of speech.

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And it's an enormous percentage, 95, pick it up, whatever height number you want, 95%.

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That would be indirect regulation, but we don't need to worry about it here because the facts are different.

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or that would not be in direct regulation regardless of the facts in this case.

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So first of all, Judge Mua, it would not be in direct regulation because it wouldn't prohibit effectively.

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OK, but your alternatives there really are not allowing the same type of speech.

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Well, and that's why I think the first part of your proposed distinction is relevant as well.

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And that's what I was getting at, if I may just continue to answer your question, with the fact that the plaintiffs here put in evidence in support of their request for a preliminary injunction.

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demonstrating that there really were effective alternatives and that that was their business concern was that users would migrate to those alternative platforms and wouldn't come back to this one even if it were later made available.

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I know I understand that somebody so you're saying that quality of the alternatives the comparability of the alternatives does or does not matter to indirect regulation.

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So I think it might matter, Judge Millett, in some circumstances.

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But that question is- What is the legal test?

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We have to articulate a test.

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And I just, I don't see anything as helpful maybe as you do in Walsh.

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What would you say, an indirect regulation?

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So I think the language of Walsh is relevant, Judge Millett.

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It says, until 1988, the regulations nominally allowed the importation, but in reality banned it.

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by requiring that the importers make payment into blocked US accounts.

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So if in reality it would be a ban,

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then that would be an indirect regulation by the language of this court's decision.

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So perhaps Judge Malau... I'm sorry, go ahead.

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No, I guess what I was trying to get at is that to the extent we're trying to understand the lesson of Walsh and the scope of the precedent that this court has decided, if you're asking, would a ban on what is a far better means

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be an indirect ban, in reality, a ban in the language of this court.

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I think that's potentially a hard question, but one that you need not answer here, because the plaintiff's own evidence demonstrates that it's not true.

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But to the extent far better than does factor into your definition, even if it's not a total ban.

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Not our definition, Your Honor.

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I'm trying to answer your hypothetical.

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In other words, I think in reality, banned is the definition this court has offered.

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And the question then becomes, well, is it in reality a ban if there is a preferred alternative that really is so much better?

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I don't know the answer to that.

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In effect, banned means that whatever was regulated was just a façade and that this really is direct regulation by another name.

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It seems a fairly narrow definition of indirect regulation.

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Well, in reality, banned is what the court said and and I think that's a meaning is meaning to indirectly regulate.

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So de facto ban.

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Yes, I think that's what the court was getting anything short of that.

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Either we tell me we don't need to decide.

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If you're telling me I don't need to decide it in this case, then it sounds like the test is de facto ban plus something else.

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But you don't even decide it in this case.

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But other times it sounds to me like you're saying the government's position is de facto ban.

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And that's what I'm trying to sort out right now.

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Is it de facto ban or is it de facto ban plus?

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It's de facto banned Judge Millett.

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So that it doesn't matter about the fact of this case.

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I think it doesn't matter to the extent that you might be concerned about a harder case where you think it might matter.

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That's what I don't think this court needs to decide in the context of the preliminary injunction.

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This one bans by forbidding new users from joining.

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This prohibition bans a lot of Americans from joining the communications and exchanges that I think more than a quarter of the American population is already engaged in.

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For all those people who wish to join in those communications, they're banned once they can no longer download the app.

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How are they not banned?

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They're not banned for two reasons.

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First of all, the president's executive order and the secretary's decision memo make clear that the particular most significant risk here is from the mobile app itself.

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Not from the platform as a whole and that other means of accessing the platform remain available.

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So, for example, a web browser can access the TikTok platform without posing the same national security risks.

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Similarly, a You have to sign away licenses and they don't give up their personal data if they go in through their web browser.

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It depends, Judge Mallette.

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So the record here does not investigate in great depth.

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But it is true that one can use a web browser without establishing an account on TikTok.

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And establishing an account is where much of that personally identifiable information is.

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Is this in your brief, or is this in the record somewhere?

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Because I had not heard of it.

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It's not.

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And that's what I said a moment ago.

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The record here does not identify those details.

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But what it does identify is the brief.

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Is it in your brief that they can go in through the web browser, that that is allowed?

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I believe we did mention that, Your Honor.

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All right, but they can't set up an account.

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Well, Your Honor, I don't think we addressed that question.

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But you asked, and I am trying to answer.

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So the answer is you cannot set up an account, though.

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Or you can get in without setting up an account.

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That is my understanding, Judge Millett.

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And if that's relevant to the court's determination, we can certainly address that in a supplement.

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But can you set up an account if you go in through a web browser?

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Yes, Judge Millett, I believe you could.

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You would have the exact same concerns.

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Not the exact same concerns, no, Judge Millett.

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So for example, the geolocation data associated with a cell phone or other mobile device is a significant privacy concern and includes a vast array of sensitive personal information at stake here.

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Similarly, collecting clipboard data, which is available and has been done from

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mobile devices is not demonstrated to be true elsewhere.

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And I'll just point to the Supreme Court's decision in Carpenter to emphasize that geolocation privacy concern that might not be present in other means.

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Is that the national security?

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I mean, that did not seem to be the chief national security concern.

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It is part of it, Judge Mollett.

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So it's mentioned in the Secretary's decision memo and I can find the page for you if you like.

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The fact is there is a wide swath of data that's collected by the TikTok mobile app that the President and the Secretary identified as permitting

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the Chinese government and the Communist Party of China to collect information on Americans and compile vast databases that pose a threat to the security, the economy of the United States.

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If these same videos were getting shipped back and forth between the United States, the exact same videos on CDs instead of on this app, you would agree you couldn't ban that, right?

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Corrective modern we are not banning the sending of the videos aren't you then because the statute says regardless informational materials regardless of medium and What you're doing is you're taking those exact same videos and because they're not on CDs, but they're instead on this medium a tick-tock mobile app Because of the medium you say you can ban them that's what I'm having that's another thing I'm having trouble with

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Right, Judge Muller, but I'll point out that the concern here is related to how the TikTok mobile app collects information about users.

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Well, I understand the language at 1702b3.

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If you agree that these same people, users, could, if they wanted to go back to my old antiquated era, could exchange these things back and forth, these videos on CDs,

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But what bothers the United States is the medium of transmission, use of a mobile app rather than a CD.

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It's banned.

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And that seems to be a problem because B3 says you cannot prohibit the importer export of information materials, which I'm going to assume you agree that these videos are.

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Regardless of the medium of transmission, it seems to me you're making a difference

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based on the medium of transmission, whether it's CDs, whether it's through a web browser, or through a mobile app.

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How is that not distinguishing the same materials on the basis of the medium of transmission?

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So it does regulate the medium of transmission, Judge Meyer.

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No, how is it?

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I'm sorry, go ahead.

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Well, no, I think that's essential.

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Because I think by including that additional language in the

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provision in 1702 B3, Congress recognized that there may be

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that there is a difference between regulating the transmission of the materials on the one hand and regulating the medium on the other hand.

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And it is the transmission, I'm sorry, not the transmission, it's the importation or exportation of those informational materials that Congress sought to protect.

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And so it may be, Judge Millett, in a particular circumstance, I'm gonna offer a crazy hypothetical, if it were demonstrated that fingerprints would always be present on a CD.

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and that the collection of those fingerprints by a foreign adversary, a foreign government, posed a threat to national security, that perhaps it would be permissible to regulate the transmission of videos by CDs, but permitted by another medium of transmission.

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It would not be, in reality, a ban of the importation or exportation

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as the court said in Walsh, to do so.

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So the distinction between user activity on the app and regulation of the app itself is the key distinction here that we think demonstrates this is not an indirect regulation of user activity.

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Well, let me just ask you then, what do you understand the sub three paragraph to be addressing?

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Because it is,

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following the does not phrase.

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In other words, I thought in your brief you were arguing in part that all you're seeking to do is to regulate in one form or another business to business transaction, you're gonna sell the company, that type of thing, not

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affecting me and how I get information or what medium I use to get that information.

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Judge Rogers, I take it you're asking about 1702B3, the exception E&I IPA for importation or exportation of information or informational materials.

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Do I understand that correctly?

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That's what we've been talking about for the last five minutes.

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Yes, that's right, Judge Rogers.

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And so I think that the distinction I just was discussing with Judge Millett, I would emphasize here as well, that regulating the business of the TikTok mobile app is distinct from regulating the conduct, the protected activity of users on that platform.

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So whereas a user can still send videos using other means, the government is free to prohibit the business activities that support the mobile app that poses a national security risk.

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That's the key distinction, Your Honor.

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Even given the language, I'm just trying to understand what Congress had in mind when it wrote this language.

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It's saying the president can't do this.

[00:22:44] Speaker 03:
Correct, your honor.

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But what it says the president can't do is regulator prohibit directly or indirectly importation or exportation of information or informational materials and Walsh says that it's a regulation indirectly if it's in reality a ban on the importation or exportation.

[00:23:04] Speaker 03:
That's a far greater standard, a higher standard, than merely regulation of a preferred method of importing or exporting informational materials.

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So just as the plaintiff in Walsh wanted to travel because that was the preferred method he wanted to negotiate the importation of Cuban posters,

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just because users here want to use the mobile app as a means to send their videos doesn't mean that it's an indirect regulation by the government of sending videos to prohibit the mobile app from operating in this country.

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I know you say it, but Congress wrote this language that seems to just fly in the face of that.

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But I don't see walls to control here.

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Judge Rogers, I think Walsh does control, and let me offer another perspective on- Well, it doesn't control in the sense that the holding is on all fours with the issue that's here.

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There may be language in it that you're using to elaborate on your reasoning, but that's different.

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I don't think it's just that.

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The holding in Walsh specifically rejected the kind of broad interpretation of indirectly regulate that the plaintiffs here have offered and the district court relied on.

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In that sense, we think it is controlling and that the district court's injunction cannot be squared with this court's decision.

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The plaintiff in Walsh said that anything that is a substantial

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of information or materials is indirect regulation.

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This court's holding rejected that argument that plaintiffs here argue anything that prevents the use of a particular preferred platform or burdens the use of that platform is an indirect regulation.

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That is inconsistent with Walsh's holding, Judge Rogers.

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And we would just emphasize that there's nothing to indicate that.

[00:25:18] Speaker 06:
I just wanted to follow up on if there were no other apps that allowed video sharing like this.

[00:25:26] Speaker 06:
The only other way to share videos would be by mailing CDs back and forth or tapes back and forth between the United States and China.

[00:25:36] Speaker 06:
Would that count as an alternative?

[00:25:38] Speaker 03:
Yes, Judge Mallett, it absolutely would.

[00:25:40] Speaker 06:
So if you banned every, every,

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video sharing app.

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And for security reasons, you have the same security concerns.

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This is my hypothetical.

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Every video sharing app that uses the internet, they're all banned so that people are back to snail mail CDs if they can buy them.

[00:26:05] Speaker 06:
I'm assuming they can, so it's an alternative.

[00:26:08] Speaker 06:
That would not be an indirect regulation of speech in the government's view.

[00:26:13] Speaker 03:
It would not be a ban in reality of importing or exporting.

[00:26:18] Speaker 06:
It would not be an indirect regulation of speech, of informational materials being exported or imported.

[00:26:26] Speaker 03:
That's right, Your Honor.

[00:26:29] Speaker 03:
But I would also emphasize, Judge Mallette, that the language adopted in the Second Amendment in 1994, the Free Trade and Ideas Act, did identify a broadening of 1702B3.

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And it did so in a way that recognized that intangible informational material was also protected.

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But that intangible informational material is the video.

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It's not the means of transmission on a particular platform or in a particular medium.

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That's why it's important that Congress nevertheless maintained that regardless of format or medium of transmission, distinguishing between the information that a user seeks to import or export on the one hand and the means that they seek to do so on the other.

[00:27:17] Speaker 03:
As long as it's not in reality a ban,

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on the import or export, it's not an indirect regulation of that activity.

[00:27:27] Speaker 06:
The language also talks about regulate indirectly too.

[00:27:30] Speaker 06:
So we've been talking a lot about prohibitions and bans.

[00:27:33] Speaker 06:
So what's an example of an indirect regulation?

[00:27:37] Speaker 03:
Your honor, I think that, for example, we spoke earlier about the hypothetical I suggested, where because the government cannot directly prohibit something, it can't require a private company to prohibit something either, if it's an altogether sweeping prohibition, leaving no alternatives.

[00:27:57] Speaker 03:
So similarly, if the government can't regulate by, I'm

[00:28:04] Speaker 03:
I'm having trouble imagining what the kinds of regulations we might have are, but let's say requiring registration of every video sent to China.

[00:28:15] Speaker 03:
That might be a regulation one might imagine.

[00:28:18] Speaker 03:
Requiring every user to

[00:28:22] Speaker 03:
registered with the government.

[00:28:24] Speaker 03:
So that would be a direct regulation.

[00:28:26] Speaker 03:
It can't require every ISP using the example we spoke of earlier to maintain a list of every user's video center received from to or from China.

[00:28:39] Speaker 03:
I could imagine that being an example of indirect regulation.

[00:28:43] Speaker 03:
But here the key, too, is that it would regulate all imports and exports of the informational materials, not just a particular method or platform that some users might prefer.

[00:29:00] Speaker 03:
And that's the key distinction that we are emphasizing.

[00:29:03] Speaker 03:
And the reason this is important, Judge Mollett, is that Congress did not intend to allow a foreign adversary to evade regulation of conduct that threatens our national security.

[00:29:18] Speaker 03:
merely by engaging in a business or offering a platform that American users might prefer to use in some circumstances to export or import information.

[00:29:32] Speaker 03:
That would be a significant undermining.

[00:29:35] Speaker 03:
It would, as this court in Walsh said, allow the foreign adversary to sap the power of the regulatory scheme here.

[00:29:44] Speaker 03:
And that's what the plaintiffs are urging.

[00:29:47] Speaker 03:
And we would ask this court to reject it.

[00:29:50] Speaker 06:
Before you leave us, do you mean deference, Chevron deference or something like it, to your interpretation?

[00:30:00] Speaker 06:
Because the most I got out of your brief was speaking of indirect, begging into, here's a case where that court decided government's interpretation gets deference.

[00:30:11] Speaker 06:
But I never heard you say,

[00:30:13] Speaker 06:
the government claims deference.

[00:30:16] Speaker 03:
We're not seeking deference with respect to anything in the Commerce Secretary's decision, Judge Mallette, but I will point out that we have cited, for example, to a Treasury Department OFAC regulation that has been, and those regulations have been recognized by this court and others, Third Circuit, Second Circuit, I believe, as worthy of Chevron deference.

[00:30:41] Speaker 03:
And we've pointed to that as an example of

[00:30:43] Speaker 06:
the regulation that says it doesn't apply to materials that were not in existence at the time?

[00:30:48] Speaker 03:
That's right.

[00:30:50] Speaker 06:
Your position and that's trying to figure out how that fits onto this.

[00:30:59] Speaker 06:
Even if the videos already existed at the time, someone couldn't doesn't doesn't get to sign up for tick tock because they say I only want to ship out.

[00:31:06] Speaker 06:
I want to only want to communicate with videos that are things I've already made.

[00:31:12] Speaker 06:
And so I couldn't figure out what the connection was.

[00:31:14] Speaker 03:
So, Judge Mollett, the key here is that every time a user uploads a video onto TikTok, it creates a new and unique communication.

[00:31:29] Speaker 03:
And in that respect, it is subject to that distinction.

[00:31:32] Speaker 03:
That's not something we're emphasizing.

[00:31:33] Speaker 03:
You asked about Chevron deference, and I was merely pointing out that that's an example where there has been Chevron deference that we did point to.

[00:31:40] Speaker 03:
We are not asking for Chevron deference with respect to the Commerce Secretary's decision.

[00:31:44] Speaker 06:
And like my colleagues indulgence, I just have one question about the one personal communication, which does not involve a transfer of anything of value value to to talk to the speaker to the listener, all of the above any of the above.

[00:32:04] Speaker 03:
I think any of the above, but in this case, it's all of the above.

[00:32:08] Speaker 03:
So the easiest example of this in terms of service is the license that TikTok compels every user to grant to TikTok itself.

[00:32:21] Speaker 03:
over any communication or any video or any other activity on the app.

[00:32:27] Speaker 03:
That is indisputably a thing of value, transferred from the user to TikTok as part of the communication or transfer of information.

[00:32:40] Speaker 03:
And there's no question there that the license is a thing of value.

[00:32:45] Speaker 03:
But TikTok has also monetized the activity of users on the app in a way that is quite different from the examples of the postal service or a telephone company.

[00:32:56] Speaker 03:
And so we think that even by that measure, it is a thing of value to everyone involved

[00:33:04] Speaker 03:
the way that TikTok has extracted value from user activity in this sense.

[00:33:11] Speaker 03:
And that itself demonstrates some of the concerns that the government has identified about the sweeping collection of sensitive personal data here.

[00:33:22] Speaker 04:
Thank you.

[00:33:23] Speaker 04:
Why don't we hear from counsel for at police?

[00:33:27] Speaker ?:
Thank you.

[00:33:32] Speaker 05:
Thank you, your honor.

[00:33:32] Speaker 05:
May it please the court

[00:33:34] Speaker 05:
Beth Brinkman for the plaintiff appellees.

[00:33:37] Speaker 05:
The Commerce Department's prohibition would restrict a robust community of millions of Americans sharing personal communications and informational materials on the TikTok app.

[00:33:49] Speaker 05:
That prohibition violates Congress's explicit limitations on IEPA authority.

[00:33:55] Speaker 05:
The government's argument that the prohibition regulates a business to business transaction doesn't change that fact.

[00:34:02] Speaker 05:
a government prohibition can regulate more than one thing.

[00:34:06] Speaker 05:
Congress specify here that IEPA does not authorize indirect regulation.

[00:34:12] Speaker 05:
That means the government cannot choose to restrict communication by choosing an indirect means to do so.

[00:34:20] Speaker 05:
There may be close cases, but this is not one of them.

[00:34:24] Speaker 05:
The prohibition stops US users from exchanging videos, photos, art,

[00:34:31] Speaker 05:
audios, texts, political messages, and it was designed to do just that.

[00:34:37] Speaker 05:
I wanted to take a moment and turn to the Walsh case, as was discussed at length, and what indirect regulation means.

[00:34:45] Speaker 05:
The Walsh case and analysis wholly supports the plaintiff's position here.

[00:34:51] Speaker 05:
The regulations there allowed posters to be imported.

[00:34:55] Speaker 05:
There was no stopping that.

[00:34:57] Speaker 05:
The additional point was whether or not a regulation could restrict travel to Cuba.

[00:35:02] Speaker 05:
And the court held it could be because it was only tangential to the importing of the posters.

[00:35:09] Speaker 05:
Indeed, a full examination of that opinion indicates that even all travel wasn't prevented.

[00:35:17] Speaker 05:
What was traveled was that you could not pay for it.

[00:35:20] Speaker 05:
Somebody could have even traveled to Cuba to do that if the host paid for that travel.

[00:35:24] Speaker 05:
That was not an indirect regulation import of the posters.

[00:35:29] Speaker 05:
By contrast, the example that opposing counsel spoke about, about buying posters, allowing the buying of posters, but then saying that it had to be paid for into an account that the government then blocked, that was not prohibited.

[00:35:47] Speaker 05:
That's in fact what existed before the 1988 Amendment.

[00:35:50] Speaker 05:
And that's why this court discussed it at the Walsh case.

[00:35:53] Speaker 05:
It's exactly that type of situation which we find here.

[00:35:58] Speaker 05:
The government tries to say, oh, we're not doing anything about these communications.

[00:36:04] Speaker 05:
We're just not going to let you have the app to do it.

[00:36:06] Speaker 05:
That's exactly what the indirect regulation was that the court in Walsh said was not permissible.

[00:36:12] Speaker 05:
Can you repeat that sentence one more time?

[00:36:13] Speaker 05:
I want to make sure I heard that.

[00:36:15] Speaker 05:
Certainly.

[00:36:15] Speaker 05:
In the Walsh case,

[00:36:17] Speaker 05:
The court explained what was an indirect regulation that was not allowed.

[00:36:22] Speaker 05:
We have exactly that here because because here the government tries to say, oh, we're not regulating the videos or the messages.

[00:36:33] Speaker 05:
But in fact, go ahead, you know, and try to use them, you know, try and buy the posters.

[00:36:37] Speaker 05:
But your money is going to go to account.

[00:36:39] Speaker 05:
Oops, we blocked the account here.

[00:36:41] Speaker 05:
We'll try and use it.

[00:36:42] Speaker 05:
Oops.

[00:36:42] Speaker 05:
You know, the app isn't available.

[00:36:44] Speaker 05:
That is exactly what's happening here is indirect regulation.

[00:36:49] Speaker 05:
The idea that there could be some kind of alternatives that would satisfy this, I just would want to say several things.

[00:36:55] Speaker 05:
First of all, the TikTok app cannot be replaced.

[00:37:00] Speaker 05:
There's no adequate or comparable alternative.

[00:37:05] Speaker 05:
The features on the TikTok app

[00:37:07] Speaker 05:
There's a duet feature, a stitch feature, they're creative, they're clever.

[00:37:11] Speaker 05:
I mean, that is why it's so successful.

[00:37:14] Speaker 05:
So there isn't some kind of adequate replacement for that.

[00:37:17] Speaker 05:
Moreover.

[00:37:18] Speaker 06:
It sounds like a complicated factual question, whether they're, I'm sure TikTok is of the view that it is absolutely the best and it's obviously incredibly popular, but it's, I didn't,

[00:37:36] Speaker 06:
for purposes of a preliminary injunction, it's a little hard to rely on that factual assertion when at the same time TikTok is saying, if we're banned, people are going to leave in droves to these other apps and will not come back.

[00:37:53] Speaker 06:
If TikTok were that special and had all these extra features, folks would come back.

[00:37:59] Speaker 06:
And so I find it a little hard at this stage to rely on

[00:38:05] Speaker 06:
the uniqueness of TikTok.

[00:38:07] Speaker 05:
Tell me why I should.

[00:38:10] Speaker 05:
Well, we don't think you need to, Your Honor.

[00:38:12] Speaker 05:
I would say, first of all, when communities leave, it's difficult to come back, not because you're not the best product, but they've transferred all of the opportunity costs that have passed.

[00:38:21] Speaker 05:
So I don't think that goes to anything about the quality of the uniqueness.

[00:38:24] Speaker 05:
I would also say, though, it's not in the statute.

[00:38:27] Speaker 05:
It doesn't say so long as you can do it some other way.

[00:38:30] Speaker 05:
There's nothing like that in the statute.

[00:38:32] Speaker 05:
This is about the text of 1702B.

[00:38:35] Speaker 05:
And it's not in the statute.

[00:38:36] Speaker 05:
And just to give an example, to try and say that's not indirectly regulating the messages, if there were a large newspaper and the government said, you know, you have a lot of editorial writers, you have a lot of subscribers, you don't need any more.

[00:38:53] Speaker 05:
We're just gonna say no more, you can keep doing what you have, but no more writers, no more subscribers.

[00:38:59] Speaker 05:
I mean, this unquestionably would be indirect regulation of those messages.

[00:39:04] Speaker 05:
And again,

[00:39:05] Speaker 05:
There may be line drawing, but this is not a case where that's required.

[00:39:08] Speaker 02:
But the government is saying that we can draw a line because the government is saying that people can still use TikTok and new users can still use TikTok.

[00:39:20] Speaker 02:
They just can't use it on the mobile app.

[00:39:23] Speaker 02:
And so they're not really regulating the use of TikTok.

[00:39:32] Speaker 02:
They're regulating

[00:39:35] Speaker 02:
or the information they're regulating just the mobile app.

[00:39:42] Speaker 05:
Your honor, the suggestion that they're just regulating the mobile app, the just isn't correct because although they're regulating the mobile app, they're also indirectly regulating the videos, the audios on there.

[00:39:54] Speaker 05:
And if I could point the court to a couple of things.

[00:39:57] Speaker 05:
I mean, we're talking about what the agency did here under the Chenery Doctrine.

[00:40:01] Speaker 05:
We looked at what the agency relied on and the district court here

[00:40:06] Speaker 05:
found both the purpose and effect of this regulation was to indirectly regulate that content, those videos.

[00:40:14] Speaker 05:
And I would direct the court to a couple of pages.

[00:40:17] Speaker 05:
It's throughout the Commerce Department's memorandum about what they are regulating here.

[00:40:24] Speaker 05:
But there was one on page 323 of the Joint Appendix.

[00:40:29] Speaker 05:
This is under a section called vulnerability.

[00:40:32] Speaker 05:
And the Commerce Department is talking about

[00:40:34] Speaker 05:
the vulnerability they perceive in their eight listed categories.

[00:40:38] Speaker 05:
And I just want to focus on number three.

[00:40:41] Speaker 05:
This is a quote.

[00:40:42] Speaker 05:
They're talking about what's collected and what poses the vulnerability.

[00:40:45] Speaker 05:
Quote, user generated content, including comments, photographs, videos, et cetera.

[00:40:54] Speaker 05:
That is what's being regulated here.

[00:40:57] Speaker 05:
And again, back on page 332 of the joint appendix,

[00:41:02] Speaker 05:
The Commerce Department talks about preventing collection and aggregation of data, also about its transmission.

[00:41:09] Speaker 05:
That is what is being regulated, what it was intended to, and what it does.

[00:41:14] Speaker 05:
And that is what comes up.

[00:41:16] Speaker 05:
Which paragraph?

[00:41:18] Speaker 05:
Pardon me?

[00:41:19] Speaker 05:
Paragraph on 332.

[00:41:19] Speaker 05:
On 332, it's the second full paragraph, Your Honor, belonging the below prohibitions.

[00:41:28] Speaker 05:
It talks about denying access, reducing functionality, and then it goes on.

[00:41:34] Speaker 05:
And it talks with the objective, with the objective of preventing collection, transmission, and aggregation.

[00:41:41] Speaker 05:
And again, back on page 323, Your Honor, it's in the first full paragraph under the heading vulnerability and the subheading.

[00:41:49] Speaker 05:
There are eight lists there.

[00:41:51] Speaker 05:
Three, user-generated content, including comments, photographs, videos, and virtual items.

[00:41:58] Speaker 06:
If somebody opens a TikTok account on their web browser, instead of on, I guess, the mobile app, which of these eight categories of information would no longer be implicated?

[00:42:11] Speaker 06:
They said they want to distinguish mobile app and web browser.

[00:42:15] Speaker 06:
I would have thought almost all of this would be the same.

[00:42:18] Speaker 05:
Yeah, I don't know what their distinguishing is, to be quite honest, Your Honor.

[00:42:22] Speaker 05:
I don't.

[00:42:23] Speaker 05:
Certainly, user...

[00:42:26] Speaker 05:
Number three, when you're looking at the user-generated content, I don't see how there would be any distinction, including comments, photographs, videos.

[00:42:36] Speaker 06:
I assume registration and profile information, payment information.

[00:42:41] Speaker 06:
So much of it.

[00:42:42] Speaker 06:
Phone and social network contacts, I assume you

[00:42:45] Speaker 05:
Would those still be available or not?

[00:42:47] Speaker 05:
I mean, I'd really have to look, Your Honor, but I'm sure a vast majority of it would be.

[00:42:53] Speaker 05:
The government has made no attempt to distinguish that in the record.

[00:42:56] Speaker 05:
Indeed, again, because we're looking at agency action under the Chenary Doctrine, we're not looking to what, you know, the government may be theorizing in a brief, but what the agency actually did here.

[00:43:09] Speaker 02:
Do you challenge the finding by the government?

[00:43:13] Speaker 02:
that the collection of this sort of data by foreign power presents a national security, a valid national security concern?

[00:43:25] Speaker 05:
This requires no second guessing of the national security determination here for several reasons, Your Honor.

[00:43:32] Speaker 05:
Judge Nichols looked directly at that and indicated this was a question of statutory construction, not second guessing that

[00:43:40] Speaker 05:
He also then also looked at on its face at the Commerce Department's rationale and pointed out that what the Commerce Department speaks about is the country of China and then says could possibly maybe at some point in the future there might be something not talking about the plaintiff that's right on its face.

[00:44:00] Speaker 05:
Also that kind of basis in the record I would say also we have

[00:44:07] Speaker 05:
other challenges remaining in this case.

[00:44:10] Speaker 05:
And it relies on very inadequate and outdated information.

[00:44:13] Speaker 05:
That is part of our due process and APA claim.

[00:44:16] Speaker 05:
I would also say the timing of the government's action itself undermines on its face, again, the national security urgency that would at all be affected by this preliminary injunction.

[00:44:29] Speaker 05:
And we go through in our papers kind of the delay over periods of times of issuing these

[00:44:34] Speaker 05:
I would also say that, again, on its face, this first prohibition doesn't allow security updates, which is just counterfactual to the claim that they state, again, just on its face.

[00:44:49] Speaker 05:
And the last thing I would say, Your Honor, again, we do not at all are asking or believe the court needs to address that.

[00:44:55] Speaker 05:
But just to give you the full flavor of the case, there is a claim having to do with other arguments and claims that haven't been decided yet having to do with

[00:45:04] Speaker 05:
pretextual background to this because it wanted a rose having to do with the campaign, that type of thing.

[00:45:11] Speaker 05:
So again, for purpose of this preliminary injunction, Judge Nichols looked at this issue.

[00:45:16] Speaker 05:
We will hardly agree with him.

[00:45:18] Speaker 05:
It is not requiring the court to second guess at all.

[00:45:21] Speaker 02:
Well, what if it were undisputable that an app controlled by a foreign government

[00:45:32] Speaker 02:
could be used if downloaded, could be used to by the foreign government as a gateway to be able to hack into email systems and other things of that nature.

[00:45:49] Speaker 02:
And for that reason, the president banned the app.

[00:46:01] Speaker 02:
You're saying that because of the way that Congress has drawn this statute, that would not be a permissible regulation.

[00:46:17] Speaker 05:
What we're saying, Your Honor, is something different from that.

[00:46:19] Speaker 05:
That suggests there's some regulatory void if this is our interpretation of IEPA.

[00:46:25] Speaker 05:
I mean, the first thing I would say is in the hypothetical that the president ordered that.

[00:46:29] Speaker 05:
Well, this only applies if he uses the IEPA authority to try and do that.

[00:46:35] Speaker 05:
The government has plenty of other tools at its disposal.

[00:46:39] Speaker 05:
And this is an extraordinary exercise of IEPA authority.

[00:46:45] Speaker 05:
The government has never found it necessary to use IEPA for this means.

[00:46:48] Speaker 05:
And in fact, there's a declaration by Professor Tyler in support of the preliminary injunction that really puts in context the IEPA authority.

[00:46:55] Speaker 05:
But in addition to that, Your Honor,

[00:46:57] Speaker 05:
If you look at the text of the statute, what Congress enacted under B3, it specifically references, for example, Chapter 37 of Title 18.

[00:47:08] Speaker 05:
Regulation of that is okay.

[00:47:10] Speaker 05:
It's not prohibited under the B3 limitation.

[00:47:13] Speaker 05:
That has to do with classified information, information about military installations.

[00:47:19] Speaker 05:
Congress also referred in there to export controls.

[00:47:23] Speaker 05:
that are not excluded from regulation under B3.

[00:47:26] Speaker 05:
So Congress went through very carefully and said what B3 applies to and not, and that's what it did.

[00:47:33] Speaker 05:
I'd also say the Walsh case, certainly if there were concerns about data security, I can imagine a regulation that addressed data security in a way that did not have an effect on the transmission of the

[00:47:53] Speaker 05:
communications and the informational materials.

[00:47:57] Speaker 05:
But if that regulation does what this does and basically stops the functioning of the app, that is not permissible under IEPA.

[00:48:08] Speaker 05:
Again, there are other tools, including CFIUS that Congress has to look at transactions and to find mitigations for that.

[00:48:17] Speaker 05:
But if it's a security issue and they're looking at the mitigation,

[00:48:21] Speaker 05:
That's what you would look at.

[00:48:22] Speaker 05:
And again, I guess ultimately, Your Honor, if for some reason all of the tools in the government's toolbox could not address a national security concern, there is Congress, of course, to take action.

[00:48:33] Speaker 05:
What we do know is that Congress not once, but twice, amended the statute to reinforce these limitations in IEPA authority and said, you can't use this economic kind of sanction to shut down this type of personal communication,

[00:48:50] Speaker 05:
or informational materials.

[00:48:55] Speaker 06:
But what if, just to follow up on these hypotheticals, if you had an app that was actually 100% owned by hostile foreign government acts, very hostile foreign government acts, and they come up with this incredibly popular application

[00:49:20] Speaker 06:
And every time it's downloaded, it puts a virus in to the phones and reachable to anybody in your contacts.

[00:49:32] Speaker 06:
And it can be released on control.

[00:49:34] Speaker 06:
So as it turns out, when it's first downloaded by everybody, we don't know if it's a virus.

[00:49:41] Speaker 06:
And then it's released.

[00:49:43] Speaker 06:
And it starts wreaking havoc across the United States at a time of acute tension with hostile foreign governments.

[00:49:51] Speaker 06:
And it's a communication app just like this one.

[00:49:53] Speaker 06:
And it's really popular and it's really unique.

[00:49:57] Speaker 06:
Are you saying that what the statute says is that the government could not ban people from continuing to download this virus spreading, computer virus spreading application?

[00:50:12] Speaker 05:
What Congress has said is that the IEPA authority can't be used for that.

[00:50:18] Speaker 05:
Another tool that the government has is certainly all of Title 18 and all kinds of criminal prohibitions, criminal prohibitions.

[00:50:28] Speaker 06:
Teenagers from downloading this thing by 400,000 people.

[00:50:34] Speaker 06:
I have my memory right.

[00:50:36] Speaker 06:
100,000 people a day.

[00:50:37] Speaker 05:
If there was a regulation that was aimed at the security concerns,

[00:50:45] Speaker 05:
that met these limitations, that would not be in direct regulation.

[00:50:49] Speaker 06:
Then stop downloading this.

[00:50:51] Speaker 06:
It is destroying our communications networks, our computer and mobile phone networks.

[00:50:58] Speaker 06:
Stop downloading it.

[00:51:02] Speaker 06:
Really, they have to wait for Congress to come in and ask something.

[00:51:05] Speaker 06:
They can prosecute somebody if they can find somebody within their jurisdictional reach, but it seems to me that there were real consequences to

[00:51:15] Speaker 06:
interpreting this language as broadly as you're proposing to national security.

[00:51:19] Speaker 06:
And it just strikes me that when Congress said what they would be getting there is clearly not the communications.

[00:51:26] Speaker 06:
It is the Reagan technology that with the technology, when it's downloaded this virus, I don't care what messages you're sending, which cannot have this technology coming into our systems here.

[00:51:41] Speaker 06:
It wouldn't have any of the concerns you have.

[00:51:43] Speaker 06:
It clearly would not be a regulation of communications.

[00:51:46] Speaker 06:
It wouldn't have any of the language you've been pointing to.

[00:51:48] Speaker 06:
And that seems to me clearly allowed.

[00:51:50] Speaker 05:
That's not a regulation.

[00:51:53] Speaker 05:
Your Honor, it's clearly not this case, obviously.

[00:51:56] Speaker 05:
I will talk about it.

[00:51:58] Speaker 05:
But again, as I said earlier, there might be cases where there's line drawing, where it has such a tangential impact under Walsh.

[00:52:06] Speaker 06:
Walsh is clearly downloading this communications app, but they don't, it's not the communications.

[00:52:13] Speaker 06:
We've just got to stop the technology.

[00:52:15] Speaker 06:
How textually can you tell me if you can offer, I know you say that isn't this case, and I'm not suggesting that there's any virus, TikTok or anything like that, to be clear.

[00:52:26] Speaker 06:
What is the, what definition, what term would you use in here?

[00:52:31] Speaker 06:
to say ruling for you in this case would not require ruling for you in the other case?

[00:52:36] Speaker 05:
Is it the indirect regulation?

[00:52:38] Speaker 05:
I would say the ruling in that case would have to do with the fact that there's limitations on B3.

[00:52:46] Speaker 05:
It talks about chapter 37 of Title 18.

[00:52:49] Speaker 05:
It talks about various trade regulations.

[00:52:53] Speaker 05:
There's the CFIUS authority.

[00:52:55] Speaker 05:
There's other kinds of criminal prohibitions.

[00:52:58] Speaker 05:
We talk about carriers that have

[00:53:01] Speaker 05:
foreign investment license.

[00:53:03] Speaker 05:
The FCC has authority.

[00:53:05] Speaker 05:
There's a multitude of other tools that the federal government has.

[00:53:09] Speaker 05:
IEPA has not ever been used, nor need it be, to do that.

[00:53:15] Speaker 05:
There are other tools and there are limitations within the B3 itself.

[00:53:22] Speaker 06:
So your view is there's nothing we can do to interpret B3 that would say

[00:53:27] Speaker 06:
government can do, can stop under AIIPA, my virus hypothetical, if we rule for you in this case.

[00:53:34] Speaker 06:
But your argument is there's authorities elsewhere.

[00:53:37] Speaker 05:
There certainly are authorities elsewhere, Your Honor.

[00:53:39] Speaker 06:
Your argument that B3 can be interpreted to allow them to ban that software download, if we rule for you in this case.

[00:53:51] Speaker 05:
We think that when you're looking at that type of situation is such a far cry from this situation where, and I just want to clear her going to the purpose.

[00:54:00] Speaker 05:
I mean, Judge Nichols has looked at the purpose and- I really do, and I'm not- But that could be a different analysis, Your Honors.

[00:54:09] Speaker 05:
What I'm saying is that the purpose there was for this overwhelming national security thing.

[00:54:14] Speaker 05:
That would be very different from here.

[00:54:16] Speaker 05:
So that might be another distinction.

[00:54:18] Speaker 06:
What burden here lets me have a purpose-driven analysis and be free?

[00:54:23] Speaker 05:
Trench Nichols believed that the idea of regulate and the objective of what is being regulated goes to the purpose.

[00:54:31] Speaker 05:
And that's why he so closely looked at the Commerce Department memo and looked at how its aim is to shut down these communications, these videos, these messages.

[00:54:43] Speaker 05:
So that would be another construction that when the date came.

[00:54:46] Speaker 05:
Do you agree with that?

[00:54:47] Speaker 06:
If in this case, it were crystal clear that they were just trying to stop these downloads.

[00:54:56] Speaker 06:
They really were.

[00:54:57] Speaker 06:
They had all the affidavits, all the fact-finding.

[00:54:59] Speaker 06:
That was their clear purpose.

[00:55:03] Speaker 06:
Change the record any way you want so that 100% of the evidence of purpose is simply to prevent the business-to-business sales that allow this download.

[00:55:14] Speaker 06:
then that subjective purpose would prevail, and it would be OK, even if, as it turns out, it's stopping an awful lot of speech.

[00:55:21] Speaker 05:
We don't think there's a purpose requirement.

[00:55:23] Speaker 05:
We argued that to Judge Nichols.

[00:55:26] Speaker 05:
But what I'm suggesting to you, Your Honor, in your hypothetical situation.

[00:55:29] Speaker 05:
So for this case today, it doesn't matter whether there is, because as Judge Nichols found, it's the purpose and effect to directly regulate this, at a minimum, indirectly regulate the videos, the messages, et cetera.

[00:55:44] Speaker 05:
So it doesn't need to be resolved for this case, nor does the situation, the other hypothetical, need to be resolved for this case.

[00:55:50] Speaker 05:
But taking your honor at the question of what is the government to do, we would say three things.

[00:55:58] Speaker 05:
There are a lot of alternatives.

[00:56:00] Speaker 05:
IEPA has never been used.

[00:56:02] Speaker 05:
Even within IEPA, the B3 itself, Congress is very clear about classified information, military installations.

[00:56:09] Speaker 05:
And third, there is Judge Nichols' approach that would say,

[00:56:12] Speaker 05:
purpose would address your situation also, that the purpose there would not be to regulate the content or the video.

[00:56:23] Speaker 05:
So those are three answers I propose to your hypothetical, none of which are necessary in this case, nor need be reached in this case.

[00:56:33] Speaker 05:
And we agree, Your Honor, that purpose is not in the statute, but we clearly meet it here as the district court found.

[00:56:41] Speaker 02:
How do you draw the line on distinguishing between indirect regulation, which isn't allowed and some sort of permissible burden, which is?

[00:56:58] Speaker 05:
We would look to the Walsh case, Your Honor.

[00:57:00] Speaker 05:
We think that the language there of tangential effect is very useful.

[00:57:05] Speaker 05:
It really goes to the thrust of what indirect regulation means.

[00:57:09] Speaker 05:
If you are

[00:57:11] Speaker 05:
trying to stop the import of something or stop the transmission of messages.

[00:57:17] Speaker 05:
And you say, I'm just going to shut down the way they get paid or the way they use the app.

[00:57:25] Speaker 05:
That is indirect regulation.

[00:57:27] Speaker 05:
But if you're doing something else and all those messages are still flowing, those posters are still being imported.

[00:57:33] Speaker 05:
But there's this other thing that you can't use US hard currency to travel to Cuba.

[00:57:41] Speaker 05:
where you want to get your posters from?

[00:57:43] Speaker 05:
Well, that pretty much has a tangential effect.

[00:57:45] Speaker 05:
And the court pointed out you could get your Cuba host even to have you come there.

[00:57:49] Speaker 02:
So could the president here have said, unless and until, you know, TikTok needs to change its license and disable certain features in the software that we think pose a national security problem.

[00:58:07] Speaker 02:
and we're giving them, you know, 30 days to do that.

[00:58:12] Speaker 02:
And if they don't, then the app is banned from further downloads.

[00:58:20] Speaker 02:
Could the president do that under IEPA?

[00:58:23] Speaker 05:
That gets much closer to the type of regulation I talked about that was, you know, we could envision that's focused on data security that speaks to that.

[00:58:32] Speaker 05:
And that would not affect the ability to transmit the communications.

[00:58:35] Speaker 05:
But I would say, Your Honor, even more fundamentally,

[00:58:37] Speaker 05:
This goes back to part of my answer to Judge Millett, too, about these other tools.

[00:58:42] Speaker 05:
CFIUS, which is the Committee on Foreign Investment in the United States, has that type of authority to mitigate national security concerns having to do with various transactions.

[00:58:54] Speaker 05:
There currently are ongoing discussions under that very authority.

[00:58:59] Speaker 05:
The president issued an order under CFIUS about a week after this order.

[00:59:04] Speaker 05:
And those negotiations and discussions are still going on.

[00:59:08] Speaker 05:
And that's an appropriate place for that.

[00:59:10] Speaker 05:
We disagree with the breadth of the government's actions there and have filed a petition for review of that agency action in order to preserve our rights while these discussions continue.

[00:59:23] Speaker 05:
But that is exactly what, again, Congress created to address those very concerns

[00:59:29] Speaker 05:
And I can't say enough, Your Honor, how important it is that we look to how Congress has looked at these various issues.

[00:59:35] Speaker 02:
But why isn't it relevant to us?

[00:59:38] Speaker 02:
I mean, when we interpret a statute, we don't normally look to see, well, if we interpret it this way, we shouldn't be worried because all of these other statutes can cover

[00:59:55] Speaker 02:
you know, these other situations.

[01:00:00] Speaker 02:
I mean, we need to look at the text of this statute in the C, given the concern that Congress had, which is to give the president the ability to act unilaterally once the proper declarations and procedural requirements are made to protect national security.

[01:00:23] Speaker 02:
And if you have a hypothetical case where there's no question there's a serious national security risk that's posed by software that's downloaded on mobile phones, it seems to me that your interpretation that you would ask us to adopt doesn't allow the president to use this authority to act.

[01:00:52] Speaker 02:
I mean, even in the hypo that I just posed, that if the president says, look, change these particular things about the application and do it by this date, or I'm going to block the application, you don't seem to be willing to admit that that is permissible because of B3.

[01:01:14] Speaker 05:
Let me be clear, Your Honor.

[01:01:16] Speaker 05:
I did not mean to say that was not permissible.

[01:01:18] Speaker 05:
I think it's more appropriate under CFIUS because this whole regulatory scheme set up for mitigation and all of that in a process.

[01:01:25] Speaker 05:
But here, Your Honor, a regulation, if the Commerce Department had done that, again, we have to look at what the Commerce Department did here.

[01:01:33] Speaker 05:
They didn't do that at all.

[01:01:35] Speaker 05:
If the Commerce Department were looking at that and had some targeted national security concern and they have a record to support it,

[01:01:44] Speaker 05:
And again, I have to say in that situation, they would have had to give us notice and comment to respond.

[01:01:49] Speaker 05:
We didn't get notice and comment to respond.

[01:01:51] Speaker 05:
So we couldn't explain to them all the security measures that we do have in place.

[01:01:55] Speaker 05:
There's a declaration below that explains that.

[01:01:57] Speaker 05:
I mean, that's not all relevant to the stature thing, but I'm just giving you the context.

[01:02:01] Speaker 05:
If that had played out, it would have played out very, very differently.

[01:02:05] Speaker 05:
And that well might be something that did not indirectly regulate communications because

[01:02:11] Speaker 05:
there could be measures taken that didn't affect the communications.

[01:02:14] Speaker 05:
So I just want to be clear about that.

[01:02:15] Speaker 05:
I'm sorry I was unclear before I was pressed, jumping too quickly to the other method that's allowed there.

[01:02:21] Speaker 05:
So that is an approach.

[01:02:22] Speaker 05:
But I would also say, it's not our interpretation.

[01:02:25] Speaker 05:
It's just the words of Congress.

[01:02:26] Speaker 05:
And this is an A3 of our appendix.

[01:02:28] Speaker 06:
Can I just follow up here on your answer to Judge Wilkins?

[01:02:31] Speaker 06:
Are you saying that if they gave you that, they went through whatever process you want, and they gave you that, look, we've got two months or one month.

[01:02:41] Speaker 06:
And then we are banning download of the app.

[01:02:44] Speaker 06:
At that point, banning download of the app would not be impermissible?

[01:02:51] Speaker 05:
If it banned the app, Your Honor, it would not come to that because there are all of these data security provisions that can be taken.

[01:03:00] Speaker 05:
In fact, TikTok tapes them.

[01:03:01] Speaker 05:
That's what the declaration indicates.

[01:03:05] Speaker 06:
After that one month period of intense negotiations, the government and the company are not

[01:03:11] Speaker 06:
in agreement, and so the ban comes into effect.

[01:03:15] Speaker 06:
It's not because they didn't try, and maybe they did do some adjustments here and there, but the ban comes into effect, and EPA is the authority for the ban.

[01:03:24] Speaker 05:
Well, CFIUS is the authority.

[01:03:27] Speaker 05:
CFIUS cross-references IEPA.

[01:03:29] Speaker 05:
So I take it, Judge Wilkins, for example, sometimes you do look at more than one statute because they cross-reference each other, and it explains if IEPA doesn't satisfy, then you can do this under CFIUS.

[01:03:40] Speaker 05:
So I think you'd have to look at the interaction of those two.

[01:03:42] Speaker 05:
And in fact, the Commerce Department regulation here, Prohibition does look at the interaction between the two because it even acknowledges that the prohibitions will not apply to activities that need to be taken to address the CFIUS issue.

[01:03:56] Speaker 05:
So I do think there's interaction between those two authorities.

[01:03:59] Speaker 05:
But I do also have to mean it could be banned.

[01:04:02] Speaker 05:
They just cited the wrong statute this time.

[01:04:05] Speaker 05:
No, your honor.

[01:04:05] Speaker 05:
It's a different process.

[01:04:07] Speaker 05:
And the CFIUS has the mitigation authority.

[01:04:09] Speaker 05:
But what I'm saying, Android, IPA, if there is a regulation that is addressing data security that does not go to an effect, the actual transmission of the messages

[01:04:25] Speaker 05:
you know, whether it's encryption, many, you know, prohibiting malware, there are lots of things that could come under that.

[01:04:31] Speaker 05:
That would be different.

[01:04:32] Speaker 05:
That's not what the Commerce Department did here.

[01:04:34] Speaker 06:
Maybe Judge Wilkins correct me if I'm wrong.

[01:04:37] Speaker 06:
His hypothetical was you have a time period, and if you haven't worked everything out, a ban on download goes into effect on day.

[01:04:48] Speaker 06:
And what I'm asking you is, would that be banned

[01:04:53] Speaker 06:
when it goes into effect, it didn't, the process just didn't lead to resolution.

[01:04:59] Speaker 06:
Would that be permissible?

[01:05:01] Speaker 06:
You're saying that would be permissible under CFIS authority, but not under IPA or under?

[01:05:06] Speaker 05:
That would not be allowed.

[01:05:07] Speaker 05:
An ultimate ban that shut down, you know, the informational materials, the transmission of informational materials, photographs, et cetera, within B3 would be an indirect regulation of those informational materials that would not be

[01:05:23] Speaker 05:
allowed, but under the CFIUS authority, there are other authorities that are not limited.

[01:05:27] Speaker 05:
CFIUS is not limited by B3.

[01:05:30] Speaker 05:
This is the statutory textual.

[01:05:32] Speaker 06:
CFIUS could impose a ban after 30 days.

[01:05:34] Speaker 06:
CFIUS could impose the same ban that was imposed here.

[01:05:37] Speaker 05:
I can't speak that broadly, Your Honor.

[01:05:39] Speaker 05:
That's why I'm hesitating.

[01:05:40] Speaker 05:
There are ongoing negotiations.

[01:05:42] Speaker 05:
And ban is a very generic word.

[01:05:45] Speaker 05:
We take issue with the scope.

[01:05:49] Speaker 06:
The ban cannot be downloaded by new users and cannot be updated.

[01:05:53] Speaker 06:
existing users.

[01:05:54] Speaker 06:
That's what I mean by ban.

[01:05:56] Speaker 05:
Right.

[01:05:56] Speaker 05:
And what I'm saying in the, um, SIFIUS context, it has to do with covered transactions and various uses of its authority that are in ongoing discussions now.

[01:06:07] Speaker 05:
Hypothetically, I'm sure there are situations where that would be possible.

[01:06:12] Speaker 05:
I just can't speak to this particular situation because I'm not privy

[01:06:16] Speaker 05:
to the CFIUS negotiations.

[01:06:18] Speaker 05:
I'm just the litigator here.

[01:06:19] Speaker 05:
But I want to bring it back to the text.

[01:06:22] Speaker 06:
I'm asking the question just because if the argument is, if we have a real crisis like Judge Wilkins hypothesized or my virus one, it's a real crisis and it really is focused on technology.

[01:06:34] Speaker 06:
That's the real problem.

[01:06:36] Speaker 06:
And I thought your argument was here's the process for dealing with that.

[01:06:40] Speaker 06:
But if it doesn't actually allow them to stop the hemorrhaging,

[01:06:46] Speaker 06:
stop the downloading, then it seems like it's not.

[01:06:51] Speaker 06:
Is there some other authority that would let them go stop the downloading of this virus viewing technology?

[01:07:01] Speaker 06:
And we'll sort it out later, but let's the government go fast and stop the downloading.

[01:07:07] Speaker 05:
Why don't we?

[01:07:09] Speaker 05:
Go ahead, Mrs. Thank you, Your Honor.

[01:07:11] Speaker 05:
The government has

[01:07:12] Speaker 05:
many authorities, Your Honor.

[01:07:13] Speaker 05:
I can't sit here and catalog all of them, but there certainly are export controls, import controls that are allowed.

[01:07:20] Speaker 05:
There are anything that would be tangential.

[01:07:23] Speaker 05:
But I would also say, Your Honor, again, if that date comes and that issue is presented, it would be such a different situation than this.

[01:07:32] Speaker 05:
I just want to say, again, it goes to this question, for example, of purpose that Judge Nichols focused on.

[01:07:37] Speaker 05:
Here, it's clear that the purpose and effect here is to

[01:07:41] Speaker 05:
stop the transmissions of these communications.

[01:07:44] Speaker 05:
But he suggests, and I'm suggesting to you, could fit your hypothetical.

[01:07:49] Speaker 05:
If there was some purpose under his approach that had nothing to do with the actual communications, that may be something.

[01:07:56] Speaker 05:
That just is not something that the court needs to grapple with today.

[01:07:59] Speaker 05:
And I think there are a lot of different analyses.

[01:08:02] Speaker 05:
The interaction with other statutes, the interaction with other national security authorities of the government,

[01:08:09] Speaker 05:
you know, the idea of a situation that's different from this where the purpose is wholly different than what the purpose was here.

[01:08:16] Speaker 05:
So I would say all of those, I think should get comfort and address the situation.

[01:08:21] Speaker 05:
There are tools for courts and the executive and the government to look to.

[01:08:26] Speaker 05:
And of course, there also is the authority of Congress.

[01:08:29] Speaker 05:
But I take your point that you're looking for something emergency that could be done directly.

[01:08:34] Speaker 05:
And I would suggest that

[01:08:35] Speaker 05:
other tools, the purpose, all of those things are a way that could arise in another situation that isn't present in this case.

[01:08:43] Speaker 05:
And that is what we're looking at here today, Your Honor.

[01:08:45] Speaker 05:
It's a question of statutory interpretation.

[01:08:48] Speaker 05:
What Congress said and expressly said, the authority granted to the president by this section does not include the authority to regulate or prohibit directly or indirectly in that it has the personal communications and the informational

[01:09:04] Speaker 05:
materials.

[01:09:04] Speaker 05:
And the information materials is quite broad, commercial or not, regardless of format or medium, twice amended in the Berman Amendment.

[01:09:13] Speaker 05:
And then again, in 1994, the free trade and ideas to ensure the robust international exchange of ideas.

[01:09:22] Speaker 05:
And that is what Congress wrote, there are other authorities, there are interactions between these statutes.

[01:09:29] Speaker 05:
And indeed, there's

[01:09:30] Speaker 05:
Judge Nichols' approach, particularly in his more recent opinion last week, he issued another opinion on the case and really went through and analyzed his approach, I think, to purpose, which might address your issue.

[01:09:43] Speaker 05:
Again, you know, we don't see that in the statute, but it just doesn't matter here because it's so clear and the record is so clear from the Commerce Department's memo about the purpose and effect of the prohibition at issue here.

[01:09:56] Speaker 04:
All right.

[01:09:56] Speaker 04:
Why don't we hear from counsel for Helen?

[01:10:00] Speaker 04:
You're a couple.

[01:10:04] Speaker 03:
Thank you, Judge Rogers.

[01:10:06] Speaker 03:
I want to make a couple of points in just to address what my opposing counsel was discussing.

[01:10:13] Speaker 03:
So first of all, the statutory language here protects the rights of Americans to certain activity like importing informational materials.

[01:10:20] Speaker 03:
It doesn't protect the rights of businesses or foreign governments.

[01:10:24] Speaker 03:
And that's important because Walsh emphasized the need for line drawing.

[01:10:28] Speaker 03:
There was a discussion about line drawing and it's indisputable that

[01:10:31] Speaker 03:
Walsh emphasized, recognized that there's a need to balance the two congressional concerns, as the court said there on page 1233, recognizing Congress's intent to give the president wide powers under AIPA to address that serious national security threats.

[01:10:46] Speaker 04:
But let me ask you just so we're clear.

[01:10:49] Speaker 04:
You have not argued that there are not other statutes, other procedures, other ways in which

[01:10:59] Speaker 04:
the president would have authority to ban downloading an app.

[01:11:06] Speaker 03:
Actually, Judge Rogers that we haven't addressed that question nor have plaintiffs in the briefing in this case, and I think it's obviously something of concern to us.

[01:11:16] Speaker 03:
Yes, and I think that concern is serious because I don't think anyone has identified a similar emergency authority to address the kind of imminent threats to national security that Judge Millett and Judge Wilkins in their hypothetical examples posed.

[01:11:32] Speaker 03:
AIIPA is designed specifically to address those kinds of threats.

[01:11:36] Speaker 03:
And the fact that a particular business or a particular foreign government seeks to hide a national security threat in a business or an activity that allows Americans to engage in personal communications or exchange of informational materials does not insulate that business from regulation of the threat it poses to national security under AIIPA.

[01:11:59] Speaker 03:
The other point I want to emphasize is that the plaintiffs acknowledge there's a national security concern here, but they nevertheless double down on this interpretation that IEPA doesn't reach this kind of national security threat if there's any implication, any effect on communication or informational exchange.

[01:12:20] Speaker 03:
If this were a rideshare app or a video game app,

[01:12:23] Speaker 03:
collecting the same sensitive personal information.

[01:12:27] Speaker 03:
There's no doubt IEPA could regulate it.

[01:12:29] Speaker 03:
It can't be insulated just by pointing to the fact that Americans might wish to use it for these protected activities.

[01:12:37] Speaker 03:
That's not what Congress intended.

[01:12:39] Speaker 03:
And finally, I want to emphasize that Walsh's reference to the tangential nature

[01:12:44] Speaker 03:
of the travel at issue there was not the court's articulation of the standard with a meaning of indirectly regulator prohibit.

[01:12:53] Speaker 03:
It was instead an example of the court's Chevron deference to the treasury department's own rationale for why it retained the travel regulation.

[01:13:07] Speaker 06:
This- Sorry.

[01:13:12] Speaker 06:
Nope, you're mid sentence.

[01:13:13] Speaker 06:
Go ahead.

[01:13:13] Speaker 06:
Sorry.

[01:13:14] Speaker 03:
No, your honor, please.

[01:13:16] Speaker 06:
I want you to finish your point.

[01:13:19] Speaker 03:
I did.

[01:13:19] Speaker 06:
Thank you.

[01:13:20] Speaker 06:
I'm sorry.

[01:13:21] Speaker 06:
Um, I know we only have the first prohibition before us, but on this, this theory about use of the web browser with the fifth prohibition, when it says no utilization of Tik TOKs, mobile applications, constituent code functions or services, the function of software or services.

[01:13:42] Speaker 06:
within the United States.

[01:13:44] Speaker 06:
Would that ban use of TikTok through the web browser?

[01:13:50] Speaker 03:
Your Honor, we don't know the answer to that yet, but I think that it might not.

[01:13:54] Speaker 03:
And the reason is that the language of the fifth prohibition, again, like all of the prohibitions and the executive order, reference the TikTok mobile application.

[01:14:04] Speaker 03:
That is the particular threat identified.

[01:14:07] Speaker 06:
I'm trying to figure out what constituent code functions or services are and whether those are actually in any way distinct from using it through the web browser, particularly if you use the web browser on your mobile phone.

[01:14:18] Speaker 03:
Yes, Your Honor, but it wouldn't be using the mobile app.

[01:14:21] Speaker 03:
So again, these are questions that probably remain to be explored in terms of browser alternative.

[01:14:28] Speaker 03:
Sorry, Your Honor.

[01:14:29] Speaker 06:
We're not at all clear about this web browser alternative.

[01:14:32] Speaker 03:
Correct.

[01:14:32] Speaker 03:
And I'll just point out that the only reason I mentioned it is because this prohibition at issue here is limited solely to the mobile app and it's limited solely to its availability on app stores.

[01:14:46] Speaker 03:
That is a targeted regulation designed to address the specific threat identified.

[01:14:53] Speaker 03:
It is not the kind of

[01:14:55] Speaker 03:
in reality ban of the importation or exportation of informational materials or personal communications.

[01:15:03] Speaker 03:
That is the meaningful difference that I think is relevant, not whether web browsers are different in some other way, Your Honor, and that that

[01:15:10] Speaker 03:
like the other questions that plaintiff has raised in their complaint, remain to be resolved as the case proceeds on the merits in district court.

[01:15:19] Speaker 03:
This question before the court now is whether the preliminary injunction can be upheld solely on the basis that the district court articulated that it is an indirect regulation of Americans protected activity.

[01:15:32] Speaker 03:
That's not what the statutory language means as the court recognized in Walsh.

[01:15:38] Speaker 03:
And we think that disposes of this appeal.

[01:15:42] Speaker 06:
Can I ask you about timing as well?

[01:15:43] Speaker 06:
This is an expedited appeal, but my recollection is correct.

[01:15:48] Speaker 06:
The government never saw the stay of the preliminary injunction, and now has published in the Federal Register a statement that, in light of this injunction, I can't remember if that was after or before the December 7th injunction.

[01:16:06] Speaker 06:
but they're not enforcing it.

[01:16:07] Speaker 06:
And my understanding is that this November 12th deadline went by and those prohibitions are not being, there's no one, it wasn't until December 7th, the November 12th deadline came and went.

[01:16:18] Speaker 06:
And at least until December 7th, there was no injunction, yet the government's, it's just not enforcing.

[01:16:25] Speaker 03:
Oh, I'm sorry, your honor.

[01:16:28] Speaker 06:
No, no, that was my understanding.

[01:16:30] Speaker 06:
Tell me how I'm wrong.

[01:16:31] Speaker 03:
So there was an injunction, your honor.

[01:16:33] Speaker 03:
It was entered by the district court in Pennsylvania in the Marlin case, which was brought by three users of TikTok.

[01:16:42] Speaker 03:
And it enjoined all five prohibitions.

[01:16:45] Speaker 03:
And you're correct, Judge Malik, the government did not seek a stay in this case of the injunction of the first prohibition.

[01:16:52] Speaker 03:
And instead, we sought expedited resolution that we'd urge this court to rule expeditiously as well in order to address and protect

[01:17:00] Speaker 06:
Have you sought a stay in the Pennsylvania case?

[01:17:04] Speaker 03:
We have not, your honor.

[01:17:05] Speaker 03:
We also sought and the court granted expedited briefing and argument of the appeal.

[01:17:11] Speaker 03:
The briefing is proceeding very rapidly.

[01:17:13] Speaker 03:
We found our opening brief and the court has set argument for February, I believe, 14 to 15.

[01:17:18] Speaker 06:
It's just a little bit unusual to me in a case, national security, one, not to have any declarations here, even if under seal.

[01:17:28] Speaker 06:
by national security officials telling us the urgency of these actions.

[01:17:33] Speaker 06:
And then in particular, I had to have the government seeking a stay.

[01:17:37] Speaker 06:
So I'm just trying to get a measure here from the government.

[01:17:40] Speaker 06:
So you've got a February argument date in the Third Circuit, is that what you said?

[01:17:45] Speaker 03:
Yes, Your Honor, that's correct.

[01:17:47] Speaker 06:
Okay, so you're not even expecting decisions until late February or on the end of February, maybe at the past.

[01:17:57] Speaker 03:
Well, we've asked this court and we've asked the Third Circuit as well to rule expeditiously this case.

[01:18:02] Speaker 06:
If there's another injunction in effect.

[01:18:05] Speaker 06:
And that's Third Circuit decision again, if you're even argument and sorry, was that February 14th?

[01:18:10] Speaker 06:
Am I remembering that?

[01:18:11] Speaker 03:
I don't remember the day in February, Your Honor.

[01:18:13] Speaker 03:
It is in February is all I can recall.

[01:18:15] Speaker 00:
Yes.

[01:18:15] Speaker 03:
So if I may address your question though, Judge Mallette, this case is the furthest along of the appeals.

[01:18:21] Speaker 03:
And we're asking you to rule expeditiously in light of the national security concerns identified.

[01:18:26] Speaker 03:
If this court rules in our favor, we could seek additional relief in other courts and that could be a basis for doing so.

[01:18:34] Speaker 03:
We thought it was better not to impose a burden both on the court and on the parties in this case to duplicatively brief both the stay and expedited briefing.

[01:18:44] Speaker 03:
And we thought that it was

[01:18:45] Speaker 03:
essential to allow the court to consider the merits questions posed the likelihood of success in the merits that is posed by this case.

[01:18:56] Speaker 03:
And so we sought expedited briefing, instead of a stay and didn't seek a stay I should say there's nothing untoward about that.

[01:19:04] Speaker 03:
Nothing undermines the national security rationale here.

[01:19:09] Speaker 03:
And indeed, as I emphasized, and in the plaintiff's argument, opposing counsel acknowledged the national security threat is legitimate.

[01:19:19] Speaker 03:
And there's no basis to second guess the president's determination on that question.

[01:19:25] Speaker 04:
Is there any timetable for the committee to act?

[01:19:28] Speaker 03:
You're referring the committee, the CFIUS proceeding, Your Honor, and I am not familiar with the details of that.

[01:19:35] Speaker 03:
My understanding is that that's a separate track, but I'll also point out that the plaintiffs have filed a separate petition for review in this court, which will proceed on its own track concerning that statutory process.

[01:19:50] Speaker 00:
All right.

[01:19:50] Speaker 03:
We think it's not relevant, however, to the interpretation of the exception.

[01:19:54] Speaker 04:
All right.

[01:19:56] Speaker 04:
Thank you.