With Oracle Deal Under Review, TikTok Seeks Injunction Against Shutdown: Reports

Oracle is seeking to become the cloud provider for TikTok and acquire a 12.5-percent stake in the social app.

As Oracle awaits a Trump administration decision on its deal to acquire a minority stake in social media app TikTok, the app’s owner is reportedly seeking a preliminary injunction against a ban taking effect this weekend.

President Donald Trump previously issued an executive order that would shut down TikTok in the U.S. on Sunday night unless there’s a sale of the app’s U.S. operations. It’s unclear if Oracle’s bid, which also includes an investment from Walmart, will satisfy the administration.

[Related: Oracle-TikTok Deal Gets OK From Trump]

Attorney General William Barr is “skeptical” of the Oracle deal due to worries over national security, according to Charles Gasparino of the Fox Business Network in a post on Twitter. Barr is in the “fact gathering stage” on the deal and hasn’t made a recommendation yet to Trump, Gasparino reported.

On Wednesday, Bloomberg reported that TikTok’s owner, China-based ByteDance, has requested a preliminary injunction from a federal court to prevent the removal of TikTok from U.S. app stores on Sunday evening.

CRN has reached out to TikTok and Oracle for comment.

Last Saturday, Trump said he “approved the [Oracle] deal in concept.”

Trump’s threats to ban TikTok have come as his administration aired concerns that the app could be used by the Chinese government to acquire data on Americans.

Under its proposed deal, Redwood Shores, Calif.-based Oracle said it will become the cloud provider for TikTok and will acquire a 12.5-percent stake in the app. The terms of the acquisition weren’t disclosed.

Oracle said it plans to combine its cloud technology with measures such as code reviews and monitoring to ensure that data for U.S. users of TikTok is kept secure and private.

Oracle and Walmart will be given the chance to take a total stake of up to 20 percent in TikTok prior to an initial public offering by the company, TikTok said.

“Upon creation of TikTok Global, Oracle/Walmart will make their investment and the TikTok Global shares will be distributed to their owners, Americans will be the majority and ByteDance will have no ownership in TikTok Global,” said Ken Glueck, Oracle executive vice president, in a statement provided to CRN on Monday.

TikTok features short videos posted by users and has emerged as a hugely popular social app in the U.S. in recent years, particularly among younger users.

ByteDance previously rejected Microsoft’s bid to acquire TikTok’s U.S. operations.

Oracle co-founder, executive chairman and CTO Larry Ellison is a friend and supporter of Trump. In February, Ellison raised money for Trump’s reelection bid with a lavish golf outing and roundtable at his Rancho Mirage estate in the Southern California desert.