Deep investors are wary of ploughing money into Trump-backed proposals for Tiktok's US ownership.
Top law firms have warned several potential investors that if they play on Oracle Takeover, proposed by a Chinese-owned video sharing app, they could require some kind of compensation from the White House. Problem: Some say that the lawsuits that argued that the transaction did not fall short of the law and subsequent Scotus decisions, and subsequent Scotus decisions, demand a transaction that amounts to a full sale from Beijing and a major penalty for violations.
“Our lawyers are worried,” said the Wall Street executive involved in the deal.
The emergence of Tiktok has haunted Silicon Valley, Wall Street and Washington for over five years, mainly with young Americans. During his first term, Donald Trump tried to ban the app on concerns that it would siphon user data, and handed it over to the Beijing owners to help the ruling Chinese Communist Party spy on US citizens. Others worry that the company's addictive algorithms pushed parental and anti-American propaganda.
Tiktok has long denied the accusation, but it has not stopped a bipartisan push to remove it from the US app store. It was signed into law last year by President Biden and endorsed by the Supreme Court before Trump took office after a lengthy court battle.
Trump, Wildcard said he wanted to save Tiktok as he was cheated after the election and believes in all the spies' concerns.
Upon his appointment, he set up a bounty period of 75 days to find deals that expire on April 5th.
As I report, the White House has been rushing to find a deal since the clock began. As it is now, it hopes that tech giant Oracle will be involved. Tech Giant currently has apps in the cloud, imposing additional safeguards on Tiktok's new structure. This is because even if the so-called “new Co” is created with US investors legally separate from the owner, Chinese technology companies ordinances control user preferences and own any possible algorithms for any possible speak craft.
As I also reported, Republicans like Sen. Tom Cotton, a powerful Arkansas senator, doubt this is enough to meet the requirements of the law that requires a clean break from China.
Another complex factor that has been discussed recently is the legal liability that equity investors may face if the contract does not meet the legal standards.
Both cotton and Congressional staff have raised issues of liability for potential investors and money has learned, and the “civil penalty” section of legislation unfolds a harsh reality. “An entity (a) violating a subsection, whether or not it increases the number of users within the US or within the maritime boundary, or an increase of $5,000, must pay a civil penalty at an amount not exceeding the amount determined to have been accessed, maintained or renewed to a foreign hostile suppression application as a result of such violations.”
You do math: Tiktok has an estimated 170 million users in the US. That is, even cash-rich companies like Oracle don't want to be hooked for such a big thing, so Oracle owns Tiktok or simply houses the company and its Chinese-owned Argo in the cloud, and has yet to publicly express interest.
Oracle representatives did not have any comments.
Again, this is not a settling method. The law itself says a lot about the president who determines whether the Chinese no longer control Argo. And Trump could say that Oracle (run by his best friend, its co-founder, Larry Ellison) is doing just that.
But that may not stop the National AG filing a lawsuit on Trump's Animus (think Leticia James of New York).
And even the deepest pocket high-tech or private equity investors can afford to put that bill into motion.
