Marland v. Trump

• Citation: 498 F.Supp.3d 624
• Decision Date: 30 October 2020
• Docket Number: CIVIL ACTION NO. 20-4597
• Parties: Douglas MARLAND, Cosette Rinab, and Alec Chambers, Plaintiffs, v. Donald J. TRUMP, in his official capacity as President of the United States; Wilbur L. Ross, Jr., in his official capacity as Secretary of Commerce; and U.S. Department of Commerce, Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

498 F.Supp.3d 624

Douglas MARLAND, Cosette Rinab, and Alec Chambers, Plaintiffs,

v.Donald J. TRUMP, in his official capacity as President of the United States; Wilbur L. Ross, Jr., in his official capacity as Secretary of Commerce; and U.S. Department of Commerce, Defendants.

CIVIL ACTION NO. 20-4597

United States District Court, E.D. Pennsylvania.

Signed October 30, 2020

Davis Wright Tremaine, LLP, Los Angles, CA, Jason A. Levine, Bonnie M. Hoffman, Hangley Aronchick Segal Pudlin & Schiller, Philadelphia, PA, Robert Corn-Revere, Davis, Wright, Tremain, LLP, Washington, DC, for Plaintiffs.

Daniel Schwei, U.S. Dept. of Justice, Washington, DC, for Defendants.

OPINION

WENDY BEETLESTONE, J.

Plaintiffs Douglas Marland, Cosette Rinab, and Alec Chambers have filed a motion to preliminarily enjoin the implementation by the Secretary of the U.S. Department of Commerce of President Trump's Executive Order 13942, which concerns limitations on the video-sharing application (or "app") TikTok. Plaintiffs contend that, absent an injunction, TikTok will be effectively banned within the United States beginning November 12, 2020.

I. BACKGROUND

A. The International Emergency Economic Powers Act

Executive Order 13942, by its terms, was issued pursuant to the President's authority under the International Emergency Economic Powers Act ("IEEPA"), 50 U.S.C. § 1701 et seq. Enacted in 1977, IEEPA is "the source of statutory authority for the Executive's exercise of emergency economic powers in response to peacetime crises." United States v. Amirnazmi , 645 F.3d 564, 572 (3d Cir. 2011). IEEPA authorizes the President to declare a national emergency "to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States." 50 U.S.C. § 1701(a). Once the President declares a national emergency, IEEPA permits him to:

investigate, block during the pendency of an investigation, regulate, direct and compel, nullify, void, prevent or prohibit, any acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in, or exercising any right, power, or privilege with respect to, or transactions involving, any property which any foreign country or a national thereof has any interest by any person, or with respect to any property, subject to the jurisdiction of the United States.

Id. § 1702(a)(1)(B).

While Congress, through IEEPA, conferred on the Executive substantial authority to confront national emergencies, it also took care to identify certain substantive limitations on the President's otherwise broad powers. As originally enacted, IEEPA limited the President's authority to regulate "any postal, telegraphic, telephonic, or other personal communication, which does not involve a transfer of anything of value." 50 U.S.C. § 1702(b)(1). In 1988, Congress enacted the Berman Amendment, in response to "several seizures by the United States of shipments of magazines and books" from countries subject to trade embargoes, as well as "to the Treasury Department's restrictions on the permissible forms of payment for informational materials purchased from Cuba." Amirnazmi , 645 F.3d at 584 (quoting Kalantari v. NITV, Inc. , 352 F.3d 1202, 1205 (9th Cir. 2003) ). The Berman Amendment constrained the President's ability to regulate certain types of information and informational materials when relying on IEEPA to respond to a national emergency. See id. Further, the amendment "removed from the Executive's purview the authority to regulate or prohibit such transactions ‘directly or indirectly.’ " Id.

The President's IEEPA authority was further limited in 1994, when Congress, through the Free Trade in Ideas Act, expanded the Berman Amendment "to restrict the Executive from regulating transactions concerning informational materials ‘regardless of format or medium of transmission.’ " Id. at 585. This "informational materials" exception to the President's IEEPA authority provides:

The authority granted to the President by this section does not include the authority to regulate or prohibit, directly or indirectly ...

(3) the importation from any country, or the exportation to any country, whether commercial or otherwise, regardless of format or medium of transmission, of any information or informational materials, including but not limited to, publications, films, posters, phonograph records, photographs, microfilms, microfiche, tapes, compact disks, CD ROMs, artworks, and news wire feeds.

Id. § 1702(b).

The House Conference Report clarified that under the informational materials exception, "no embargo may prohibit or restrict directly or indirectly the import or export of information that is protected under the First Amendment to the U.S. Constitution." H.R. Conf. Rep. No. 103-482, at 239 (1994), reprinted in 1994 U.S.C.C.A.N. 398, 483. To that end, the Report notes that the exception was "explicitly intended, by including the words ‘directly or indirectly,’ to have a broad scope," and to "facilitate transactions and activities incident to the flow of information and informational materials without regard to the type of information, its format, or means of transmission." Id.

B. Executive Order 13873

On May 15, 2019, prior to issuing the executive order challenged by Plaintiffs here, President Trump issued Executive Order 13873 (the "ICTS Executive Order"), which declared a national emergency under IEEPA and the National Emergencies Act, 50 U.S.C. § 1601 et seq. , with respect to the threat posed by foreign adversaries to the United States’ information and communications technology and services. See Securing the Information and Communications Technology and Services Supply Chain, 84 Fed. Reg. 22,689 (May 15, 2019). Specifically, the President found that "foreign adversaries are increasingly creating and exploiting vulnerabilities in information and communications technology and services, which store and communicate vast amounts of sensitive information, facilitate the digital economy, and support critical infrastructure and vital emergency services, in order to commit malicious cyber-enabled actions." Id. The ICTS Executive Order does not, however, name the particular foreign adversaries or technologies posing a threat to national security.

In May 2020, the President renewed the ICTS Executive Order for one year, and again did not specify a particular foreign adversary or technology of concern. See Continuation of the National Emergency with Respect to Securing the Information and Communications Technology and Services Supply Chain, 85 Fed. Reg. 28,321 (May 13, 2020).

C. Executive Order 13942

Citing the ICTS Executive Order and pursuant to his authority under IEEPA, President Trump issued Executive Order 13942 (the "TikTok Executive Order") on August 6, 2020. See Addressing the Threat Posed by TikTok, and Taking Additional Steps to Address the National Emergency with Respect to the Information and Communications Technology and Services Supply Chain, 85 Fed. Reg. 48,637 (Aug. 6, 2020). The TikTok Executive Order is more specific than either the May 2019 or the May 2020 ICTS Executive Orders: It identifies the country of concern – China; the company of concern – ByteDance Ltd.; and the technology of concern – the TikTok mobile application.

Specifically, it names TikTok – a global video-sharing application, or "app," owned by Chinese company ByteDance and used by over 100 million Americans – as a threat to the "national security, foreign policy, and economy of the United States." Id. Because of TikTok's foreign ownership and the company's ability to "automatically capture[ ] vast swaths of information from its users," President Trump identified a risk that the People's Republic of China (the "PRC") and the Chinese Communist Party (the "CCP") could use TikTok to "access ... Americans’ personal information for blackmail, and conduct corporate espionage." Further, the President identified a risk of the CCP using TikTok "for disinformation campaigns that benefit the [CCP], such as when TikTok videos spread debunked conspiracy theories about the origins of the 2019 Novel Coronavirus." The President determined that "additional steps must be taken" to deal with these risks to the national security.

The TikTok Executive Order directed the Secretary of Commerce to identify a list of transactions related to ByteDance and its subsidiaries – including TikTok – by persons subject to the jurisdiction of the United States. Separately, ByteDance was ordered to divest itself of TikTok's U.S. operations, including any interest in U.S. user data. See Regarding the Acquisition of Musical.ly by ByteDance Ltd., 85 Fed. Reg. 51,297 (Aug. 14, 2020).

D. The Commerce Identification

Pursuant to the President's directive, the Commerce Department issued a memorandum on September 17, 2020 recommending to the Secretary of Commerce, Defendant Wilbur L. Ross, that certain categories of TikTok-related transactions be prohibited. The memorandum discusses the threats to national security posed by ByteDance and TikTok, noting that the Chinese government is "building massive databases of Americans’ personal information" to help "further its intelligence-gathering and to understand more about who to target for espionage, whether electronically or via human recruitment."

On September 18, 2020, the Secretary of Commerce published a list of six prohibited transactions that was shortly revised and re-published.¹ See Identification of Prohibited Transactions to Implement Executive Order 13942 and Address the Threat Posed by TikTok and the National Emergency with Respect to the Information and Communications Technology and Services Supply Chain, 85 Fed. Reg. 60,061 (Sept. 24, 2020) (the "Commerce Identification"). As relevant here, the Commerce Identification prohibits the following:

(1) Any provision of services, occurring on or after 11:59 p.m.

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