TikTok has reached a settlement with Alabama over allegations that the platform was designed to addict children and mislead consumers about the safety of its platform.

The state will receive a minimum of $100 million within 45 days and has the potential to get up to $300 million if certain unspecified conditions are met, according to a statement released by the Alabama Attorney General’s office on Friday,

First State Deal Signals a Shift in Strategy

The agreement marks TikTok’s first settlement with a U.S. state, even as it continues fighting similar claims in courts nationwide. Alabama’s case against TikTok was slated to go to trial on Monday. Alabama would have been the first state to bring its claims against TikTok to trial, according to the statement.

“This is a great day for Alabama parents,” Attorney General Steve Marshall said. “TikTok has agreed to give parents real control over what their kids see and how much time they spend on the app.”

The state noted that besides the payment, TikTok must implement several safety features aimed at protecting children using its platform. The features include a two-hour daily time limit, with parental controls.

The deal comes as the regulatory environment continues to change. In July, the Justice Department reversed a federal ban from 2022, allowing employees to reinstall TikTok on government devices. Officials pointed to lower security risks associated with TikTok USDS, a new joint venture in which global investors, including Oracle Corp. (NYSE:ORCL), own an 80.1% stake, while Chinese company ByteDance holds the remaining 19.9%.

President Donald Trump chose not to enforce a law passed in April 2024 requiring ByteDance to divest TikTok’s U.S. assets by January 2025 or face a nationwide ban.

TikTok did not immediately respond to Benzinga’s request for comment.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Image via Shutterstock