Microsoft Compliance Chief Jumps to TikTok as Prime U.S. Lawyer

TikTok Inc., a social networking service operated by China’s ByteDance Ltd. that was scrutinized by US regulators and policymakers last year, has hired a new chief executive for its America branch.

Matthew Penarczyk, who worked for Microsoft Corp. for almost 19 years. recently left the company to become America’s Head of Legal for TikTok. Penarczyk’s new position makes him TikTok’s top attorney in the United States and the entire Americas region, which includes South America, said company spokesman Josh Gartner.

“I have had the privilege of helping the world’s brightest innovators, learning from the best technology lawyers, and leading teams that have truly enriched themselves,” Penarczyk wrote last month on his profile on Microsoft-owned LinkedIn .

TikTok has been busy recruiting lawyers and public policy professionals for the past year when it battled the Trump administration over its data collection policies. Penarczyk, whose first day at TikTok was June 7th, reunited with longtime former Microsoft legal colleague Erich Andersen, who was hired as Global General Counsel and Head of Corporate Affairs for ByteDance last year.

Federal judges blocked the U.S. government’s offer to ban TikTok, and in early June the Biden administration announced it would revoke Trump-era orders targeting the company in favor of a broader review of software applications owned by foreign opponents that could potentially pose national security risks.

Microsoft was one of several bidders last year looking to acquire TikTok’s US operations and partnered with retail giant Walmart Inc. to create an offer that was ultimately rejected by ByteDance in September.

K&L Gates, a law firm with long-standing Microsoft affiliations, received $ 40,000 from ByteDance in the first quarter of this year for lobbying the US government on a number of issues, according to public records. ByteDance has paid K&L Gates $ 240,000 for federal advocacy since acquiring the firm in November 2019.

Penarczyk most recently served as Microsoft’s assistant general counsel, compliance and ethics, a position that made him head of compliance and ethics for the Redmond, Washington-based company. The software giant hired the former Holland & Knight attorney in 2002, and in the same year Microsoft reached a groundbreaking deal with the US antitrust authorities that reshaped the technology industry.

“There was something magical about arriving at Microsoft in 2002,” Penarczyk recently wrote on LinkedIn. “My wife, little daughter and I excitedly took the mandatory family photo in front of the Microsoft logo at the entrance to the main campus and couldn’t believe our luck to work for such an iconic company.”

For the next two decades, Penarczyk held various internal roles at Microsoft. The company was named one of the world’s most ethical companies earlier this year, an award that Microsoft has received for the eleven years from the Ethispere Institute, a nonprofit that evaluates corporate ethical standards.

“It’s not just words from above. It’s action and responsibility, ”said Penarczyk in March when he was asked about this series of successes in an interview with the legal journal Corporate Counsel. Penarczyk also spoke about his role in helping Microsoft address ethical and compliance challenges related to the coronavirus pandemic, building a compliance culture, and promoting diversity and inclusion.

During his time at Microsoft, Penarczyk worked with both Andersen – the company’s former Chief Intellectual Property Counsel – and former General Counsel Horacio Gutierrez, who left in 2016 and moved to Spotify Technology SA, where he is now the lead legal and global counsel. The head of the podcast and streaming audio service is the commissioner for affairs.

Microsoft watched Gutierrez’s successor as General Counsel, Deborah “Dev” Stahlkopf, recently step down as she prepared to become the new legal chief at Cisco Systems Inc. Stahlkopf’s departure was announced by Microsoft President and Chief Legal Officer Bradford Smith in an internal memo from Bloomberg Law last week heralded a larger series of internal legal changes at the company.

Rebecca “Becky” Lenaburg, associate general counsel who was on Penarczyk’s team at Microsoft, and several other in-house attorneys will lead his ethics and compliance portfolio, said two company sources familiar with the matter.

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