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Settlement in FTC First Case Involving Mobile Applications

The Federal Trade Commission announced today that W3 Innovations, LLC, a developer of mobile applications, will pay $50, 000 to settle charges that it violated the Children’s Online Privacy Protection Act (COPPA) and the FTC COPPA Rule (the Rule). The case, United States of America v. W3 Innovations, LLC, is the first FTC case involving mobile applications.

The Rule applies to any operator of a commercial website or online service directed to children that collects, uses and/or discloses children’s personal information. A website operator must obtain “verifiable parental consent prior to collecting, using, and/or disclosing personal information from children.”

The Complaint alleged that defendant had offered some forty apps for download from the Apple’s app store, which allowed users to play games and share information online. These apps, listed by the Defendant in the Games-Kids section of the Apple store, and similar to games played by elementary school girls and boys, were targeted to children.

The Complaint also alleged that the defendant had collected over 30,000 email addresses, and also had collected, maintained, and/or disclosed personal information from about 600 users, but had failed to provide direct notice to parents about this practice and had failed to maintain or link to an online notice of the way it collects data. Defendant had not obtained verifiable consent from parents prior to collecting, using, or disclosing children’s personal information.

The Consent Order (the Order) ordered that Defendant must, within 5 days from the date of entry of the Order, delete all personal information collected and maintained in violation of the Rule, and also pay a $50,000 penalty.

 

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