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New York Attorney General reaches largest ever COPPA settlement to resolve violations of children’s privacy
On December 4, the New York Attorney General announced the largest Children’s Online Privacy Protection Act (COPPA) settlement in U.S. history—totaling approximately $6 million —to resolve allegations with a subsidiary of a telecommunications company that allegedly conducted billions of auctions for ad space on hundreds of websites it knew were directed to children under the age of 13. According to the Attorney General’s office, the subsidiary collected and disclosed personal data on children through auctions for ad space, allowing advertisers to track and serve targeted ads to children without parental consent. Under COPPA, operators of websites and other online services are prohibited from collecting or sharing the information of children under the age of 13 unless they give notice and have express parental consent. Among other things, the subsidiary also allegedly placed ads on other exchanges that possessed the capability to auction ad space on child-directed websites, but that when it won ad space on COPPA-covered websites, the subsidiary treated the space as it would any other and collected user information to serve targeted ads.
Under the terms of the settlement, the subsidiary must (i) create a comprehensive COPPA compliance program, which requires annual COPPA training for staff, regular compliance monitoring, and the retention of service providers that can comply with COPPA, as well as a third party who will assess the privacy controls; (ii) enable website operators that sell ad inventory to indicate what portion of a website is subject to COPPA; and (iii) destroy the personal data it collected on children.
New Mexico Attorney General sues technology companies over COPPA violations regarding the collection of children’s personal data
On September 12, the New Mexico Attorney General announced the filing of a lawsuit against a group of technology companies for allegedly designing and marketing mobile gaming applications (apps) targeted towards children that contain illegal tracking software. The complaint asserts that the defendants’ practices violate both the Children’s Online Privacy Protection Act (COPPA) and New Mexico’s Unfair Practices Act, and pose the risk of data breaches and third-party access. Among other things, the complaint alleges the defendants’ data collection and sharing practices did not comply with COPPA’s specific notice and consent requirements, while the apps’ embedded software development kits allow the apps to communicate directly with the advertising companies that analyze, store, use, share, and sell the data to other third-parties to build “increasingly-detailed profiles of child users” in order to send highly-targeted advertising. The complaint seeks injunctive relief and nominal and punitive damages.
On October 4, the FTC and the Department of Education issued a notice announcing a joint Ed Tech (education technology) workshop to examine the challenges concerning privacy implications as more schools are using school-issued personal computing devices. The workshop will discuss issues surrounding the FTC’s Children’s Online Privacy Protection Act Rule (COPPA) as it applies to schools and how it intersects with the Department of Education’s Family Educational Rights and Privacy Act, which is designed to protect the privacy of students’ education records. The workshop, which is open to the public, will be held in Washington, D.C., on December 1.
As previously covered in InfoBytes, the FTC made modifications to COPPA’s safe harbor program this past July that now require all participants to conduct a comprehensive annual internal assessment of any third-party or service provider that collects personal information from children on their websites or through online services, in addition to issuing updates in June regarding resources companies can use to ensure COPPA compliance.
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