The U.S. Department of Justice has announced that a federal court has approved a stipulated order resolving allegations that Disney Worldwide Services Inc. and Disney Entertainment Operations LLC violated federal children’s online privacy laws.
According to the Justice Department press release, the government alleged that Disney violated the Children’s Online Privacy Protection Act (COPPA) and its implementing regulations.
COPPA prohibits operators of websites or online services from knowingly collecting, using, or disclosing personal information from children under 13 without notifying parents and obtaining verifiable parental consent.
The complaint, filed in the U.S. District Court for the Central District of California, alleged that Disney failed to properly designate certain YouTube video content as being directed toward children.
This failure allegedly resulted in advertisements being targeted to child viewers on the platform.
As a result of that failure, Disney and third parties acting on its behalf collected personal information from children without the required parental notice or consent, in what the government said was a direct violation of COPPA.
The Justice Department release also emphasized the scale of Disney’s YouTube presence, noting that its content has accumulated billions of views in the United States.
Officials argued that the scope of that audience heightened the potential privacy impact because the content in question includes videos appealing to children, such as programming featuring Disney characters, animation, and family-oriented entertainment.
The case represents a COPPA enforcement action administered by the Federal Trade Commission (FTC).
The FTC has pursued similar actions against other companies over improper data collection involving minors on digital platforms.
Under the stipulated order approved by the court, Disney agreed to pay a $10 million civil penalty to the United States.
The agreement resolves the allegations without an admission of liability by the company.
The order also imposes injunctive relief intended to prevent future violations, prohibiting Disney from operating on YouTube in any manner that contravenes COPPA requirements.
In addition, Disney must implement a comprehensive compliance program to ensure continued adherence to the law, including internal policies, employee training, audits, and procedures for properly identifying and labeling child-directed content.
In a statement, Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division said:
“The Justice Department is firmly devoted to ensuring parents have a say in how their children’s information is collected and used.
“The Department will take swift action to root out any unlawful infringement on parents’ rights to protect their children’s privacy.”
The settlement resolves the case without trial and does not include findings of fact beyond the allegations contained in the complaint.
Disney did not issue a public statement quoted in the DOJ press release regarding the settlement or the allegations.
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