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Monday, January 4, 2016

COPPA Settles Two Cases with App Companies Hinging on Collection of Persistent Identifiers


In case you missed it with all the hustle and bustle of the holidays, to close out 2015, the Federal Trade Commision (FTC) settled two cases with the operators of two "online services" directed to children. The FTC charged the two app operators with violating the Children's Online Privacy Protection Act (COPPA) by allowing third-party advertising networks to use their apps to collect children's personal information without parental knowledge or consent.

The apps were collecting persistent identifiers, which is data that can be used to recognize a children over time and across different websites. Advertisers then use such identifiers to track online behavior and target ads based on those behaviors. In these cases, the apps were allowing the ad networks to collect the persistent identifiers from children so the children could be served personalized ads. Both cases involved apps that were directed to children. In each case, the only violation was the collection of the persistent identifiers, which is a first.

The settlements involved fines for LAI Systems of $60,000 and Retro Dreamer of $300,000 in civil penalties. The companies will be required to bring their apps into compliance with COPPA, which means obtaining verifiable parental consent before collecting, using or disclosing children's personal information as well as posting a clear privacy policy.

To learn more, visit the FTC's website.