Feds Target Disney's 'Abuse Of Parents' Trust' With $10M Fine

BURBANK, CA — Burbank-based Walt Disney Co. will pay $10 million to the Federal Trade Commission to settle allegations that it violated a federal children's privacy law by allowing children to be targeted with online advertising, it was announced Tuesday.

Under the proposed order, the entertainment giant will also be required to implement a program to review whether videos posted to YouTube should be designated as made for kids, according to the FTC.

According to the FTC, Disney receives a portion of the revenues that YouTube generates from advertising placed with Disney videos and from advertising that Disney sells directly.

"This case underscores the FTC's commitment to enforcing COPPA (the Children's Online Privacy Protection Act), which was enacted by Congress to ensure that parents, not companies like Disney, make decisions about the collection and use of their children's personal information online," FTC Chairman Andrew N. Ferguson said in a statement. "Our order penalizes Disney's abuse of parents' trust, and, through a mandated video-review program, makes room for the future of protecting kids online — age assurance technology."

The complaint, filed Tuesday in L.A. federal court, alleges Disney failed to designate certain YouTube videos as being made for children when they were added to the platform. In failing to do so, Disney inadvertently allowed those videos to be targeted with online advertising, according to the FTC.

No Disney-owned or operated platforms are involved in the settlement, according to a Disney statement.

"Disney has a long tradition of embracing the highest standards of compliance with children's privacy laws, and we remain committed to investing in the tools needed to continue being a leader in this space," according to the company.

City News Service