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App developer slurped kids' data without consent

50,000 Apple Store downloads, $50,000 fine

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A mobile applications developer will be fined $50,000 for allegedly collecting and disclosing children's personal information without parental consent, the US Federal Trade Commission (FTC) has said.

The US consumer regulator settled charges against W3 Innovations and its owner, Justin Maples, over the company's alleged violation of the US' Children's Online Privacy Protection Act (COPPA) and the FTC's rules that ensure enforcement of the Act, it said. A court has yet to approve the voluntary agreement which would withdraw the threat of criminal charges.

The agreement would also prohibit W3 and Maples from violating COPPA in the future and force them to delete all personal information collected in violation of the laws, the FTC said.

"According to the [FTC's] complaint, [W3 and Maples] did not provide notice of their information-collection practices and did not obtain verifiable parental consent before collecting and/or disclosing personal information from children. The FTC charged that those practices violated the COPPA Rule," the FTC said in a statement.

COPPA requires that "the operator of any website or online service directed to children that collects personal information from children or the operator of a website or online service that has actual knowledge that it is collecting personal information from a child ... obtain verifiable parental consent for the collection, use, or disclosure of personal information from children".

W3, operating as Broken Thumbs Apps, developed games apps for kids, including Emily's Girl World, Emily's Dress Up and Emily's Runway High Fashion.

The Emily apps "encouraged children to email 'Emily' their comments and submit blogs to 'Emily's Blog' via email, such as 'shout-outs' to friends and requests for advice. The FTC alleges that the defendants collected and maintained thousands of email addresses from users of the Emily apps", the FTC said.

"In addition to collecting and maintaining children's email addresses, the FTC alleges that the defendants also allowed children to publicly post information, including personal information, on message boards," the FTC statement said.

More than 50,000 Broken Thumbs Apps were downloaded via Apple's App Store and the company collected personal data of thousands of children under the age of 13 without consent, the FTC claimed.

The FTC voted to refer the case to the US Department of Justice, which filed the FTC's complaint and proposed a settlement agreement with a district court in California. The court will now decide whether to approve the settlement.

"The FTC's COPPA Rule requires parental notice and consent before collecting children's personal information online, whether through a website or a mobile app," FTC chairman Jon Leibowitz said.

"Companies must give parents the opportunity to make smart choices when it comes to their children's sharing of information on smartphones," Leibowitz said.

The FTC said it was the first time it had been involved in a case against an apps developer.

Copyright © 2011, OUT-LAW.com

OUT-LAW.COM is part of international law firm Pinsent Masons.

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