01 Oct Yelp and TinyCo Settle FTC Charges of COPPA Violations
On September 17, 2014, the FTC announced the review site Yelp, Inc., and mobile app developer TinyCo, Inc., in separate enforcement actions agreed to settle charges that they each violated COPPA. Yelp agreed to pay a $450,000.00 penalty, and TinyCo agreed to pay $300,000.00.
COPPA (Children’s Online Privacy Protection Act) requires companies that use the internet to collect information about children under 13 to follow certain procedures designed to protect the children’s information. These procedures include obtaining verifiable parental consent before collecting information from a child, disclosing to the parents how the information is used, and protecting the information.
In Yelp’s case, the allegation was that from 2009 to 2013 they collected information from children without first obtaining parental consent. Several thousand children registered for the site providing a date of birth showing they were under 13. Despite knowing that children under 13 were registering for the site, Yelp failed to screen these children to prevent them from registering for the app and providing personal information.
The complaint against TinyCo was that many of its apps, including Tiny Pets, Tiny Zoo, Tiny Monsters, Tiny Village and Mermaid Resort targeted children under 13, making TinyCo subject to COPPA. The app users could provide an email address in exchange for in game currency. TinyCo apps collected this information without following the steps required to collect children’s personal information.
The settlements are still subject to court approval.