Disney, accused of violating children’s privacy, agrees to $10 million settlement

The U.S. Department of Justice has announced that Disney is paying a $10 million civil penalty and has agreed to an injunction to settle allegations it violated children’s privacy laws with its work on YouTube.

Under the agreement, Disney will pay $10 million in civil penalties to resolve claims it violated the Children’s Online Privacy Protection Act and its implementing regulations in connection with Disney’s YouTube video content.

“COPPA prohibits website operators from knowingly collecting, using, or disclosing personal information from children under the age of 13 (hereinafter, children), unless they provide notice to and obtain consent from those children’s parents,” the DOJ said.

But its complaint filed in the U.S. District Court for the Central District of California charged that Disney improperly failed to designate YouTube video content as directed toward children.

“As a result, Disney, and others acting on Disney’s behalf, targeted advertising toward children on YouTube and unlawfully collected children’s information without parental notice and consent, in violation of COPPA. Disney’s YouTube video content is extremely popular, with billions of views in the United States alone,” the DOJ said.

“The Justice Department is firmly devoted to ensuring parents have a say in how their children’s information is collected and used,” said Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division. “The department will take swift action to root out any unlawful infringement on parents’ rights to protect their children’s privacy.”

It was a federal court that entered a stipulated order ending the case against Disney Worldwide Services Inc. and Disney Entertainment Operations LLC.

Besides the financial penalty, the order “bars Disney from operating on YouTube in a manner that violates COPPA and requires Disney to create a program that will ensure it properly complies with COPPA on YouTube going forward.”

The Washington Examiner noted that the DOJ concerns were that Disney allegedly failed to say its YouTube content was directed to children, it collected children’s data without parental notice and consent and targeted advertising toward children.

“The settlement was filed in court nearly four months after Disney was ordered to pay the $10 million fine to resolve allegations made by the FTC,” the report said.

Earlier, Disney issued a statement that it complies with COPPA and the issues were not on any Disney-owned platforms.

“Disney has a long tradition of embracing the highest standards of compliance with children’s privacy laws,” a company official told reporters, “and we remain committed to investing in the tools needed to continue being a leader in this space.”