Disney Agrees Paying $10M to Settle Children’s Privacy Law Allegations

A federal court has entered a stipulated order resolving a Justice Department case against Disney Worldwide Services Inc. and Disney Entertainment Operations LLC in which the company must pay $10 million in civil penalties as part of a settlement to resolve Federal Trade Commission allegations that Disney violated the Children’s Online Privacy Protection Act.

The FTC negotiated a resolution with Disney and referred the case to the DOJ. Under the order, Disney is implementing COPPA regulations in connection with Disney’s popular YouTube video content.

COPPA prohibits website operators from knowingly collecting, using, or disclosing personal information from children under age of 13 unless they obtain consent from those children’s parents.

A complaint filed in the U.S. District Court for the Central District of California says Disney improperly failed to designate YouTube video content as directed toward children. As a result, children were targeted with advertising on YouTube and the companies unlawfully collected children’s information without parental notice and consent, according to the DOJ.

On top of the $10 million civil 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.