Disney to Settle FTC Lawsuit for $10 Million

The Walt Disney Company has agreed to pay $10 million to settle a lawsuit from the Federal Trade Commission (FTC) that accused the company of unlawfully gathering personal data from children under 13, in violation of federal regulations.

On Tuesday, the FTC stated that Disney breached the Children’s Online Privacy Protection Act by failing to acquire necessary parental consent for child-specific apps and websites before collecting any personal information.

The allegations also highlight that Disney did not adequately label some videos uploaded to YouTube as “Made for Kids,” resulting in unauthorized data collection from younger viewers for targeted advertising purposes.

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This settlement entails that Disney will implement a designated program to ensure future compliance, particularly regarding proper labeling of videos aimed at children.

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A Disney spokesperson clarified that while the settlement addresses issues linked to content distribution on YouTube, it does not extend to Disney’s owned digital platforms.

The spokesperson emphasized Disney’s commitment to upholding high standards in child privacy laws, expressing intention to invest in necessary compliance tools.

Background on YouTube Settlement

Interestingly, Google, the parent company of YouTube, faced a similar situation six years ago, where it agreed to pay a substantial $170 million to resolve related allegations.