The Walt Disney Company will pay $10 million to settle a Federal Trade Commission lawsuit claiming the entertainment company allowed personal data to be collected on children under 13 in violation of federal law.
The FTC said on Tuesday that Disney violated the Children’s Online Privacy Protection Act, requiring children-oriented apps and websites to obtain parental consent before collecting personal information of children under 13.
The complaint accuses Disney of not properly labeling some videos uploaded to YouTube as "Made for Kids," a mislabeling that allowed Disney, through YouTube, to collect personal data from children under 13 and use that data for targeted advertising to children.
The Walt Disney Company will pay $10 million to settle a Federal Trade Commission lawsuit (Getty Images / Getty Images)
The settlement requires Disney to "implement an audience designation program to ensure its videos are properly directed as 'made for kids' where appropriate," according to a court filing.
The FTC said that Disney violated the Children’s Online Privacy Protection Act. (PATRICK T. FALLON/AFP via Getty Images / Getty Images)
"This settlement does not involve Disney-owned and operated digital platforms but rather is limited to the distribution of some of our content on YouTube's platform," a Disney spokesperson said in a statement to Reuters.
"Disney has a long tradition of embracing the highest standards of compliance with children's privacy laws, and we remain committed to investing in the tools needed to continue being a leader in this space," the spokesperson continued.
The complaint accuses Disney of not properly labeling some videos uploaded to YouTube as "Made for Kids." (Myung J. Chun / Los Angeles Times / Getty Images)
Google, the parent company of YouTube, agreed to pay $170 million in a similar settlement six years ago.
Reuters contributed to this report.