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FTC Settles Privacy Complaints Against Google and Facebook
Practical Law Legal Update 4-520-8521 (Approx. 3 pages)
FTC Settles Privacy Complaints Against Google and Facebook
by PLC Intellectual Property & Technology
| Published on 10 Aug 2012 • USA (National/Federal) |
The Federal Trade Commission (FTC) announced a settlement with Google Inc., over charges that Google violated an earlier privacy settlement with the FTC by misrepresenting to users of Apple Inc.'s Safari internet browser that it would not place tracking cookies on their computers or serve them targeted ads. Google agreed to pay a record $22.5 million civil penalty and disable all the improper tracking cookies. The FTC also announced that it has accepted as final a settlement with Facebook resolving charges that Facebook deceived consumers by telling them that their information could be kept private on Facebook, but repeatedly allowing it to be made public.
Google Settlement
In an August 9, 2012 press release, the FTC announced that Google Inc. will pay a record $22.5 million civil penalty to settle FTC charges that it violated an October 2011 privacy settlement with the FTC by misrepresenting to users of Apple Inc.'s Safari internet browser that it would not:
- Place tracking cookies on their computers.
- Serve them targeted ads.
In addition to the $22.5 million penalty, which is the largest penalty the FTC has ever imposed for an order violation, the new settlement also requires Google to disable all of the tracking cookies it said it would not place on consumers' computers. Placing a tracking cookie on a user's computer allows a company to:
- Collect information about the user's web-browsing activities.
- Generate targeted online ads for that user.
In its complaint, the FTC charged that for several months in 2011 and 2012, Google placed a certain advertising cookie on the computers of Safari internet users who visited sites within Google's DoubleClick advertising network, while having previously told these users that they would be automatically opted out of such tracking as a result of the default Safari settings. According to the complaint, Google also represented to consumers that it was a member of the Network Advertising Initiative, an industry group that requires members to adhere to a self-imposed code of conduct, which includes disclosure of data collection and use practices.
The FTC charged that, contrary to its promises, Google placed tracking cookies on consumers' computers, often defeating the Safari browser's default cookie-blocking setting. Google's 2011 settlement with the FTC resolved charges that Google used deceptive tactics and violated its privacy promises when it launched its now defunct social network, Google Buzz. The 2011 settlement barred Google from misrepresenting the extent of consumers' control over the collection of their information.
The Google settlement is the latest in a string of high-profile FTC privacy enforcement actions. The settlement shows the aggressive effort the FTC is making to hold companies to their consumer privacy promises as well as the significant penalties that can be imposed on companies that do not adhere to those promises, particularly where a company's actions violate an existing FTC order.
Facebook Settlement
In an August 9, 2012 press release, the FTC announced that it has accepted as final a settlement with Facebook. The settlement resolved charges that Facebook deceived consumers by telling them that they could keep their information on Facebook private, but repeatedly allowing it to be shared and made public. The settlement requires Facebook to take steps to ensure that it lives up to its promises in the future, including requiring Facebook to:
- Give consumers clear and prominent notice.
- Obtain consumers' express consent before sharing their information beyond their privacy settings.
- Maintain a comprehensive privacy program to protect consumers' information.
- Obtain biennial privacy audits from an independent third-party.