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A New Season for Kids’ Privacy: Court enjoins California’s Landmark Youth Privacy — Protecting Children Online Remains a Prime Concern

Stacy Feuer, Sr. Vice President, Privacy Certified — Tue, 19 Sep 2023 21:21:19 +0000

Summer is definitely over. With the autumnal equinox just days away (Saturday, September 23, to be exact), there’s been a definite shift in the air – and in the children’s privacy world. Just as the fastest sunsets and sunrises of the year happen at the equinoxes, kids’ privacy developments are piling on rapidly right now.

Since the beginning of September, we’ve seen the Irish Data Protection Commission issue a huge, €345 million ($367 million) fine against TikTok for using unfair design practices that violate kids’ privacy. Delaware’s governor just signed a new privacy law that bans profiling and targeted advertising for users under the age of 18 unless they opt-in. And the Dutch data protection authority, just this week, announced an investigation into businesses’ use of generative AI in apps directed at young children.

As I was catching up with these matters yesterday, news broke that a federal district court judge in California had granted a preliminary injunction (“PI”) prohibiting the landmark California Age Appropriate Design Code Act (“CAADCA”) from going into effect on July 1, 2024. The judge ruled that the law violates the First Amendment’s free speech guarantees.

As ESRB Privacy Certified blog readers might recall, in September 2022, California enacted the CAADCA, establishing a far-reaching privacy framework that requires businesses to prioritize the “best interests of the child” when designing, developing, and providing online services. At the time, I wrote that the California law had the “potential to transform data privacy protections for children and teens in the United States.”

In particular, I pointed to the law’s coverage of children under the age of 18, its applicability to all online services “likely to be accessed by a minor,” and its requirement that businesses set default privacy settings that offer a “high level” of privacy protection (e.g., turning off geolocation and app tracking settings) unless the business can present a “compelling reason” that different settings are in the best interests of children. I also noted the Act’s provisions on age estimation/verification, data protection impact assessments (“DPIAs”), and data minimization as significant features.

In December 2022, tech industry organization NetChoice filed a lawsuit challenging the CAADCA on a wide range of constitutional and other grounds. In addition to a cluster of First Amendment arguments, NetChoice asserted that the Children’s Online Privacy Protection Act (“COPPA”), which is enforced primarily by the Federal Trade Commission (“FTC”), preempts the California law. The State of California, represented by the Office of the Attorney General, defended the law, arguing that the “Act operates well within constitutional parameters.”

Yesterday’s PI shifts the “atmospherics” of the kids’ privacy landscape dramatically. But the injunction doesn’t mean that businesses and privacy practitioners can ignore the underlying reasons for the CAADCA (which was passed overwhelmingly by the California legislature) or the practices and provisions it contains. Here’s a very rough analysis of the decision and some tips about what it might mean for your kids’ privacy program.

The Court’s Holding: In her 45-page written opinion, Judge Beth Labson Freeman held that “NetChoice has shown that it is likely to succeed on the merits of its argument that the provisions of the CAADCA intended to achieve [the purpose of protecting children when they are online] likely violates the First Amendment.” The Court held that the CAADCA is a regulation of protected expression, and not simply a regulation of non-expressive conduct, i.e., activity without a significant expressive element. Because she viewed the statute as implicating “commercial speech,” the Court analyzed the CAADCA under an “intermediate scrutiny standard of review.”

The Relevant Test: Under that standard (often referred to as the Central Hudson test based on the name of the Supreme Court case that formulated it), if the challenged regulation concerns lawful activity and speech that is not misleading, the government bears the burden of proving that (i) it has a “substantial interest” in the regulation advanced, (ii) that the regulation directly and materially advance the government’s substantial interest, and (iii) that the regulation is “narrowly tailored” to achieve that interest.

The Court recognized that California would likely succeed in establishing a substantial interest in protecting minors from harms to their physical and psychological well-being caused by lax data and privacy protections online. Reviewing the CAADCA’s specific provisions, however, it found that that many of the provisions challenged by NetChoice did not meet the remaining prongs of the intermediate scrutiny test.

The Court’s Central Hudson Analysis: The Court made findings on each of the specific provisions challenged by NetChoice keyed to the Central Hudson factors. I highlight a few here:

Data Protection Impact Assessments (DPIAs): The Court held that California did not meet its burden to demonstrate that the requirement for businesses to assess their practices in DPIAs would alleviate any harms from the design of digital products, services, and features, to a material degree.
Age Estimation: Judge Freeman also found that the statutory requirement to estimate the age of child users with a “reasonable level of certainty” would likely fail the Central Hudson test: “[T]he CAADCA’s age estimation provision appears not only unlikely to materially alleviate the harm of insufficient data and privacy protections for children, but actually likely to exacerbate the problem by inducing covered businesses to require consumers, including children, to divulge additional personal information.”
- The Court also found that the age estimation provision would likely fail to meet the Central Hudson test because the effect of a business choosing not to estimate age, but instead to apply privacy and data protections broadly, would impermissibly shield adults from that same content. In reaching this conclusion, Judge Freeman rejected California’s argument that the “CAADCA does not prevent any specific content from being displayed to a consumer, even if the consumer is a minor; it only prohibits a business from profiling a minor and using that information to provide targeted content.”
- Notably, later in the decision, Judge Freeman held that the age estimation provision is the “linchpin” of most of most of the CAADCA’s provisions and therefore determined it is not “functionally severable” from the remainder of the statute.
High Default Privacy Settings: The Court found that the CAADCA’s requirement for “high default privacy settings” would be likely to cause at least some businesses to prohibit children from accessing their services and products altogether.
Profiling by Default: Here, Judge Freeman held that the provision banning profiling of children by default could discard “beneficial aspects” of targeted information to certain categories of children, e.g., pregnant teenagers.
Dark Patterns: The Judge held that California did not meet its burden to establish that prohibitions on the use of dark patterns to lead or encourage children to provide unnecessary personal information would ameliorate a causally connected harm.

COPPA Preemption: Although the Court granted the injunction based on First Amendment considerations alone, it did, briefly, address NetChoice’s argument that the COPPA preempts the CAADCA. The Court rejected this argument at the PI stage, explaining: “In the Court’s view, it is not clear that the cited provisions of the CAADCA contradict, rather than supplement, those of COPPA. Nor is it clear that the cited provisions of the CAADCA would stand as an obstacle to enforcement of COPPA. An online provider might well be able to comply with the provisions of both the CAADCA and COPPA . . . . “

N.B. Judge Freeman’s decision to act cautiously on this claim makes sense. Recently, the Ninth Circuit Court of Appeals, in Google v. Jones, overturned her decision that COPPA preempted state law claims asserted in a class action alleging that Google/You Tube used persistent identifiers to collect data and track children’s online behavior surreptitiously and without their consent – conduct that also violates COPPA. Interestingly, in that case, the Ninth Circuit invited the FTC, which enforces COPPA, to express its views on the preemption issue. The FTC accepted, stating that “Congress did not intend to wholly foreclose state protection of children’s online privacy, and the panel properly rejected an interpretation of COPPA that would achieve that outcome.”

Takeaways: The CAADCA litigation is far from over, and it is likely that the California Attorney General will seek an immediate interlocutory appeal. It is clear, though, that the district court’s decision will have consequences in the short term for state privacy laws that are scheduled to come into effect soon as well as for efforts underway in Congress on child-related online privacy and safety legislation. Here are a few takeaways:

Privacy Laws Can Still Pack a Punch: Regardless of whether the Court ultimately strikes down the CAADCA or not, many of the concepts in the design code are already embedded in other privacy laws that apply to game and toy companies’ activities, both without and within the United States. On the U.S. front, there are newly enacted child privacy provisions in state laws that should be able to withstand constitutional challenge. Plus, the NetChoice ruling might loosen the California’s Congressional delegation’s resistance to bipartisan federal legislation. Although today’s some may view the Court’s ruling as a reprieve, companies still need to meet other legal obligations.
- For example, Connecticut recently passed child privacy amendments (scheduled to go into effect on October 1, 2024) to its privacy law that skirt some of the elements Judge Freeman found provisionally unconstitutional. Unlike the CAADCA, the Connecticut law does not require that companies estimate the age of their users; it applies only to companies that have “actual knowledge” of or “willfully disregard” the presence of minor users, and it does not regulate “potentially harmful” (as opposed to illegal) content. Instead of using the CAADCA “best interest of the child” standard, the Connecticut law establishes a duty to avoid a “heightened risk of harm” to minors and delineates potential harms.
DPIAs are still a “Must Do”: Most of the new state privacy laws passed in the last year contain requirements for data protection impact assessments, similar to those already required by the European Union’s General Data Protection Regulation (GDPR). At the beginning of September, the California Privacy Protection Agency published draft regulations that contain practical examples of how DPIAs should work under California’s comprehensive privacy law. Regardless of what happens with the CAADCA, statutory requirements for more focused DPIAs such as those in the California Consumer Privacy Act will likely remain.
- Judge Freeman’s skepticism about the CAADCA’s DPIA provision aside, DPIAs can be a useful accountability tool for identifying privacy risks, working out when, where, and how likely they are to occur, and assessing the impact of such risks on your customers and business.
COPPA Continues to Be Relevant: It will probably take years for the court battle over the CAADCA to play out. In the meantime, if you know that children — or teenagers — are using your products, expect the FTC to enforce COPPA and other privacy protections aggressively. (For quick review of the FTC’s recent COPPA cases, see my previous blog post COPPA Battlegrounds: The Quest to Uncover the Secrets of the FTC’s Kids’ Privacy Actions.)
- Indeed, it’s likely the FTC will use both the substantive provisions of COPPA and the “unfairness” and “deception” prongs of Section 5 of the FTC Act to set requirements for child-friendly privacy disclosures, mandates for high privacy default settings, and prohibitions against manipulative dark patterns through its child-focused investigations and enforcement actions.
- The NetChoice ruling – coupled with Congressional inaction – could also spur the FTC to complete its now-four-years-old COPPA Rule review and act on (at least parts of) last year’s privacy rulemaking proposal.

While this all unfolds, ESRB Privacy Certified will continue to help its program members comply with existing laws and adopt and implement best practices for children’s privacy. As privacy protections for kids and teens continue to evolve, we’ll be following closely and providing guidance to our program members on all of the moving parts of the complex children’s privacy landscape. To learn more about ESRB Privacy Certified’s compliance and certification program, please visit our website, find us on LinkedIn, or contact us at privacy@esrb.org.

• • •

As senior vice president of ESRB Privacy Certified (EPC), Stacy Feuer ensures that member companies in the video game and toy industries adopt and maintain lawful, transparent, and responsible data collection and privacy policies and practices for their websites, mobile apps, and online services. She oversees compliance with ESRB’s privacy certifications, including its “Kids Certified” seal, which is an approved Safe Harbor program under the Federal Trade Commission’s Children’s Online Privacy Protection Act (COPPA) Rule.

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A New Season for Kids’ Privacy: Court enjoins California’s Landmark Youth Privacy — Protecting Children Online Remains a Prime Concern

Stacy Feuer, Sr. Vice President, Privacy Certified — Tue, 19 Sep 2023 21:21:19 +0000

The Court’s Central Hudson Analysis: The Court made findings on each of the specific provisions challenged by NetChoice keyed to the Central Hudson factors. I highlight a few here:

Data Protection Impact Assessments (DPIAs): The Court held that California did not meet its burden to demonstrate that the requirement for businesses to assess their practices in DPIAs would alleviate any harms from the design of digital products, services, and features, to a material degree.
Age Estimation: Judge Freeman also found that the statutory requirement to estimate the age of child users with a “reasonable level of certainty” would likely fail the Central Hudson test: “[T]he CAADCA’s age estimation provision appears not only unlikely to materially alleviate the harm of insufficient data and privacy protections for children, but actually likely to exacerbate the problem by inducing covered businesses to require consumers, including children, to divulge additional personal information.”
- The Court also found that the age estimation provision would likely fail to meet the Central Hudson test because the effect of a business choosing not to estimate age, but instead to apply privacy and data protections broadly, would impermissibly shield adults from that same content. In reaching this conclusion, Judge Freeman rejected California’s argument that the “CAADCA does not prevent any specific content from being displayed to a consumer, even if the consumer is a minor; it only prohibits a business from profiling a minor and using that information to provide targeted content.”
- Notably, later in the decision, Judge Freeman held that the age estimation provision is the “linchpin” of most of most of the CAADCA’s provisions and therefore determined it is not “functionally severable” from the remainder of the statute.
High Default Privacy Settings: The Court found that the CAADCA’s requirement for “high default privacy settings” would be likely to cause at least some businesses to prohibit children from accessing their services and products altogether.
Profiling by Default: Here, Judge Freeman held that the provision banning profiling of children by default could discard “beneficial aspects” of targeted information to certain categories of children, e.g., pregnant teenagers.
Dark Patterns: The Judge held that California did not meet its burden to establish that prohibitions on the use of dark patterns to lead or encourage children to provide unnecessary personal information would ameliorate a causally connected harm.

N.B. Judge Freeman’s decision to act cautiously on this claim makes sense. Recently, the Ninth Circuit Court of Appeals, in Google v. Jones, overturned her decision that COPPA preempted state law claims asserted in a class action alleging that Google/You Tube used persistent identifiers to collect data and track children’s online behavior surreptitiously and without their consent – conduct that also violates COPPA. Interestingly, in that case, the Ninth Circuit invited the FTC, which enforces COPPA, to express its views on the preemption issue. The FTC accepted, stating that “Congress did not intend to wholly foreclose state protection of children’s online privacy, and the panel properly rejected an interpretation of COPPA that would achieve that outcome.”

Privacy Laws Can Still Pack a Punch: Regardless of whether the Court ultimately strikes down the CAADCA or not, many of the concepts in the design code are already embedded in other privacy laws that apply to game and toy companies’ activities, both without and within the United States. On the U.S. front, there are newly enacted child privacy provisions in state laws that should be able to withstand constitutional challenge. Plus, the NetChoice ruling might loosen the California’s Congressional delegation’s resistance to bipartisan federal legislation. Although today’s some may view the Court’s ruling as a reprieve, companies still need to meet other legal obligations.
- For example, Connecticut recently passed child privacy amendments (scheduled to go into effect on October 1, 2024) to its privacy law that skirt some of the elements Judge Freeman found provisionally unconstitutional. Unlike the CAADCA, the Connecticut law does not require that companies estimate the age of their users; it applies only to companies that have “actual knowledge” of or “willfully disregard” the presence of minor users, and it does not regulate “potentially harmful” (as opposed to illegal) content. Instead of using the CAADCA “best interest of the child” standard, the Connecticut law establishes a duty to avoid a “heightened risk of harm” to minors and delineates potential harms.
DPIAs are still a “Must Do”: Most of the new state privacy laws passed in the last year contain requirements for data protection impact assessments, similar to those already required by the European Union’s General Data Protection Regulation (GDPR). At the beginning of September, the California Privacy Protection Agency published draft regulations that contain practical examples of how DPIAs should work under California’s comprehensive privacy law. Regardless of what happens with the CAADCA, statutory requirements for more focused DPIAs such as those in the California Consumer Privacy Act will likely remain.
- Judge Freeman’s skepticism about the CAADCA’s DPIA provision aside, DPIAs can be a useful accountability tool for identifying privacy risks, working out when, where, and how likely they are to occur, and assessing the impact of such risks on your customers and business.
COPPA Continues to Be Relevant: It will probably take years for the court battle over the CAADCA to play out. In the meantime, if you know that children — or teenagers — are using your products, expect the FTC to enforce COPPA and other privacy protections aggressively. (For quick review of the FTC’s recent COPPA cases, see my previous blog post COPPA Battlegrounds: The Quest to Uncover the Secrets of the FTC’s Kids’ Privacy Actions.)
- Indeed, it’s likely the FTC will use both the substantive provisions of COPPA and the “unfairness” and “deception” prongs of Section 5 of the FTC Act to set requirements for child-friendly privacy disclosures, mandates for high privacy default settings, and prohibitions against manipulative dark patterns through its child-focused investigations and enforcement actions.
- The NetChoice ruling – coupled with Congressional inaction – could also spur the FTC to complete its now-four-years-old COPPA Rule review and act on (at least parts of) last year’s privacy rulemaking proposal.

• • •

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COPPA Battlegrounds: The Quest to Uncover the Secrets of the FTC’s Kids’ Privacy Actions

Stacy Feuer, Sr. Vice President, Privacy Certified — Wed, 05 Jul 2023 17:02:32 +0000

At ESRB, the non-profit, self-regulatory body for the video game industry, kids’ privacy is serious business. We do take breaks, though, from reviewing privacy policies, preparing compliance assessments, and absorbing the onslaught of privacy developments. Some of us even play and design video games when we’re not working. We are the Entertainment Software Rating Board after all!

So, for a little fun, we decided to create an imaginary video game – COPPA Battlegrounds. Join the ESRB Privacy Certified team as we dive deeply into the ongoing saga of the Federal Trade Commission’s kids’ privacy enforcement actions – cases that have resulted in hundreds of millions of dollars in fines and landmark legal remedies. Venture into new privacy territory, unlocking the mysteries of “personal information,” “privacy by default,” “data retention,” and more! Collect XPs as you explore strategies and best practices to protect young gamers’ privacy.

The Players

The “COPPA Controller”: The Federal Trade Commission (FTC) is the U.S. government agency charged with protecting consumers and competition. It is the chief federal agency that works to protect consumer privacy. Over the years, it has brought hundreds of privacy and data security cases to protect consumers and their data.

The “Digital Defendants”: Several well-known tech companies have been hit with FTC actions alleging violations of children’s privacy law in the past half year. Two – Epic Games and Microsoft Xbox – are popular video game publishers. Amazon, Meta, and Edtech company, Edmodo, are also in the line-up.

The Weapons and Equipment

The “Sword of COPPA”: The Children’s Online Privacy Protection Act of 1998 (COPPA) and its implementing COPPA Rule (updated in 2013) provide the FTC with a powerful weapon to protect the privacy of children under the age of 13. The law and rule (together, COPPA) require companies that offer services “directed to children,” or that have knowledge that kids under 13 are using their services, to provide notice of their data practices. They must also obtain verifiable parental consent (VPC) from parents before collecting personal information from children. COPPA also contains strong substantive protections, mandating that companies minimize the data they collect from children, honor parents’ data deletion requests, and implement strong security safeguards. To date, the FTC has brought nearly 40 COPPA enforcement actions.

The “Section 5 Superweapon”: The FTC’s true superweapon comes from Section 5 of the Federal Trade Commission Act, which prohibits unfair or deceptive practices in the marketplace. Since the advent of the internet, the FTC has used Section 5 to address a wide range of issues that affect people online, including the privacy of people purchasing and playing video games.

Policy Statement “Power-ups”: From time to time, the FTC releases policy statements that explain how the agency applies the laws it enforces. These potent statements put companies on notice that they will face legal action if they ignore the FTC’s prescriptions. In May, the FTC issued a Policy Statement on Biometric Information, which sets out a list of unfair practices relating to the collection and use of such data. Earlier, the FTC issued a Policy Statement on COPPA and EdTech that emphasized COPPA’s limits on companies’ ability to collect, use, and retain children’s data.

The Backstory

The FTC’s quest to secure a safer online environment for kids and their personal information has been ongoing since Congress passed COPPA in 1998. Previous blockbuster titles in the COPPA franchise include the FTC’s landmark 2019 settlement with Google/You Tube and the 2018 VTech and Musical.ly/TikTok actions.

COPPA has been extremely effective in giving parents information about and control over their kids’ data. There’s been an emerging consensus, however, that the legal framework for children’s privacy should be updated to include teenagers and meet the challenges of social media, mobility, ad tech, and immersive technologies – issues that weren’t present when Congress enacted the law 25 years ago. Despite the introduction of several bills in Congress to update COPPA, none have yet become law. The FTC therefore has proposed several new ideas to protect the privacy of not only children under the age of 13 but teens too. These are now playing out in the FTC’s enforcement actions.

Multiplayer Actions

During the past half year or so, the FTC has announced four new COPPA actions, plus a an order against Meta/Facebook relating to a previous settlement. For video game companies, two stand out: the Epic Games/Fortnite settlement (see our earlier blog) and the Microsoft/Xbox Live settlement, announced in June. The FTC’s settlements with Amazon/Alexa and Edmodo also provide some clues to unlocking the secrets of the FTC’s COPPA enforcement mode. Consistent with ESRB Privacy Certified’s focus on privacy compliance in video games, we’ll focus our analysis on the two gaming cases. But we’ll add some insights from the NPCs (here, nonplayable “cases”), too.

Epic Games/Fortnite

Late last year, the FTC filed a two-count complaint and proposed settlement order against Epic Games. It alleged that Epic knew its massively popular game Fortnite was “directed to children” and unlawfully collected personal data from them without VPC. The FTC also charged Epic with violating the FTC Act by using unfair “on by default” voice and text chat settings that led to children and teens being bullied, threatened, and harassed within Fortnite. Epic settled with the FTC, agreeing to pay a $275 million civil penalty and to standard injunctive relief. (In the privacy area, this includes monitoring, reports, a comprehensive privacy plan, and regular, independent audits.) The final court Order entered in February also required Epic to implement privacy-protective default settings for children and teens. It also required the company to delete personal information previously collected from children in Fortnite unless the company obtains parental consent to retain such data or the user identifies as 13 or older.

Microsoft/Xbox Live

In the beginning of June, the FTC filed a one-count complaint and proposed settlement order against Microsoft alleging that its Xbox Live online service violated COPPA in three ways: (i) by collecting personal information (i.e., email address, first and last name, date of birth, and phone number) from kids under 13 before notifying their parents and getting VPC; (ii) by failing to provide clear and complete information about its data practices in COPPA’s required notices, i.e., that it didn’t tell parents that it would disclose Xbox’s customer unique persistent identifier to third-party game and app developers; and (iii) by holding on to kids’ data for years even when parents did not complete the account creation process.

Microsoft, which has long had a comprehensive privacy program, settled with the FTC for $20 million. It agreed to implement new business practices to increase privacy protections for Xbox users under 13. For example, the Order requires Microsoft to tell parents that a separate child account will provide significant privacy protections for their child by default. The company also must maintain a system to delete, within two weeks from the collection date, all personal information collected from kids for the purpose of obtaining parental consent. In addition, Microsoft must honor COPPA’s data deletion requirements by deleting all other personal data collected from children after it no longer needs it for the purpose collected.

Unearthing the Seven COPPA Revelations

Beyond the allegations and remedies of the enforcement actions, there’s a wealth of information about the FTC’s kids’ privacy priorities and practices you might want to adopt – or avoid – if you want to stay out of the sites of the COPPA Controller. Here are COPPA Battlegrounds seven lessons for COPPA compliance based on the FTC’s recent kids’ privacy actions:

1. Sequence your game play to obtain VPC before you collect ANY personal information from a child: The FTC’s complaint in the Xbox action emphasized that – even though Microsoft had a VPC program in place – it violated COPPA by not obtaining parental consent before it collected any personal information from kids besides their data of birth. Xbox did require children to involve their parents in the registration process, but the FTC found that Microsoft’s initial collection of kids’ email addresses, their first and last name, and phone number before obtaining consent violated COPPA’s VPC requirements. The FTC also blasted Microsoft for requiring kids to agree to the company’s service agreement, which, until 2019, included a pre-checked box allowing Microsoft to send them promotional messages and to share user data with advertisers. The FTC’s approach indicates that they will look closely at companies’ verifiable parental consent sequences, and that they will strictly enforce COPPA’s prohibition on collecting any personal information before obtaining VPC (unless an exception to VPC exists).

2. The FTC views COPPA’s “actual knowledge” standard broadly and so should you: When the FTC announced its Epic Games settlement, we reminded companies that you can’t disclaim COPPA by declaring that you don’t process children’s information or by ignoring evidence that children are playing your games. Now, with the Xbox Live settlement, the FTC has affirmed that it will enforce COPPA against any company with “actual knowledge” that the company is handling children’s personal information, regardless of whether that company has directed its service to children intentionally. Significantly, the settlement requires Microsoft – when it discloses personal information about children to other video game publishers – to tell them that the user is a child. The FTC’s requirement for Microsoft to share information about children on its platform with third parties is a game-changing move. In the FTC’s words, “[I]t will put [third-party] publishers on notice that they, too, must apply COPPA protections to that child.”

3. Your COPPA notices must be clear, understandable, and complete: The FTC emphasized that it’s not enough under COPPA’s notice provisions to summarize your collection, use, and disclosure practices generally. Instead, your direct notice must be complete. The FTC faulted Microsoft for failing to tell parents about its collection of personal information children shared through their profile or Xbox Live usage, such as their “gamertags,” photos, which kids used to create avatars, and voice recordings from video messages. The agency also alleged that Microsoft’s notice failed to inform parents that it created persistent identifiers for children, which it combined with other information, and shared with third-party game and app developers. Going forward, it’s important for companies to specify, in a clear and complete way, their practices in the notices required by COPPA, and not just provide parents with a link to a densely worded privacy policy.

4. Privacy by default is not a fad: In Epic Games, the FTC focused for the first time not just on “privacy by design” but on “privacy by default,” finding that Epic did not have “privacy-protective” default settings in Fortnite that limited kids’ contact with strangers and otherwise protected their privacy. The FTC went further in Xbox Live, emphasizing that, even though Xbox had default settings that only allowed a child to disclose their activity feed or otherwise communicate with parent-approved “friends,” Microsoft configured other defaults in a way that did not protect children sufficiently. As the FTC emphasized in a blog about the Amazon case, “[C]ompanies that ignore consumers’ rights to control their data do so at their peril . . . The upshot is clear: Any company that undermines consumer control of their data can face FTC enforcement action.”

5. Take your data minimization and retention/deletion obligations seriously: The FTC’s recent cases also highlight COPPA’s substantive provisions on data minimization and data retention. The COPPA Rule prohibits conditioning a child’s participation in a game on the child “disclosing more personal information than is reasonably necessary to participate in such activity” and allows companies to keep it “for only as long as is reasonably necessary to fulfill the purpose for which the information was collected.” In the Edmodo complaint, for example, the agency said that Edmodo violated COPPA by using the personal information it collected for advertising instead of limiting it to educational purposes.

In the Xbox Live case, the agency chided Xbox for holding onto kids’ data when the parental verification process was incomplete, sometimes for years. Although Microsoft described this as a “technical glitch,” and explained that this data “was never used, shared, or monetized,” the FTC doubled down on its concerns with company data retention practices that violate COPPA. Indeed, in the Amazon Alexa case, the FTC charged that Amazon made it difficult for parents to exercise their right, under COPPA, to delete their children’s voice recording data. It further alleged that Amazon disregarded parents’ deletion requests, retained kids’ voice recordings indefinitely, and misled parents about its data deletion practices (e.g., by retaining copies of transcripts of voice recordings). The FTC is wielding the “Sword of COPPA” to press for meaningful data minimization, purpose limitation, and data retention/deletion practices.

6. Be especially careful when dealing with kids’ biometric data, algorithms, and machine learning: The FTC’s Xbox Live settlement covers biometric information like avatars generated from a child’s image and emphasizes COPPA’s strict limitations on the retention of this type of data from kids. In the Amazon case, the agency was clearly troubled by Amazon’s retention of kids’ voice recordings, which count as biometric info, indefinitely. One of the FTC Commissioners emphasized this point, stating that “Claims from businesses that data must be indefinitely retained to improve algorithms do not override legal bans on indefinite retention of data.” Consider yourself warned!

7. Privacy Innovation Can Help You Comply with COPPA: Not all the privacy-protective action in COPPA Battlegrounds comes from the FTC. Even before the settlement, Epic Games announced that it was creating “Cabined Accounts” to provide safe, tailored experiences for younger players. Following the FTC’s action, Microsoft unveiled its plans to test “next-generation identity and age validation” methods to create a “convenient, secure, one-time process for all players that will allow us to better deliver customized, safe, age-appropriate experiences.” Xbox explained that the entire games industry can benefit from advancing safe and innovative digital experiences that are accessible, simple to use, and benefit all players. We agree! Many ESRB Privacy Certified members are developing new strategies and tools to enhance kids’ privacy. Achievement unlocked!

The Final Conquest

Congratulations on completing the breakout version of COPPA Battlegrounds! You can now take your kids’ privacy program to the next level. Contact us at privacy@esrb.org if you’d like to discuss how your company can prevail in COPPA Battlegrounds – and its inevitable sequels.

As senior vice president of ESRB Privacy Certified (EPC), Stacy Feuer ensures that member companies in the video game and toy industries adopt and maintain lawful, transparent, and responsible data collection and privacy policies and practices. She oversees compliance with ESRB’s privacy certifications, including its “Kids Certified” seal, which is an approved Safe Harbor program under the Federal Trade Commission’s Children’s Online Privacy Protection Act (COPPA) Rule, and the general “Privacy Certified” seal.

The post COPPA Battlegrounds: The Quest to Uncover the Secrets of the FTC’s Kids’ Privacy Actions appeared first on ESRB Ratings.

Wrapping Up 2022 with A Huge (Epic) Fortnite Privacy Case

Stacy Feuer, Sr. Vice President, Privacy Certified — Wed, 21 Dec 2022 20:58:11 +0000

With 2022 almost behind us, we’d planned on easing out of work mode and into festive celebrations this week for the end of this hectic and challenging privacy year. But Stacy’s former employer, the Federal Trade Commission (FTC), had other ideas. So, instead of wrapping presents, we’re wrapping up the year with an analysis of the FTC’s record-breaking $520 million settlements with Epic Games (Epic) for privacy and consumer protection violations in its wildly popular Fortnite video game.

The “s” in settlements is not a typo: On Monday, the FTC announced two separate enforcement actions against Epic. Consistent with ESRB Privacy Certified’s focus on privacy compliance, though, we’ll limit our analysis to the FTC’s privacy-related case. In short, the FTC (represented by the Department of Justice) filed a two-count Complaint and a Stipulated Order in federal court alleging that Epic violated the Children’s Online Privacy Protection Act (COPPA) and the related COPPA Rule. COPPA protects the personal information of children under the age of 13. The FTC asserted that Epic knew that Fortnite was “directed to children” and unlawfully collected personal data from them without verifiable parental consent (VPC).

The FTC also charged Epic with violating the FTC Act, which prohibits unfair and deceptive practices, by using unfair “on by default” voice and text chat settings in Fortnite that led to children and teens being bullied, threatened, and harassed within the game, including sexually. It charged that Epic’s privacy and parental controls did not meaningfully alleviate these harms or empower players to avoid them. If approved, this settlement will require Epic to pay $275 million in civil penalties. (The other $245 million is for the other case and is allotted for consumer refunds.)

Apart from the epic fine, the Fortnite action provides insight into the FTC’s thinking on children’s and teens’ privacy. Here are seven takeaways from a case that will likely reverberate far past the New Year:

Declaring that your services are not directed to children is not enough: The FTC’s action makes clear that you can’t disclaim COPPA. In a paragraph that appeared on the next-to-last page of Epic’s lengthy global privacy policy, the company stated that it does not direct its websites, games, game engines, or applications to children or intentionally collect personal information from them. Although many companies make this claim in their privacy policies, it won’t help you if the facts show that your product is, in fact, child directed. (Remember, a mixed-audience product is one that targets children but not as the primary audience.)

COPPA’s “actual knowledge” standard doesn’t allow you to ignore evidence that children are using your services – especially internal and empirical evidence: While many advocates and lawmakers have criticized COPPA’s “actual knowledge” standard, seeking to replace it with “constructive knowledge,” the Fortnite action shows the FTC will construe the standard broadly. The agency cited several of the standard COPPA Rule factors – subject matter, use of animation, child-oriented activities and language, and music content, evidence of intended audience, and empirical evidence about the game’s player demographics – to determine that Fortnite is directed to children. The key evidence, though, came from empirical evidence and Epic’s own internal documents including:
- Demographic data: The FTC provided examples of public survey data, which Epic had reviewed, to demonstrate it knew a considerable portion of Fortnite players were under the age of 13. It pointed to publicly available survey results from a 2019 report showing that 53% of U.S. children aged 10-12 played Fortnite weekly, compared to 33% of U.S. teens aged 13-17, and 19% of the U.S. population aged 18-24. The agency alleged that these results also matched Epic’s internal data.
- Advertising and marketing: The FTC homed in on Epic’s product licensing deals with a wide variety of companies for Fortnite-branded costumes, toys, books, youth-sized apparel, and “back to school” merchandise, many of which were targeted to the under-13 crowd. As in the FTC’s previous record-breaking COPPA matter, Google/YouTube ($170 million fine), the agency cited numerous internal statements and documentation that Epic had generated to emphasize Fortnite’s appeal to children to potential advertising and marketing partners.
- Internal statements and events: The FTC also cited “ordinary course of business” communications such as consumer complaints and conversations among Epic employees that acknowledged explicitly that many of its users skewed younger. The FTC strung a number of them together (perhaps unfairly) but the phrases – “a large portion of our player base” consists of “underage kids,” / “high penetration among tweens/teens,” / “Fortnite is enjoyed by a very young audience at home and abroad” – convey, unmistakably, that Epic knew that it had a large user base of tweens and younger kids.

Implement VPC and age gates from the get-go or make sure you apply them retroactively: The FTC faulted Epic for failing to obtain VPC for the personal information it collected from child users. In addition to data like name and email, the agency pointed to Epic’s broadcast of “display names” that put children and teens in direct, real-time contact with others through voice and text communication, as personal information that required parental consent. It also charged that even after Epic deployed age gates, it failed to deploy them retroactively to most of the hundreds of millions of Fortnite players who already had accounts. This is pretty much the same conduct that got TikTok (then Musical.ly) in trouble in an earlier, FTC COPPA case. (The $5.7 million civil penalty there was the largest ever fine at the time the case settled in 2019.) Like TikTok, Epic didn’t go back and request age information for people who already had accounts and adjust their default social features and privacy controls to comply with COPPA.

Privacy by default is not just a catchphrase: Although the FTC has long emphasized privacy by design, the FTC hadn’t previously focused on “privacy-protective” default settings in games and other online services. Now it has. The FTC alleged that Epic’s default settings, which enabled live text and voice communications for all users – including children and teens – constituted an unfair practice that led kids and teens to be bullied, threatened, and harassed, including sexually, through Fortnite. Moreover, the agency, citing evidence from Epic’s own employees, alleged that Epic’s parental controls were insufficient. Even when Epic eventually added a button allowing users to turn voice chat off, the company made it difficult for users to find, according to the FTC.

Injunctive relief can be tough – and retroactive: In addition to the whopping $275 million civil penalty, the proposed Stipulated Order sets out the standard injunctive relief the FTC has long obtained in privacy cases – requirements for FTC monitoring, reports, a comprehensive privacy plan, and regular, independent audits. The Order also requires Epic to implement privacy-protective default settings for children and teens. Following the agency’s newer trend of using injunctions to remedy past harms, the Order requires Epic to delete personal information previously collected from Fortnite users in violation of the COPPA Rule’s parental notice and consent requirements unless the company obtains parental consent to retain such data or the user identifies as 13 or older through a neutral age gate.

Real-world harms matter a lot: Commissioner Christine Wilson, the only Republican currently on the Commission, issued a concurring statement supporting the agency’s action. Although she has cautioned the agency’s majority against overly-expansive uses of the FTC’s unfairness authority, Commissioner Wilson noted that the “elements of the unfairness test are clearly satisfied — because Epic Games allegedly opted children into voice and text communications with players around the world, children were exposed to bullying, threats, and harassment, and were enticed or coerced into sharing sexually explicit images and meeting offline for sexual activity.” Wilson also approved of the “novel injunctive mechanisms, which require Epic Games to implement heightened privacy default settings” for children and teens because they “directly address the privacy harms fostered by the company’s alleged business practices.”

Failing to comply with COPPA can be expensive: There’s a clear upward trajectory from the $5.7 million civil penalty in the FTC’s TikTok/Musicl.ly action to the $170 million fine in Google/YouTube to the $275 million civil penalty that Epic will pay to resolve the FTC’s charges. That’s definitely something to remember as you make your plans for the New Year!

Following the FTC’s announcement, Epic explained that it had accepted the settlement agreements “because we want Epic to be at the forefront of consumer protection and provide the best experience for our players.” It set out – as a “helpful guide” to the industry – principles, policies, and recommendations that the company has instituted over the past few years to protect its players and meet regulators’ expectations globally. On the children’s privacy front, Epic recommended that game developers “proactively create age-appropriate ways for players to enjoy their games” – advice that mirrors our own. Maybe we can tie that up with a ribbon!

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Wishing you and your loved ones a joyful and relaxing holiday season without any more blockbuster FTC announcements until 2023!

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What Parents Need to Know About Privacy in Mobile Games: Communicate with Your Kids

Stacy Feuer, Sr. Vice President, Privacy Certified — Fri, 28 Oct 2022 13:00:03 +0000

We’ve pulled together five tips to help protect your children’s privacy throughout this week. Catch up on the first four tips here. The final tip? Make sure you communicate with your kids about how they can protect their privacy online.

Our first four tips are privacy-specific while this last one applies to many parenting challenges: Communicate with your kids! Talk with them about what they should know and can do to protect their privacy online. If your kids are young, you can tell them to come to you or simply say no to all in-game requests for information. If your children are older, you can teach them how to use privacy settings and permissions.

You can also educate them in an age-appropriate way about the consequences of sharing too much personal information in a game. These can range from compromising the security of online accounts to attracting cyberbullies to damaging their personal reputation. Let them know that they can come talk to you if they’ve posted something online that they later realize is too personal (you can help them get it deleted) or if they’re receiving inappropriate advertisements, messages, or other communications. (You can report inappropriate ads to Apple and Google.)

Make sure your kids know they can turn to you for help in protecting their personal data and preferences, and that you know where to find answers and advice.

Sometimes, in a rush to play a game, your child might simply click “yes” on permissions, or even falsify their age, but when they understand how their personal data and preferences may be used, or more importantly misused, most kids will become more interested in managing their own privacy online. Make sure they know they can turn to you for help, and that you know where to find answers and advice.

Protecting your kids’ privacy in mobile games may sound overwhelming, but the benefits of playing games far outweigh the risks. Our tips – together with ESRB’s Family Gaming Guide and our “What Parents Need to Know” blogs can help you protect your kids’ privacy online.

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If you have more questions about kids’ privacy in mobile apps or you want to learn more about our program, please reach out to us through our contact page to learn more about our program. Be sure to follow us on LinkedIn for more privacy-related updates.

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What Parents Need to Know About Privacy in Mobile Games: Don’t Let Your Children Lie About Their Ages

Stacy Feuer, Sr. Vice President, Privacy Certified — Thu, 27 Oct 2022 13:00:52 +0000

We’ve pulled together five tips to help protect your children’s privacy and are rolling one out each day this week. Yesterday, we covered what the ESRB Privacy Certified seals mean and where you should look for them. Our fourth tip is to prevent your children from lying about their ages online.

It’s important that your child uses an accurate birthdate or age when signing up for a new game or mobile app. When companies know that children under the age of 13 are playing their games, they are required by law to follow the federal Children’s Online Privacy Protection Act (COPPA). COPPA and its associated Rule issued by the Federal Trade Commission (FTC) gives parents control over what information companies can collect from kids under 13 years of age through their websites, apps, and other online services, including mobile games. Under COPPA, companies with games, apps, and other services “directed to children” or who know that kids under 13 are using their game must:

Notify you of how they use your kid’s information;
Get your express consent (known as “verifiable parental consent”) before collecting, using, or disclosing your child’s personal information;
Allow you to review and request deletion of your child’s information.

Under COPPA, a game company can’t condition participation in a game on a child disclosing more information than is necessary. They’re also prohibited from using information for commercial purposes such as targeted marketing and advertising that are unrelated to gameplay. This is part of why it’s so important to make sure you or your kid enters an accurate birthdate or age when signing up for a new game!

Make sure your children enter their ages accurately so they can benefit from legal protections tailored to protect kids’ personal information.

Beyond COPPA, recently enacted privacy laws in states like California, Colorado, Connecticut, Utah, and Virginia give kids and their parents additional privacy rights. Some extend certain privacy rights to teens. For example, several of these state laws prohibit companies from selling or sharing teenagers’ (typically ages 13-16) personal information without their consent or the consent of their parent or guardian. You can ask that a mobile game company not sell or share your child’s information by making a request using a form or email address available from the company’s app or website. Other laws, such as California’s recently-passed Age Appropriate Design Code Act, require companies to set privacy controls in games and other products to the most-protective level for all users under the age of 18.

Companies that don’t follow these rules can get in a lot of trouble. The FTC and state law enforcers have slammed mobile game companies that failed to comply with COPPA with large fines and other penalties. And more enforcement is likely on the way. Along with our other tips, making sure that your children enter their ages accurately will help ensure that they benefit from legal privacy protections tailored for kids and teens.

Click here to continue to the final tip: Communicate with Your Kids.

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What Parents Need to Know About Privacy in Mobile Games: Look for the ESRB Privacy Certified Seal

Stacy Feuer, Sr. Vice President, Privacy Certified — Wed, 26 Oct 2022 13:00:34 +0000

We’ve pulled together five tips to help protect your children’s privacy and are rolling one out each day. Our first two tips covered decoding privacy labels and policies and setting parental controls and permissions. Our third tip is to look for the ESRB Privacy Certified seals.

You’re probably already familiar with ESRB’s content ratings for video games and apps, but did you know that ESRB also has special icons certifying a company’s compliance with ESRB’s privacy requirements? ESRB Privacy Certified is a membership-based program that works mostly with companies in the toy and video game industries. We review our members’ products for compliance with federal and state privacy laws, including the federal Children’s Online Privacy Protection Act (COPPA), and global rules, platform standards, and best practices.

We have two seals: (1) the ESRB Privacy Certified Kids Seal, which covers games directed or targeted to children, and (2) the ESRB Privacy Certified Seal for games that are not primarily directed to and do not target children.

The Kids Seal links to a confirmation page on our ESRB website, which confirms that a company is a member of our program, shows the seal(s) the member is approved to use, and provides a link to the member’s online privacy policy. The Federal Trade Commission (FTC), the United States’ leading privacy agency, has approved our Kids Seal requirements. Every year we provide a confidential annual report to the FTC detailing our compliance work with our members on children’s privacy.

When you see one of our ESRB Privacy Certified seals in a mobile app, you can be assured that we’ve reviewed the company’s privacy practices and policies thoroughly.

When you see one of our seals in a mobile app (often in or near the app’s privacy policy), you can be assured that we’ve reviewed the company’s privacy practices and policies thoroughly. We conduct an initial assessment to make sure the company’s product complies with applicable laws and the company’s actual practices are described accurately and fully. We also conduct two comprehensive reviews annually of each participant’s policies, practices, and products to help members remain compliant.

You can also find ESRB’s Privacy Certified seals on websites and connected toys. For more information about ESRB Privacy Certified, check out our website and blog. You can also follow us on LinkedIn and Twitter.

Click here to continue to Tip #4: Don’t Let Your Children Lie About Their Ages.

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What Parents Need to Know About Privacy in Mobile Games: Use Parental Controls and Permissions

Stacy Feuer, Sr. Vice President, Privacy Certified — Tue, 25 Oct 2022 13:00:22 +0000

We’ve pulled together five tips to help protect your children’s privacy and are rolling one out each day. Yesterday, we told you about privacy labels and privacy policies. You likely know about the parental controls that you can set on game consoles, but did you also know that there are controls for privacy features in mobile games, too?

You can set privacy controls and permissions for the mobile games and apps your children play and download, just like the parental controls you use on your kids’ video game consoles. Some game companies allow you to enable privacy features (such as limiting which players can see your game activity) that would normally share identifying information.

Also, both Apple and Google have settings for families that help you protect your children’s privacy by allowing you to restrict information sharing about your child’s location and block targeted advertising. Even if you block targeted ads, your child may still receive contextual advertising. Although you can’t stop advertising completely, you can limit inappropriate ads by buying the paid version of the game (if available), putting your child’s phone in airplane mode for simple games that don’t require an online connection, or using a third-party ad blocker.

You can also take advantage of other privacy-protective features that the app stores offer to all users. You can access Apple’s complete controls here and Google’s here.

You can also teach your kids to consult with you or say no to permissions that pop up in-game asking for data. That includes requests for your precise location, the contacts in your phone, pictures, or anything else that could identify you or your child. Explain that they should just say no to permissions that ask for access to anything that has to do with health, money, or making changes to the phone’s hardware.

One of the most publicized developments is Apple’s App Tracking Transparency feature. If an app collects users’ data to track them across other apps and websites, the developer must send you a notification and receive your permission before they can track and share your activity. Apple automatically activates this feature if your children have an iPhone set up with a kids account. You can also toggle a setting, so these requests are denied automatically.

Take advantage of family controls and other privacy-protective features from the app stores like Apple’s “Families” and Google’s “Family Link.” You can access Apple’s complete set of privacy controls here and Google’s here.

Late last year, Google introduced a similar feature that prevents apps from collecting the user’s advertising ID, which is used for ad tracking, when the user is opted out of personalized ads on Android 12. Google won’t allow developers to transmit the advertising ID from children in apps targeting children, such as those in the Families Link program. If you opt out of tracking, your kids will still be able to play most games although some features might not be available. Additionally, Google announced in August that it would block ad targeting based on the age, gender, or interests of users under 18, and also turn off location history for users under 18. Google plans to “start rolling out these updates across our products globally over the coming months,” so we are hopeful that they’ll implement this fully by the end of 2022.

You can also just say no. Before you grant permissions to any new app your kid is using or wants to download, review which permissions the app requires. See if they correspond to gameplay. For example, if a simple alphabet game for preschoolers wants access to your phone number or contact list, just say no. Your kid may still be able to play the game, although the developer may limit its functionality. You can also look for a privacy-friendly alternative.

Take some time to explore privacy controls and permissions that make sense for you and your family. And remember to review and update them periodically as game companies roll out new features and your kids mature and change.

Click here to continue to Tip #3: Look for the ESRB Privacy Certified Seal.

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What Parents Need to Know About Privacy in Mobile Games: Look for Privacy Labels and Policies

Stacy Feuer, Sr. Vice President, Privacy Certified — Mon, 24 Oct 2022 13:00:15 +0000

With teens, tweens, and even toddlers using smartphones and tablets, it’s no surprise that mobile games continue to be among the most popular apps. There are lots of upsides to games-to-go for your kids, from entertainment to stress management, and even education! As with all types of products consumed by children, though, parents and caregivers need to stay involved. As we advised in What Parents Need to Know About Mobile Games, there are many steps you can take to make sure your kids have appropriate experiences playing mobile games.

That’s true, too, when it comes to protecting your children’s privacy. Whether your children are using your device or their own, it likely contains lots of sensitive information like personal contacts, location data, photos, and browsing history. And, like most app developers, many mobile game companies make money by selling data and serving ads to their users. That’s especially the case for free-to-play games that don’t cost anything to play up front.

Whether they’re free or not, mobile games and apps use tracking technologies to collect information from and about players. Developers use gameplay data to improve their games, customize the experience, measure progress, iron out bugs, serve personalized ads, detect cheats, comply with laws, and more. To do so, they collect all sorts of data – everything from your child’s birthday and location to what in-game purchases they made.

There are, of course, laws that govern the collection and use of kids’ information. And app stores and game developers also offer many privacy tools for both children and adults. Despite this, it can be hard for parents and caregivers to figure out the maze of privacy laws, settings, and features. So, here are some tips to help protect your children’s privacy.

Tip #1: Look for Privacy Labels and Policies
Most of the games your children play will be ones you or they have downloaded from either the Google Play Store (Android) or the Apple App Store (iOS). As you’ve heard before, you should always check for age and content ratings before your children play games to ensure that the game is age appropriate. ESRB ratings are displayed for all games in the Google Play store.
What you might not know is that the app stores have also introduced “labels” for privacy modeled on nutrition labels on products in the grocery store. Instead of information about calories and nutrients, they have information about a game’s privacy policy and data collection practices. Apple’s “Privacy Information” labels and Google’s “Data Safety” labels differ somewhat, but both have links to the game’s full privacy policy, explain the types of data the game is collecting, what the data will be used for, and whether the game is sharing information with third parties. The labels aim to be user-friendly and written in plain English, but they can still be difficult to understand. Here are a few things to focus on when looking at a privacy label in Google Play or the Apple App store:

What information the app collects and uses about gamers (including child users) via their account, device, or other details)
Whether the app collects “location” data, and, if so, whether it is “coarse” (meaning general information such as the city or town you live in) or “precise” (meaning your specific geographic address); and
Whether the app potentially shares users’ information with third parties.

The app stores have also introduced “labels” for privacy modeled on nutrition labels on products in the grocery store. Instead of information about calories and nutrients, they have information about a game’s privacy policy and data collection practices.

Of course, the labels aren’t perfect. Not all game developers have posted privacy labels, and Google and Apple don’t verify companies’ self-reported info. Plus, some labels do have errors – usually unintentional, due to mistakes or misunderstandings. But they are an important starting point for understanding what kind of data a game collects from its users and your kids, more specifically, and how companies use and share that information.

Another source of information is a company’s privacy policy. Many mobile game companies now have simple short-form policies or dashboards summarizing key privacy facts such as what information is gathered in a game, where it goes, how it gets used, and whom to contact if you have a problem or question. You can view an example of a short form privacy policy in the ESRB Rating Search app (Android | iOS). And if you want more information, you can always review a company’s full-length privacy policy, which provides much greater detail.

It’s best to look at a game’s privacy label and privacy policy before your kids start playing. If you want more information afterwards, you can check out Google’s Privacy Dashboard on your Android device to see which apps accessed your child’s data and when. You can also check out the App Privacy Report in your iOS device’s settings to see how often your child’s location, photos, camera, microphone, and contacts have been accessed during the last seven days. Together with the privacy labels, these features can give you a more complete picture of how the apps your children use treat their privacy.

Almost all video game apps have to collect some personal information to function. But if you want to minimize the amount of personal data that is collected, used, and shared about your child, you can look for games that make clear that they won’t use kids’ personal information for any marketing, online advertising, employ any third-party tracking that would directly identify a child, or collect and share precise location information. The privacy labels and other features offered by the app stores such as family programs can help you figure that out.

Click here to continue to Tip #2: Use Parental Controls and Permissions.

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P.S.R. Reinforces Fundamental Privacy Principles in a Changing World

Meghan Ventura — Thu, 20 Oct 2022 12:00:44 +0000

After a busy few days in Austin, I’ve pulled together my key takeaways from last week’s International Association of Privacy Professional’s (IAPP) Privacy. Security. Risk. 2022 conference (P.S.R.). P.S.R. is a one-of-a-kind conference that focuses on the intersection of privacy and technology. And there certainly was lots of tech, from content dealing with bias in AI to privacy engineering. But given the location in Texas, one of many states that now place significant restrictions on women’s reproductive rights, the effect of the U.S. Supreme Court’s recent decision in the Dobbs case on the constitutional right to privacy, was a strong undercurrent throughout the event.

Starting with the keynote session (which you can watch here, if you’re an IAPP member) and going through sessions on geolocation, cybersecurity, and advertising, many speakers grappled with new privacy challenges arising from Dobbs. Much of the conversation, though, focused on applying privacy basics to new and emerging technologies. This year’s P.S.R. highlighted that it’s an important time for companies to be good and responsible stewards of data. Here are more details on three topics that came up repeatedly at the conference: (1) Kids and Teens; (2) Data Minimization; and (3) Deidentification.

Kids and Teens
It’s clear that the UK Children’s Code and its offshoot, the recently passed California Age Appropriate Design Code (CA AADC), are top of mind. Companies are looking for more guidance and best practices from regulators on how to best comply. Both the UK and California codes feature similar concepts such as “the best interests of the child,” and privacy by default and prohibit behavioral ads/profiling. There are some differences, of course, but they are more technical than conceptual. If you’re looking for further analysis, we recommend checking out our post on the CA AADC and reading through the Future of Privacy Forum’s excellent analysis here.

During the keynote session featuring Federal Trade Commission (FTC) Commissioner Rebecca Kelly Slaughter, the IAPP’s Chief Knowledge Officer, Caitlin Fennessy, asked her if there are questions from the FTC’s 95-question Advance Notice of Proposed Rulemaking (ANPR) on commercial surveillance and data security that people should focus on when submitting comments. Commissioner Slaughter mentioned issues of tech addiction and psychological harms to teens that traditionally aren’t thought of as privacy problems, but stem from the same data sets. While the Commissioner did not have any updates on the FTC’s review of the Children’s Online Privacy Protection Act (COPPA) review to share, she strongly encouraged the public to submit comments on the ANPR. Many attendees interpreted the Commissioner’s COPPA comment as yet another signal that the FTC has effectively abandoned the COPPA Rule Review in favor of the ANPR. The FTC just extended the comment period, so you have plenty of time to file your comment.

Sensitive Data and Data Minimization
With five new state privacy laws (California, Virginia, Colorado, Utah, Connecticut) coming into effect next year, there was a lot of discussion about privacy law basics. It’s no surprise then that that the panels focused on defining personal data. In particular, sensitive data came up at nearly every session.

The state laws have similar definitions of sensitive data, but there are some key differences privacy professionals must pay attention to. For example, all states consider special category data like ethnic origin, religious beliefs and sexual orientation to be sensitive data. Virginia, Colorado, and Connecticut all consider personal data collected from a known child to be sensitive information. Each of the state laws specifies precise geolocation as sensitive data, except for Colorado. Colorado instead, is planning to cover geolocation information under its proposed rules for processing “sensitive data inferences.” Sensitive data inferences are “inferences made by a [c]ontroller based on [p]ersonal [d]ata, alone or in combination with other data, which indicate an individual’s racial or ethnic origin; religious beliefs; mental or physical health condition or diagnosis; sex life or sexual orientation; or citizenship or citizenship status.”

And just about every time someone spoke about sensitive data, they stressed the importance of data minimization. This concept that goes back to the Fair Information Practice Principles (FIPPs), first developed in the 1970’s, which contained the collection limitation principle, designed to prevent overcollection of information. As many speakers made clear (referring in part to the Dobbs decision and fears about the use of reproductive data), data can’t be breached, hacked, or turned over to law enforcement if it’s not collected in the first place.

Deidentification
The issue of deidentification also came up frequently, often in relation to data minimization. Deidentification refers to actions that organizations can take to remove identifying characteristics from their data.

Where can you look for deidentification standards? P.S.R. panelists mentioned governmental sources, such as the Health Insurance Portability and Accountability Act’s (HIPAA) deidentification standards in the medical privacy context and the FTC’s three-part test for deidentified data (pasted below from page 10 of this report) as good starting points. The FTC standard states that deidentified data is not:

“reasonably linkable” to the extent that a company: (1) takes reasonable measures to ensure that the data is de-identified; (2) publicly commits not to try to reidentify the data; and (3) contractually prohibits downstream recipients from trying to re-identify the data.

(The California Privacy Rights Act, which comes into effect in January 2023, also uses a similar standard.) That said, deidentification may not last long as a privacy-enhancing tool. As one speaker noted, some data scientists predict that technological advances will allow most data sets to be identifiable within three to five years. Our takeaway: It’s best to err on the side of minimizing the data you collect, use, and share from the outset. This is a principle we’ve long preached to members of ESRB Privacy Certified program.

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Although P.S.R. explored newer technologies from biometrics to data clean rooms, much of the conference focused on core privacy practices: Have you done your risk assessments and data protection impact assessments, and implemented mitigating factors? Do you apply best practices for cybersecurity and have documentation for how and why you might deviate from those best practices and standards? Are you keeping the FIPPs in mind? These, of course, are the types of questions we think about all of the time at ESRB Privacy Certified. Amidst all the changing laws and technologies, it’s reassuring to know that sticking to privacy fundamentals can boost your compliance efforts. And don’t forget, we’re here to help our members with the issues I summarized above – child and teen privacy, sensitive data and data minimization, deidentification – and more.

Photo credit: Meghan Ventura

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The UK Age Appropriate Design Code: Childproofing the Digital World

John Falzone, VP Privacy Certified — Thu, 21 Jan 2021 15:47:36 +0000

“A generation from now, I believe we will look back and find it peculiar that online services weren’t always designed with children in mind. When my grandchildren are grown and have children of their own, the need to keep children safer online will be as second nature as the need to ensure they eat healthy, get a good education or buckle up in the back of a car.”
– Information Commissioner Elizabeth Denham

In May 2018, the European Union’s General Data Protection Regulation (GDPR) went into effect, recognizing for the first time within the European Union (EU) that children’s personal data warrants special protection. The United Kingdom’s Data Protection Act 2018 adopted GDPR within the United Kingdom and, among other things, charged the Information Commissioner’s Office (ICO) with developing a code of practice to protect children’s personal data online. The result is the Age Appropriate Design Code (also referred to as the Children’s Code), an ambitious attempt to childproof the digital world.

The Internet was not built with children in mind, yet children are prolific users of the Internet. The Children’s Code, which is comprised of fifteen “Standards,” seeks to correct that incongruity by requiring online services that children are likely to use to be designed with their best interests in mind.

For over the last twenty years, the U.S. Children’s Online Privacy Protection Act (COPPA) has been the primary source of protection for children’s privacy online. COPPA protects the privacy of internet users under 13 years old, primarily by requiring informed, verifiable consent from a parent or guardian. The Children’s Code, however, has much grander aspirations. It protects all children under 18 years old, asking companies to reimagine their online services from the bottom up.

The foundational principle of the Children’s Code calls for online services likely to be accessed by children under 18 years old to be designed and developed with the best interests of the child as a primary consideration. The Children’s Code is grounded in the United Nations Convention on the Rights of the Child (UNRC), which recognizes that children have several rights, including the rights to privacy and to be free from economic exploitation; to access information; to associate with others and play; and to have a voice in matters that affect them.

To meet the best interests of the child, online services must comply with each of the applicable fifteen Standards. Those Standards are distilled below.

1. Assessing and Mitigating Risks
Compliance with the Children’s Code begins with a Data Protection Impact Assessment (DPIA), a roadmap to compliance and a requirement for all online services that are likely to be accessed by children under 18 years old. The DPIA must identify the risks the online service poses to children, the ways in which the online service mitigates those risks, and how it balances the varying and sometimes competing rights and interests of children of different age groups. If the ICO conducts an audit of an online service or investigates a consumer complaint, the DPIA will be among the first documents requested.
The ICO suggests involving experts and consulting research to help with this process. This might not be feasible for all companies. At a minimum, however, small- and medium-sized companies with online services that create risks to children will be expected to keep up to date with resources that are publicly available. More will be expected of larger companies.
While the Internet cannot exist without commercial interests, the primary consideration must be the best interests of the child. If there is a conflict between the commercial interests of an online service and the child’s interests, the child’s interests must prevail.

2. Achieving Risk-Proportionate Age Assurance
To adequately assess and mitigate risk, an online service must have a level of confidence in the age range(s) of its users that is proportionate to the risks posed by the online service. The greater the risk, the more confidence the online service must have.
The ICO identifies several options to obtain what it calls “age assurance,” which can be used alone or in combination depending on the circumstances. Age assurance options include self-declaration by users (a/k/a age gates), artificial intelligence (AI), third-party verification services, and hard identifiers (e.g., government IDs). Less reliable options, like age gates, are only permitted in low-risk situations or when combined with other age assurance mechanisms.

Achieving an adequate level of confidence will be challenging. The Verification of Children Online (VoCO), a multi-stakeholder child online safety research project led by the U.K.’s Department for Digital, Culture, Media & Sport (DCMS), is attempting to address that challenge. The VoCO Phase 2 Report provided the following potential flow as an example:
[F]or a platform that needs a medium level of confidence, a user could initially declare their age as part of the onboarding process, and alongside this an automated age assurance method (such as using AI analysis) could be used to confirm the declared age. If this measure suggests a different age band than that stated, which reduces confidence in the initial assessment, a request could be made to validate the user’s age through a verified digital parent.

Ultimately, if an online service is unable to reach an appropriate level of confidence, it has two options: 1) take steps to adequately reduce the level of risk; or 2) apply the Children’s Code to all users, even adults.

3. Setting High Privacy by Default
For all children, high privacy must be the default setting. This means an online service may only collect the minimum amount of personal data needed to provide the core or most basic service. Additional, optional elements of the online service, for example to personalize offerings, would have to be individually selected and activated by the child. To illustrate this point, the ICO uses the example of a music download service.

High privacy by default also means that children’s personal information cannot be used in ways that have been shown to be detrimental. Based on specific Standards within the Children’s Code, this means the following must be turned off by default:

Profiling (for example, behavioral advertising);
Geolocation tracking;
Marketing and advertising that does not comply with The Committee of Advertising Practice (CAP) Code in the United Kingdom;
Sharing children’s personal data; and
Utilizing nudge techniques that lead children to make poor choices.

To turn these on, the online service must be able to demonstrate a compelling reason and adequate safeguards.

4. Making Online Tools Available
Children must be given the tools to exercise their privacy rights, whether it be opting into optional parts of a service or asking to delete or get access to their personal information. The tools should be highlighted during the start-up process and must be prominently placed on the user’s screen. They must also be tailored to the age ranges of the users that access the online service. The ICO encourages using easily identifiable icons and other age-appropriate mechanisms.

5. Communicating Age-Appropriate Privacy Information
The Children’s Code requires all privacy-related information to be communicated to children in a way they can understand. This includes traditional privacy policies, as well as bite-sized, just-in-time notices. To help achieve this daunting task, the ICO provides age-based guidance. For example, for children 6 to 9 years old, the ICO recommends providing complete privacy disclosures for parents, while explaining the basic concepts to the children. If a child in this age range attempts to change a default setting, the ICO recommends using a prompt to get the child’s attention, explaining what will happen and instructing the child to get a trusted adult. The ICO also encourages the use of cartoons, videos and audio materials to help make the information understandable to children in different age groups and at different stages of development.

For connected toys and devices, the Children’s Code requires notice to be provided at the point of purchase, for example, a disclosure or easily identifiable icon on the packaging of the physical product. Disclosures about the collection and use of personal data should also be provided prior to setup (e.g., in the instructions or a special insert). Anytime a connected device is collecting information, it should be obvious to the user (e.g., a light goes on), and collection should always be avoided when in standby mode.

6. Being Fair
The Children’s Code expects online services to act fairly when processing children’s personal data. In essence, this means online services must say what they do, and do what they say. This edict applies not just to privacy disclosures, but to all published terms, policies and community standards. If, for example, an online service’s community standards prohibit bullying, the failure to enforce that standard could result in a finding that the online service unfairly collected a child’s personal data.

Initial implementation of the Children’s Code will be a challenge. User disruption is inevitable, as are increased compliance and engineering costs. The return on that initial investment, however, will hopefully make it all worthwhile. If Commissioner Denham’s vision is realized, the digital world will become a safe place for children to socialize, create, play, and learn.

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This article has been published in PLI Chronicle, https://plus.pli.edu.

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