Online advertising platform OpenX Technologies Inc. (OpenX) accepted a court order requiring it to pay $ 2 million and be bound by injunction provisions requiring its compliance with Federal Trade law. Commission (FTC) and the Children’s Online Privacy Protection Act (COPPA)) Reign. This stipulated order resolves a government lawsuit against OpenX in the U.S. District Court for the Central District of California.
The government alleged that OpenX’s Ad Exchange platform, which connects publishers of websites and mobile applications (apps) with advertisers who want to display targeted ads, has collected and stored location data and other personal information of children under 13 without prior notice or parental consent and has made it easier to use this data for targeted advertising on hundreds of apps aimed at children. According to the complaint, OpenX violated FTC law by distorting its data collection policies as having been implemented with consumer consent, when such consent was often lacking, and also by distorting its compliance with the COPPA rule. The complaint alleges that OpenX violated the COPPA rule by failing to notify parents and failing to obtain verifiable parental consent before collecting personal information from children or allowing third-party ad networks to do so.
“Americans should be able to visit websites and use mobile apps knowing that their privacy – and that of their children – is protected,” said Acting Assistant Attorney General Brian M. Boynton of the Civil Division of the Department of Justice. “The Department of Justice and the Federal Trade Commission are committed to ensuring that the digital advertising industry complies with federal privacy law. “
“OpenX has secretly collected location data and opened the door to large-scale privacy breaches, including against children,” said director Samuel Levine of the FTC’s Office of Consumer Protection. “The gatekeepers of digital advertising may operate behind the scenes, but they are not above the law. “
The stipulated order requires OpenX to pay a civil fine of $ 2 million and prohibits OpenX from committing future violations of the COPPA rule or making false statements. It also prohibits OpenX from collecting location information without first obtaining express affirmative consent, enforces the deletion of data collected by OpenX in the past, and requires OpenX to maintain a comprehensive program to protect the privacy of data collected from consumers and of their devices.
The FTC referred the matter and offered a stipulated order to the Department of Justice. The case was handled by lawyers from the Consumer Protection Division of the Civil Division, including trial lawyers Zachary Dietert and David Crockett and Deputy Director Lisa Hsiao, together with lawyers from the Civil Division. protection of the privacy and identity of the FTC.