The US authority FTC recently drew attention to itself through headlines due to the planned takeover of Activision Blizzard by Microsoft, but Epic Games also had points of contact with this – and these are now getting really expensive.
Epic Games has settled a lawsuit from the US authority FTC by agreeing to a settlement – but this is literally expensive for the company. Due to the violation of the COPPA guidelines in the blockbuster Fortnite, the developer now has to pay a whopping 520 million dollars, which consists of refunds and penalties. It’s the largest regulatory penalty the FTC has ever imposed on gaming.
What is it about? Behind COPPA is the “Children’s Online Privacy Protection Act” from 1998. This is primarily there to protect the data and privacy of children on the Internet – and Epic Games is only less successful in the battle royale long-running Fortnite succeeded. Spicy: The violations only became known in the course of Epic Games’ lawsuit against competitor Apple from 2021; Due to this legal dispute between the two technology giants, the FTC has examined the data protection measures and other practices of Epic Games more closely – and found what they were looking for.
$275 million of the total is actual penalties for COPPA violations, $245 million is refunds. After all, the expansive supply of skins and cosmetic items has already generated more than a million complaints from unintended buyers, according to the Federal Trade Commission.
FTC Chairwoman Lina M. Khan, who above all took up the fight against technology giants in the Activision-Microsoft deal, denounced the privacy-violating default settings and the deceptive user interface through which Fortnite Players are sometimes misled, including teenagers and children. The FTC will consistently pursue such illegal practices to protect end customers and in particular minors.
According to the FTC, Epic Games is said to have collected personal information from children in Fortnite without parental consent. The default settings are said to have been children chatting up strangers, which also resulted in (sexual) harassment and bullying. Parents who would have asked Epic Games to delete their children’s private data would have had to jump over unreasonably high hurdles to enforce this. Epic Games is now being sanctioned for all of this.
The refunds in this regard are due to a separate FTC process, separate from COPPA violations, which stem from unintentional in-game purchases that customers were more or less tricked into making. Both proceedings taken together were settled; Epic Chairman Tim Sweeney signed this on December 2nd.
Epic Games has published a statement in this regard and emphasizes that changes have been implemented in Fortnite due to the process. The aim is to respond better and faster to customer complaints in the future and to resolve concerns about privacy and data protection. Among other things, accounts can now be set up in such a way that it is clearly visible if the user is under 13 years old. In this case, the e-mail address of a legal guardian is required, via which the use of Fortnite must be approved in the first place.
After the final event, Fortnite is now entering the fourth chapter.
