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United States of America v. Playdom

May 24, 2011

UNITED STATES OF AMERICA, PLAINTIFF,
v.
PLAYDOM, INC., A SUBSIDIARY OF DISNEY ENTERPRISES, INC., AND, HOWARD MARKS, INDIVIDUALLY, DEFENDANTS.



The opinion of the court was delivered by: Andrew J. Guilford United States District Judge

ALAN PHELPS Trial Attorney Office of Consumer Protection Litigation U.S. Department of Justice PO Box 386 Washington, DC 20044 Telephone: 202-307-6154 Facsimile: 202-514-8742 E-mail: alan.phelps@usdoj.gov ANDRE BIROTTE JR. United States Attorney Central District of California LEE WEIDMAN, AUSA Chief, Civil Division GARY PLESSMAN, AUSA Chief, Civil Frauds Section Central District of California California State Bar No. 101233 Room 7516, Federal Building 300 North Los Angeles Street Los Angeles, CA 90012 Telephone: (213) 894-2474 Facsimile: (213) 894-2380 E-mail: gary.plessman@usdoj.gov Attorneys for Plaintiff THE UNITED STATES OF AMERICA

CONSENT DECREE AND ORDER FOR CIVIL PENALTIES, INJUNCTION AND OTHER RELIEF

WHEREAS Plaintiff, the United States of America, has commenced this action by filing the complaint herein; Defendants have waived service of the Summons and Complaint; the parties have been represented by the attorneys Consent Decree whose names appear hereafter; and the parties have agreed to settlement of this action upon the following terms and conditions, without adjudication of any issue of fact or law, and without Defendants admitting that any issue of fact or law other than those related to jurisdiction and venue is true;

THEREFORE, on the joint motion of Plaintiff and Defendants, it is hereby ORDERED, ADJUDGED, and DECREED as follows:

1. This Court has jurisdiction of the subject matter and of the parties pursuant to 28 U.S.C. §§ 1331, 1337(a), 1345, and 1355, and 15 U.S.C. § § 45(m)(1)(A), 53(b), 56(a), and 57b.

2. Venue is proper as to all parties in the Central District of California under 15 U.S.C. § 53(b) and 28 U.S.C. §§ 1391(b)-(c) and 1395(a).

3. The activities of Defendants are in or affecting commerce as defined in Section 4 of the FTC Act, 15 U.S.C. § 44.

4. The Complaint states a claim upon which relief may be granted against Defendants under Sections 1303(c) and 1306(d) of the Children's Online Privacy Protection Act of 1998 ("COPPA"), 15 U.S.C. §§ 6501-6506, 6502(c), and 6505(d); the Commission's Children's Online Privacy Protection Rule, 16 C.F.R. Part 312; and Sections 5(a)(1), 5(m)(1)(A), 13(b), and16(a) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. §§ 41-58, 45(a)(1), 45(m)(1)(A), 53(b), and 56(a). Among other things, the complaint alleges that Defendants violated COPPA by failing to provide notice to parents of their information practices, and to obtain verifiable parental consent prior to collecting, using, and or disclosing personal information from children online.

5. Defendants have entered into this Consent Decree and Order for Civil Penalties, Injunction, and Other Relief ("Order") freely and without coercion. Defendants further acknowledge that they have read the provisions of this Order and are prepared to abide by them.

6. Plaintiff and Defendants hereby waive all rights to appeal or otherwise challenge the validity of this Order.

7. Plaintiff and Defendants stipulate and agree that entry of this Order shall constitute a full, complete, and final settlement of this action.

8. Defendants have agreed that this Order does not entitle them to seek or to obtain attorneys' fees as a prevailing party under the Equal Access to Justice Act, 28 U.S.C. § 2412, and Defendants further waive any rights to attorneys' fees that may arise under said provision of law.

9. Entry of this Order is in the public interest. DEFINITIONS

10. "Rule" means the Federal Trade Commission's Children's Online Privacy Protection Rule, 16 C.F.R. Part 312.

11. The terms "child," "collects," "collection," "Commission," "delete," "disclosure," "Internet," "online contact information," "operator," "parent," "person," "personal information," "third party," "verifiable consent," and "website or online service directed to children," mean as those terms are defined in Section 312.2 of the Rule, 16 C.F.R. § 312.2.

12. "Individual Defendant" means Howard Marks.

13. "Corporate Defendant" means Playdom. Inc., and its successors and assigns.

14. "Defendants" means both the Individual Defendant and the Corporate Defendant.

INJUNCTION

15. IT IS ORDERED that Defendants, and their officers, agents, representatives, and employees, and all persons in active concert or participation with them who receive actual notice of this Order by personal service or otherwise, are hereby enjoined, directly or through any corporation, subsidiary, division, website, or other device, from:

A. Failing, on any website or online service directed to children, or on any website or online service through which they, with actual knowledge, collect, use, and/or disclose personal information from children, to provide sufficient notice of the information Defendants collect online from children, how they use such information, their disclosure practices, and all other content, as required by Section 312.4(b) of the Rule, 16 C.F.R. § 312.4(b);

B. Failing, on any website or online service directed to children, or on any website or online service through which they, with actual knowledge, collect, use, and/or disclose personal information from children, to provide direct notice to parents of what information Defendants collect online from children, how they use such information, their disclosure practices, and all other required content, as required by Section 312.4(c) of the Rule, 16 C.F.R. § 312.4(c);

C. Failing, on any website or online service directed to children, or on any website or online service through which they, with actual knowledge, collect, use, and/or disclose personal information from children, to obtain verifiable parental consent before any collection, use, and/or disclosure of personal information from children, as required by Section 312.5 of the Rule, 16 C.F.R. § 312.5(a)(1); or,

D. Violating any other provision of the Children's Online Privacy Protection Rule, 16 C.F.R. Part 312, and as the Rule may hereafter be amended. A copy of the Rule is attached hereto as "Appendix A" and incorporated herein as if fully set forth verbatim.

16. IT IS FURTHER ORDERED that Defendants, and their officers, agents, representatives, and employees, and all persons in active concert or participation with them who receive actual notice of this Order by personal service or otherwise, are hereby enjoined, directly or through any corporation, subsidiary, division, website, or other device, in connection with the operation of any website or online service, from making any misrepresentation in the website or online service's privacy policy or elsewhere about the website or online service's collection, use, disclosure, or deletion of children's personal information.

DELETION OF CHILDREN'S PERSONAL INFORMATION

17. IT IS FURTHER ORDERED that Defendants, within ten (10) days from the date of receipt of notice of the entry of this Order shall delete all personal information collected and maintained within their possession, custody, or control in violation of the Rule at any time from April 21, 2000 through the date of entry of this Order.

CONSUMER EDUCATION REMEDY

18. IT IS FURTHER ORDERED that, for a period of five (5) years from the date of entry of this Order, Defendants, in connection with their operation of any website or online service directed to children, and any website or online service through which Defendants, with actual knowledge, collect, use, and/or disclose personal information from children, shall place a clear and conspicuous notice: (1) within the privacy policy required to be posted by Section 312.4(b) of the Rule, 16 C.F.R. § 312.4(b); (2) within the direct notice required to be sent to parents by Section 312.4(c) of the Rule, 16 C.F.R. § 312.4(c); and, (3) at each location on the website or online service where personal information is collected, which states as follows in bold typeface: NOTICE: Visit www.OnGuardOnline.gov for tips from the Federal

Trade Commission on protecting kids' privacy online

["www.OnguardOnline.gov" must contain a hyperlink to http://www.onguardonline.gov/topics/kids-privacy.aspx] Defendants shall be required to ...


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