The U.S. Justice Department announced in a press release Tuesday that a federal court has entered a stipulated order resolving allegations against Disney Worldwide Services Inc. and Disney Entertainment Operations LLC over alleged violations of children’s privacy laws.
The government alleged that Disney violated the Children’s Online Privacy Protection Act (COPPA) and its implementing regulations. COPPA prohibits operators of websites or online services from knowingly collecting, using, or disclosing personal information from children under the age of 13 without providing notice to and obtaining verifiable consent from their parents.
The complaint, which was filed in the U.S. District Court for the Central District of California, alleged that Disney failed to properly designate certain YouTube video content as being directed toward children. This oversight allegedly led to the targeting of advertisements toward child viewers on YouTube.
As a consequence, Disney and entities acting on its behalf collected personal information from these children without the required parental notice or consent, in direct violation of COPPA provisions. In addition, a press release from the Department of Justice highlighted the popularity of Disney’s YouTube content, noting that it has garnered billions of views within the United States alone.
This, officials argued, underscores the scale of the potential impact on young audiences, as the content in question includes videos that appeal to children, such as those featuring Disney characters, animations, or family-oriented programming.
The case represents an enforcement action under COPPA, which has been in effect since 2000 and is administered by the Federal Trade Commission (FTC). Over the years, the FTC has pursued similar cases against other companies for failing to comply with child privacy rules on digital platforms, emphasizing the importance of accurate content classification to prevent unauthorized data collection.
Under the terms of the stipulated order approved by the court, Disney has agreed to pay a civil penalty of $10 million to the United States. This penalty serves as a financial resolution to the allegations without an admission of liability by Disney.
In addition to the monetary payment, the order includes injunctive relief to prevent future violations. Specifically, it prohibits Disney from operating on YouTube in any manner that contravenes COPPA requirements.
Disney is further mandated to implement a comprehensive compliance program. This program must ensure ongoing adherence to COPPA on the YouTube platform, which may involve internal policies, employee training, regular audits, and mechanisms for properly identifying and labeling child-directed content.
“The Justice Department is firmly devoted to ensuring parents have a say in how their children’s information is collected and used. The Department will take swift action to root out any unlawful infringement on parents’ rights to protect their children’s privacy,” said Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division.
While the resolution addresses the specific allegations against Disney, it does not include any findings of fact beyond the complaint’s assertions, as the matter was settled without a trial. Disney has not issued a public statement quoted in the press release regarding the settlement or the allegations.
