Epic Games Loses Battle Royale with the FTC, Will Pay $520 Million Fine

This week, Epic Games agreed to pay $520 million in fines related to allegations that Fortnite violated the Children’s Online Privacy Protection Act (COPPA) and used dark patterns to trick millions of people into making unintentional purchases.

“As our complaints note, Epic used privacy-invasive default settings and deceptive interfaces that tricked Fortnite users, including teenagers and children,” FTC Chairperson Lina Khan said. “Protecting the public, and especially children, from online privacy invasions and dark patterns is a top priority for the Commission, and these enforcement actions make clear to businesses that the FTC is cracking down on these unlawful practices.”

According to the FTC, Fortnite employed two sets of illegal tactics.

The first instance is privacy-related. Epic Games, the FTC says, violated COPPA by collecting the personal information of children under the age of 13 and enabling real-time voice and text chat communications for children and teens by default. “Children and teens have been bullied, threatened, harassed, and exposed to dangerous and psychologically traumatizing issues such as suicide while on Fortnite,” the FTC claims. “These default settings, along with Epic’s role in matching children and teens with strangers to play Fortnite together, harmed children and teens.”

The second instance concerns the use of dark patterns to trick players into making unwanted purchases and let children rack up unauthorized charges without any parental involvement. “Fortnite’s counterintuitive, inconsistent, and confusing button configuration led players to incur unwanted charges based on the press of a single button,” the complaint alleges. “[And] up until 2018, Epic allowed children to purchase Fortnite V-Bucks by simply pressing buttons without requiring any parental or card holder action or consent.” Epic also locked the accounts of customers who disputed unauthorized charges with their credit card companies, the FTC claims.

Epic Games ignored over one million customer complaints and repeated employee concerns about these tactics, the FTC continues.

Epic Games settled the case and has admitted no wrongdoing. $245 million of the fines it agreed to pay will be used to provide refunds to consumers.

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