The Walt Disney Company has agreed to pay $10 million to resolve Federal Trade Commission claims that it improperly labeled children's videos on YouTube, violating privacy laws. The settlement, announced by the Department of Justice, requires Disney to implement better compliance measures. The case highlights ongoing scrutiny of how media companies handle children's data online.
The U.S. Department of Justice confirmed on Tuesday a $10 million settlement between the Walt Disney Company and the Federal Trade Commission over allegations of mislabeling videos on YouTube. The issue stemmed from Disney's failure to designate certain uploads as "Made for Kids" between 2020 and 2022, which allegedly allowed the collection of personal data from children under 13 without parental consent, breaching the Children's Online Privacy Protection Act (COPPA).
The FTC complaint, filed by the DOJ in the U.S. District Court for the Central District of California, pointed to specific channels like Pixar, marked as "not made for kids," despite featuring child-directed content from films such as Frozen, Inside Out, Finding Dory, and Encanto. In contrast, the Pixar Cars channel was labeled appropriately, illustrating inconsistencies in Disney's practices. This followed YouTube's 2019 policy changes requiring creators to specify content for children; Disney was notified in mid-2020 that over 300 of its videos had been reclassified but maintained a channel-level designation policy.
Assistant Attorney General Brett A. Shumate emphasized the DOJ's commitment, stating, "The Justice Department is firmly devoted to ensuring parents have a say in how their children’s information is collected and used." The court mandated not only the penalty but also a compliance program to prevent future violations.
COPPA, enacted in 2000, has gained renewed attention amid rising digital media use by youth. A 2024 Senate amendment stalled in the House, though hearings continue. Disney is not alone; Microsoft settled similar Xbox claims for $20 million in 2023, and the FTC has targeted TikTok for potential COPPA breaches.
A Disney spokesperson noted last September, "Supporting the well-being and safety of kids and families is at the heart of what we do... Disney has a long tradition of embracing the highest standards of compliance with children’s privacy laws." The company declined further comment on the announcement day.
This resolution underscores broader efforts to safeguard children's online privacy in an era of pervasive streaming content.
