The Secure Times

An online forum of the ABA Section of Antitrust Law's Privacy and Information Security Committee

Google to Pay Record $22.5 Million to Settle FTC Privacy Charges

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Just ten months after it entered into a consent decree with the the FTC in a case charging that it violated its privacy promises when it launched Google Buzz, Google has agreed to pay $22.5 million to settle charges that it violated that agreement by making misrepresentations to Apple Safari users. In addition to the $22.5 million civil fine – the largest ever obtained by the FTC for a violation of one of its orders – the settlement agreement requires that Google disable all the tracking cookies it said it would not place on user’s computers.

According to the FTC complaint, Google told Apple Safari users that the browser’s default privacy options would protect them from being tracked by Google’s DoubleClick advertising network – stating that Safari’s default settings were effectively the same thing as opting out of DoubleClick tracking. Google then went ahead and placed advertising tracking cookies on Safari user’s computers anyway – in many cases by utilizing an exploit to circumvent the privacy protections built into Safari. These misrepresentations, the FTC charged, violated the earlier consent decree that barred Google from misrepresenting the extent to which consumers can control collection of their information.

This case is just the latest in which the FTC brings its enforcement power to bear in ensuring companies respect their own privacy policies and representations. As FTC Chairman Jon Leibowitz states in the FTC press release, “all companies must . . . keep their privacy promises to consumers, or they will end up paying many times what it would have cost to comply in the first place.”

In an interesting twist, though, Google was allowed a fairly strongly worded denial of liability in the consent decree.  Paragraph 2 of the decree states that Google "denies any violation of the FTC Order, any and all liability for the claims set forth in the Complaint, and all material allegations of the Complaint save for those
regarding jurisdiction and venue."  This language, rather than the more common "neither admit nor deny" formula, caused Commissioner J. Thomas Rosch to issue a fairly strongly worded dissent.  Pointing out that the FTC had essentially charged Google with contempt and that it was Google’s "second bite at the [deceptive conduct] apple", Commissioner Rosch found the Commission’s acceptance of Google’s denial of liability "inexplicable."

Author: ABA Antitrust

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