The creator of the popular video game Fortnite will pay $520 million in penalties and refunds to settle complaints about children’s privacy and payment methods that tricked players into making unintended purchases, according to US federal regulators on Monday.
The settlements were reached by the Federal Trade Commission to resolve two cases against Epic Games Inc., which has leveraged Fortnite’s success over the last five years to become a video game powerhouse.
The $520 million settlement includes $245 million in customer refunds and a $275 million fine for collecting personal information on Fortnite players under the age of 13 without informing or obtaining consent from their parents. It is the most severe penalty ever imposed for violating an FTC rule.
“Epic used privacy-invading default settings and deceptive interfaces to fool Fortnite users, including teenagers and children,” said FTC Chair Lina Khan in a statement.
The creator of Fortnite has agreed to pay $520 million in damages for ‘privacy-invading default settings and deceptive interfaces.’
The Associated Press (AP)
The settlements were reached by the Federal Trade Commission to resolve two cases against Epic Games Inc., which has leveraged Fortnite’s success over the last five years to become a video game powerhouse.
The creator of the popular video game Fortnite will pay $520 million in penalties and refunds to settle complaints about children’s privacy and payment methods that tricked players into making unintended purchases, according to US federal regulators on Monday.
The settlements were reached by the Federal Trade Commission to resolve two cases against Epic Games Inc., which has leveraged Fortnite’s success over the last five years to become a video game powerhouse.
The $520 million settlement includes $245 million in customer refunds and a $275 million fine for collecting personal information on Fortnite players under the age of 13 without informing or obtaining consent from their parents. It is the most severe penalty ever imposed for violating an FTC rule.
“Epic used privacy-invading default settings and deceptive interfaces to fool Fortnite users, including teenagers and children,” said FTC Chair Lina Khan in a statement.
Fortnite modifications
Even before the settlement was announced, Epic announced a series of changes “to ensure our ecosystem meets the expectations of our players and regulators, which we hope will be a helpful guide for others in our industry.”
The Cary, North Carolina-based company also stated that it no longer engages in the FTC-identified practises.
Who will be eligible for a Fortnite refund?
The $245 million in customer refunds will be distributed to players who were victims of “dark patterns” and billing practises. Dark patterns are deceptive online techniques that are used to entice users to do things they did not intend to do.
The FTC stated that “Fortnite’s counterintuitive, inconsistent, and confusing button configuration caused players to incur unwanted charges based on the press of a single button” in this case.
It stated that players could be charged while attempting to wake the game from sleep mode, while the game was in a loading screen, or by pressing a nearby button while simply attempting to preview an item.
“These tactics resulted in hundreds of millions of dollars in unauthorised charges for consumers,” according to the FTC.
Epic stated that it agreed to the FTC settlement in order to “be at the forefront of consumer protection and provide the best experience for our players.”
“No developer makes a game with the intent of ending up here,” Epic explained.
Will Fortnite return to iPhone?
During the last two years, Epic has also been embroiled in a high-profile legal battle with Apple in an attempt to remove the barriers that have protected the iPhone app store, which has emerged as one of the world’s largest e-commerce hubs over the last 14 years. After Epic implemented a new payment system within its Fortnite app in August 2020, Apple removed the video from the app store, sparking a lawsuit that went to trial last year.
A federal judge ruled largely in favour of Apple, partly because she accepted the iPhone maker’s argument that its exclusive control of the app store helped protect consumers’ security and privacy. The ruling is currently being appealed, with a decision expected early next year.
