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October 30, 2019
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By Allison Grande | Law360 (October 29, 2019) -- Google and several companies that host popular child-friendly channels on YouTube — including Cartoon Network and toymakers Hasbro and Mattel — have been hit with a putative class action in California federal court accusing them of illegally compiling minors' personal data to serve them with targeted ads.
In a 43-page complaint filed Friday, Nichole Hubbard, the parent of a 5-year-old child identified as C.H., claimed that Google LLC, its subsidiary YouTube LLC, Cartoon Network Studios Inc., Hasbro Inc., Mattel Inc., DreamWorks Animation LLC, the companies behind Ryans ToysReview and two others invaded the privacy of millions of YouTube users under the age of 13. The suit claims they enabled child viewers' personal information to be used to create individual profiles vital to the distribution of targeted advertising between July 1, 2013, and Sept. 4, 2019.
The Children's Online Privacy Protection Act prohibits the collection of this type of personal information from minors without their parents' permission, and while the Federal Trade Commission and New York's attorney general earlier this year hit Google and YouTube with a record $170 million fine for allegedly illegally harvesting personal information from children under 13, COPPA allows consumers to bring private lawsuits.
However, Hubbard alleges that the data usage practices of not only Google and YouTube but also well-known companies that operate monetized YouTube channels for children and that allow YouTube to place paid advertising on their channels in exchange for a cut of the revenue violate California and 33 other states' common law right to be free from intrusion upon seclusion and the California Constitution's right to privacy.
"By failing to (1) obtain parental consent, (2) disclose to parents the nature of their data collection practices, and (3) take other steps to preclude the capture of children's Personal Information, Defendants have breached the privacy rights and reasonable expectations of privacy of C.H. and the other millions of minors who have viewed YouTube's monetized channels, in contravention of privacy norms that are reflected in consumer surveys, centuries of common law, state and federal statutes, legislative commentaries, industry standards and guidelines, and scholarly literature," Hubbard said.
Although YouTube claims its platform is not intended for children under 13, users don't have to be registered to view videos and Google and YouTube don't take steps to verify the age of anyone opening an already installed mobile app, according to the complaint. They are also "well aware" that minors are viewing content on YouTube and have even "actively sought" to increase child viewership and make YouTube "the new 'Saturday Morning cartoons'" while "falsely pretending that such minors are not permitted to access the platform," Hubbard claims.
YouTube channel owners that pass a viewership threshold set by the platform can choose to "monetize" their channel by allowing Google and YouTube to run ads, according to the complaint. Google and YouTube keep 45% of the advertising revenue and the channel owners receive 55%, the complaint says.
In order to serve this advertising, Google and YouTube collects "persistent identifiers" such as internet protocol addresses and device serial numbers from users — including those under 13, without their parents' consent — that allows them to profile and track these viewers across multiple websites, apps and devices, Hubbard claims.
Channel owners also play a vital role in this operation, as the lure of "economic incentives" drives them to "bait and exploit" children using nursery rhymes, cartoons and toys, according to the complaint.
Hubbard claims her child watched many of the channel owner defendant's YouTube channels, including a popular toy unboxing channel operated by CookieSwirlC, a nursery rhymes and song channel owned by ChuChuTV Studios, Hasbro's official My Little Pony Channel and Ryans ToysReview, another hit toy unboxing channel operated by defendants Remka Inc., RTR Production LLC, RFR Entertainment Inc. and Pocketwatch Inc.
The complaint seeks to certify a class of all children and their parents residing in the 34 states where intrusion upon seclusion claims are allowed — including New Jersey, Connecticut, Maryland, Texas and Pennsylvania — from whom defendants collected, used or disclosed personal information without first obtaining verified parental consent, as well as a nationwide class under California's Unfair Competition Law and a California subclass for violation of the state Constitution's right to privacy, the state's unfair competition law and for unjust enrichment.
Representatives for the defendants could not immediately be reached for comment Tuesday.
Hubbard is represented by Jonathan K. Levine, Elizabeth C. Pritzker, Bethany Caracuzzo and Caroline C. Corbitt of Pritzker Levine LLP, and David S. Golub, Steven l. Bloch and Ian W. Sloss of Silver Golub & Teitell LLP.
Counsel information for the defendants was not immediately available.
The case is Hubbard v. Google LLC et al., case number 5:19-cv-07016, in the U.S. District Court for the Northern District of California.