Home » Amazon » Amazon Liable for Children’s In-App Purchases, Court Rules

Amazon Liable for Children’s In-App Purchases, Court Rules

28 April 2016

From The Wall Street Journal:

Amazon.com Inc. is liable for in-app purchases children made years ago without their parents’ authorization, a federal court ruled late Tuesday.

The Seattle retailer didn’t provide sufficient safeguards to prevent children from making purchases within apps that were free to download, according to the U.S. District Court for the Western District of Washington state. The Federal Trade Commission filed the case against Amazon in 2014, citing thousands of complaints about unauthorized in-app charges for virtual goods or services, totaling hundreds of dollars in some cases.

“Given the design of the Appstore and procedures around in-app purchases, it is reasonable to conclude that many customers were never aware that they had made an in-app purchase,” the court said.

Amazon has since taken measures to prevent such purchases and said it has reimbursed customers who lodged complaints. But the ruling means Amazon will face additional monetary penalties, which will be determined later.

. . . .

The FTC had reached settlements with Apple Inc. and Alphabet Inc.’s Google in 2014 about similar unauthorized in-app purchases for $32.5 million and $19 million, respectively. But Amazon chose instead to challenge the agency in court. Today, those app stores require customers to type in their password for in-app purchases, which may include new levels or characters in a game or additional music options.

Link to the rest at The Wall Street Journal (Link may expire)

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15 Comments to “Amazon Liable for Children’s In-App Purchases, Court Rules”

  1. Not a real surprise the way the defaults are set against ‘preventing’ kiddo from buying on mom/dad’s credit card … (and that you have to jump through hoops to stop it!)

    • Here’s another group discussing it:

      https://yro.slashdot.org/story/16/04/27/1555220/federal-judge-rules-amazon-must-refund-parents-duped-by-in-app-purchases#comments

      A couple of the remarks:

      There is something you don’t understand. I am a victim of this. I purchased a Kindle Fire kids edition for my 5 year old son. You have to have a parents account on the kindle before you can have a child account on it. To purchase applications at amazon, it won’t load from google play store, you have to purchase the app from the parent account. You then give access to the app to the child account. But once you have purchased the app from Amazon, the credit card you used to purchase the app is tied to that application. There is no setting to untie the credit card from the application. So when my 5 year old son sees a screen pop up with a button that says “Purchase the in game upgrade” he automatically clicks on the button. There are no settings to prevent that.

      I have had to call Amazon several times and they have refunded my money. But the only way to prevent that from happening is to uninstall the application and to never purchase applications for a child to use. That limits you to only the free apps that can be loaded to the tablet, rendering the Kindle Fire kids edition almost useless.

      And:

      [Get a credit card for this purpose. Buy all the apps you need, then discontinue the card. Problem solved, no more purchases possible with the invalid card registered to the app.

      I never registered a card with my android phone – no personal need for pay-apps. It nags, I press the ‘later’ button. Works fine, and kids can do no worse than dialling a foreign number. Which they don’t know how to do – all they know is the contact list and phone numbers are as obscure as IP addresses . . .]

      It’s called a Visa (or MC) gift card, and it’s the only CC I’ll use for app stores…

      So long as you log in to the credit card provider site and set up a ‘mailing address’ first so the card passes the automated validity check, it should be fine. I’ve never had a problem with one of these sites rejecting one yet just because it’s a gift card…

      So, as one person sees the problem, and another’s workaround.

      Surely it doesn’t have to be that hard to keep the kid from buying things …

      • I only use gift cards for my iPad and Android accounts, though mostly because I don’t trust Google or Apple with my credit cards. That way, I can at most lose about $50, because that’s all the money I have on there.

        Not sure whether Amazon allow you to do the same.

  2. What the hell ever happened to parental responsibility?

    • Computers.

      When I was a kid, I’d be reading a book or playing a board game, and it was hard to spend my parents’ money in the process. Today, though, computers allow kids to spend their parents’ money at the touch of a button, and the companies collecting a 30% cut of that money have no real incentive to make it hard to do.

      Imagine if, twenty years ago, all those commercials for action figures in between the kids’ TV shows that were little more than advertising for those action figures… came with a button saying ‘click here to buy’ that automatically charged them to our parents’ credit cards. Parents would have had to constantly watch their kids to make sure they didn’t buy some.

    • Nothing.

  3. Good grief. Are corporations now expected to bear the consequences for bad parenting? In the nanny state, even parents are treated like children.

    • The problem with these types of applications is that, very often, they make it hard to avoid purchasing or upgrading when in the app, and they don’t make it obvious to children that they’re going to charge money.

      Many of these apps are made for small children, and they’re designed so that the urge to click buttons in the game leads to the occasional purchase. They are, quite literally, designed in such a way that accidental purchases inevitably occur.

      The only way to avoid overages is to work around the ease of purchasing, and the only difference between this situation and the games I played growing up is that micro transactions weren’t invented when the SNES was the platform of choice.

    • Nanny state?

      There is a long tradition of not honoring and/or disallowing children to enter into binding contracts.

      Why? Cuz kids are stupid, not legally competent, and companies can and do target them.

      Remember it only becomes a ‘dumb parent’ situation once they find out about it. 10 years from now parents won’t get tricked into this, they’ll know better.

      There was an earlier version of this, children calling phone numbers that cost money because they saw the number on TV. Those contracts/charges were also not enforceable but it didn’t mean I didn’t get my ass beat for ordering a Sergeant Slaughter action figure. I still have it, but got it for Christmas later.

      Contrast this with kids tossing rocks through windows or whatever, in those cases of misbehavior that did not involve contract, transactions and tricks you’re goddamn right parents paid. And still do. Got my ass beat for that as well, and much worse because my parents had to pay for the window!

      My brother blew out a TV with a BB gun. HAHAHA. He got the worst of it, way worse than anything I ever did. An expensive Zenith, cracked the screen!

      Also let’s be honest. You can’t helicopter you kids, they grow up all screwy that way. Let us build a system that allows for that.

  4. I bought my son a kindle at 8. He didn’t realize clicking the button meant he was using my cc. Totally my fault and I promptly added a password for all app purchases which a nice amazon rep walked me through after I called.

  5. It doesn’t help that many of these games have the player earning and using several different “currencies” for different tasks, such as coins, gems, energy bolts, hearts, brains etc. and that the currencies are used to “buy” each other. Part of that is for game play reasons, but part of that is to obfuscate purchases. Usually it’s set up so that like a casino real money is used to buy an in-game currency, and that currency is used to buy virtual items. This makes it easier to spend actual money and makes it harder for both kids and adults to resize when they are doing so.

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