A company that operates fan websites for Justin Bieber, Rihanna, Demi Lovato, Selena Gomez and other favorites of the under-13 crowd has agreed to pay $1 million to settle Federal Trade Commission charges that it violated the Children's Online Privacy Protection Act.
Artist Arena allegedly collected personal information from children such as their names, addresses and birthdates without properly notifying or obtaining permission from their parents.
"Marketers need to know that even a bad case of Bieber Fever doesn't excuse their legal obligation to get parental consent before collecting personal information from children," said FTC Chairman Jon Leibowitz in a news release.
According to the complaint, which was filed in U.S. District Court for the Southern District of New York, Artist Arena registered more than 25,000 children under age 13 and collected and maintained personal information from almost 75,000 additional children who began, but did not complete the registration process.
In addition to the civil penalty, the settlement requires Artist Arena to delete all the information it obtained from the children.
Artist Arena neither admitted nor denied the allegations. The company was represented by Morrison & Foerster partner D. Reed Freeman Jr., who declined comment and referred inquiries to the company. A company representative could not immediately be reached for comment.
To Jeremy Mishkin , a partner at Montgomery, McCracken, Walker & Rhoads who specializes in technology and internet security issues and was not involved in the case, the settlement sends an important message.
"If you have an online site that is directed to children you must be very careful not to collect personally-identifiable information without going through an extensive process to make certain that you have the legally-required permissions," Mishkin said via email. "More and more sites are seeking to appeal to children, and that's a recipe for disaster if the site operator is trying to wing it, rather than get good legal advice regarding how to proceed."