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FTC files lawsuit against Amazon over in-app purchases in kids' games

FTC files lawsuit against Amazon over in-app purchases in kids' games

July 11, 2014 | By Mike Rose

July 11, 2014 | By Mike Rose
More: Smartphone/Tablet, Business/Marketing

Earlier this month, Amazon warned regulatory body FTC not to go ahead with a legal complaint regarding in-app purchases in games and apps aimed at kids. Now the FTC has officially filed a lawsuit against Amazon.

The legal issues surrounding the business model are an important factor in the game industry, where in-app purchases have become the norm. Game makers have landed in hot water for releasing games that made it too easy for kids to buy virtual items.

The FTC is alleging that Amazon has unlawfully billed parents for millions of dollars where children have accidentally purchased in-app purchases in games and apps, via interfaces that allow for this sort of accident to occur.

"Amazon offers many children's apps in its appstore for download to mobile devices such as the Kindle Fire," reads the complaint. "In its complaint, the FTC alleges that Amazon violated the FTC Act by billing parents and other Amazon account holders for charges incurred by their children without the permission of the parent or other account holder."

It continues, "Amazon's setup allowed children playing these kids' games to spend unlimited amounts of money to pay for virtual items within the apps such as 'coins,' 'stars,' and 'acorns' without parental involvement."

The FTC notes that even Amazon's own employees have previously admitted that this was a problem, and thus, the FTC is suing Amazon in the hope of seeking refunds for those parents who were affected.

You can find a summary of the complaint on the FTC website, or read the full complaint here [PDF].

Amazon claims that it has been improving its Amazon App Store in response to customer complaints and that its billing practices "already meet or exceed the requirements of the Apple consent order."

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