Google facing legal action over kids' in-app purchases

Google facing legal action over kids’ in-app purchases

11 MAR 2014

Google faces legal action over children being able to make unauthorised purchases of virtual currency within apps available via Google Play, after a class action was filed on behalf of parents.

The action concerns free or low-cost games downloaded from the Google Play app store which allow children to make in-app purchases of game currency without the knowledge or authorisation of parents.

The case alleges that many games in Google Play are engineered to be “highly addictive and require the purchase of in-game currency at times to continue playing”. Some permit the purchase of as much as $100 worth of in-game currency in one transaction.

Google requires users to authenticate their accounts by entering a password before purchasing a game or buying in-game content. However, device users can then make additional purchases for up to 30 minutes without re-entering their password.

The action asserts that this practice “is designed to enable children to purchase in-game currency without parental permission and without having to enter a password”.

“Google has unfairly profited by marketing free or low-cost games to children and by permitting them to easily rack up charges for worthless in-game currency, by failing to incorporate reasonable controls such as simply requiring the entry of a password,” said Shanon Carson of Berger & Montague, one of the law firms overseeing the class action, which has been filed with the US District Court for the Northern District of California.

Apple settled a private class action lawsuit related to the same issue in October 2013. Berger & Montague was involved in that case, which dated back to 2011.

The iPhone maker also reached a settlement in January with the Federal Trade Commission to pay $32.5 million to parents who had lost money as a result of their children making in-app purchases without their consent.

Apple introduced a Kids category in the App Store in September last year to better cater for younger consumers, following concern about the use of apps by children. It also added new rules to its iOS developer guidelines in preparation for the new category.

Just this week, the iPhone maker added a new alert that appears after an in-app purchase has been made, warning that additional purchases can be made without re-entering the password for the next 15 minutes.

“Google is certainly aware that its primary competitor, Apple, has taken steps to end this unfair practice, and Google should do the same,” Carson added.

Outside of the US, the UK Office of Fair Trading recently published principles for the mobile app industry to adhere to when developing apps for children, while the European Commission said it would raise consumer concerns with the mobile app industry to help the app economy develop its full potential.


Tim Ferguson

Tim joined Mobile World Live in August 2011 and works across all channels, with a particular focus on apps. He came to the GSMA with five years of tech journalism experience, having started his career as a reporter... More

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