Yesterday, the FTC announced a settlement with Goldenshores Technologies, a company that makes the most-downloaded flashlight app on the Android platform.  The FTC alleged that Goldenshores violated Section 5 of the FTC Act by failing to disclose to consumers that it shared location data it collected from users’ device with third parties.  Although a list of permissions in the Google Play store noted that the app would collect location data, neither those permissions nor the app’s privacy policy stated that the data would be shared with third parties.  The data allegedly was transmitted to third parties, including ad networks, along with persistent identifiers that the FTC suggested could have allowed the third parties to track a user’s whereabouts over time.  

Goldenshores also allegedly failed to respect a user’s choice not to accept the app’s EULA.  Apparently, the EULA was presented the first time a user launched the app, and a user was given a choice either to “Accept” or “Refuse” the EULA, under which the user gave Goldenshores certain permissions to use data collected from the user.  Notwithstanding this apparent choice to refuse the EULA (and the data use permission), the app allegedly began collecting data from the user’s device immediately, including when the user was reviewing the EULA. 

The FTC alleged that both of these practices were “deceptive” in violation of Section 5.  The settlement reflects the agency’s keen focus on the uses of geolocation data, a category of data the FTC identified as “sensitive” in its March 2012 privacy report.  The report recommended that companies obtain “affirmative express consent” before collecting geolocation information.   Although the FTC did not fault Goldenshores for failing to obtain such consent, the consent order resolving the case requires Goldenshores to obtain affirmative express consent before “transmitting” geolocation data in the future.  This requirement is similar to a requirement imposed on the Aaron’s rent-to-own chain in a consent order announced in October.