The Federal Trade Commission (“FTC”) recently announced a settlement with Apple, Inc. over allegations that the company billed parents and other account holders for children’s in-app activities without obtaining the account holders’ express and informed consent. The FTC’s complaint alleged that Apple’s failure to obtain express and informed consent prior to each in-app purchase constituted an unfair act or practice in violation of Section 5 of the FTC Act.

The FTC’s allegations stemmed from an App Store feature, disclosed in Apple’s Terms and Conditions, that allowed in-app purchases for up to fifteen minutes without requiring password re-entry after the user completed a password-requiring transaction. The FTC complaint alleged that this feature allowed children who were given possession of mobile devices after an initial password entry to incur charges for up to fifteen minutes without parental or accountholder knowledge.Continue Reading FTC Announces $32.5M Settlement with Apple, Inc., May Be Seen as Expanding its “Unfairness” Authority