The Federal Trade Commission (FTC) has filed an amicus brief in a lawsuit initiated by a group of parents against IXL Learning, Inc. The FTC's brief challenges the company's assertion that under the Children’s Online Privacy Protection Act (COPPA) and the COPPA Rule, schools' agreements to binding arbitration also apply to parents.
The plaintiffs in Shanahan, et al. v. IXL Learning, Inc., are parents of school-age children who claim that IXL Learning unlawfully collected, used, and sold their children's data through its website and software used in schools. The class action lawsuit alleges violations of various laws including the Federal Wiretap Act, multiple California statutes, and common law privacy torts.
IXL Learning provides educational websites and services for schools. The company filed a motion to compel arbitration based on the argument that school districts had agreed to its full terms of service, which included an arbitration provision. According to IXL Learning, under COPPA, school districts act as agents for parents regarding the use of its educational services; therefore, parents should be bound by these terms.
The FTC's amicus brief clarifies that neither COPPA nor the COPPA Rule mandates that parents and children must adhere to all parts of a service agreement between companies like IXL Learning and school districts. Furthermore, it states that COPPA does not support claims binding parents to arbitration in this context.
In December 2023, the FTC proposed amendments aimed at strengthening the COPPA Rule by further restricting companies' ability to monetize children's data. These proposed changes would require targeted advertising to be off by default, prohibit indefinite retention of children's data, and enhance data security measures. The review process for these amendments is ongoing.
The FTC submitted its amicus brief in the United States District Court for the Northern District of California's San Francisco Division.
The Commission voted unanimously (5-0) to file the amicus brief with Commissioner Andrew Ferguson issuing a concurring statement.
The Federal Trade Commission aims to promote competition while protecting and educating consumers. It emphasizes never demanding money or making threats over monetary transfers or prize promises. More information on consumer topics can be found at consumer.ftc.gov or ReportFraud.ftc.gov for reporting frauds and scams. Updates from the FTC are available through social media channels and newsletters on their website.
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