Federal Trade Commission Stories July 29, 2015

AT&T doesn’t want to be throttled for throttling customers

It seems AT&T thinks throttling the data speeds of customers without telling them about it isn’t such a big deal. The Federal Trade Commission sued AT&T back in 2014 for “deceptive and unfair data throttling” after the company imposed caps on unlimited data contracts, beyond which it reduced their data speeds by almost 90%. The Federal Communications Commission joined the party last month, fining AT&T $100 million – and The Hill reports that the carrier now wants that fine reduced to just $16,000.

The Commission’s findings that consumers and competition were harmed are devoid of factual support and wholly implausible,” the company wrote in its filing. “Its ‘moderate’ forfeiture penalty of $100 million is plucked out of thin air, and the injunctive sanctions it proposes are beyond the Commission’s authority.”

The FTC had stated that it could legally have imposed fines of $16,000 per affected consumer, but that would have resulted in an “astronomic” fine, so chose to limit the total penalty to one large enough to deter future violations. AT&T had originally claimed that it was doing nothing wrong, but Ars Technica notes that the company amended its policy in May so that throttling was applied only when the network was congested.

AT&T has not offered unlimited data plans to new customers for some years, but has a small-ish group of customers who remain on grandfathered plans which remain valid for as long as the customer retains the plan.

Apple last month removed subsidies from both AT&T and Verizon iPhones, moving to plans where customers pay the full cost of the phone on an installment plan.

Photo: Re/code

Federal Trade Commission Stories March 27, 2015

cookies

UK Safari users have been given the go-ahead to sue Google for continuing to drop cookies on their devices even after they had refused permission through their browser settings.

It was revealed in 2012 that Google bypassed the setting in Safari which instructed sites not to drop cookies, enabling it to deliver personalized ads. The FTC in the US fined the company $22.5M for the practice, with millions more in additional fines levied by 38 US states. There was no government action in the UK, but a group of British iPhone users took Google to court, seeking compensation for breaching their privacy.

Google had attempted to have the case dismissed, claiming that there was no case to answer as the plaintiffs had not suffered any financial harm, but the UK’s Court of Appeal has rejected this argument, allowing the case to proceed …

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Federal Trade Commission Stories November 19, 2014

App Store Free Get

Apple has introduced a small but interesting tweak to the way it markets apps on the App Store. As you can see in the screenshot above, non-paid apps are now presented with the word ‘GET’ rather than ‘FREE’. While the reason for the change in how Apple is presenting non-paid apps isn’t clear, it’s likely due to the popularity of ‘freemium’ apps and in-app purchases, something that has been the source of controversy for Apple in the past… expand full story

Federal Trade Commission Stories July 9, 2014

sewell

Apple seemingly wasn’t too happy that it was singled out for an FTC investigation into making it too easy for children to make in-app purchases: following its own settlement back in January, the company’s general counsel Bruce Sewell promptly reported Google for the same thing, reports Politico.

“I thought this article might be of some interest, particularly if you have not already seen it,” Apple general counsel Bruce Sewell wrote to FTC Chairwoman Edith Ramirez and Democratic Commissioner Julie Brill, pointing to a report that criticized Google’s app store over the same issue of unauthorized purchases …

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Federal Trade Commission Stories July 1, 2014

T-Mobile gets socked with an FTC complaint alleging the Uncarrier ‘Crammed Bogus Charges onto Customers’ Phone Bills’

It feels like just last month, TMobile CEO John Legere accused Verizon and AT&T of “raping” (ugh) its customers and that “the fuckers hate you”.

In a complaint filed today, the Federal Trade Commission is charging mobile phone service provider T-Mobile USA, Inc., with making hundreds of millions of dollars by placing charges on mobile phone bills for purported “premium” SMS subscriptions that, in many cases, were bogus charges that were never authorized by its customers…

The FTC alleges that T-Mobile received anywhere from 35 to 40 percent of the total amount charged to consumers for subscriptions for content such as flirting tips, horoscope information or celebrity gossip that typically cost $9.99 per month. According to the FTC’s complaint, T-Mobile in some cases continued to bill its customers for these services offered by scammers years after becoming aware of signs that the charges were fraudulent.

More in the PDF

Update: T-Mobile has responded publicly to the complaint saying it is being singled out…

We have seen the complaint filed today by the FTC and find it to be unfounded and without merit.  In fact T-Mobile stopped billing for these Premium SMS services last year and launched a proactive program to provide full refunds for any customer that feels that they were charged for something they did not want.  T-Mobile is fighting harder than any of the carriers to change the way the wireless industry operates and we are disappointed that the FTC has chosen to file this action against the most pro-consumer company in the industry rather than the real bad actors.

Full response here.

Federal Trade Commission Stories May 12, 2014

Apple improves refund turnaround times for returns to less than a week

A retail research firm is reporting that Apple has improved its return systems for customers, via Reuters. Customers can now get a refund in a less than a week, whereas it used to take about ten days.

The report says Apple has transitioned to a new expedited shipping service, which ships returned products back to Apple within three days. In turn, this means customers get their money back faster. The new delivery method was first spotted during the holiday period and now seems to be a permanent measure.

Reuters positions the change as a way to lift online sales. This seems a little farfetched, and is unlikely to significantly affect purchasing decisions, but it will no doubt be appreciated by Apple’s customer base. Perhaps, it will help customer satisfaction slightly, Tim Cook’s favorite statistic.

Federal Trade Commission Stories February 10, 2014

apple

Photo: edudemic.com

arsTechnica drew our attention to some unusually forthright comments from Apple’s lawyers on the subject of patent trolls, in a public FTC filing. Apple revealed that it had been the subject of 92 lawsuits by patent assertion entities over the course of the past three years, more than any other company.

Apple has rarely lost on the merits. But victory figures are small consolation, because in every one of these cases, Apple has been forced to bear its legal fees. This reality is the lifeblood of the patent assertion industry… Indeed, the opening line of many negotiations is some form of, “What we’re asking for is less than it will cost you to litigate this case to judgment.” It should come as no surprise, then, that despite its success in litigating the merits, for business purposes Apple has agreed to a settlement in 51 of the 57 closed cases.

Apple’s legal team used particularly direct language when referring to Lodsys, a company which claims to hold a patent on in-app purchases and which litigates against small developers who cannot afford the legal costs of fighting the case …  expand full story

Federal Trade Commission Stories January 15, 2014

Tim-Cook-02-Senate-taxes

Apple CEO Tim Cook informed Apple employees today via email that the company has settled with the United States Federal Trade Commision over an in-app purchases dispute. Cook says that Apple and the FTC have been negotiating for “several months.” The issue in the App Store comes down to the controversies surrounding children spending money too easily in the App Store without the consent of their parents.

Cook notes that “protecting children” has been a priority for everyone at Apple, and Cook notes that the App Store has industry leading controls for security and privacy, making the need to deal with the FTC surprising. Cook’s email details the safeguards in place for the in-app purchase system. Cook also notes the great lengths that Apple went to in order to appease customers who may have been harmed by in-app purchases:

Last year, we set out to refund any in-app purchase which may have been made without a parent’s permission. We wanted to reach every customer who might have been affected, so we sent emails to 28 million App Store customers – anyone who had made an in-app purchase in a game designed for kids. When some emails bounced, we mailed the parents postcards. In all, we received 37,000 claims and we will be reimbursing each one as promised.

Cook also says that it doesn’t feel right that the FTC intervened here. Alas, a settlement has been reached:

It doesn’t feel right for the FTC to sue over a case that had already been settled. To us, it smacked of double jeopardy. However, the consent decree the FTC proposed does not require us to do anything we weren’t already going to do, so we decided to accept it rather than take on a long and distracting legal fight.

Here’s Cook’s email in full:

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Federal Trade Commission Stories February 1, 2013

Screen Shot 2013-02-01 at 10.51.38 AMThe Federal Trade Commission released a report today that recommends how owners of mobile platforms can better inform consumers about how their data is being handled. The FTC named a number of companies in its report, including: Amazon, Apple, BlackBerry, Google, and Microsoft, as well as “application (app) developers, advertising networks and analytics companies, and app developer trade associations.”

The recommendations follow the FTC updating its online child privacy law to require parental consent before collecting data from children under the age of 13. It also came as Path agreed to pay an $800,000 settlement to the FTC forviolations of the Children’s Online Privacy Protections Act. Path posted a response to the FTC settlement on its website.

In the report, titled “Mobile Privacy Disclosures, Building Trust Through Transparency,” the FTC issued a number of recommendations. The FTC recommended that all platform owners “Provide just-in-time disclosures to consumers and obtain their affirmative express consent before allowing apps to access sensitive content like geolocation.” It recommended app developers take the same measures in addition to having “a privacy policy and make sure it is easily accessible through the app stores.” The report also suggested that companies implement a ” a one-stop “dashboard” into their operating systems so consumers can easily view how their data is being handled by specific apps.

Other recommendations the FTC asked Apple and others to implement include new icons that “depict the transmission of user data” and a “Do Not Track” option for users to easily opt out of their data being sent to third parties.

“FTC staff strongly encourages companies in the mobile ecosystem to work expeditiously to implement the recommendations in this report.  Doing so likely will result in enhancing the consumer trust that is so vital to companies operating in the mobile environment.  Moving forward, as the mobile landscape evolves, the FTC will continue to closely monitor developments in this space and consider additional ways it can help businesses effectively provide privacy information to consumers,” the report states.

A full list of the recommendations made by the FTC for mobile platform owners, advertising agencies, and app developers is below: expand full story

Federal Trade Commission Stories August 9, 2012

It’s official: Google agrees to pay record $22.5M FTC fine in Safari bypass dispute

We reported last week that the Federal Trade Commission voted to fine Google $22.5 million for violating browser security settings in Safari, but now Google has agreed to pay the record-setting amount and finally settle its dispute.

According to the press release (via MarketWatch): 

  • Google to pay $22.5 million to settle FTC dispute
  • SAN FRANCISCO (MarketWatch) — Google Inc. GOOG +0.27% Thursday agreed to pay a $22.5 million penalty to settle a dispute with the U.S. Federal Trade Commission. The FTC said the penalty stems from charges that Google misrepresented users of Apple Inc.’sAAPL +0.13% Safari Web browser after saying it wouldn’t place tracking “cookies” or serve targeted ads to Safari users. The FTC said Google’s actions violated and earlier privacy settlement between the FTC and Google. Google shares were up less than 1% at $643.63 in early trading Thursday.

The allegations against Google began in February, when the search engine and other ad companies were caught bypassing Safari security settings to install tracking cookies on devices and computers without consent.

“The record setting penalty in this matter sends a clear message to all companies under an FTC privacy order,” said FTC Chairman Jon Leibowitz in another presser. “No matter how big or small, all companies must abide by FTC orders against them and keep their privacy promises to consumers, or they will end up paying many times what it would have cost to comply in the first place.”

It is worth noting that the hefty fine roughly equals five hours of revenue for Google based on Q2 2012 sales.

The FTC’s full press release is below.

This article is cross-posted on 9to5Google.

Federal Trade Commission Stories July 10, 2012

Congress considers forbidding sales bans related to essential patents

Reuters reported today that Congress is set to discuss whether companies that hold patents considered essential to an industry standard, “such as a digital movie format,” should be allowed to request bans on infringing devices. A hearing will take place this Wednesday with the Senate Judiciary Committee, and Federal Trade Commission officials are expected to testify:

“If they (smartphone makers) had taken the conservatively $15 to $20 billion dollars they’ve spent on this fight, imagine how much better a place the world would be,” said Lemley.

Google to pay $22.5M settlement in FTC’s iOS Safari privacy investigation

The last time we updated you on the Federal Trade Commission’s investigation into Google’s method of bypassing the default Safari browser settings on iOS devices, reports claimed the company was facing possible fines that could reach tens of millions. Today, The Wall Street Journal said Google is close to reaching a $22.5 million settlement with the FTC, according to people close to the negotiations:

The fine is expected to be the largest penalty ever levied on a single company by the U.S. Federal Trade Commission. It offers the latest sign of the FTC’s stepped-up approach to policing online privacy violations, coming just six months after The Wall Street Journal reported on Google’s practices.

While the fine likely will represent only a tiny portion of Google’s revenues—last year, the Internet giant raked in that much cash roughly every five hours or so—it counts among a series of negative reports about Google’s privacy practices that could undermine users’ trust in its services.

Federal Trade Commission Stories May 4, 2012

Google facing tens of millions in fines in FTC’s iOS Safari privacy investigation

We knew that Google would likely face fines in the Federal Trade Commission’s investigation into its method of bypassing Apple’s default iOS Safari browser settings. Last month, reports claimed the FTC would make a decision on the fines within 30 days. Today, Reuters reported sources close to the situation have confirmed Google is currently negotiating with the FTC over fines that “could amount to tens of millions of dollars”:

Google Inc. (GOOG) is negotiating with the U.S. Federal Trade Commission over how big a fine it will have to pay for its breach of Apple Inc. (AAPL)’s Safari Internet browser, a person familiar with the matter said. The FTC is preparing to allege that Mountain View, California-based Google deceived consumers and violated terms of a consent decree signed with the commission last year when it planted so-called cookies on Safari, bypassing Apple software’s privacy settings, the person said.

Cross-posted on 9to5Google.com

Federal Trade Commission Stories April 17, 2012

In February, the story broke that Google and other advertising companies were bypassing iOS Safari’s privacy settings and continuing to track users without their consent. Google quickly disabled its code responsible for the tracking after a story from The Wall Street Journal published, and Apple then claimed it was “working to put a stop” to the issue.

Now, a new report from Mercury News claimed the U.S. Federal Trade Commission is considering whether to fine Google over the incident. The decision is expected in the next 30 days:

The Federal Trade Commission is deep into an investigation of Google’s actions in bypassing the default privacy settings of Apple’s (AAPL) Safari browser for Google users, according to sources familiar with ongoing negotiations between the company and the government… Within the next 30 days, the FTC could order the Mountain View search giant to pay an even larger fine in the Safari case than the penalty the Federal Communications Commission hit Google with Friday, say the sources, who spoke on condition of anonymity.

The report is referring to Google being recently fined $25,000 by the FCC after it allegedly “deliberately impeded and delayed” an investigation related to Street View cars. The heart of the Safari bypassing investigation is whether the company is violating a previous privacy agreement made with the FTC following controversy over the failed “Buzz” service. The report claimed Google could face up to $16,000 per violation per day for violating the agreement. Google said to Mercury News today it would “cooperate with any officials who have questions” and explained making its +1 compatible on mobile Safari created the issue:

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Federal Trade Commission Stories March 13, 2012

According to a report from Bloomberg (via AllThingsD), the U.S. Federal Trade Commission subpoenaed Apple as part of its antitrust investigation of Google. There are not many details currently, but the report claims the FTC is interested in Apple’s agreement with the company to use Google as its primary default search engine on iOS devices.

The agency’s request for documents includes the agreements that made Google the preferred search engine on Apple’s mobile devices, said the people, who weren’t authorized to speak publicly and declined to be identified. Google rivals such as Microsoft Corp. (MSFT) have criticized these agreements as anticompetitive.

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