United States: FTC Not Kidding Around With TikTok's Record-Setting COPPA Fine – Five Steps To Reduce Your Risk Now

On February 27, 2019, the U.S. Federal Trade Commission announced a record-setting $5.7 million fine to popular short-form video sharing platform TikTok, formerly known as Musical.ly, as part of a consent order over allegations the company violated the Children's Online Privacy Protection Act (COPPA). The settlement is now the largest COPPA penalty ever obtained by the FTC, beating the previous 2011 record of $3 million. In addition to reinforcing the FTC's commitment to enforcement with respect to children's privacy issues, the FTC here took an expansive view of what services qualify as "directed to children" under COPPA. Although that expansive view is expressed in the form of a complaint and not a judicial opinion, it nonetheless changes the risk landscape for online service providers, particularly in the social media and videogame industries. Many companies have previously felt comfortable not addressing COPPA in their sites and services, arguing they are not "directed to children." However, following TikTok, it is now time for such companies to re-evaluate their exposure to and steps needed to comply with COPPA.


COPPA, passed in 1998 and revised in 2012, is one of the United States' older consumer-facing privacy laws. COPPA applies to the operator of any website or online service "directed to children" that collects personal information from children, or any website or online service that has actual knowledge that it is collecting personal information from children. Unless an exception applies, an operator subject to COPPA must obtain verifiable parental consent before collecting any personal information from a child in those circumstances. For an online service that is not directed at children, but may nonetheless appeal to them, or where a substantial number of users are under 13, the FTC permits companies to implement an "age-screen" or "age-gate," where users are asked to enter their age and their experience and data is handled accordingly.

Although COPPA is a U.S.-specific law, it has extraterritorial application to companies outside the U.S. that collect personal information from children in the U.S. It has also served as a model for many international children's privacy laws, including the EU's GDPR. The FTC has repeatedly enforced COPPA in the online/games space; for example, against TinyCo and Yelp in 2014, and LAI Systems and Retro Dreamer in 2015. The FTC has increased its focus in this area on the heels of child-protection aspects of the GDPR and the California Consumer Protection Act.

Factual Background

The TikTok/Musical.ly App (App) allows users to create and share short videos with other users. The videos typically involve the users lip-syncing to popular music. To create an account, the App requires an email address, phone number, username, first and last name, a short biography and a profile picture. In addition to creating and sharing videos, the App allows users to interact by commenting on their videos and sending direct messages. User accounts are public by default.

Initially, the App did not request age information from its users. This was changed in July 2017, but the App did not request age information from existing users who created their accounts prior to the change. While Musical.ly's 2018 Privacy Policy states that the platform "is not directed at children under the age of 13," according to the FTC complaint, Musical.ly was aware of the popularity of its platform with children, as shown in a number of ways:

  • Since 2014, Musical.ly received "thousands" of complaints from parents (over 300 in a single two-week period) that their children under 13 had created Since 2014, Musical.ly received "thousands" of complaints from parents (over 300 in a single two-week period) that their children under 13 had created Musical.ly accounts. (Since 2014, Musical.ly received "thousands" of complaints from parents (over 300 in a single two-week period) that their children under 13 had created Musical.ly accounts. (Musical.ly closed the accounts in response to the parents' complaints, but left the videos of the kids publicly available on the platform.)
  • Press articles published between 2016 and 2018 highlighted the popularity of the App among tweens and younger children.
  • Musical.ly published guidance in 2016 and 2017, stating, "If you have a young child on Musical.ly published guidance in 2016 and 2017, stating, "If you have a young child on Musical.ly, please be sure to monitor their activity on the App."
  • A third party met with Musical.ly's co-founder and noted that seven of the App's most popular users appeared to be children under 13; the company then performed an internal audit and found an additional 39 underage users among its most popular users.

A Broader Interpretation of "Directed to Children"

This settlement is notable because of the FTC's broad interpretation of what makes an online service "directed to children" under the App. For context, the Amended COPPA rule explains that the FTC will evaluate whether a site or service will is "directed to children" based on the "subject matter of the site or service, its visual content, the use of animated characters or child-oriented activities and incentives, music or other audio content, age of models, presence of child celebrities or celebrities who appeal to children, language or other characteristics of the website or online service," or the content of advertising on the service. In addition to these factors, the FTC will also rely on other "competent and reliable empirical evidence regarding audience composition."

Filed in February, the FTC complaint, weighing the factors, concluded that Musical.ly is a child-directed service due to the activity involved (creating lip-syncing videos) and the presence of emojis like "cute animals and smiley faces," "simple tools" for sharing content, songs related to "Disney" and "school," and kid-friendly celebrities like Katy Perry, Selena Gomez, Ariana Grande, Meghan Trainor and others. However, this type of content (lip-syncing, approachable design, bright colors, emojis, presence of pop music, etc.) can arguably be found on many sites and games not directed to children as well. (Take, for example, RuPaul's Drag Race and its associated App).

Either the FTC is now adopting a more expansive definition than previously understood, or it may instead be relying less on the subject-matter factors and more heavily on "other competent and reliable empirical evidence" of audience composition; specifically, the complaints from parents, press articles, Musical.ly's own admissions in its guidance to parents, and Either the FTC is now adopting a more expansive definition than previously understood, or it may instead be relying less on the subject-matter factors and more heavily on "other competent and reliable empirical evidence" of audience composition; specifically, the complaints from parents, press articles, Musical.ly's own admissions in its guidance to parents, and Musical.ly executives' actual knowledge of popular underage users on their platform.

Five Practical Tips for Reducing Your Risk under COPPA and Similar Laws

Absent further guidance from the FTC, service providers should view this decision with caution and take steps to protect their site or service now, especially if there is a chance the site or service may be seen as child-directed.

  1. Be careful before using your next emoji: Re-analyze your site/services' appeal to children. Given that the FTC seems to have relied heavily on empirical evidence of audience composition in this case, keep on the lookout for evidence like that called out above. For example, talk to marketing and see if they have data regarding the target demographics of your app. Keep up on the news and see if the app is starting to become popular with younger users. Determine if your app is being featured on any "Children's" or "Families" lists. In any case, counsel should be involved in this investigation to preserve the attorney-client privilege.
  2. Reconsider whether you need an age-gate in light of Musical.ly. Even an app that explicitly states in its privacy policy that it is not directed to children may nonetheless be found child-directed by the FTC. Service providers do not want to be in a position of having to argue that their game does not appeal to kids. If you suspect children make up a significant portion of your audience, it's easier to add an age-gate sooner rather than later in development.
  3. Age-gate the right way – it's more than just asking about age. When implementing an age-gate, the FTC has stated a service provider cannot encourage children to lie about their age, or make it easy for the child to circumvent the gate (for instance, by clicking the "back" button and trying again). If implementing an age-gate for a service that is already live, make sure the gate is presented to existing users as well as new users. Once you have users' ages, delete any personal information you may have collected from underage users.
  4. Buyer Beware: Perform Privacy due diligence during and after M&A. Musical.ly was acquired by ByteDance in August 2018 and merged with the TikTok app under the TikTok name. If you acquire a company, make sure you do thorough diligence on any privacy issues your target might be bringing along. Acquirers should conduct a post-close privacy assessment to evaluate and remediate any risks. COPPA Safe Harbor programs are slowly gaining popularity with some companies; consider if they might be right for you.
  5. Train, Train, Train: Teach your customer service reps to handle COPPA. It's important that customer service reps are trained to both handle complaints from parents, and to know what to do when it sounds like a child might be on the other end of a customer support line. Customer support should also keep in close contact with your legal team and flag if they sense that a game might be unexpectedly popular with kids.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Events from this Firm
17 Sep 2019, Speaking Engagement, California, United States

We are highlighting the importance of having a buttoned-up IP strategy and portfolio in two back-to-back panels. The first panel will be led by Fenwick’s David Hayes, one of the top IP attorneys in the US, along with noted IP strategist Shmuel Silverman of Multi-Innovation.

2 Dec 2019, Speaking Engagement, San Francisco, United States

With the revenue and lease standards in the rear-view mirror but CECL still to be adopted, it is as important as ever to keep up with new and evolving accounting standards and regulations especially given the SEC’s Disclosure Modernization and Simplification initiatives.

Similar Articles
Relevancy Powered by MondaqAI
Smith Gambrell & Russell LLP
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Smith Gambrell & Russell LLP
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions