Epic Games fined US $520 million for Fortnite privacy violations

Epic Games has today been ordered to pay the FTC for multiple violations of privacy law, and for 'tricking users'.
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Epic Games has officially been charged US $520 million for two major violations of the US Children’s Online Privacy Protection Act (COPPA), per the Federal Trade Commission. The organisation levelled charges against Epic for purposeful design in Fortnite that infringed on established COPPA rules: the game reportedly contained ‘dark patterns’ that tricked players into spending money on unwanted cosmetics, and further violated children’s privacy by turning on voice and text chat by default during gameplay.

Together, the settlements make up the whopping US $520 million fine now facing Epic – the largest penalty ever handed down by the FTC.

In future, Epic will be required to make several changes to the design of Fortnite, to better protect young players and prevent anyone from making unwanted purchases. It will further be required to ‘adopt strong privacy default settings for children and teens, ensuring that voice and text communications are turned off by default.’

Read: Fortnite lawsuit alleging the game is too addictive goes ahead

The company will also pay US $245 million (as part of the fine) to refund customers ‘for its dark patterns and billing practices’. These practices allegedly relied on customers accidentally purchasing goods due to confusing game design, and a complicated refund system that discouraged players from seeking recourse.

‘Epic used privacy-invasive default settings and deceptive interfaces that tricked Fortnite users, including teenagers and children,’ Lina M. Khan, FTC Chair said in a release. ‘Protecting the public, and especially children, from online privacy invasions and dark patterns is a top priority for the Commission, and these enforcement actions make clear to businesses that the FTC is cracking down on these unlawful practices.’

In response, Epic Games has confirmed the terms of the FTC fine, and criticised a legal system which has yet to catch up to modern gaming practices.

‘No developer creates a game with the intention of ending up here,’ it said in a blog post. ‘The video game industry is a place of fast-moving innovation, where player expectations are high and new ideas are paramount. Statutes written decades ago don’t specify how gaming ecosystems should operate. The laws have not changed, but their application has evolved and long-standing industry practices are no longer enough.’

The company has claimed it should act as a beacon for changes in the wider games industry, and serve as a ‘helpful guide’ for others looking to better protect players and their privacy in future.

‘All game developers should rethink steps they’ve taken to simplify payment flows in favour of practices that provide the largest amount of clarity to players when they make purchase decisions,’ the company said. ‘Games should go above and beyond to make sure players even more clearly understand when they are making a purchase with real money or with virtual currencies to prevent accidental purchases. We don’t want players to pay for something that they did not intend to.’

Epic has called for industry-wide updates to payment flows, refunds, privacy defaults, and player-centric gameplay, with Fortnite upheld as an example. We’ll have to wait to see whether this call for action is met with wider change in the global games industry.

Leah J. Williams is a gaming and entertainment journalist who's spent years writing about the games industry, her love for The Sims 2 on Nintendo DS and every piece of weird history she knows. You can find her tweeting @legenette most days.