05/26/2023 | News release | Archived content
On May 22 the Federal Trade Commission ("FTC") announced a $6 million settlement with Edmodo, an ed tech provider, for violations of the COPPA Rule and Section 5 of the FTC Act. The FTC described this settlement as the first FTC order that will prohibit an ed tech provider from requiring students to provide more personal data than necessary to participate in online activities. The settlement is consistent with the FTC's policy statement on ed tech issued last May (see our summary of the policy statement here).
The complaint alleges that Edmodo violated COPPA by failing to provide notice and obtain verifiable parental consent before collecting personal information from children under the age of 13. Specifically, the complaint alleges that Edmodo's reliance on schools and teachers to provide verifiable parental consent as agents of parents was not permissible because (1) Edmodo did not provide the required direct notice of its practices as to the collection, use, or disclosure of personal information from children and (2) Edmodo's used student's personal information for contextual advertising which exceeds the limited educational context for which school and teachers may provide consent. The complaint also alleges that Edmodo failed to inform teachers and sole of its reliance on them as intermediaries to provide notice and obtain authorization from parents and failed to make reasonable efforts to ensure parents received notice and provided authorization.
In addition to violating COPPA's notice and consent provisions, the complaint alleges Edmodo collected more personal information from children than necessary to participate in educational activities and retained children's personal information longer than reasonably necessary.
Beyond COPPA, the complaint includes allegations that Edmodo violated Section 5 by telling schools and teachers that they were "solely" responsible for COPPA compliance while providing allegedly "confusing and inaccurate information" about obtaining consent under COPPA, thus unfairly burdening teachers and schools with Edmodo's own COPPA compliance responsibilities. According to the FTC's press release, this is the first time the FTC has used Section 5 to allege an unfair trade practice in the context of an ed tech operator's interaction with schools.
The proposed order includes the following relief:
The order also defines an "educational purpose" to be "any use related to a child's education including, but not limited to, instruction in the classroom or at home, administrative activities, and collaboration between students, school personnel, or parents." Notably, the definition of an educational purpose does not include "commercial purposes unrelated to the provision of the online service requested by the school such as advertising or building user profiles."