Parents whose kids made unauthorized in-app purchases through Amazon will soon start seeing refunds.
The Federal Trade Commission and Amazon will ends appeals to a ruling that said the tech giant failed to seek parents' permission for purchases made within apps by children, the agency announced.
The FTC had been seeking an appeal of a judge's denial of an injunction preventing Amazon from similar conduct in the future. Separately, Amazon filed an appeal disputing the court's finding that it broke the law related to unauthorized purchases.
The withdrawal of the appeals means Amazon can start the process of refunding consumers. The FTC says more than $70 million in in-app charges made between November 2011 and May 2016 might be eligible for a refund.
"This case demonstrates what should be a bedrock principle for all companies — you must get customers’ consent before you charge them,” Thomas B. Pahl, the director of the FTC’s Bureau of Consumer Protection, said in a statement. Amazon could not be immediately reached for comment.
In 2014, the FTC sued Amazon, claiming the retailer billed parents for millions of dollars in unauthorized in-app purchases on Fire tablets and other devices. The FTC said Amazon did not implement strong enough parental controls to prevent these purchases from taking place.
Amazon disputed the claims in a letter to the FTC, stating they used "effective" controls and offered real-time notices when an in-app purchase was made.
Last year, a federal judge ruled Amazon was liable, saying the company did not do enough to inform parents about charges incurred by their children.
Three years ago, Apple reached a $32.5 million settlement with the FTC, which included full refunds for any unauthorized charges made by kids. In September 2014, Google agreed to refund consumers at least $19 million to settle complaints over unauthorized in-app purchases.
Although many apps in marketplaces like Amazon or Apple's app stores are free, users have the option to make purchases ranging from as little as 99 cents to $100. The purchases often go toward in-game items or currency. In 2014, Apple changed labeling on download buttons from "Free" to "Get," to make clear which apps allow for in-app purchases.