The Federal Trade Commission (FTC) secured the agreement, claiming Epic Games violated the Children’s Online Privacy Protection Act (COPPA) and deployed design tricks, known as dark patterns, to dupe millions of players into making unintentional purchases.
There are actually two settlements that total $520 million in payments. As a result of the first agreement, Epic will pay $275 million for violating the COPPA Rule, the largest penalty ever obtained for violating an FTC rule. In a first-of-its-kind provision, Epic will also be required to adopt strong privacy default settings for children and teens, ensuring that voice and text communications are turned off by default.
$245 million will go to consumers
Under the second agreement, the company will pay $245 million to refund consumers for its dark patterns and billing practices, which the FTC says is the largest refund amount it has secured in a video game case.
"As our complaints note, Epic used privacy-invasive default settings and deceptive interfaces that tricked Fortnite users, including teenagers and children," said FTC Chair Lina M. Khan. "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.”
The Fortnite video game is generally free to download and play but charges users for certain things within the game. The game reportedly has more than 400 million users worldwide.
According to Gamequitters.com, a site for parents, Fortnite is highly addictive for young people.
“Fortnite (and video games at large) are designed by people with PhD’s in human psychology,” the site declares. “Games use state-of-the-art behavioral psychology to intentionally keep you hooked and increasingly… to spend more money. The gaming industry describes this as making a game engaging and immersive, but what this really means is that Fortnite addiction is by design and changes the brain.”
Here’s who is eligible
The FTC explains in detail which consumers can get refunds and who is eligible. In short, the agency says refunds will be available to:
Parents whose children made an unauthorized credit card purchase in the Epic Games Store between January 2017 and November 2018
Fortnite players who were charged in-game currency (V-Bucks) for unwanted in-game items (such as cosmetics, llamas, or battle passes) between January 2017 and September 2022
Fortnite players whose accounts were locked between January 2017 and September 2022 after disputing unauthorized charges with their credit card companies.
The FTC said it is still in the process of setting up the refund system and will announce the specifics when plans are finalized.