OpenX Technologies recently agreed to pay $2 million to settle FTC allegations that the advertising platform violated the FTC Act and the Children’s Online Privacy Protection Act. OpenX runs a programmatic ad exchange, running a bidding platform that auctions online ad space. The company contracts with publishers who have open ad space as well as ad networks with inventories of ads they are seeking to publish online.
In addition to the monetary penalty, OpenX has agreed to delete all data that it collected in violation of the COPPA Rule. OpenX has also agreed to implement a comprehensive privacy program to ensure COPPA compliance.
Putting it into Practice: This case serves as a reminder that the FTC will look closely at companies’ underlying technologies and practices when determining privacy compliance, including whether companies are adhering to their stated privacy notice. (In other words, not doing anything the FTC might consider a deceptive practice.) This case is also a reminder that the FTC takes the perspective that the serving of targeted advertising in many circumstances involves the collection of personal information.