Everything You Need to Know About the FTC’s ‘Record-Breaking’ Epic Games Fortnite Settlement [UPDATE]

The Federal Trade Commission (FTC) this week announced that it locked in two “record-breaking” settlements totaling $520 million with Fortnite maker Epic Games over violations of a federal children’s privacy law and its use of “dark patterns” to trick players into making unintentional purchases.

While more than half of the money will go to the U.S. Treasury as a monetary penalty, consumers are set to receive $245 million in refunds. Read on to learn who’s eligible for a Fortnite refund, when and how you can get some cash, and more on the FTC’s complaints against Epic Games.

Who’s eligible for a Fortnite refund?

According to the FTC’s website, the agency plans to make Fortnite refunds available to:

How do I get a Fortnite refund?

The FTC says that if you believe you’re eligible for a refund, there’s nothing you need to do right now. When more information is available, parents and players who paid for in-game Fortnite purchases, or whose accounts were locked, during the time periods highlighted above will be sent direct notice of the settlement via email.

“When we have more information about the refund program, we will post updates here and send email notices to customers who paid for in-game purchases,” the FTC website reads.

Crucially, the agency urges consumers to remember that the FTC will never ask them to pay to file a claim or get a refund and to be on alert for possible scammers.

“Don’t pay anyone who promises you an FTC refund in exchange for a fee,” the FTC stresses.

How can I keep track of when refunds will be sent?

The FTC suggests that consumers bookmark FTC.gov/Fortnite on their web browser and check back often with the page for updates on when refunds will be sent out. Consumers can also sign up for FTC email updates about the refund program here.

Is the Fortnite settlement real?

Yes. We assure you that the FTC’s Fortnite settlement is legit and not a scam. You can read all about it on the FTC’s official website here.

What’s all this about?

On December 19, the FTC shared that it had secured agreements that required Fortnite creator Epic Games to pay $520 million in relief over alleged violations of the federal Children’s Online Privacy Protection Act (COPPA) and the company’s supposed use of “dark patterns” to trick gamers into making in-game purchases of unwanted items.

More specifically, the FTC’s action against Epic Games involves two separate settlements. For the alleged COPPA violations, Epic will pay a $275 million monetary penalty, the largest ever for violating an FTC rule, for allegedly collecting personal information from children under 13 without notifying their parents or obtaining verifiable parental consent. The video game house also allegedly enabled real-time voice and text chat communications for children and teens by default, allowing young people to communicate with strangers and encounter bullying, threats, harassment and other psychological trauma.

According to the complaint, Epic was urged by employees shortly after Fortnite’s launch in 2017 to change the game’s default settings and put in place “basic toxicity prevention” measures; this namely involved requiring players to opt in for the voice chat feature, the suit relays. Despite this—and reports of children having been harassed while playing Fortnite—Epic left voice chat turned on by default for Fortnite for years. When the company eventually did address its problematic default settings, Epic “made it difficult for users to find” the button to turn off voice chat, the FTC said.

In addition to the monetary penalty, Epic must adopt “strong privacy default settings” for children and teens “by ensuring that voice and text communications are turned off by default.” Epic must also delete all personal information associated with any Fortnite user under the age of 13 unless consent has been provided; implement a “comprehensive privacy program” that protects players’ sensitive personal, financial and biometric information; and obtain independent reviews of its privacy program every two years, FTC documents state.

Under a separate proposed order, Epic will refund consumers $245 million (the largest ever in a gaming case) for allegedly using dark patterns—tactics that can subtly trick users into doing something they didn’t intend to do—and charging account holders without authorization.  

The FTC alleged that the dark patterns wielded by Epic Games were specifically designed to get consumers to make unintended purchases while playing Fortnite. In particular, Fortnite’s “counterintuitive, inconsistent, and confusing button configuration” caused players to rack up unwanted charges with the push of only a single button, the FTC claimed.

For example, players could be charged while attempting to wake the game from sleep mode, while the game was in a loading screen, or by pressing an adjacent button while attempting simply to preview an item. These tactics led to hundreds of millions of dollars in unauthorized charges for consumers.”

According to the FTC complaint, Epic allowed children to acquire V-Bucks “simply by pressing buttons with no parental or card holder action or consent.” This meant Epic did not require parents to enter a PIN or password to authorize in-game purchases, much less “allow them to enable such control,” the FTC said. As a result, some parents incurred hefty credit card charges before they even realized Epic had charged them without their knowledge or consent.

The FTC also claimed Epic denied consumers access to their Fortnite accounts as a penalty for disputing these unauthorized credit card charges and requesting a chargeback, “regardless of the reason for the dispute or whether it was upheld.” According to the complaint, Epic has received “tens of thousands” of chargebacks since July 2017, totaling millions of dollars, leading Visa and Mastercard to place Epic in their respective chargeback monitoring programs, “threatening Epic’s ability to process consumer payments through the networks going forward.”

Consumers whose accounts were locked lost access to everything they purchased, the FTC said. Even when Epic unlocked an account, it threatened that a player could be banned for life if they disputed any charges in the future, the complaint alleged.

The FTC alleged that Epic received and ignored “at least thousands” of complaints from consumers who were locked out of their accounts, and likewise did nothing with regard to employee concerns about masses of people being charged without authorization. What Epic did to address these issues “only made the problem worse,” the FTC said, as the company “purposefully obscured cancel and refund features” to make them harder to locate.

In addition to providing monetary refunds, Epic is prohibited from charging consumers by way of dark patterns, or otherwise charging their accounts without obtaining affirmative authorization. The video game company is also barred from blocking consumers from accessing their accounts for disputing unauthorized charges. Epic must also provide accountholders with a simple mechanism by which they can revoke consent to be charged for in-game Fortnite purchases at any time, among other injunctive measures.

Was this a class action?

No, the FTC settlements detailed on this page were not the result of a class action lawsuit.

A class action typically involves one plaintiff (or multiple plaintiffs) filing a lawsuit on behalf of a larger group of people who’ve all allegedly experienced similar harm or damages. For the deals detailed here, the FTC, the federal agency tasked with protecting the public from deceptive or unfair business practices and promoting competition, filed its own complaints against Epic Games. According to its website, the FTC issues what’s called a complaint against a company or individual when it has “reason to believe” that a law has been or is being violated.

The FTC, like the Consumer Financial Protection Bureau, is one of the federal agencies authorized to pursue enforcement actions against companies or individuals over alleged violations of the law. For some actions brought by the FTC or CFPB, consumers may stand to receive a refund if the case is successful.

A complete list of recent FTC cases that have resulted in refunds for consumers can be found here. To learn more about the FTC’s process for issuing refunds, head to this page.

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