Penalty Amount
$500,000
The FTC took action against CafePress for failing to secure consumer data and covering up a major data breach. The company stored sensitive information insecurely and delayed notifying customers. As part of the settlement, Residual Pumpkin must pay $500,000 in redress, and both companies must implement comprehensive security programs.
The settlement requires Residual Pumpkin to pay $500,000 to compensate affected small businesses. Both companies must implement comprehensive information security programs, including multi-factor authentication and data minimization. They must also notify affected consumers and undergo third-party security assessments.
In-house legal teams should review all agreements involving the handling of consumer or small business data, including vendor contracts (especially IT/cloud service providers), customer terms of service, and data processing addendums. Focus on clauses governing data security obligations, breach notification timelines (including requirements to notify customers and regulators), data storage/encryption standards, audit rights to verify security practices, and indemnification provisions for data breaches. Given the FTC's order requiring specific controls like multi-factor authentication and comprehensive security programs, contracts may need amendments to mandate these technical safeguards, establish regular security assessments, clarify redress mechanisms for affected parties, and potentially adjust liability caps to reflect heightened security responsibilities.
Entity
Residual Pumpkin Entity, LLC and PlanetArt, LLC
Also known as: CafePress
Industry
TechnologyOfficial Press Release
https://www.ftc.gov/news-events/news/press-releases/2022/03/ftc-takes-action-against-cafepress-data-breach-cover
CafePress Complaint 0
https://www.ftc.gov/system/files/ftc_gov/pdf/CafePress-Complaint_0.pdf
Residual Pumpkin Agreement Containing Consent Order
https://www.ftc.gov/system/files/ftc_gov/pdf/Residual%20Pumpkin%20Agreement%20Containing%20Consent%20Order.pdf
PlanetArt Agreement to Containing Consent Order 0
https://www.ftc.gov/system/files/ftc_gov/pdf/PlanetArt%20Agreement%20to%20Containing%20Consent%20Order_0.pdf
Federal Trade Commission Enforcement Page
https://www.ftc.gov/enforcement
"Residual Pumpkin Entity, LLC, the former owner of CafePress, and PlanetArt, LLC, which bought CafePress in 2020"
"Residual Pumpkin to pay $500,000 in redress to victims of the data breaches"
"CafePress employed careless security practices and concealed multiple breaches from consumers."
$500K
The FTC settled with CafePress's former owner Residual Pumpkin Entity, LLC and buyer PlanetArt, LLC over data security failures that led to a breach exposing Social Security numbers and other sensitive data. Residual Pumpkin paid $500,000 for victim compensation, and both companies must implement comprehensive security programs. A claims process is open for affected consumers until March 10, 2024.
The FTC filed a complaint alleging that GovAssist LLC, Entry LLC, and Scott Zuckerman used deceptive paid search ads, misleading service and pricing claims, and fake reviews to deceive consumers seeking passport services. The complaint alleges violations of the FTC Act, the Impersonation Rule, and the Gramm-Leach-Bliley Act; the case will be decided by the court, and no penalty or remedy is reported as imposed.
The FTC issued its annual report to Congress describing fraud trends affecting older adults and the agency’s enforcement, education, and outreach efforts. The report is not a specific privacy enforcement action and announces no penalty or remedy.
The FTC referred a complaint against REPS & Company Inc. and company executives, alleging they bypassed ticket-issuer security controls and purchasing limits to acquire millions of tickets for resale. The complaint was filed by the Department of Justice, and the case will be decided by the court; the press release does not report a penalty or other remedy imposed.
$106.8M
A federal court entered a $106.8 million default judgment against corporate defendants in an alleged debt-relief scheme that impersonated banks and government entities and targeted seniors and veterans. The judgment permanently bans the defendants from the debt-relief industry and imposes additional prohibitions, including on impersonation, telemarketing, and misrepresentations.
The FTC sued Digital Forensics Corporation LLC and affiliated defendants, alleging they misled sextortion victims with promises of investigative and monitoring services that often were not provided, and used fake positive reviews. A federal court granted the FTC’s request to temporarily halt the defendants’ activities; the complaint remains for the court to decide.