Penalty Amount
$20,000,000
The FTC settled with Cognosphere LLC, developer of Genshin Impact, for violating COPPA by collecting personal information from children without parental consent and for deceptive practices regarding in-game loot box purchases. The company will pay $20 million in penalties and is banned from selling loot boxes to children under 16 without verifiable parental consent.
Cognosphere LLC must pay $20 million in civil penalties, is permanently enjoined from selling loot boxes to children under 16 without verifiable parental consent, and must implement a comprehensive privacy program to comply with COPPA.
In-house legal teams should review all customer-facing agreements (Terms of Service, End User License Agreements), vendor contracts involving data processing or analytics for child-directed services, and any data processing addendums. Specific clauses to scrutinize include those governing consent mechanisms (especially for users under 13 and 13-16), data collection from minors, in-game purchase and loot box mechanics, disclosure of odds for virtual items, and age verification procedures. Changes will likely be needed to implement robust, verifiable parental consent flows, restrict or prohibit loot box purchases for users under 16, provide clear and conspicuous odds disclosures, and establish enforceable age-gating and transaction limit systems to comply with COPPA and prevent deceptive practices.
Entity
COGNOSPHERE LLC
Also known as: Cognosphere
Industry
GamingOfficial Press Release
https://www.ftc.gov/legal-library/browse/cases-proceedings/222-3152-cognosphere-llc-us-v
cognosphere complaint
https://www.ftc.gov/system/files/ftc_gov/pdf/cognosphere_complaint.pdf
cognosphere stiporder
https://www.ftc.gov/system/files/ftc_gov/pdf/cognosphere_stiporder.pdf
Cognosphere Attachment3 2
https://www.ftc.gov/system/files/ftc_gov/pdf/Cognosphere-Attachment3-2.pdf
Cognosphere Attachment3 3
https://www.ftc.gov/system/files/ftc_gov/pdf/Cognosphere-Attachment3-3.pdf
Cognosphere Attachment3 4
https://www.ftc.gov/system/files/ftc_gov/pdf/Cognosphere-Attachment3-4.pdf
cognospherea
https://www.ftc.gov/system/files/ftc_gov/pdf/cognospherea.pdf
Federal Trade Commission Enforcement Page
https://www.ftc.gov/enforcement
"COGNOSPHERE LLC"
"$20 million"
"Children's Online Privacy Protection Act (COPPA)"
"violated a children’s privacy law and deceived children and other users about the real costs of in-game transactions and odds of obtaining rare prizes."
$750K
The FTC finalized an order against Vanilla Chip LLC (doing business as TruHeight) and its principals for deceptively advertising height-enhancing supplements for children and teens without scientific evidence. The company also used fake reviews and incentivized 5-star ratings. The order requires a $750,000 payment and prohibits false health claims and deceptive review practices.
$2.3M
The FTC alleged that RentGrow, a tenant screening company, violated the Fair Credit Reporting Act (FCRA) by failing to use reasonable procedures to ensure the accuracy of its reports, including by reporting duplicate records and failing to disclose data sources. RentGrow agreed to pay a $2.25 million penalty and is prohibited from further FCRA violations and from misrepresenting dispute outcomes.
The FTC and New York Attorney General took action against Handy Technologies for deceptive earnings claims and failure to disclose fees and fines that led to millions of dollars being withheld from workers' wages. The FTC is sending over $2.7 million in refunds to 62,893 affected consumers.
$35.0M
The FTC alleged that Hopper, a travel booking app, charged consumers hidden and pre-selected fees (Tip and VIP Support) without their consent, misrepresented the benefits of VIP Support and Price Freeze services, and failed to clearly disclose total prices. Hopper agreed to pay $35 million for consumer redress and is prohibited from misrepresenting fees under a proposed order.
$1.5M
The FTC finalized a settlement with Publishing.com LLC and its principals for misleading consumers about potential earnings from self-publishing products. The company will pay $1.5 million and is prohibited from making unsubstantiated earnings claims, failing to disclose refund terms, and misrepresenting endorsements and reviews.
The FTC is seeking public comment on a proposed policy statement addressing concerns that AI companies may be manipulating AI system outputs contrary to consumer expectations for objectivity and accuracy. The statement explains that such conduct could be considered deceptive under Section 5 of the FTC Act. The public comment period runs until July 31, 2026.