Consumer Watchdog Calls On Federal Trade Commission To Act Against Google's App Store Privacy Violations; Says Penalties Should Be In Billions of Dollars

Public Interest Group Also Asks California Attorney General to Investigate

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SANTA MONICA, Calif., Feb. 25, 2013 /PRNewswire-USNewswire/ -- Consumer Watchdog today called on the Federal Trade Commission to act immediately against Google's most recent privacy violation – sharing users' personal information with apps developers – and said the penalties for violating a previous consent order should reach into the billions of dollars.

Consumer Watchdog also asked California Attorney General Kamala Harris to investigate whether Google's privacy breach also violates California law in addition to violating the so-called "Buzz Consent Order" with the FTC.

"Google has become a serial privacy abuser and the FTC must change its tactics to curb the Internet giant's abuses. Google's wanton disregard for its obligations under the law demonstrate the need for meaningful penalties – in this case a fine in the billions of dollars," said John M. Simpson, Consumer Watchdog's Privacy Project director, at a news conference to discuss the nonprofit, nonpartisan public interest group's complaint.

In a seven-page formal letter of complaint to Charles A. Harwood, the FTC's Acting Director of the Bureau of Consumer Protection, Simpson, wrote:

"To no one's surprise (and the Commission's prior statements notwithstanding), the press is now awash in reports that Google has violated the Buzz Order yet again – and this time in a most substantive and egregious manner, by giving personal and closely held information from tens (if not hundreds) of millions of Android users to independent and unrestrained application developers, in contravention of Google's own stated privacy policy (as well as its obligations under the Buzz Order).  This represents the fifth significant misuse of confidential user data by Google in the last three years (previously, the "Wi-Spy" scandal, the Google Buzz fiasco, Google's improper combining and use of personal data, and the Safari Hacking episode)."

Read Consumer Watchdog's letter to the FTC here: http://www.consumerwatchdog.org/resources/ltrftc022513.pdf

Consumer Watchdog's letter said Google had been sending to app developers personal information about each user who purchased an app from Google, without obtaining the user's permission. The personal information sent by Google included the users' names, certain physical address information and email addresses. Neither Apple nor Microsoft had engaged in similar conduct.  Consumer Watchdog's letter warned:

"Google's conduct constitutes a most serious breach of user privacy.  Google Play apps deal with sensitive personal subjects, including health conditions and sexual activity.  By disclosing personal user information to app developers, Google enables the identification of people who downloaded apps such as:

• "Depression App Counselor:  an app designed to help people suffering from depression to manage their symptoms.
• "Pregnancy+:  an app for expectant parents.
• "Heart Disease:  an app for people concerned that they are at risk of heart disorders.
• "Utoopi:  a former app (now removed) 'used for the purposes of advertising, soliciting and recruiting sex workers.'

"Many Google app developers are young people.  Google's disclosure of personal user information to these developers makes it possible for them to further disseminate the information.  App developers can, for example, sell lists of customers to marketing services and data brokers – who will, in turn, sell the information to others."

Consumer Watchdog's letter noted that the group had gone to court to block the FTC's $22.5 million settlement with Google in the "Safari Hacking episode" because it "was inadequate to deter future Google violations of the Buzz Order because the settlement lacked a court injunction proscribing future violations, contained an express denial of liability by Google, and imposed a manifestly inadequate civil penalty."

Consumer Watchdog said now that Google has once again breached the Buzz Consent Order, the FTC must use new tactics.

"The strategy of initiating enforcement procedures by proposing a settlement followed by secret negotiations and a toothless decree has brought the Commission little beyond public condemnation.  And consumers have not been protected adequately by the Commission's enforcement actions," the letter said.  "We suggest, this time around, that the Commission begin its enforcement procedure by assigning a team of trial litigators – people who can actually conduct a trial – to the latest Google transgression and that these lawyers actually bring suit in federal court against Google for the latest violation of the Buzz Order.  The complaint should seek injunctive relief sufficient to enforce compliance to the Buzz Order through contempt actions, as well as an appropriate civil penalty – which, as we explain below, will run into the billions of dollars."

The law provides a penalty of $16,000 per violation.  Millions of apps have been purchased and downloaded.  "Calculating the amount of the penalty is a simple matter of multiplication.  The number is enormous (in the billions of dollars), and only a penalty of that magnitude will deter Google from future violation of the Buzz Order," Consumer Watchdog's letter said.

The letter recapped Google's privacy violations over the last three years including the Wi-Spy scandal, the Buzz fiasco, Google's improper combining data across services without consent and the Safari Hacking episode.  The letter spelled out how the FTC's actions and tactics have proved inadequate in an attempt to thwart Google's abuses against privacy.

Gary Reback, an attorney with Carr & Ferrel, in Menlo Park, CA., assisted Consumer Watchdog in preparing its formal complaint to the FTC.

Read Consumer Watchdog's letter to the FTC here: http://www.consumerwatchdog.org/resources/ltrftc022513.pdf

Visit our website at www.consumerwatchdog.org

SOURCE Consumer Watchdog