(CN) — Google must face a purported class-action lawsuit by children who claimed they were tracked and profiled for targeted ads without their parents' consent while watching YouTube videos.
The Ninth Circuit Court of Appeals on Wednesday reversed a judge's dismissal of the children's claims brought under various state laws because, the appellate panel said, the judge had wrongly concluded that these claims were preempted by federal law.
Although the U.S. Children’s Online Privacy Protection Act, or COPPA, which prohibits the use of so-called persistent identifiers to collect data from children and track their online behavior without their parents' permission, includes a preemption clause that bars liability under state laws that are inconsistent with the treatment of violations under the federal statute, it doesn't preclude supplemental claims, the panel said.
"Since the bar on 'inconsistent' state laws implicitly preserves 'consistent' state substantive laws, it would be nonsensical to assume Congress intended to simultaneously preclude all state remedies for violations of those laws," Circuit Judge M. Margaret McKeown, a Bill Clinton appointee, wrote in the unanimous decision.
Google and YouTube agreed to pay $170 million three years ago in a settlement with the Federal Trade Commission and the State of New York over similar allegations that they violated child-privacy laws by collecting personal information from children without getting their parents' consent.
The FTC and New York accused Google and YouTube of violating a federal regulation created under the COPPA, which requires companies that run websites targeted at children under the age of 13 to get parental consent before collecting personal information used to track users and target advertisements.
The case before the Ninth Circuit was filed in 2019 by children, through their guardians, against Google, YouTube and various large providers of children shows, such as the Cartoon Network, that have their own YouTube channels and that allegedly ran targeted ads based on Google's use of "persistent identifiers" for which they get more money from Google than for ads based solely on key words.
Google uses these persistent identifiers, such as an IP address or a device's unique IMEI number, to track individuals' behavior over as much as 80% of the internet to create profiles that are used to provide targeted ads.
"User profiles such as those developed by Google have been called the 'holy grail' of advertising and allow Google to charge advertisers increased advertising rates," according to the children's lawsuit.
They alleged that until their settlement with the FTC and New York, Google and YouTube tried to circumvent the COPPA requirements by falsely denying that they were marketing the YouTube platform to children and that children utilized the YouTube platform, "despite knowing that the YouTube child-directed channels were intentionally designed to appeal to children and that the YouTube Platform was a top attraction for children viewing its content."
The children seek damages and injunctive relief under California, Colorado, Indiana, Massachusetts, New Jersey, and Tennessee state laws but not under the federal statute.
Representatives of Google didn't immediately respond to a request for comment on the ruling.
The two other judges on the Ninth Circuit panel were Circuit Judges Michael Daly Hawkins, also a Bill Clinton appointee, and Gabriel Sanchez, a Joe Biden appointee.
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