$10 Million and a Court Order: Disney's Children's Privacy Settlement

The Walt Disney Company agreed to pay $10 million to settle Federal Trade Commission charges announced September 2, 2025, that it violated the Children's Online Privacy Protection Act by allowing personal information to be collected from children who viewed kid-directed videos on YouTube, without notifying parents or obtaining the verifiable parental consent the law requires.DOCUMENTED

A federal judge approved the settlement order in December 2025, resolving a complaint filed by the Department of Justice on the FTC's behalf in the U.S. District Court for the Central District of California.DOCUMENTED

How YouTube's child-labeling system works

Under the FTC's 2019 settlement with YouTube's parent company Google, the platform requires channel owners and individual video uploaders to designate content as "made for kids" whenever it is primarily directed at children. That label triggers a set of protections required under COPPA: platforms and advertisers must disable behavioral ad-targeting, and cannot collect certain kinds of persistent identifiers, for anyone viewing that content, without the platform first verifying the viewer is an adult or obtaining parental consent.DOCUMENTED

According to the FTC's complaint, Disney managed hundreds of YouTube channels featuring characters and franchises squarely aimed at children, including through brands like Disney Junior and various Pixar- and Marvel-branded children's content channels. The complaint alleges that rather than reviewing individual videos to determine whether each one should be labeled as directed at children, Disney frequently relied on a channel-level, rather than video-level, designation process that allowed content clearly aimed at kids to be mislabeled as intended for a general audience.DOCUMENTED

What that mislabeling allowed to happen

Because mislabeled videos were treated by YouTube's systems as general-audience content, the FTC alleges that third-party advertising networks were able to collect personal information, including persistent identifiers used to track viewing habits over time, from children who watched those videos — the exact outcome COPPA's video-labeling and consent requirements are designed to prevent.DOCUMENTED

The FTC's complaint further alleges that Disney had specific knowledge that certain of its channels contained a substantial amount of child-directed content, based on internal reviews and its own understanding of the audience for franchises like children's animated series, yet the company continued to designate at least some of those channels and their videos in ways that permitted ad-targeting and data collection to continue unchecked.DOCUMENTED

The settlement's terms

Beyond the $10 million civil penalty, the settlement order requires Disney to establish a video-review program specifically designed to correctly designate future YouTube content as child-directed when appropriate, and to comply with COPPA's notice and parental-consent requirements for any video found to be aimed at children going forward. The order was approved by a federal judge in December 2025, formalizing the terms the FTC and Disney had reached months earlier.DOCUMENTED

In a statement accompanying the settlement, three sitting FTC Commissioners — Chairman Andrew Ferguson, joined by Commissioners Melissa Holyoak and Mark Meador — emphasized the Commission's broader posture on children's privacy enforcement, framing the Disney case as consistent with the agency's stated priority of holding major platforms and content owners accountable for how they handle data collected from young viewers.DOCUMENTED

Part of a broader children's privacy push

The Disney settlement arrived amid a wider wave of FTC activity on children's online privacy, including amendments to the COPPA Rule finalized in April 2025 that expanded requirements for operators collecting children's personal information, with a compliance deadline of April 22, 2026 for most provisions. The FTC has separately held public workshops examining age-verification technologies and has signaled that children's privacy and online safety will remain a central enforcement priority through 2026, according to statements from the agency's Associate Director for its Division of Privacy and Identity Protection.DOCUMENTED

For a company the size of Disney, whose media empire spans dozens of children's entertainment brands across broadcast, streaming, and social platforms, the case illustrates a specific and recurring compliance risk: even a policy of designating content by channel rather than by individual video can create gaps large enough for regulators to treat as a systemic COPPA violation, regardless of a company's overall intent to protect young viewers.REVIEWED

The case also reinforces a broader pattern in COPPA enforcement, in which the FTC has increasingly focused not on standalone kids' apps and websites but on how mainstream entertainment and technology companies manage child-directed content within larger platforms they do not fully control, placing the compliance burden on content owners to correctly flag their own material rather than relying solely on the hosting platform's own classification systems.REVIEWED

The case also illustrates a structural tension in how large media companies manage compliance across sprawling catalogs of third-party-hosted content: a channel-level review process is inherently less precise than a video-level one, yet reviewing every individual upload across hundreds of channels demands far more sustained compliance resources than most companies are willing to commit absent a specific regulatory trigger. Disney's $10 million penalty, modest relative to the company's overall size, functions less as a meaningful financial deterrent and more as a public marker establishing that channel-level designation practices, on their own, do not satisfy COPPA's video-specific labeling expectations.REVIEWED

The FTC's own record of returning to the same company for repeat COPPA violations — YouTube's parent Google previously paid $170 million in 2019 over similar allegations — suggests regulators view video-hosting platforms and major content owners as sharing responsibility for correct child-directed labeling, rather than treating the platform's own classification system as a complete defense for content owners who upload material to it.REVIEWED

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