In a first-of-its-kind settlement with the Federal Trade Commission, Apple. Inc. has agreed to pay out $32.5 million in refunds to parents who say they were not properly informed that their children could buy things in iPad and iPhone games without their knowledge. This follows on a previous class-action lawsuit brought by parents several years back, some of whose children racked up thousand-dollar bills buying "Smurfberries" in a game called Smurf’s Village.

As the Washington Post reports, Apple and the FTC started getting complaints in 2011 over games like Tap Pet Hotel and Smurf’s Village, and lawyers in the eventual class-action argued that Apple had unfairly and deceptively changed a purchasing policy in their iOS that allowed users 15 minutes of unlimited in-app purchases after a password was entered. The games have various currencies and boosts in them ranging in price from 99 cents to $500, and a lot of kids, and their parents, got swindled in the process.

The bigger question is: Why should app-makers be allowed to design games with in-app purchases at all when those games are geared toward children?

Apple addressed the parental-control problem back in March 2011, scrapping that 15-minute window, and they settled the class-action suit for an undisclosed sum, saying that they've received 37,000 claims for full refunds and paid them all out.

In an email to employees yesterday, CEO Tim Cook sounded pissy about the fact that the FTC has come after them as well. "It smacked of double jeopardy,” Cook wrote. “However, the consent decree the FTC proposed does not require us to do anything we weren’t already going to do, so we decided to accept it rather than take on a long and distracting legal fight." In a separate statement, an Apple spokesman says the $32.5 million settlement simply "extends our existing refund program for in-app purchases."

Now does anyone want to start a class-action suit with me claiming we should not be allowed to purchase five extra moves in Candy Crush when drunk? I feel I'm owed a refund for the lack of a "drunk-lock" in that game.

[WP]
[SF Biz Times]