November 8, 2012

Facebook to answer for allowing kids to pay

Facebook may be facing a lawsuit for letting children rack up charges on their parents’ credit cards which they thought were virtual, game-related tokens.

The mothers of two children have filed a class action suit. Glynis Bohannon and Julie Wright were both victims of large-scale credit card charges imposed by Facebook after their children, referred to in the complaint as “I.B.” and “J.W.”, played games on the social media network that they thought had no actual cost.

Julie Wright says her child bought more than $1,000 in Facebook credits, which he thought were virtual. By the time the woman noticed the charges on her debit card, which she shares with her husband, the large sum had already been spent and Facebook refused to reimburse it. The Wright child had taken the card without parental permission for one-time use, and Facebook had stored the debit card information. With the click of a button, the child was able to keep racking up charges.

Bohannon, on the other hand, had let her child use her credit card on a one-time basis in exchange for twenty dollars cash. What neither she nor her child knew was that the social media site stored her credit card information and charged her card every time her child made in-game purchases, which he didn’t know were charging her card.

“Without any notice that his mother’s credit card information had been stored by Facebook and the Facebook Credits system, or that his mother’s credit card information was being used again after the initial twenty dollar purchase, I.D. made in-game purchases for which the thought he was spending virtual, in-game currency,” the lawsuit states.

Bohannon’s credit card was repeatedly charged without her consent until the cost totaled $700. Facebook did not respond to her requests for a refund.

The two mothers have already filed two complaints. US District Judge Claudia Wilken on Thursday dismissed claims from the second complaint in which the parents requested to have their children’s Facebook contracts voided.

The California Family Code restricts minors from making a contract that deals with personal property that the minor does not own – like bank accounts. Under the code, minors are able to disaffirm from such contracts that they may have entered.

Facebook had violated public policy protecting minors by writing in their Facebook Credits contract that “all sales are final”. If Facebook had been following the code, minors would have the right to void those contracts.

Still, the judge requested more details before being able to proceed with the lawsuit.

“Plaintiffs cite the statutory definition of ‘unauthorized electronic funds transfer’ but do not identify a particular provision of the EFTA that has allegedly been violated,” Wilken wrote. “Because the [Second Amended Complaint] fails to allege a violation of any specific provision of the EFTA, and amendment does not appear to be futile, the motion to dismiss the EFTA claim is granted with leave to amend.”

The two mothers have until Nov. 15 to file a third complaint.

rt.com

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