FTC Rules on Hot Coffee

In a long-awaited ruling, the Federal Trade Commission has found that the companies behind Grand Theft Auto San Andreas engaged in deceptive marketing practices.

The FTC issued a press release this morning, wrapping up a 10-month investigation into the so-called "Hot Coffee" scandal.

Although the FTC concluded that Take-Two and Rockstar used deceptive marketing practices by not revealing that hidden sex animations were on the GTA San Andreas disc, the proposed penalty was quite moderate, at least in economic terms. The ruling is a blow, however, to the public image of both companies as well as the video game industry.

Under terms of a proposed consent decree, the FTC will require Take-Two and Rockstar going forward to clearly disclose all content relevant to a game's rating on its packaging. The companies must also set up a content review system to spare the gaming public additional servings of Hot Coffee. Finally, the companies agreed that they would be subject to fines of up to $11,000 per game sold if they commit such violations in the future.

Essentially, the FTC is saying, "Don't do it again."

Commission members accepted the proposed agreement by a 5-0 vote. The public may comment on the decision, which will be finalized in 30 days. The FTC investigation was requested last year by Congress as well as Sen. Hillary Clinton (D-NY).

Speaking of the investigation, Lydia Parnes, Director of the FTC's Bureau of Consumer Protection, said, "We allege that Take-Two and Rockstar's actions undermined the industry's own rating system and deceived consumers. This is a matter of serious concern to the Commission, and if they violate this order, they can be heavily fined."

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