'Grand Theft Auto' makers settle with FTC

Government says agreement forces video game's publishers to follow labeling rules strictly or face steep fines.

Daniel Terdiman Former Senior Writer / News
Daniel Terdiman is a senior writer at CNET News covering Twitter, Net culture, and everything in between.
Daniel Terdiman
2 min read
The makers of "Grand Theft Auto: San Andreas" reached a settlement Thursday with the Federal Trade Commission after the government agency spent months investigating sexually themed content that was hidden in the popular video game.

At the request of several members of Congress, including New York Democratic Sen. Hillary Clinton, the FTC's department of consumer protection had been looking into the so-called "Hot Coffee" scandal, in which easily downloadable software could be used to unlock adult content from the mature-rated game, one of the best-selling of 2004 and 2005 for the PC, PlayStation 2 and Xbox consoles.

Games with the Entertainment Software Ratings Board's "M," or mature, rating are intended for consumers aged 17 and up, while the "Grand Theft Auto" content that could be unlocked was determined by the ESRB to require an "Adults Only," or "AO" rating.

When the scandal broke in July 2005, the game's publishers, New York-based Take-Two Interactive Software and Rockstar Games, agreed to change the rating to AO and subsequently incurred $24.5 million in costs due to returns of the game, the FTC said in a statement.

Under the terms of Thursday's settlement with the FTC, Take-Two and Rockstar Games agreed to "clearly and prominently disclose on product packaging and in any promotion or advertisement...content relevant to the rating." Any violations would mean hefty fines.

In other words, the publishers agreed to never again misrepresent the content in its games in order to seek a lower age-appropriate rating.

"Parents have the right to rely on the accuracy of the entertainment rating system," Lydia Parnes, director of the FTC's bureau of consumer protection, said in the Thursday statement. "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 (FTC), and if they violate this order, they can be heavily fined."

Under the consent agreement, the statement said, the publishers also agreed to create and maintain a "comprehensive system reasonably designed to ensure that all content in an electronic game is considered and reviewed in preparing submissions to a rating authority."

Take-Two and Rockstar would incur fines of $11,000 per violation if they were found to be hiding adult content in future games, according to the agreement.

FTC Commissioners voted 5-0 to accept the consent agreement. The public will have 30 days to comment on its terms, after which the agency will vote whether to make it final.

Take-Two could not be immediately reached for comment.

Last month, Take-Two had another one of its games, "The Elder Scrolls IV: Oblivion," rerated by the ESRB. The ratings board changed the rating from "Teen" to "Mature" after it determined that Take-Two played down the level of violence in the game and the inclusion of a topless woman accessible with a third-party modification like "Hot Coffee."

Ironically, the announcement of the agreement came on the same day that the first Sex in Video Games conference was set to begin, in San Francisco.