Zynga 2011 Annual Report Download - page 22

Table of Contents
We process, store and use personal information and other data, which subjects us to governmental regulation and other legal obligations
related to privacy, and our actual or perceived failure to comply with such obligations could harm our business.
We receive, store and process personal information and other player data, and we enable our players to share their personal information
with each other and with third parties, including on the Internet and mobile platforms. There are numerous federal, state and local laws around
the world regarding privacy and the storing, sharing, use, processing, disclosure and protection of personal information and other player data on
the Internet and mobile platforms, the scope of which are changing, subject to differing interpretations, and may be inconsistent between
countries or conflict with other rules. We generally comply with industry standards and are subject to the terms of our own privacy policies and
privacy-related obligations to third parties (including voluntary third-party certification bodies such as TRUSTe). We strive to comply with all
applicable laws, policies, legal obligations and certain industry codes of conduct relating to privacy and data protection, to the extent reasonably
attainable. However, it is possible that these obligations may be interpreted and applied in a manner that is inconsistent from one jurisdiction to
another and may conflict with other rules or our practices. Any failure or perceived failure by us to comply with our privacy policies, our
privacy-related obligations to players or other third parties, or our privacy-related legal obligations, or any compromise of security that results in
the unauthorized release or transfer of personally identifiable information or other player data, may result in governmental enforcement actions,
litigation or public statements against us by consumer advocacy groups or others and could cause our players to lose trust in us, which could
have an adverse effect on our business. Additionally, if third parties we work with, such as players, vendors or developers, violate applicable
laws or our policies, such violations may also put our players’ information at risk and could in turn have an adverse effect on our business.
In the area of information security and data protection, many states have passed laws requiring notification to players when there is a
security breach for personal data, such as the 2002 amendment to California’s Information Practices Act, or requiring the adoption of minimum
information security standards that are often vaguely defined and difficult to practically implement. The costs of compliance with these laws may
increase in the future as a result of changes in interpretation. Furthermore, any failure on our part to comply with these laws may subject us to
significant liabilities.
Our business is subject to a variety of other U.S. and foreign laws, many of which are unsettled and still developing and which could subject
us to claims or otherwise harm our business.
We are subject to a variety of laws in the United States and abroad, including laws regarding consumer protection, intellectual property,
export and national security, that are continuously evolving and developing. The scope and interpretation of the laws that are or may be
applicable to us are often uncertain and may be conflicting, particularly laws outside the United States. For example, laws relating to the liability
of providers of online services for activities of their users and other third parties are currently being tested by a number of claims, including
actions based on invasion of privacy and other torts, unfair competition, copyright and trademark infringement, and other theories based on the
nature and content of the materials searched, the ads posted or the content provided by users. It is also likely that as our business grows and
evolves and our games are played in a greater number of countries, we will become subject to laws and regulations in additional jurisdictions.
We are potentially subject to a number of foreign and domestic laws and regulations that affect the offering of certain types of content, such as
that which depicts violence, many of which are ambiguous, still evolving and could be interpreted in ways that could harm our business or
expose us to liability. In addition, certain of our games, including Zynga Poker , may become subject to gambling-related rules and regulations
and expose us to civil and criminal penalties if we do not comply. It is difficult to predict how existing laws will be applied to our business and
the new laws to which we may become subject. See the discussion included in the section titled “Business — Government Regulation.”
If we are not able to comply with these laws or regulations or if we become liable under these laws or regulations, we could be directly
harmed, and we may be forced to implement new measures to reduce our
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