admin April 8th, 2009
Criminal law
Unauthorized access to a computer is illegal under computer crime laws, such as the U.S. Computer Fraud and Abuse Act, the U.K.’s Computer Misuse Act and similar laws in other countries. Since the owners of computers infected with spyware generally claim that they never authorized the installation, a prima facie reading would suggest that the promulgation of spyware would count as a criminal act. Law enforcement has often pursued the authors of other malware, particularly viruses. However, few spyware developers have been prosecuted, and many operate openly as strictly legitimate businesses, though some have faced lawsuits.
Spyware producers argue that, contrary to the users’ claims, users do in fact give consent to installations. Spyware that comes bundled with shareware applications may be described in the legalese text of an end-user license agreement (EULA). Many users habitually ignore these purported contracts, but spyware companies such as Claria claim these demonstrate that users have consented.
Despite the ubiquity of EULAs and of “clickwrap” agreements, under which a single click can be taken as consent to the entire text, relatively little case law has resulted from their use. It has been established in most common law jurisdictions that a clickwrap agreement can be a binding contract in certain circumstances. This does not, however, mean that every such agreement is a contract or that every term in one is enforceable.
Some jurisdictions, including the U.S. states of Iowa and Washington, have passed laws criminalizing some forms of spyware. Such laws make it illegal for anyone other than the owner or operator of a computer to install software that alters Web-browser settings, monitors keystrokes, or disables computer-security software.
In the United States, lawmakers introduced a bill in 2005 entitled the Internet Spyware Prevention Act, which would imprison creators of spyware.
US FTC actions
The US Federal Trade Commission has sued Internet marketing organizations under the “unfairness doctrine” to make them stop infecting consumers’ PCs with spyware. In one case, that against Seismic Entertainment Productions, the FTC accused the defendants of developing a program that seized control of PCs nationwide, infected them with spyware and other malicious software, bombarded them with a barrage of pop-up advertising for Seismic’s clients, exposed the PCs to security risks, and caused them to malfunction, slow down, and, at times, crash. Seismic then offered to sell the victims an “antispyware” program to fix the computers, and stop the popups and other problems that Seismic had caused. On November 21, 2006, a settlement was entered in federal court under which a $1.75 million judgment was imposed in one case and $1.86 million in another, but the defendants were insolvent.
In a second case, brought against CyberSpy Software LLC, the FTC charged that CyberSpy marketed and sold “RemoteSpy” keylogger spyware to clients who would then secretly monitor unsuspecting consumers’ computers. According to the FTC, Cyberspy touted RemoteSpy as a “100% undetectable” way to “Spy on Anyone. From Anywhere.” The FTC has obtained a temporary order prohibiting the defendants from selling the software and disconnecting from the Internet any of their servers that collect, store, or provide access to information that this software has gathered. The case is still in its preliminary stages. A complaint filed by the Electronic Privacy Information Center (EPIC) brought the RemoteSpy software to the FTC’s attention.
Netherlands OPTA
An administrative fine, first of its kind in Europe, has been taken by the Independent Authority of Posts and Telecommunications (OPTA) from the Netherlands. It applied fines in total value of Euro 1,000,000 for infecting 22 million computers. The spyware is called DollarRevenue. The law articles which have been violated are art. 4.1 of the Dutch telecommunications law; the fines have been given based on art. 15.4 taken together with art. 15.10. A part of these fines has to be paid by the directors of these companies in their own person, i.e. not from the accounts of their companies, but from their personal fortunes.
Since a protest procedure has been taken, the fines will have to be paid after a Dutch law court will take a decision in this case. The culprits maintain that the evidence for violating the two law articles has been obtained illegally. The names of the directors and the names of the companies have not been revealed, since it is not clear that OPTA is allowed to make such information public.
Civil law
Former New York State Attorney General and former New York State Governor Eliot Spitzer has pursued spyware companies for fraudulent installation of software. In a suit brought in 2005 by Spitzer, the California firm Intermix Media, Inc. ended up settling by agreeing to pay US$7.5 million and to stop distributing spyware.
The hijacking of Web advertisements has also led to litigation. In June 2002, a number of large Web publishers sued Claria for replacing advertisements, but settled out of court.
Courts have not yet had to decide whether advertisers can be held liable for spyware which displays their ads. In many cases, the companies whose advertisements appear in spyware pop-ups do not directly do business with the spyware firm. Rather, they have contracted with an advertising agency, which in turn contracts with an online subcontractor who gets paid by the number of “impressions” or appearances of the advertisement. Some major firms such as Dell Computer and Mercedes-Benz have sacked advertising agencies which have run their ads in spyware.
Libel suits by spyware developers
Litigation has gone both ways. Since “spyware” has become a common pejorative, some makers have filed libel and defamation actions when their products have been so described. In 2003, Gator (now known as Claria) filed suit against the website PC Pitstop for describing its program as “spyware”. PC Pitstop settled, agreeing not to use the word “spyware”, but continues to describe harm caused by the Gator/Claria software. As a result, other antispyware and antivirus companies have also used other terms such as “potentially unwanted programs” or greyware to denote these products.
Tags: Claria, CyberSpy, DollarRevenue, PC Pitstop, RemoteSpy, sanctions against spyware, Spyware, spyware legal issues
