AVG Gets Mixed Ruling In 'Scareware' Lawsuit

courtroomA consumer who says he was duped into purchasing security software from AVG can proceed with his lawsuit against the company's European division, but not the U.S. branch, a judge has ruled.

California resident Christopher Rottner, who is suing AVG for breach of warranty and breach of contract, says in court papers that he purchased PC TuneUp in early 2012 because his computer was acting sluggishly.

Rottner alleges that he initially downloaded a free trial version of the software and ran a “diagnostic” scan. The software reported that numerous 'severe' errors were present on his computer. PC TuneUp then supposedly "fixed these errors," and advised Rottner that he should "perform weekly diagnostic scans of his computer,” he alleges in his complaint, filed in U.S. District Court in Massachusetts.



Rottner also alleges that last November, shortly after he updated the AVG software, his computer froze. He says he ultimately had to reformat his hard drive and reinstall Windows in order to use the machine.

He later hired a computer expert who said the trial version of the PC TuneUp software “consistently reported” that whatever computer it tested “suffered from multiple problems regardless of its actual health,” according to the court papers.

But for defendants’ misrepresentations in their marketing materials ... plaintiff would not have purchased the full version of PC TuneUp,” Rottner alleges in his potential class-action lawsuit. Rottner named AVG CZ, which is located in the Czech Republic, as well as the U.S.-based AVG US, as defendants in the case.

Both divisions of AVG asked for the lawsuit to be dismissed. The company argued that its user agreement disclaimed certain warranties, and also required consumers to notify the company “within a reasonable time” after discovering any problems with the software.

U.S. District Court Judge Richard Stearns in Massachusetts disagreed with AVG on those points, ruling that PC TuneUp's software “trumpets announcements about its functionality ... each and every time it is run.” Therefore, Stearns wrote, Rottner can sue the company for allegedly violating its promises about the software regardless of statements in the user agreement.

The U.S. branch of the company also argued that any claims against it should be dismissed because the software came from the company's division in the Czech Republic.

Stearns sided with AVG on that point and dismissed claims against the U.S. branch of the company.

Rottner unsuccessfully argued that dismissing the U.S. branch of the company from the case would make it harder to collect damages, if he won after trial. But Stearns wrote that Rottner's contention about the difficulties of enforcing a judgment “simply casts doubt on the wisdom of the underlying transaction,” but doesn't provide grounds to sue the company's U.S. division.


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