'Spyware' Label Delays Deal, Sparks Libel Lawsuit

Adware company 180solutions filed a lawsuit against Internet security company Zone Labs because a potential business partner of 180solutions had concerns about associating with a company that Zone Labs had tagged as a high security risk, Sean Sundwall, 180solutions director of communications, said Thursday.

Sundwall said that several months ago, a large online Web property approached 180solutions with a business offer, but told the company it couldn't go ahead with a deal until Zone Labs stopped classifying 180solutions as "spyware" that monitored mouse clicks and logged keystrokes.

Sundwall added that 180solutions attempted to negotiate with Zone Labs, owned by Check Point Software Technologies--but that talks were unsuccessful, resulting in 180solutions filing suit last month in state court in Washington.

"It's clearly an egregious example, in our mind, of how we're being treated," Sundwall said, referring to the Zone Labs classification of 180solutions. "Not even the most crazed zealot has ever accused us of tracking mouse clicks and keystrokes," he added.

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In the lawsuit, 180solutions charges that Zone Labs was aware that its statements about 180solutions "have caused certain content vendors to refuse to contract with 180, harming 180's business and subscribers."

Zone Labs said the suit was "without merit" in a written statement. "We believe consumers have the right to know what programs reside on their computers, to understand what those programs are doing, and ultimately have the choice to keep or remove them from their systems," stated the company.

The 180solutions lawsuit marked the first time in more than two years that an adware company has launched a large legal offensive against a spyware removal company. Claria in 2003 brought suit against PC Pitstop; that case eventually settled.

The gist of 180solutions' complaint appears to be language that Zone Labs uses to describe 180solutions, rather than the fact that Zone Labs removes the program. Sundwall added that 180solutions doesn't plan to file lawsuits against other software removal companies at this time.

In its lawsuit, 180solutions charges Zone Labs with trade libel, tortious interference with business expectancies, unfair and deceptive trade practices, and unjust enrichment. According to the lawsuit, Zone Labs categorizes 180solutions' ad-serving software as "high-risk" threats to security and privacy, and tells consumers that 180solutions "is trying to monitor your mouse movements and keyboard strokes."

This information is inaccurate, said 180solutions in its court filing. "180 only collects and uses browsing habits to the extent it aggregates the number of hits on a given keyword from its anonymous users," states the lawsuit. 180solutions detailed in its papers that it serves pop-up ads to users based on their Web browsing behavior, but doesn't keep personally identifiable information about users.

180solutions also took issue with being called "spyware." "The term 'spyware' carries a common meaning in the industry that includes as its key element a compromise of the user's privacy. Specifically, spyware is typically understood to involve collecting, without consent, a user's personally identifiable information and Internet browsing habits," stated the lawsuit.

But whether the industry actually has agreed on a common meaning for the term "spyware" is subject to debate. A Federal Trade Commission report issued in March, "Monitoring Software on Your PC: Spyware, Adware, and Other Software," found a wide variety of definitions for spyware and adware. Some people who participated in an FTC panel on the topic held that the most important factor was whether the software led to the serving of pop-up ads; if so, they argued, then it was spyware. Others argued that the adware/spyware distinction hinges on whether users had adequate advance notice of what the program would do; if so, then it's adware, but if not, spyware's the appropriate name. Still others maintained that adware could only be spyware if it monitored where users went on the Web.

On another front, 180solutions remains on the defensive in a separate lawsuit in federal court in Chicago. That case stems from alleged improper installations of 180solutions' adware.

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