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Center for Democracy and Technology
JULY 28, 2004
2:30 PM
CONTACT:  Center for Democracy and Technology
Ari Schwartz, (202) 637-9800
Michael Steffen, (202) 637-9800
Advertising Software Company Sues Deceptive Distributor and Promises Reforms, as CDT's Campaign against Spyware Reaps Dividends

WASHINGTON - July 28 - As a result of working with the Center for Democracy and Technology (CDT), advertising software developer 180solutions today announced a lawsuit against a former distribution partner, alleging deceptive practices and breach of contract. In a letter to CDT, the company laid out a plan to prevent further abuse of its distribution program, using a combination of improved software, independent auditing, and legal action. 180solutions pledged its continued support for CDT's work to ensure users have control over the programs installed on their computers.

180solutions filed the lawsuit after receiving reports from CDT and others that a distributor had exploited security vulnerabilities in Microsoft Internet Explorer to forcibly install 180solutions software without user notice and consent-a practice known as "drive-by downloading." After being told of the breach, 180solutions ended its relationship with the distributor. Based on continued discussions with CDT, it is working to address consumer concerns with its distribution practices and ensure that similar incidents will not occur again.

The lawsuit and letter represent a new victory in CDT's campaign to fight deceptive software practices on the Internet and hold advertising software companies responsible for policing affiliates. Earlier this year, in a Federal Trade Commission complaint against a company that refused to pursue a deceptive distributor, CDT reported that affiliate relationships can be used to "avoid accountability" for harmful actions.

Based in Bellevue, Wash., 180solutions makes desktop advertising software that is installed on the computers of over 30 million computer users. The company receives revenue from advertisers and offers support for free software and Web content in exchange for having its applications bundled with those products. For example, 180search Assistant, which analyzes users' Web surfing behavior and displays related Web ads, is distributed with search toolbars and screen savers. 180solutions pays distributors a commission for each installation as well as over-time bonuses for installations that remain on the user's computer.

180solutions has promised to obtain the consent of each user before installing 180search Assistant and, since the beginning of this year, requires its distribution partners to sign an explicit agreement to this effect. Aztec Marketing, an affiliate of 180solutions distributor, allegedly violated this agreement and tried to collect installation commissions by forcing certain users to unknowingly install 180search Assistant and other software. 180solutions responded by filing a suit against the distributor under Washington state law.

CDT strongly supports the lawsuit. However, CDT representatives expressed disappointment that 180solutions was unable to prevent the misconduct before it occurred.

"The installation practices employed by Aztec Marketing have been condemned by a broad coalition of industry and consumer groups as devious, deceptive and unfair hijacking of user's computers," said CDT Policy Analyst Michael Steffen. "Any company that pays for installations needs to be absolutely sure it is not providing incentives for this kind of behavior."

Recognizing that it is not enough to punish distributors after abuse occurs, 180solutions announced its intention to further improve the security of its distribution partner program. The planned improvements include:

third party audits of distributors,

direct confirmation of consent to install software,

tools to contact affected users if another distributor breaches the code of conduct, and

a way to proactively detect fraudulent activity of distributors.

"The affiliate problem is at the root of the sudden upsurge in spyware incidents," said CDT Associate Director Ari Schwartz. "CDT is pleased to see that 180solutions recognizes the severity of this issue, and we hope these and further changes can begin to provide some protection for Internet users."

CDT is investigating several other cases and will continue monitoring the results of past complaints. Internet users are encouraged to join CDT's campaign against spyware by sending in their experiences at CDT's spyware action page.

For more information, visit the following links:

180solutions' letter to CDT

CDT's Complaint with the FTC against Mailwiper and Seismic Entertainment Media

CDT's spyware information page


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