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With spam, viruses and worms invading our computers on a daily basis, a recent ruling by a federal judge in Virginia authorizes yet another annoyance in using the Internet — pop-up advertising commonly associated with spyware. The U.S. District Court for the Eastern District of Virginia ruled last September that pop-up advertising, although annoying, is not illegal. But the ruling runs contrary to other court decisions on this issue. While relatively few people are familiar with the terms adware and spyware, many people have heard about software such as Gator, and most computer users are all too familiar with pop-up ads. Such software is called spyware because it is often installed together with other software so that computer users don’t realize what they’re installing. For instance, you might think that you’re installing a new screen saver or a program for keeping track of passwords. In reality, you’re also installing software that watches what you do when browsing the Internet. When you open a Web browser, the spyware goes into action and causes pop-up windows to appear. Critics also refer to the software as scumware. Once in action, the spyware causes pop-up windows with advertisements to appear. In many cases, these advertisements are specifically related to the Web site displayed in the user’s browser. For instance, if you’re browsing the Web in search of a new car and you open the hummer.com Web site to look at the new H2, spyware might open a window with an advertisement for Range Rovers. By watching for the Web sites a user visits, the spyware can target advertisements that are relevant to the user’s interest. Promoters of spyware — who unsurprisingly do not refer to their software as spyware — defend their products by arguing that such software allows for a more targeted form of marketing. The problem, however, is that the pop-ups often are created so as to appear they are part of the Web site loaded in the Web browser. Owners of the underlying Web sites argue that scumware violates various federal laws because it changes the overall appearance of the Web site, and because it uses the Web site owners’ trademarks to trigger competitive advertisements. In some cases, the competitive advertisements may appear to be associated with or sponsored by the underlying Web site. This is particularly true in various industries where major companies have acquired previously unrelated brands. For instance, since Ford acquired Jaguar, consumers may assume it could have acquired another auto brand. Thus, a pop-up ad for another brand of automobile appearing over Ford’s Web site may appear to be related. Over the last year or so, spyware has been a recurring issue in courts around the country. In late 2002, Weight Watchers won a legal battle in U.S. District Court for the Southern District of New York against a competitor that was using spyware to cause competitive advertisements to appear whenever weightwatchers.com was loaded into a Web browser. In another prominent case, the Washington Post and other publishers sued Gator Corp., perhaps the best-known publisher of spyware software. In the Gator case, the U.S. District Court in Alexandria, Va., entered a preliminary injunction against Gator in July 2002, and the action was ultimately settled earlier last year. But spyware foes lost a battle in the same court last September. In U-Haul International Inc. v. WhenU.com Inc., Phoenix-based U-Haul brought suit against New York-based WhenU.com because the latter’s spyware was causing rival advertisements to appear in pop-up windows when U-Haul’s Web site was loaded into a Web browser. As with many of the other actions involving spyware, U-Haul sued WhenU.com for violations of its trademark and copyright rights and for engaging in unfair competition. Contrary to the trend over the last year or so, spyware forces in this case emerged from the courtroom victorious. In his ruling, Judge Gerald Lee found that computer users had consented to the installation of WhenU.com’s spyware on their computers, and as a result, caused the spyware to create pop-up advertisements on their computer. Thus, Judge Lee ruled that while pop-up advertisements are annoying — he called pop-up advertising and “her ugly brother … spam … a burden of using the Internet” — they are not illegal because the computer user ultimately controls what appears on the screen. But industry experts question that ruling. While users may have knowingly or unknowingly consented to the installation of WhenU.com’s software, the owners of the Web sites being targeted by the software and pop-up advertisements did not consent to having their Web sites altered by pop-up windows, they point out. Since Web sites are copyrighted works belonging to their owners, pop-up window and advertisements change the appearance of a Web site. In some cases, the pop-up advertisements even give the impression of being sponsored by the underlying Web site rather than being a competitor. The consent of the computer user is irrelevant without consent from the owner of the Web site. U-Haul said it plans to appeal. Spyware isn’t going away anytime soon. Litigation on this issue often has been resolved through undisclosed settlements, so it seems unlikely that a good case that could resolve the issue one way or another will be presented to an appellate court for a definitive ruling in the near future. There have been no appellate rulings so far. Until the appellate courts do decide, it seems that Internet users will have to mount an aggressive defense and install software to block pop-ups. Samuel Lewis is a partner at Feldman Gale & Weber (www.fgwlaw.com) in Miami, where he practices computer/Internet law and intellectual property law. He is also an adjunct professor of law at Nova Southeastern University. He can be reached via e-mail at [email protected]. If you are interested in submitting an article to law.com, please click here for our submission guidelines.

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