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Feds asked to take action against adware maker

Anti-spyware watchdog lodges complaint with the FTC against 180solutions, alleging deceptive business practices.

An anti-spyware watchdog group has lodged official complaints against 180solutions and one of its partners, dealing a blow to the adware industry's efforts to police itself.

The Center for Democracy and Technology, a Washington-based public advocacy group, filed a pair of complaints with the Federal Trade Commission on Monday. The complaints charge 180solutions and free Web hosting provider with engaging in unfair and deceptive business practices.

180Solutions deliberately and repeatedly duped Internet users into downloading intrusive advertising software, according to a Center for Democracy and Technology complaint (download PDF). The company continued these practices even after it pledged to better itself and after receiving warnings from spyware experts and privacy advocates, the group said.

"180solutions has continually made assertions that they have improved or cleaned up their services. CDT has found those assertions to be untrue at best," Ari Schwartz, deputy director at the Center for Democracy and Technology, said in a press conference call on Monday.

Company spokesman Sean Sundwall said that 180solutions has not yet reviewed the complaints. Both target 180solutions, but the second also addresses CJB's distribution of the company's adware.

"We have made voluntarily improvements to address every reasonable concern that the CDT has made us aware of," Sundwall said. "180solutions and the CDT share the same vision of protecting the rights and privacy of consumers on the Internet."

180solutions has long been in the crosshairs of anti-spyware groups. The Bellevue, Wash., company makes software that delivers pop-up ads to people's systems as they perform Web searches. It distributes the software partly on its own, but also relies on third parties such as CJB, a provider of free Web space, for distribution. Those parties get paid for each installation of the software.

Adware and spyware fighters, including the Center for Democracy and Technology, have criticized 180solutions over bad practices on the part of its distributors. These practices include burying download disclosures in lengthy legalese; installing software surreptitiously through Web browser security holes; disguising their brands; and making it tough for people to uninstall the pop-up programs.

Seeking to distance itself from such practices, 180solutions has sued several of its former partners, cut relationships with some partners and made changes to its software. However, throughout that period, the Center for Democracy and Technology received a nearly continuous stream of new complaints about 180solutions and its affiliates, the organization said.

In its complaint, the group asks the FTC to take action against 180solutions and stop the practice of sneaky installations of the ad-serving software, since the company repeatedly failed to adequately police its own distribution network. The watchdog also asks for unspecified financial compensation for those who have been duped into installing the software.

"180solutions and its affiliates have caused immeasurable harm, not just to individual Internet users, but to the Internet itself," Schwartz said. The advertising software is on millions of PCs, the Center for Democracy and Technology has estimated.

The FTC should take decisive action against 180solutions, said Eric Howes, director of malicious software research at Sunbelt Software, a maker of anti-spyware tools.

"This company has had ample opportunity to get its act cleaned up," he said. "At this point, the company has demonstrated that it is either unwilling or unable to make the necessary reforms. Given as much, the authorities are called upon to intervene."

The Center for Democracy and Technology joined with the Technology Law & Public Policy Clinic at the University of Washington School of Law to file the second complaint, which names CJB.

A CJB representative said the complaint against it is "probably based on a misunderstanding" that it hopes to work out soon with the Center for Democracy and Technology. Still, the company will cooperate with any FTC investigation, the representative said: "We look forward to working with the FTC in the investigation and resolution of this matter, if so requested."

180solutions' business model is fundamentally flawed, the Center for Democracy and Technology said in a statement: "Until it is changed, consumers will continue to become unwitting victims of its deceptive software installations."

The group has battled spyware, adware and other online pests before. In 2004, the FTC sued Seismic Entertainment and a former self-styled "Spam King," Sanford Wallace, after a complaint by the Center for Democracy and Technology. That case was considered the first major suit by the regulatory agency in the area of spyware.

The Center for Democracy and Technology also runs the Anti-Spyware Coalition of makers of anti-spyware tools, which is supported by consumer watchdog groups. The Anti-Spyware Coalition is not involved in the FTC complaints.