'Spamford' Accepts Injunction in FTC Spyware Case

Share this content:
The Federal Trade Commission and Sanford Wallace reached an agreement that will prevent Wallace from putting so-called spyware programs on users' computers while an FTC lawsuit against him proceeds.


Under the preliminary injunction, Wallace and his companies, SmartBot.net and Seismic Entertainment Products, can advertise only on their Web sites. The order also prohibits Wallace from helping others exploit security vulnerabilities in Microsoft's Internet Explorer browser.


The FTC accused Wallace in an October 2004 lawsuit of deceptively installing advertising and Web monitoring software on consumers' computers. A judge placed a temporary restraining order against Wallace at the time. The preliminary injunction contains no admission of wrongdoing by Wallace.


"We're hopeful this case will be resolved by a favorable ruling of the court or an agreement with the parties that gives consumers the relief necessary," said Laura Sullivan, an FTC attorney on the case.


The FTC filed the suit against Wallace -- its first involving spyware -- in U.S. District Court in New Hampshire. No trial date has been set. Hanson said she hoped the court would schedule one this month.


Wallace gained the moniker "Spamford" in the late 1990s for sending millions of unsolicited e-mails through his company, Cyber Promotions. EarthLink won a $2 million judgment against him in March 1998, and Wallace subsequently left the e-mail marketing business, according to reports.


The FTC charges that Wallace moved from spam to spyware, a new form of intrusive marketing online that relies on software downloaded without consumer consent to track Internet behavior and serve advertising.


According to the suit, Seismic infected computers with spyware that would display pop-up ads for $30 anti-spyware software, called Spy Wiper and Spy Deleter, made by an Atlanta company.


Sullivan declined to say whether the FTC would pursue companies that profited from Wallace's activities, either through acting as distribution channels or letting Wallace act as an affiliate. She said the FTC would continue to investigate spyware cases.


"It sends a strong message to people ... who in some way benefit from these types of illegal activities that they're on notice," she said.


Brian Morrissey covers online marketing and advertising, including e-mail marketing and paid search, for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


Loading links....
close

Next Article in Digital Marketing

Sign up to our newsletters

Company of the Week

We recently were named B2B Magazine's Direct Marketing Agency of the Year, and with good reason: We make real, measureable, positive change happen for our clients. A full-service agency founded in 1974, Bader Rutter expertly helps you get the right message to the right audience at the right time through the right channels. As we engage our clients' audiences along their journey, direct marketing (email, direct mail, phone, SMS) and behavioral marketing (SEM, retargeting, contextual) channels deliver information relevant to the needs of each stage. We are experts at implementing and leveraging marketing technologies such as CRM and marketing automation in order to synchronize sales and marketing communications. Our team of architects and activators plan, execute, measure and adjust in real time to ensure the strategy is working as needed and change things if it's not.

Find out more here »

DMN's Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here