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FTC gets injunction against ‘pop-up spam scam’

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Acting on a Federal Trade Commission’s request, a US district court has issued a temporary restraining order against an operation that allegedly barraged numerous consumers’ computers with repeated Windows Messenger Service pop up ads.

Ironically most of the ads allegedly sent by San Diego-based D Squared advertised software that offered to block future pop-up ads.

According to the FTC, the defendants repeatedly sent messages to consumers – as frequently as every 10 minutes – instructing consumers to visit Web sites promising to block the barrage of pop-ups with software costing between $25 to $30. Changing the default settings on Windows PCs would have had much the same effect, the FTC notes

By exploiting Windows Messenger Service, the defendants are charged with causing their pop-ups to appear on consumers’ computer screens even when consumers were not browsing the Internet.

Additionally the defendants allegedly either sold or licensed their pop-up-sending software to other people, allowing them to engage in the same conduct. The defendants’ Web site allegedly offered software that would allow buyers to send pop-ups to 135,000 Internet addresses per hour, along with a database of more than two billion unique addresses.

“This is nothing more than a high-tech version of a classic scam,” said Howard Beales, Director of the FTC’s Bureau of Consumer Protection. “The defendants created the problem that they proposed to solve – for a fee. Their pop-up spam wasted computer users’ time and caused them needless frustration.”

Case for the prosecution

The complaint announced today was filed against Anish Dhingra and Jeffrey Davis, both individually and as officers of D Squared, which was also named in the law suit.

According to the FTC’s complaint, the D Squared defendants have engaged in an unfair practice by interfering with consumers’ use of their computers, specifically by causing a stream of multiple, unwanted Windows Messenger Service pop-ups to appear on their computer screens, even when the consumers are not using their Internet browsers. The complaint contends the practice is unfair because it is likely to cause substantial consumer injury, including the loss of data, reduced work productivity, and the temporary freezing of the consumer’s computer screen. Further, the defendants encouraged consumers to think that they could not easily stop the barrage of pop-ups.

In addition, the complaint charges the defendants with unfairly attempting to coerce consumers into buying their pop-up blocking software. The multiple, unwanted Windows Messenger Service pop-ups that appear on consumers’ computer screens serve simply to advertise the defendants’ product that is designed to stop exactly this type of pop-up.

The FTC voted unanimously to approve the complaint, which was filed in a US District Court in Maryland on October 30. A temporary restraining order was granted the same day and the seal on that order was lifted yesterday. Via the case, the FTC is seeking a permanent restraining order.

Court documents related to the case can be found online at the FTC website here. ®

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