Overstock.com is set to become the first company to take action under Utah's new anti-spyware law. The company has filed a complaint against online retailer SmartBargains in the third district court in Salt Lake City. Utah's spyware law, the world's first, only made the statute book on 3 May. Utah is the only state with current spyware legislation, although California and Iowa are considering their own versions of the law.

Overstock alleges that SmartBargains is using spyware to display pop-up ads over the top of Overstock's website. Overstock wants the practise stopped and it wants damages, costs and legal fees.

Patrick Byrne, president of Overstock said: "Pop-up ads have been to Web browsing what spam is to email. Within the world of affiliate marketing, such software is often called 'parasiteware' on the grounds that the companies which distribute such code and those who advertise through it are parasitic on legitimate commerce: spyware hijacks not only consumer spending, but the commissions that would otherwise be paid to legitimate affiliate community" ®

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