Arguments Continue in Utah Anti-Spyware Case

Adware firm WhenU continued its fight to block enforcement of Utah’s new anti-spyware law Friday. Meanwhile, Internet entrepreneurs testified such software has been harmful to their companies.

Adware like WhenU’s harms Salt Lake City ISP ArosNet’s business, an ArosNet representative testified before Judge Joseph Fratto of the Third Judicial District Court of Utah on Friday. ArosNet technicians spend about 20 percent of their time helping customers who have spyware installed on their computers at company expense, the representative said in the second day of arguments.

WhenU is seeking to delay enforcement of Utah’s Spyware Control Act until a full-blown trial can be held to test its claims the law is unconstitutional and limits companies’ right to commercial speech. The adware company filed the lawsuit against the state of Utah; its governor, Olene Walker; and Mark Shurtleff, the state attorney general (AG), on April 12.

WhenU’s suit seeks a declaration that Utah’s Spyware Control Act violates the U.S. and Utah Constitutions.

The recently passed act prohibits installation of spyware on a person’s computer. It also makes it illegal to “use a context based triggering mechanism to display an advertisement that covers or obscures paid advertising or other content on an Internet Web site.”

The Act would effectively make WhenU’s software, along with that of rival Claria, illegal in Utah. Both employ applications that track online behavior and use the behavioral information to target ads, which pop up while users surf Web sites.

Adware and spyware are a matter of growing concern to businesses and consumers alike. A recent study found the average computer houses roughly 28 items of monitoring software, unbeknownst to the user, according to Earthlink and Webroot Software. Addressing these and other concerns, the FTC held a public forum in April on the subject.

U.S. Sens. Conrad Burns and Barbara Boxer have introduced legislation to prohibit spyware, adware and other intrusive software. The proposed act, known as SPYBLOCK, would make it illegal to install software on a user’s computer without notice and consent. Anti-spyware bills are also currently making their ways through the California legislature.

While pressing ahead with its lawsuit, WhenU recently suffered a defeat on another front. The company was yanked from Google and Yahoo’s search results after being accused of trying to artificially raise its ranking using a prohibited optimization measure known as “cloaking.”

Calls to attorneys representing the state of Utah were not returned by press time. Alan Sullivan, one of the attorneys representing WhenU, would not comment on the case.

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