Update: Consumer group files complaint against 'adware' firm

A Washington, D.C., civil liberties and consumer group has filed two complaints against Web-based marketer 180solutions Inc., accusing the company of "duping" Internet users into downloading intrusive advertising software.

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The Center for Democracy and Technology (CDT) filed the complaints Monday with the U.S. Federal Trade Commission (FTC), accusing 180solutions of unfair and deceptive business practices. The CDT accuses 180solutions of tricking millions of Web users into downloading adware that can slow users' computers and deliver multiple pop-up ads.

The company's software has shown up on computers owned by large businesses as well as those owned by individuals, CDT officials said. "This stuff is all over the Internet, which is why we thought it was important to go after it," said David McGuire, CDT's director of communications.

According to the CDT complaint, 180solutions continued downloading its adware to computers without the owners' consent after it was warned by technology experts, privacy advocates and its own auditors that its practices were unethical, and in some cases, illegal.

The company's actions have caused "immeasurable harm" to Web users' computers and to the Internet itself by causing users to distrust the medium, said Ari Schwartz, CDT deputy director.

One of the complaints includes 180solutions' affiliate CJB.net of offering free Web hosting, but not telling customers that their Web sites would download 180solutions' adware to visitors' computers. Visitors to Web sites hosted by CJB.net "unwittingly become distributors" of adware, Schwartz said.

180solutions, based in Bellevue, Washington, said Monday it wants to continue a "productive dialog" it's had with CDT for about two years.

"180solutions and the CDT share the same vision of protecting the rights and privacy of consumers on the Internet," the company said in an e-mail sent by a spokesman. "This shared vision has resulted in a healthy working relationship that has seen great progress in the fight against spyware and benefited consumers around the world. We have made voluntarily improvements to address every reasonable concern that the CDT has made us aware of."

CJB.net issued a statement saying CDT did not contact the company before filing its complaint.

"We respectfully suggest that CDT's complaint is probably based on a misunderstanding of the facts," CJB.net said in an e-mail. "Further ... investigation by CDT into the facts, we believe, would have been advisable. In particular, we respectfully suggest that CDT might have had a better understanding of the facts if CDT had bothered to contact CJB management to discuss the matter prior to filing a complaint with the FTC."

CJB has a policy of cooperating with law enforcement investigations, "insofar as CJB is permitted by law to do so," the statement reads. "CJB Management has long supported CDT and its public policy mission," the CJB added in the e-mail. "We view CDT as a like-minded ally, not as an enemy or adversary."

CDT officials said they were unsure whether 180solutions adware was acting as spyware by tracking users' Web surfing, but they accused the company of engaging in unfair and deceptive business practices by not seeking computer users' consent before downloading its adware onto their machines.

"There are many cases where there is no notice and consent," Schwartz said. "There are others where there is deceptive notice and consent."

If a company had one relationship with an affiliate that included adware downloads without consent, that would be enough to prompt a complaint over unfair business practices, Schwartz said. "But to have this continually happen is really beyond the pale of what a responsible software company should be doing today."

The CDT has tried to work with 180solutions for about two years in an attempt to get the company to change its business practices, CDT said. While the company delivered on some promises to change its practices, it has not followed through on many other promises, including reining in some of its affiliates, McGuire said.

"Each time we felt as though we had gotten them to address one bad practice, a new bad practice would come to our attention," McGuire said. "What we came to believe ... is that there is sort of a core flaw in their business practices."

CDT next plans to contact advertisers using 180solutions and its affiliates about the company's practices.