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Some Pop-Up Ads Shut Down

The FTC wins a temporary halt to spam that targets Microsoft's Windows Messenger.

November 07, 2003|From Times Wire Services

The Federal Trade Commission obtained a temporary restraining order Thursday against a San Diego company to stop it from bombarding computer users with unwanted pop-up ads as frequently as one every 10 minutes.

The FTC accused D Squared Solutions of "high-tech extortion" because of its push to sell software, for $29.99, that blocks the very pop-up ads it was sending to consumers.

The agency's move could curb some of the most irritating practices by Internet marketers, which have learned ways to display intrusive messages on computer screens using a technology built into most versions of Microsoft Corp.'s Windows software.

"This is a shot across the bow," said Mark Rasch, an expert on technology law and former head of the Justice Department's cyber-crimes division.

D Squared Solutions would bombard computer users with pop-up ads, even if the user wasn't using an Internet browser, by taking advantage of a security weakness in Microsoft's Windows Messenger service, regulators said.

The company set out to "create a problem for consumers and then try to charge them for a solution" in what amounted to "high-tech extortion," said Howard Beales, the FTC's consumer protection chief.

The FTC also is seeking to collect the "hundreds of thousands" of dollars that consumers paid D Squared Solutions for the ad-blocking software. The temporary restraining order, signed by a U.S. judge in Baltimore, also bars D Squared Solutions from licensing its software to other companies.

Messenger, a feature of the Windows 2000 and Windows XP computer operating systems, is designed to let administrators of corporate computer networks send internal messages. Microsoft has advised computer users to turn off the feature, and the world's largest software maker plans to ship future versions of Windows with Messenger turned off, Beales said.

The head of D Squared Solutions, Anish Dhingra, declined to comment on the government's accusations. His lawyer, Jacob C. Reinbolt, did not return calls to his office.

The victims of the pop-up ad attack included FTC Commissioner Orson Swindle, FTC officials said.

Beales said the FTC case did not cover ads that pop up when computer users visit an Internet site.

"What we are challenging is this 'backdoor' kind of advertising, particularly when it is done in a way and with a frequency that threatens to impair consumers' ability to use their computers," Beales said.

D Squared Solutions licensed the software to Scintillant Inc., another San Diego-based sender of pop-up ads, Beales said. He declined to say whether the FTC was investigating Scintillant, saying only, "I would think anybody that was using this technology should pay attention today."

This year, Microsoft advised Windows XP and Windows 2000 users on its Web site to disable Messenger to avoid receiving the pop-up ads.

Associated Press and Bloomberg News were used in compiling this report.

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