Adware manufacturer Zango settled with the Federal Trade Commission for $3 million after being accused of deceptively installing unsolicited adware onto users’ PCs and obstructing its removal.
Zango co-founders Keith Smith and Daniel Todd will be responsible for paying the settlement, it was announced today. Additionally, the settlement stipulates that Zango must refrain from installing any similar software on PCs without the users’ permission.
The FTC alleges that Zango used third-party affiliates such as 180Search Assistant, Seekmo, and n-Case to install the adware and monitor consumers’ Internet use in order to display relevant pop-up advertising. The adware surreptitiously was attached to free software such as screensavers, peer-to-peer file-sharing software, games, and utilities.
In court documents obtained by AVNOnline.com, it is stipulated that “Respondents, directly or through any person, corporation, subsidiary, division, affiliate, or other device, in connection with the advertising, marketing, offering for sale, sale, or provision of any good or services on or through the Internet, the World Wide Web, or any webpage or website in or affecting commerce, shall not install or download, or assist others in installing or downloading, any software program or application without express consent.”
The settlement comes following hearty debate regarding the validity of Zango’s spyware-driven business models. Just two months ago, a class-action suit against Zango in protest of its desktop advertising software was dropped when the three plaintiffs decided the suit would not be the best vehicle to go after the company.
Although Zango agreed to pay $3 million to settle, the company is not claiming any guilt. Instead, it blames its over-reliance on affiliates to enforce its consumer “notice and consent” policies. “Unfortunately, this allowed deceptive third parties to exploit our system to the detriment of consumers, our advertisers, and our publishing partners,” Smith stated in a release on Zango’s corporate blog. “We deeply regret and apologize for the resulting negative impact.”
