Court Shutters Spyware Operation

ERG Ventures and one of its affiliates were ordered by a U.S. district court today to stop distributing what the Federal Trade Commission (FTC) claims is false and deceptive software.

According to the FTC, the Nevada-based ERG and its affiliate trick consumers into downloading seemingly innocent software such as screensavers and video files.

Embedded in the software, the FTC states, are spyware programs that are installed without the consumer’s consent.

In addition to the temporary restraining order granted Monday, the FTC issued a permanent injunction against ERG and the affiliate. In addition, the FTC wants the operation to return its “ill-gotten” gains.

The U.S. Attorney’s Office in Washington, D.C., is engaged in a parallel criminal investigation of the defendants.

The FTC’s complaint claims the program, known as Media Motor, has been installed on millions of computers, degrading performance, tracking consumers and distributing unwanted and unsolicited advertising.

Many of the malware programs installed by the program are extremely difficult or impossible for consumers to remove from their computers.

The FTC charges that ERG Ventures and its affiliate, Timothy P. Taylor, have violated the FTC Act, which bars unfair and deceptive practices.

According to court documents, ERG Ventures and Taylor failed to disclose that the free software was bundled with malware. The FTC also said ERG Ventures and Taylor used a deceptive End User License Agreement (EULA).

The EULA claimed to give users the option to halt the installation of the program, but secretly installed the malware no matter what option the user selected.

The FTC said Microsoft assisted in the investigation of ERG.

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