Microsoft, FTC Sue Spyware Distributor

The Federal Trade Commission said Monday that a court has shut down a spyware operation run by ERG Ventures, which installed malware on millions of consumers' computers. Microsoft followed up the news Tuesday by filing its own lawsuit against the individual behind the company, Timothy P. Taylor.

Taylor allegedly used screensavers and video files as Trojans to surreptitiously install spyware in the background. The program, Media Motor, changed users' home pages, added toolbars and pop-up advertising to the Web browser, tracked Internet activity, put icons on the Windows desktop, and disabled antivirus software.

The FTC says the programs installed by Media Motor were nearly impossible to remove, and were placed onto consumers' computers whether or not they accepted the end-user license agreement. ERG Ventures and Timothy P. Taylor were charged by the agency with violating the FTC act, which bars unfair and deceptive practices.

Microsoft, meanwhile, claims Taylor violated the Washington Computer Spyware Act and the Washington Consumer Protection Act. The company is seeking damages from the defendant, but did not specify how much it is asking the court to award.

"We commend the FTC for exposing this spyware operation," said Scott Stein, senior attorney with the Internet Safety Enforcement Team at Microsoft. "Microsoft was proud to provide technical assistance to the FTC and also to take legal action against one part of the operation targeted by the FTC."