Report from WhenU v Utah updated June 13, 2004

In April I mentioned WhenU’s suit against the state of Utah, challenging Utah’s recent Spyware Control Act. Oral argument took place yesterday and today as to WhenU’s motion for preliminary injunction.

Consistent with case filings, WhenU claimed that the company cannot reliably determine which users are in Utah and which are elsewhere. However, documents presented in the hearing showed that WhenU offers its advertisers the service of showing their ads only in particular locations, including in particular states.

Counsel for the state of Utah also asked WhenU’s CEO about WhenU’s display of advertising for online gambling and for online liquor sales. My testing demonstrated that WhenU shows such ads in Utah, but longstanding Utah law is thought to prohibit these ads. So WhenU will have to develop — arguably, already should have developed! — systems to avoid showing these ads in Utah. WhenU has criticized the Spyware Control Act, claiming that compliance would be difficult and costly. But WhenU must satisfy Utah’s gambling and liquor laws independent of the Spyware Control Act. So much for the purportedly high burden of Utah’s spyware regulation.

In my own oral testimony, I explained the methods of installation and operation of spyware. In one notable section, I showed videos of WhenU software installed via drive-by downloads with defective license agreements, such that even when a user requested to view WhenU’s license agreement, the license was not available.

Details in, Inc., v. The State of Utah – Case Documents. The hearing will conclude on June 22, 2004, and the Court’s decision is expected thereafter.