Several major advertisers who used the adware service Direct Revenue have reached a settlement with New York Attorney General Andrew Cuomo, agreeing to pay tens of thousands of dollars in penalties and to only use advertising services that offer full disclosure to customers. According to Cuomo’s office, this is the first time that the advertisers, which include Priceline, Travelocity, and Cingular, have been held responsible for having their advertising delivered through an adware system.
Three advertisers came under fire after a lawsuit filed by the Attorney General’s office in April 2006 against Direct Revenue alleging that the advertising company installed its software on home computers without consent or adequate notice. Once a piece of adware has been installed on a computer system, it will continue to display advertising until it has been removed, something the Attorney General claimed Direct Revenue made deliberately difficult to do. Cuomo and company learned that the aforementioned advertisers, as well as several others, spent hundreds of thousands of dollars on advertising delivered through Direct Revenue.
“Advertisers can no longer insulate themselves from liability by turning a blind eye to how their advertisements are delivered, or by placing ads through intermediaries, such as media buyers. New Yorkers have suffered enough with unwanted adware programs and this agreement goes a long way toward clamping down on this odious practice,” said Cuomo in a statement.
In addition to penalties in the $30,000-35,000 range, Priceline, Travelocity, and Cingular have agreed to better screen their advertising providers and affiliates.