Overstock.com to Test Utah's Anti-Spyware Bill


Utah-based Overstock.com announced today that it will sue Massachusetts-based online retailer SmartBargains, Inc. in the Third District Court in Salt Lake City. OVerstock.com will sue under provisions of the recently enacted Utah Spyware Control Act (HB 323), which went into effect May 3. HB 323 was sponsored by Rep. Steve Urquhart of St. George. Overstock.com President Patrick Byrne said,

"Pop-up ads have been to Web browsing what spam is to email. Within the world of affiliate marketing, such software is often called 'parasiteware' on the grounds that the companies which distribute such code and those who advertise through it are parasitic on legitimate commerce: spyware hijacks not only consumer spending, but the commissions that would otherwise be paid to legitimate affiliate community. Several years ago we decided on principle to cease any advertising with such firms, and have encouraged members of the vast affiliate marketing community to respect the position we have taken by refusing to act as affiliates for sites that avail themselves of parasiteware."

When this bill was first passed, I wondered how effective it would be. Rep. Urquhart and I discussed it briefly on the forum. I think I missed an important factor in dismissing this legislation too quickly. Unlike anti-spam legislation where it's pretty much left to individuals to fight the battle, corporations like Overstock.com care about spyware because it eats into their revenue. What's more they've can afford the attorneys to fight the battle. I'm anxious to see how this one holds up in court.