Judge: Security Company Protecting Customers is Immune from Prosecution

What might have been a relatively insignificant case brought by a shareware re-distributor against security software firm Kaspersky Labs was granted a landmark dismissal on Tuesday, for reasons whose repercussions could lead to a new shield of legal security for anti-malware firms throughout the US.

Kaspersky invoked the Communications Decency Act in its own defense, saying it immunizes companies from prosecution for their attempts to give customers the means to block unwanted or offensive content.

Seattle District Judge John C. Coughenour agreed, granting Kasperky's motion for summary judgment in a case brought by Zango Inc., who also brought on a similar suit against Australia-based PC Tools, Ltd. Zango's shareware comes to consumers' PCs with advertising attached, unless customers pay an extra fee to have those ads removed. Kaspersky's anti-virus program blocks those ads, and Zango argued that block prevents the company from doing its business.

The security software firm might have lost its case, as its original defense was that the software in question was written in Moscow and only distributed in the US. Legal precedent was cited in striking that argument down flat.

But in the company's second turn at bat, it knocked Zango's argument out of the park, in a grand slam that could end up scoring runs not only for Kaspersky but for everyone in the security business in this country. Here is the portion of the Communications Decency Act - part of the Telecommunications Act of 1996 - cited by Kaspersky:

The key elements of US code here are: first, "otherwise objectionable." Maybe Zango's ads aren't obscene, lewd, or filthy, but people may have reason not to want to see them. Second, "to...make available to...others the technical means to restrict access." The law doesn't specify who receives that material, so it can be anyone - you and me. If someone gives you the means to not see something you don't want to see, that someone can't be prosecuted by a third party for what you do with it.

And because the law defines "interactive computer service" broadly, Kaspersky qualifies as a communications service under the Telecom Act.

Yesterday, Sunbelt Software President Alex Eckelberry, whose company provides anti-spyware software, wrote for his company's blog, "This is very big news folks. Big news. This decision may have far-reaching consequences for security companies in the inclusion of malicious and/or potentially unwanted software in their software."

Zango dropped its lawsuit against PC Tools on Tuesday, for reasons described at the time as its unlikelihood of prevailing. Now we know how Zango arrived at that conclusion.

Last November, the Federal Trade Commission settled its lawsuit against Zango, under the condition that it change the way it installs other companies' shareware on its customers machines - for instance, to make those companies' respective EULA statements more visible.

Since that time, Harvard Business School Professor Ben Edelman has been compiling evidence of Zango installations that appear to fail to meet the terms of that settlement. So last Tuesday could be just the beginning of more bad news to come for the shareware provider.