Adware company Zango has voluntarily withdrawn its lawsuit against security software company PC Tools, which Zango accused of illegally removing its software from users' PCs without their express permission. The move follows a court's refusal to grant Zango a temporary restraining order.

The company had asked a court to prevent PC Tools' Spyware Doctor software from detecting and classifying Zango as potentially harmful, but a judge ruled it was "unlikely that the Plaintiff will be able to prove that the Defendant's software was unfair or deceptive."

Zango demanded $35 million in damages from PC Tools for causing "irreparable harm."

"It appears that Zango has realised they were not going to prevail in this matter and the case has been withdrawn on this basis," said PC Tools CEO Simon Clausen. "We believe the case should not have been brought in the first place. The outcome sends a strong message that PC Tools will not be changing their classification of programs as a result of the threat of legal proceedings."

The move by Zango is not unexpected; the company dropped its lawsuit against Zone Labs in 2006 after coming under fire by the media. Zango claims its software "has been consensually installed by millions of users," but most security experts dispute this claim.