Company ordered to stop marketing its "vaporware"

March 16, 2005

The FTC today announced that it's filed a restraining order against a company that allegedly offered Internet users a spyware scanner program that falsely reported that computers were infected with spyware, and which failed to remove any spyware at all from infected machines.

The commission issued a report Monday that alleges the company, MaxTheater, Inc., engaged in fraudulent and deceptive business practices. Operating from the Web site SpywareAssassin.com, Washington-based MaxTheater offered visitors free scan of their PCs, and then sold them a $30 product called Spyware Assassin which, the commission says, didn't do a thing.

MaxTheatre apparently tried to scare consumers into buying software through pop-up ads and e-mail that warned their computers had been infected with malicious monitoring software.

Researches hired to evaluate the effectiveness of Spyware Assassin have found that the program was unable to inoculate any of the known spyware threats and reported “detected" spyware even on clean machines.

Mona Sedky Spivack, the FTC attorney handling the case, said that the agency hired a computer expert to test Spyware Assassin before filing the complaint. The expert conducted an experiment that involved loading a computer with 14 separate spyware programs, then downloading and running SpywareAssassin. That program ended up eradicating just one of the 14 spyware programs, said Spivack.

"In numerous instances the defendants display their spyware detection "pop up" even when, in fact, the computer is clean and does not have spyware installed on it," the report says.

The FTC is asking for a permanent ban on Spyware Assassin's claims and will ask the federal court hearing the case to order MaxTheater to refund money to its customers. The commission also had a restraining order issued, which requires MaxTheater to immediately stop engaging in the deceptive advertising and to preserve all records from the company, "due to the likelihood that advance notice of this action will cause the defendants to...abscond with or destroy evidence."

The report also names the owner of MaxTheater, Thomas Delanoy, as a defendant in the action, and details exactly what kinds of business practices got him into trouble.