Pop-up firm fights legal block

A software start-up is fighting back after it was shut down by a federal court in the US for exploiting a flaw in Windows Messenger service to send pop-up advertisements.

Ironically the company was advertising it's own software - which is designed to block pop-ups.

Last month, the Federal Trade Commission obtained an order from a US district court in Maryland to shut down software maker D Squared Solutions, run by Anish Dhingra and Jeffrey Davis, college students at the University of California at San Diego. The order barred the two from sending pop-up ads to PC users through a security hole in Windows Messenger service.

D Squared and its attorney, Anthony Bain, filed a motion in opposition to the order last week. A hearing is scheduled for Monday, during which the FTC is expected to try to show justifiable cause to continue the injunction.

"There's no law that says annoying advertising is illegal. It's just a cost of doing business in our society," Bain said on Wednesday.

The FTC declined to comment on the pending litigation.

To promote its software, D Squared took advantage of a loophole in Windows Messenger service. The Windows feature (not to be confused with Microsoft's instant-messaging service) is designed to let network administrators notify users about critical maintenance - about when servers are about to go down, for example.

D Squared licenses software that uses this method to deliver pop-up ads to third parties, according to the FTC. D Squared says the program lets buyers send pop-ups to 135,000 internet addresses per hour.

The FTC claims that D Squared used unfair business practices, calling the operation a "classic scam," which essentially created a problem it hoped to solve for a fee.

But Dain, the attorney for D Squared, argues that its practices are perfectly legal.

Dain, a partner at San Diego-based law firm Procopio Cory, said that the Windows vulnerability can be exploited by hackers who want to take over PCs for malicious purposes, and D Squared's software aims to help consumers fend off such attacks and other pop-ups sent via the web.

The FTC has urged consumers to change a default setting on their Windows operating system to block the feature that allows spontaneous messages.

Microsoft recently alerted customers to the security hole in Windows. AOL has also made technical changes to its Internet service to stop the flaw from affecting its subscribers.

Stefanie Olsen writes for News.com