The Federal Trade Commission has finally put an end to the Media Motor dispute which started in October 2006. ERG Venture, the financial arm of Media Motor, has been obliged to pay $330,000 as a penalty for distributing spyware.

From the very start of the allegations, Media Motor was accused of wrong doing business conduit because it has repeatedly distributed spyware concealed as free screensavers and funny videos.


As a result of the new sentence, the company was also barred from continuing to install any software onto users' computers without explicit consent from the customer and from installing any software that interferes with anyone's computer use.

One of the Media Motor business model was "tricking" consumers into installing the screensaver software, which seemed innocent enough on the surface. But the software also came with various flavors of spyware and malware—it changed consumers' home pages, added toolbars and displayed pop-ups in users' browsers, tracked Internet activity, displayed porn ads, put advertising on users' desktops, and, best of all, disabled anti-spyware and anti-virus software on the machines. The FTC said that the programs were either extremely difficult or just downright impossible to remove.

The FTC also said that the company used a deceptive EULA in its Media Motor software, which gave users the option to not install the software but did so regardless of whether the users accepted or rejected the agreement. These were violations of the Federal Trade Commission Act, said the FTC, which barred unfair and deceptive business practices.

The judgment carries implications for other spyware makers and distributors, as they are now much more likely are held liable if they install software with misleading EULAs and without the user's explicit consent. The biggest problem will be tracking them down if they're not based in the US.