People v. Direct Revenue, LLC

Direct Revenue, LLC (defendant) produced software known as an “advertising client” that generated pop-up advertisements based on a consumer’s Internet usage. Direct Revenue offered free software, such as screensavers and games; if a consumer downloaded the free software, the advertising client would also be installed on the consumer’s computer. Consumers complained that the advertising client was being installed on their computers without their consent. The New York attorney general (NYAG) (plaintiff) tested 29 websites that distributed Direct Revenue’s advertising client and conducted seven tests directly with Direct Revenue. In each of the seven tests, the investigator was presented with a hyperlink and given the option of accepting or declining an end-user license agreement (EULA). The EULA stated that the software would collect information about websites accessed by the consumer and use that information to display advertising on the consumer’s computer. Six investigators clicked “yes” to accept the EULA and downloaded the free software. No software was installed on the computer of the investigator who clicked “no.” Two of the tests were preceded by an advertisement offering “free” software. The NYAG sued Direct Revenue for an injunction and monetary relief, alleging deceptive practices, trespass to chattel, computer tampering, and false advertising based on the investigators’ tests and millions of other transactions throughout the world. Direct Revenue moved to dismiss the petition.