June 22, 2005
Alaska's Anti-Adware Law
Alaska’s legislature has passed SB 140 (to be codified at Sec. 45.45.792, 45.45.794 and 45.45.798), which is awaiting the governor’s signature. This statute contains some anti-Internet porn provisions (probably unconstitutional under the First Amendment and Dormant Commerce Clause), but I’m more interested in the law’s anti-adware provisions.
I’ve generally stopped tracking state anti-spyware laws because of the sheer volume of the state-level efforts. However, most of the statutes have been unremarkable; they are principally modeled off California’s anti-spyware law, which got defanged prior to passage by the repeated insertion of an “intentionally deceptive” standard for the proscribed acts. This intentionally deceptive standard makes these laws mostly irrelevant, because intentional deception in this context usually should trigger other legal violations without the anti-spyware laws being on the books.
Instead of starting with the California model, Alaska started with a version of the Utah amended Spyware Control Act. I blogged unfavorably about that law when it passed. In that post, I concluded that the amended Utah Spyware Control Act was effectively irrelevant. To violate the law, the plaintiff must prove that the defendant committed trademark infringement, so the statute merely creates an additional cause of action to supplement a standard trademark infringement claim.
Alaska’s anti-adware law goes further--much further. It omitted the requirement that the defendants commit trademark infringement. Instead, a defendant commits a violation simply by using adware to display pop-up advertising triggered by trademarks or URLs (whether trademarkable or not). Further, unlike the amended Utah law, the Alaska law does not contain any exclusions for fair use or nominative use.
In short, Alaska took a terrible Utah law and made it worse.
Like the Utah law, I have my doubts that the Alaska law will survive any court challenges. First, it may violate the Dormant Commerce Clause. To avoid this fate, the Alaska law tries the "clever" Utah trick of expecting that adware vendors throw up pop-ups to every user in the world to identify (and then refuse downloads to) Alaska residents. This trick has not been blessed by the courts, and given the courts’ concerns about restricting the free flow of Internet content, I doubt it will be. (Plus, there’s the bizarre irony of an anti-pop-up law mandating that adware vendors display lots of pop-ups to consumers).
Second, it may not survive 47 USC 230’s preemption, which preempts most state laws that try to hold intermediaries liable for third party content except in limited types of claims, like IP claims. At least the Utah law could claim to be an “IP law” because trademark infringement was an essential element of a claim. Alaska's law doesn’t limit itself to trademarks and does not require trademark infringement to establish a violation. Instead, it’s squarely housed in consumer protection law. Therefore, I think there's a good chance that the law, at least as applied to adware vendors (as opposed to advertisers), is preempted by 230.
Third, I’m not entirely convinced that this law survives a First Amendment challenge. It regulates commercial speech, so it “only” triggers intermediate scrutiny. However, I’m not sure the law can make a good enough argument about the government need or the law’s efficacy to support that need. Note that, like the Utah law, the Alaska law does not give consumers the right to consent to regulated adware on their own (except that user-installed filtering software is excluded from the definition of adware). So even if users expressly say they want the software, the Alaska law deprives them of it.
Let's hope the Alaska governor vetoes the law, but it seems politically imprudent to veto a (mis-characterized) anti-"spyware" law that also attacks "online enticement." Thus, assuming the Alaska governor signs the law, any predictions about who will lead the lawsuit to clean out this stinker?
Posted by Eric at June 22, 2005 09:27 AM | Adware/Spyware