Microsoft Joins Washington Attorney General McKenna to Help Protect Consumers From Spyware Deception

REDMOND, Wash. — Jan. 25, 2006 — Microsoft Corp. today praised Washington state Attorney General Rob McKenna for his strong action to help protect consumers from deceptive software. With the help of technical information and analysis from Microsoft, the attorney general’s office filed the state’s first legal action under the Washington Computer Spyware Act, which was enacted last year. Microsoft today also announced it has filed its own lawsuit alleging violation of the same law.

Microsoft Deputy General Counsel Nancy Anderson (L) and Washington State Attorney General Rob McKenna view an alleged bogus “spyware cleaner” tool that is one of the targets of Washington’s first lawsuit under the state’s new computer spyware act. Seattle, Wash., Jan. 25, 2006

McKenna’s 16-count lawsuit alleges that Secure Computer LLC in New York state, company president Paul E. Burke and others associated with the company used deceptive spam, misleading advertising and misleading computer scan results to frighten users into purchasing its Spyware Cleaner product.

“We applaud Attorney General McKenna for his strong and sustained leadership in helping protect consumers on the Internet,” said Nancy Anderson, deputy general counsel for Microsoft. “Attorney General McKenna led the effort in Washington to pass one of the nation’s first anti-spyware laws. Now he is using that law to help protect consumers.”

The Washington Computer Spyware Act prohibits the installation of computer software that prevents the reasonable efforts of the owner or operator to block the installation, and prohibits intentional misrepresentation of the extent to which such software is required for security or privacy. Software that collects and transmits information or changes settings on a computer without the owner’s permission is also outlawed.

“Computer users should be able to trust that they will not be misled by dishonest activity in the online marketplace,” Anderson said. “Attorney General McKenna’s use of Washington’s anti-spyware law sends a strong message to online businesses that the state will do everything it can to prevent its citizens from becoming victims of deceit.

“Microsoft continues to collaborate with many state attorneys general to help protect computer users from the effects of spyware, spam and cybercrime — such as identity theft,” said Anderson. “It is encouraging to see our home state of Washington at the forefront of legislation and enforcement on these important consumer protection issues.”

Microsoft’s lawsuit, which was also announced today, includes a claim based on a provision of the Washington Computer Spyware Act that allows providers of computer software and owners of Web sites or trademarks adversely affected by spyware activities to bring legal action to prohibit further violations.

Microsoft’s lawsuit alleges that Secure Computer LLC used deceptive pop-up ads to warn users that their computers were at risk and could contain spyware. The ads allegedly directed users to the company’s Web site. According to the lawsuit, when users visited the site and consented to have their computer’s hard disk scanned, the results labeled innocuous files — such as harmless tracking cookies and Microsoft® Windows® registry keys — as spyware infections and categorized them as having either high risk or extreme risk. The site advised users to purchase Secure Computer’s Spyware Cleaner to remove the files. In addition, Microsoft’s lawsuit alleges that advertisements for Spyware Cleaner used Microsoft’s trademarks to falsely suggest that Microsoft sponsored or approved of the product.

Microsoft has collaborated with governments, law enforcement and industry partners to support civil and criminal enforcement activities against those who engage in online fraud, spam, spyware and other illegal activity on the Internet. The company has provided technical expertise and investigative assistance to attorneys general in California, Florida, Massachusetts, New York, Texas and Washington.

Consumers can take the following steps to help minimize their exposure to spyware and other online threats: Use an Internet firewall; run regular updates; install and keep up to date an anti-virus program; and use anti-spyware software.

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.

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