Judge Blocks WhenU Pop-Ups

In a court case that may decide the future of online competitive and contextual advertising, U.S. District Judge Deborah A. Batts blocked WhenU from displaying Vision Direct’s ads over the website of 1-800 Contacts.

According to the ruling, which overturned two previous decisions, Judge Batts declared that WhenU users may not be able to differentiate the WhenU browser utility pop-up advertisements and those advertisements which would be generated from the targeted website.

Avi Naidern, CEO of WhenU, stated that “There have been two judges that have already ruled that there is no use of a competitor’s trademark when you target advertising this way. We’re confident the ruling will be overturned on appeal.”

The ruling may lay the groundwork for a larger Federal court appeal and perhaps even a US Supreme Court decision on the subject of browser embedded contextually targeted advertising. According to opposition of the practice, such advertising defaces commercial websites and steals their profits.

About WhenU’s Pop-Up Advertising

WhenU bundles with and installs itself through a variety of partner downloads including other software, MP3 players, screensavers, online games and shopping tools. It describes its contextual targeting solution as software examining “keywords, URLs and search terms currently in use on the consumer’s browser — without collecting or transmitting this data — and then select[ing and displaying] relevant and useful advertisements.”

WhenU works like Gator by suggesting advertising and offers on shopping sites like Amazon or eBay. Publishers have also accused WhenU of revenue stealing because WhenU ads are shown after an affiliate link to Amazon or another site has been clicked, which could potentially divert the user from the affiliate purchase which would in turn divert dollars earned from that purchase.

Advertising or Scumware?

The term “contextual targeting” is/was one of the hottest buzzwords of 2003. Contextual targeting can be anything from syndicated search engine pay-per-click buys on editorial-related web sites to delivery of ads by way of software, typically downloaded by a user but sometimes surreptiously bundled in with another download. These software have earned the disreputable name of “scumware” or “theftware” because their ad serving tactics woo visitors away from one publisher’s site and over to another’s, hence taking with them the ad dollars the publisher might have otherwise earned.

Previous Court Battles Around Contextual Advertising

In July of this year, a Virginia court ruled that WhenU ads which broadcasted pop-ups over U-Haul’s web site were NOT illegal. This was a landmark ruling for contextual targeting ad companies, helping to both legitimize its methodologies and solidify this format as a true advertising medium.

There have been other court cases as well. Rather than litigate, Gator settled a case against them by media powerhouses including The Washington Post, The New York Times, Dow Jones and other digital publishers. And Overstock.com and Wells Fargo had also filed suit again WhenU.

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