Judge Dismisses U-Haul Pop-up Suit

U-Haul International Inc. doesn’t like it when pop-up ads for competitors appear on its Web site. But a federal judge says the truck rental firm will have to put up with it because the pop-ups are perfectly legal.

The September ruling by Judge Gerald Bruce Lee dismissed U-Haul’s lawsuit that had sought to ban the advertising software created by online marketing company WhenU.

The judge found that WhenU’s pop-up advertising “does not constitute trademark or copyright infringement or unfair competition” because U-Haul’s trademark doesn’t appear and because computer users choose to download the software.

“Alas, we computer users must endure pop-up advertising along with her ugly brother, unsolicited bulk e-mail — ‘spam’ — as a burden of using the Internet,” wrote Lee in granting WhenU’s motion for summary judgment on Sept. 5. U-Haul is considering an appeal.

“U-Haul has long believed that unwanted pop-up ads such as those provided by WhenU are the scourge of the Internet for both businesses and consumers,” said U-Haul spokesman Tom Prefling in an e-mail interview. “Web site owners have the right to display their Web sites without having them hidden behind such invasive advertisements.”

The lawsuit, filed in July 2002 in the U.S. District Court for the Eastern District of Virginia, claimed that WhenU violated U-Haul’s copyright and trademark, and created unfair competition by placing pop-up ads on its Web site for competitors’ products.

However, the judge threw it out based on an analysis of how WhenU’s software works.

WhenU’s ads appear on Web sites only because computer owners have downloaded the firm’s software, the judge wrote. Called SaveNow, it’s found in many Web-based free screen-saver programs that users download for free, Lee continued.

To be able to download the software, the computer user must sign a license agreement.

Using a directory of common search phrases, frequently visited Web addresses and keyword algorithms, SaveNow scans the user’s Internet activity to match the information in the directory. When a user visits a site in the directory, an ad appears, the judge explained in his opinion.

The ad pops up on top of everything else on the screen, and can be closed by the user. The ads are sometimes for competing products, sometimes not.

WhenU sells ad space to marketers, but doesn’t sell individual Web addresses to marketers nor guarantee that an ad will be shown when a consumer visits a certain Web site, the judge wrote.

“While at first blush this detour in the user’s Web search seems like a siphoning off of a business opportunity, the fact is that the computer user consented to this detour when the user downloaded WhenU’s computer software from the Internet,” the judge concluded.