Yahoo sued over typo-squatting

Yesterday, I reviewed an article from the Washington Post which covered the typo-squatting issue.

Today, in his Security Fix column, Washington Post writer Brian Krebs covers a class-action lawsuit against Yahoo alleging syndication fraud. Related to last month's report of Yahoo and click fraud, the claims are that Yahoo knowingly displays advertisements on typosquatting sites and through spyware.

4. For example, in spite of Defendants' promise and duty not to place ads in pernicious spyware programs, Defendants have done just that, and have charged their advertising customers for every click made on spyware pop-up ads. Defendants have also represented that advertisements would be "highly targeted" when, in fact, Defendants entered into syndication agreements with companies that show random ads that are the opposite of "highly targetd." Defendants have further represented that advertisements would appear in "high quality" substantive sites when, in fact, Defendants and their Syndication Partners ... placed such advertisements in a variety of low-quality sites without bona fide content....

The lawsuit alleges that Yahoo didn't merely fail to prevent abuse by typosquatting sites, but actually knowingly manipulated that system for its own purposes.

20. However, instead of safeguarding against such abuse, finding such practices, and diligently putting a stop to them, Defendants have actually engaged in such abuses. In fact, not only have Defendants turned a blind eye to abuse of their PPC advertising system, but Defendants knowingly have manipulated that system for their own benefit, by increasing the volumne of improper advertising displays during financial reporting periods when Defendants were at risk of failing to meet investor expectations.

For the full story, see Suit Levels Spyware, Typosquatting Allegations at Yahoo. A copy of the lawsuit is available (pdf).