• Targeted Ad Service Sued for Privacy Violations
  • January 8, 2009
  • Law Firm: Manatt, Phelps & Phillips, LLP - Los Angeles Office
  • NebuAd Inc., a start-up company that has developed a product permitting Internet service providers to closely track the online surfing habits of their subscribers, is now facing a lawsuit by customers claiming the product violated their privacy rights.

    Fifteen plaintiffs have filed a complaint in San Francisco federal court against NebuAd and six ISPs that briefly used its product. They are seeking class action status and more than $5 million in damages.

    NebuAd’s product was aimed at allowing ISPs and others to develop ad campaigns targeted to individual users. In a beta trial, NebuAd installed its hardware on ISP data hubs and then reported the results to the ISPs. The ISPs’ subscribers were not informed that their Web surfing habits were being tracked by the product.

    “Like a vacuum cleaner, everything passing through the pipe of the consumers’ internet connection was sucked up, copied and forwarded to the California processing center,” stated the lawsuit, which charges NebuAd and the ISPs with violating federal and state privacy laws.

    After privacy advocates and federal lawmakers voiced concerns about the technology over the summer, the six ISPs named in the lawsuit each told Congress it had dropped NebuAd’s technology. The ISPs are Bresnans Communications, Cable One, CenturyTel, Embarq, Wow!, and Knology.