Newspapers Sue Gator Over Online Advertising

By: Anick Jesdanun, AP Internet Writer

(AP) Complaining of parasitical behavior, some of the nation’s largest news publishers are suing Internet advertising company Gator Corp. over software that triggers pop-up ads when surfers visit their Web sites.

“We make all the investment to gather and collect news and set up an attractive Web site,” Terence Ross, an attorney for the publishers, said Friday. “Gator, without making any equivalent investment, reaps the profits.”

The lawsuit was filed this week in U.S. District Court in Alexandria, Va., by a group that includes parent companies of The New York Times, USA Today, The Wall Street Journal, and The Washington Post, as well as the digital arms of Knight Ridder and Conde Nast.

In it, the publishers call Gator “a parasite on the Web that free rides on the content of others.” They seek an injunction and unspecified damages.

Gator, based in Redwood City, Calif., runs an ad network that claims 22 million active users and 400 advertisers. Internet users get Gator advertising software when they install a separate product for filling out online forms and remembering passwords.

Gator also comes hitched with free software from other companies, including games and file-sharing programs.

As users surf the Web, Gator runs in the background and delivers advertisements on top of what the surfer would normally get at a site.

Though the Gator ads are marked “GAIN” — for Gator Advertising and Information Network — many consumers won’t know the difference and will instead blame the site for an unpleasant experience, Ross said.

He acknowledges that some of the publishers, including the Times, do deliver pop-up ads, but he said their timing, frequency, and nature are typically controlled.

“What if in a story covering the tragic event of Sept. 11, Gator suddenly popped up an advertising for a flight training school?” Ross said. “That would be wholly inappropriate.”

In some cases, the lawsuit charges, Gator’s ads are for services that compete with the publishers’ — for example, a Travelocity.com ad appears while surfing CondeNet’s concierge.com. Both provide travel-related services.

In a statement, Gator pledged to vigorously defend the lawsuit. To Gator, its pop-up windows are no different than what happens when a user runs instant messaging, e-mail, or other programs in separate windows while surfing a Web site.

“While we understand why these publishers of advertising-supported Web sites feel threatened by us, we are certain that being a strong and thriving competitor is not illegal,” said Jeff McFadden, the company’s chief executive.

In response to questions via e-mail, McFadden said Gator may file its own lawsuit seeking a declaratory judgment that consumers have the right to decide what is displayed on their computer screens and that Gator’s practices constitute lawful competition.

Responding to the publishers’ claims of copyright and trademark infringements, Gator said its practices do not involve copying of the publishers’ site or using their trademarks.

But Ross said Gator could be held liable because ads block copyrighted material — and hence its presentation — and could confuse visitors into thinking the pitches were authorized by the Web site.

Gator’s advertising practices have come under fire before.

Last year, the Interactive Advertising Bureau threatened to file a complaint with the Federal Trade Commission over Gator’s selling of ads that block out the ads displayed on other Web sites. Gator responded with a federal suit against the trade group. Gator ultimately agreed to stop the practice.

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