AV Vendors Have Immunity for Malware-Blocking Decisions, Court Says

Antivirus software vendor Malwarebytes successfully cited a rarely used provision in the Communications Decency Act of 1996 (CDA) to win dismissal of a lawsuit that accused the company of using its software to interfere with a rival's product.

Enigma Software Group (ESG), a provider of anti-malware tools, in October 2016 sued rival Malwarebytes for unlawfully characterizing Enigma's software as potentially harmful to users.

In its complaint, Enigma alleged that Malwarebytes's AV software was wrongly classifying Enigma's SpyHunter and RegHunter tools as potentially unwanted programs (aka PUPs) and either quarantining them or warning end users that the software posed a security threat to their systems.

Enigma claimed that Malwarebytes was trying to interfere with its client base in retaliation for a lawsuit that it had previously filed against Bleepingcomputer.com, a Malwarebytes affiliate. The vendor noted that Malwarebytes' software for 10 years previously had not identified either SpyHunter or RegHunter as unwanted software or malware.

Malwarebytes argued that its actions were protected under Section 230(c)(2)(B) of the CDA, which provides legal immunity to computer vendors that provide "technical means to restrict access" to obscene, lewd, excessively violent, and otherwise objectionable content.

Malwarebytes claimed that as provider of filtering tools for restricting access to items it deems as objectionable, the company had immunity under the Section 230 provision.

Federal Judge Edward Davila of the US District Court for the Northern District of California Tuesday agreed with Malwarebyte in dismissing Enigma's lawsuit. Judge Davila rejected Enigma's argument that the language in Section 230 does not apply to malware but to other types of objectionable content such as obscene, lewd, lascivious, and violent content.

He also noted that contrary to Engima's claims, the law indeed gives Malwarebytes the legal authority to decide what is "objectionable" material and filter it or warn users about it. The immunity offered under Section 230(c)(2)(B) is available to providers such as Malwarebytes regardless of whether they are acting in good faith or not when filtering objectionable content, Judge Davila noted in his 7-page decision.

The decision marks the second time in the last eight years that an anti-malware vendor has successfully used the CDA provision to overcome a similar legal challenge. The last time was in 2009, when Kaspersky Lab used the provision to overcome a lawsuit filed against it by Zango Inc.

"Since the Zango vs Kaspersky case, we have seen very few challenges to the antivirus, antispyware, and anti-spam industry," over how they filter out objectionable content, says Eric Goldman, a professor at the Santa Clara University School of Law.

Before that case, there was much agitation over lawsuits and threats to sue people in the anti-malware industry over their classification decisions, Goldman says. "It created a lot of stress among those vendors," he says.

On the one hand, they needed their tools to be robust enough to block malware threats, while on the other the vendors had to be extremely careful when classifying content as unwanted and objectionable. "They had to get it just right every time," he says.

The ruling in the Malwarebytes case is consistent with the ruling in the Kaspersky case, and is another rare example of the Section 230 provision being used successfully to litigate a case. A vast majority of the cases involving Section 230 disputes have to do with liability for hosting objectionable content, Goldman says.

Andy Serwin, co-chair of the privacy group at Morrison & Foerster, says this week's ruling in the dispute between Enigma and Malwarebytes does not surprise him. "This issue has been litigated before," with the same outcome, he says.

That does not mean that vendors such as Enigma have no recourse. Companies such as Malwarebytes have considerable immunity in such disputes. But third parties whose malware signature or other information that Malwarebytes or other anti-malware firms use for filtering decisions, may not always have that protection.

"This is not a situation where if there is a wrong, there is no remedy," at all Serwin notes. "It is just against whom that remedy is available."

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