IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
|FEDERAL TRADE COMMISSION, Plaintiff,
W.T.F.R.C. PTY LTD.
JURISDICTION AND VENUE
1. This Court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 1331, 1337(a), and 1345, and 15 U.S.C. §§ 45(a) and 53(b).
2. Venue in the United States District Court for the Eastern District of Virginia, Alexandria Division is proper under 28 U.S.C. § 1391(d), and 15 U.S.C. § 53(b).
3. Plaintiff, the Federal Trade Commission, is an independent agency of the United States government created by statute. 15 U.S.C. §§ 41 et seq. The Commission, inter alia, enforces Section 5(a) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. § 45(a), which prohibits unfair or deceptive acts or practices in or affecting commerce. The Commission has the authority to initiate federal district court proceedings, by its own attorneys, to enjoin violations of the FTC Act in order to secure such equitable relief as may be appropriate in each case. 15 U.S.C. §§ 53(b), 56(a)(2).
4. The Commission brings this action under Section 13(b) of the FTC Act, 15 U.S.C. § 53(b), to secure preliminary and permanent injunctive relief, rescission of contracts, restitution, disgorgement, and other equitable relief for defendants' deceptive and unfair acts and practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a).
5. Defendant Carlos Pereira ("Pereira"), doing business as atariz.com, PremiaNet Corp, Atari Corp, and piratelynx.com, is an individual who lists his residence as Apartado 320, Odivelas Loures, 2675 Odivelas, Portugal. He transacts or has transacted business in this District, and throughout the United States.
6. Defendant W.T.F.R.C. Pty Ltd. ("WTFRC"), doing business as Kewl Photographies, Kool Images, taboosisters.com, taboohardcore.com, and tabooanimals.com, is an Australian corporation with a registered office at 240 Margaret Street, 5th Level, Brisbane, Queensland, 4000, Australia, and a principal place of business at 8 Baracchi Crescent, Giralang, ACT, 2617, Australia. It transacts or has transacted business in this District and throughout the United States.
7. Defendant Guiseppe Nirta ("Nirta") is the director and secretary of WTFRC. He resides at 8 Baracchi Crescent, Giralang, ACT, 2617, Australia. At all times material to this complaint, acting alone or in conjunction with others, he has formulated, directed, controlled, or participated in the acts and practices of WTFRC, including the acts and practices set forth in this complaint. Nirta transacts or has transacted business in this District.
8. At all times relevant to this complaint, defendants have maintained a substantial course of trade, advertising, offering for sale, and selling of information and memberships via the Internet in or affecting commerce as "commerce" is defined in Section 4 of the FTC Act, 15 U.S.C. § 44.
9. "Internet" means a worldwide system of linked computer networks that use a common protocol to deliver and receive information. The "Internet" includes, but is not limited to, the following forms of electronic communication: electronic mail and mailing lists, the World Wide Web ("Web"), bulletin boards and newsgroups, chat groups, remote computer access (telnet), and file transfer protocol (ftp).
10. "URL" is an abbreviation for Uniform Resource Locator. Each Web page and Web site has a distinct URL, such as www.atariz.com or www.atariz.com/c_141.htm, that serves as a unique Internet address for that Web site or Web page.
11. A "Web site" is a set of electronic documents, usually a home page and subordinate pages, readily viewable on a computer by anyone with access to the Internet, standard software, and knowledge of the Web site's URL.
12. A "Web page" is a single electronic document within a Web site, readily viewable on a computer by anyone with access to the Internet, standard software, and knowledge of the Web page or Web site's URL. Web site visitors generally first link to its "home page," which is a Web page that serves as an index, or gateway, to the rest of the Web site's contents.
13. A "search engine" is a software program that searches Internet documents for specified keywords and returns addresses and descriptions of documents where the keywords are found. The term is often used to describe specific Web sites like AltaVista, Excite, and Lycos, which enable consumers to search for documents on the Internet or in newsgroups.
14. A "metatag" is a set of words or phrases within a Web page that, among other things, summarizes the contents of that Web page. Metatags contain such information as a general description of the page, keywords for search engines that describe the contents of the Web page, and copyright information. Typically, metatags are part of the source code of a Web page and are not readily visible to Internet users. Metatags are used by search engines to index Web sites for the purpose of comparing sites to an Internet user's search request.
DEFENDANTS' COURSE OF BUSINESS
15. Defendant Pereira uses technical tricks and thievery to drive consumers to defendant WTFRC's sexually-explicit, adult-oriented Web sites ("adult sites"). Defendant WTFRC then prevents consumers from leaving its adult sites by manipulating the normal functioning of consumers' Internet browsers. These practices expose consumers, including children, to unwanted, sexually-explicit, adult-oriented content. These practices also cause hardship to employees who unintentionally violate company policies against visiting adult sites on the job. More generally, these practices prevent consumers from locating the Web sites they desire to visit, and impair the growth of the Internet as a commercial medium.
16. Defendant Pereira subverts the manner in which search engines deliver search results to consumers. Normally, consumers enter a word or words using the search engine's inquiry function. The search engine returns a "results" page of Web pages and Web sites deemed relevant to the inquiry. The results page typically includes the title of the Web page, a short description of its contents, and a link to the URL for each Web page found.
17. Defendant Pereira makes unauthorized copies of (or "hijacks") Web pages created by unrelated third parties and posts these copies onto computer servers operated by defendant WTFRC, and others such as The Entangled Web, so that they will be indexed by the "spider" software used by search engines. These copies include not only the images and text of the hijacked Web pages, but also their metatags.
18. Later, when using a search engine that has indexed one of these copies, consumers unexpectedly encounter defendant WTFRC's adult sites. This happens even when consumers search for non-sexually-explicit topics such as children's songs and books, recipes, automobiles, popular movies, and others. For example, searching on AltaVista for children's medieval books returns, among others, two listings for "Gloriana's Book Store" with the following description, "medieval books for young readers." One is a listing for the original Web page located at http://www.gloriana.nu/kids2.html. The other is a listing containing the same description, but is for defendant Pereira's unauthorized copy located at www.atariz.com/kids2.html. If consumers click on the second listing, they never go to "Gloriana's Book Store." Instead, consumers are quickly taken to www.taboosisters.com, one of defendant WTFRC's adult sites.
20. After defendant Pereira has deceived consumers into visiting defendant WTFRC's adult sites, defendant WTFRC compounds the harm by preventing consumers from exiting their sites, and by redirecting consumers to other adult sites. Normally, the "Back" button on an Internet browser returns the user to the previously visited Web site, but defendant WTFRC disables the Back button so that consumers cannot return to the previously-visited Web site, which is usually the search engine result's page. Defendant WTFRC further traps consumers by altering the functioning of the "Close It" ("X") button located at the top right corner of the Internet browser screen. Normally this feature allows consumers to exit their browsers and leave the Internet entirely. Instead, when consumers attempt to use this button to exit, defendant WTFRC sends them to additional adult sites and forces consumers to view additional sexually-explicit images. Thus, by manipulating the functioning of these browser commands, defendant WTFRC is able to override consumers' attempts to exit defendant WTFRC's adult sites, and makes consumers' viewing of defendant WTFRC's adult sites unavoidable.
21. Defendants Pereira, WTFRC, and Nirta generate substantial revenues through this scheme of page hijacking and misdirecting consumers to defendant WTFRC's Web sites. Defendant Pereira has hijacked millions of pages from Web sites containing information about pies (www.atariz.com/pies.htm); folk music (www.atariz.com/Y03.htm); cars (www.atariz.com/suite.html), (www.atariz.com/TTcoupe.html); movie reviews (www.atariz.com/spCityOfAngels.htm); (www.atariz.com/SavingPrivateRyan.htm); business classifieds (www.atariz.com/pga0051.html); Web businesses (www.atariz.com/grlogin.htm); sports information (www.atariz.com/pol_ind.htm); astronomy (www.atariz.com/stareye.html); and non-profit organizations (www.atariz.com/inlgo.html). Operators of adult sites such as those owned by defendants WTFRC and Nirta often pay Webmasters and people such as defendant Pereira to direct consumer "traffic" to their adult sites. By causing consumers to unintentionally visit their adult sites, and then redirecting them to their other adult sites, it is likely that defendants derive revenues from each Web page view delivered to consumers, each click by consumers, and each transaction by consumers with defendant WTFRC's adult sites.
VIOLATIONS OF THE FTC ACT
22. In numerous instances, through the manipulation of search engine results by means of Web page hijacking, defendant Pereira has represented, directly or indirectly, that visitors to his Web pages will obtain information about children's songs, children's books, recipes, automobiles, popular movies, and other non-sexually-explicit materials.
23. In truth and in fact, visitors to defendant Pereira's Web pages do not obtain information about children's songs, children's books, recipes, automobiles, popular movies, and other non-sexually-explicit materials, but are instead redirected to Web sites operated by defendants WTFRC and Nirta that contain sexually-explicit, adult-oriented material.
24. Therefore, defendant Pereira's representations, as set forth above, are false and misleading and constitute deceptive acts or practices in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a).
25. In numerous instances, after defendant Pereira tricks consumers into visiting defendants WTFRC and Nirta's adult sites by misrepresenting the contents of these Web sites, defendants WTFRC and Nirta impede consumers from exiting their adult sites by manipulating the normal functioning of consumers' Internet browsers. In doing so, defendants WTFRC and Nirta force consumers into viewing additional sexually-explicit, adult-oriented material when attempting to exit defendants' Web sites.
26. In numerous instances, consumers suffer injury by unintentionally accessing defendants WTFRC and Nirta's adult sites at their places of employment in violation of employers' policies. In other instances, children suffer injury by unintentionally accessing defendants' adult sites in spite of the efforts of parents to protect their children against such access. This injury is unavoidable as defendant Pereira leads reasonable consumers to believe that they are going to the Web page described in the search engine's search results, not an adult site.
27. By deceptively inducing the consumers described in paragraph 26 above, and others, to visit their adult sites and then by impeding consumers from leaving their adult sites, defendants Pereira, WTFRC, and Nirta have caused or are likely to cause substantial injury to consumers that is not outweighed by countervailing benefits to consumers or competition.
28. Therefore, the practices of defendants Pereira, WTFRC, and Nirta, as alleged above, are unfair and violate Section 5(a) of the FTC Act, 15 U.S.C. § 45(a).
29. Consumers throughout the United States, including the Eastern District of Virginia, have been injured as a result of defendants' unlawful acts or practices. Absent injunctive relief by this Court, defendants are likely to continue to injure consumers and harm the public interest. By granting the requested injunctive relief, the Court can immediately halt these frauds being perpetrated on children and others.
THIS COURT'S POWER TO GRANT RELIEF
30. Section 13(b) of the FTC Act, 15 U.S.C.§ 53(b), empowers this Court to grant injunctive and other ancillary relief, including consumer redress, disgorgement and restitution, to prevent and remedy any violations of any provision of law enforced by the FTC.
31. This Court, in the exercise of its equitable jurisdiction, may award other ancillary relief to remedy injury caused by defendants' law violations.
PRAYER FOR RELIEF
WHEREFORE, plaintiff, the Federal Trade Commission, requests that this Court, as authorized by Section 13(b) of the FTC Act, 15 U.S.C. §53(b), and pursuant to its own equitable powers:1. Award plaintiff such preliminary injunctive and ancillary relief as may be necessary to avert the likelihood of consumer injury during the pendency of this action and to preserve the possibility of effective final relief; 2. Permanently enjoin the defendant(s) from violating the FTC Act, as alleged herein; 3. Award such relief as the Court finds necessary to redress injury to consumers resulting from the defendants' violations of the FTC Act; and, 4. Award plaintiff the costs of bringing this action, as well as such other and additional relief as the Court may determine to be just and proper.
Stephen L. Cohen
Dean C. Forbes
Michael W. Donohue
VSB # 43525
Attorneys for the Federal Trade Commission
600 Pennsylvania Avenue, N.W.
Washington, DC 20580
(202) 326-3222, 2831, 3563, 3665