Sony BMG Music Entertainment on Thursday settled lawsuits with an additional 39 states and the District of Columbia over allegations that the company planted spyware on CD buyers' PCs without their knowledge. The total payout will be $4.25 million or more.
Two days after Sony BMG reached agreements with California and Texas totaling at least $1.5 million, it agreed to pay each of the 13 states that began the lawsuit $316,000, and the remaining states and D.C. $5,000 each, according to Associated Press reports. As in the California and Texas settlements, Sony BMG has promised to refund up to $175 to each person who spent money to repair computers damaged by attempts to uninstall the rootkit Sony used to mask its CD copy-protection software.
"Consumers do not expect music CDs to contain hidden software which could expose their computers to viruses and other security risks," said Tom Reilly, Massachusetts' attorney general, in a statement. Reilly had led the settlement effort by the 39 states and D.C. "If companies want to use technology to protect their interests, they need to be up-front with consumers, and give consumers the opportunity to make informed choices about buying and using these products."
Among the participating states were Michigan, New York, Oregon, Pennsylvania, and Wisconsin.
Sony's problems began in November 2005, when independent researcher Mark Russinovich reported that the New York-based company was using a rootkit to "cloak" digital rights management software on PCs that played the company's CDs. Users had not been told that the rootkit, technology often used by spyware authors to prevent detection by security software, had been installed. Later analysis by Russinovich and others found that uninstalling the code could damage the computer, and that hackers could use the rootkit to add other malicious code to the compromised machines.
Sony BMG, a joint venture between Sony Corp. and Bertelsmann AG, has set up a Web site that outlines that settlement and the process for filing an individual claim.