Net Spying Firm and ISPs Sued Over Ad System

Net eavesdropping firm NebuAd and its partner ISPs violated hacking and wiretapping laws when they tested advertising technology that spied on ISP customers web searches and surfing, according to a lawsuit filed in federal court Monday.

The lawsuit seeks damages on behalf of thousands of subscribers to the five ISPs that are known to have worked with NebuAd. If successful, the suit could be the final blow to the company, which abandoned its eavesdropping plans this summer after powerful lawmakers began asking if the companies and ISPs violated federal privacy law by monitoring customers to deliver targeted ads.