The Joseph Saveri Law Firm filed a class action lawsuit in April 2015 on behalf of Plaintiff purchasers of certain models of Lenovo notebook computers in the U.S. District Court for the Northern District of California, alleging multiple violations of federal computer fraud, racketeering, and consumer protection laws, as well as corollary and other common law claims under California, New York, and Ohio law.
From August 2014 through early 2015, Lenovo Group Ltd. pre-installed “VisualDiscovery” software designed by Superfish on at least 43 different Lenovo notebook computer models, which were then sold to consumers in the United States and elsewhere. This software was by definition spyware—hidden within each computer’s operating system to impede detection and of which users had no knowledge—that allowed Superfish to intercept, monitor, and alter computer users’ internet activities, and search the results.
Superfish was then able to capture and “monetize” the computer owner’s private online activity and search behavior by selling the data collected from unwitting Lenovo users to third parties. Lenovo agreed to install and conceal the spyware in exchange for a cut of the proceeds received by Superfish.
The Superfish software not only jeopardized security for anyone accessing the internet on affected computers, but caused significant performance issues for Lenovo laptops.
The suit, In re Lenovo Adware Litigation, seeks damages for loss of value and functionality to affected notebook computers.
In October 2015, Plaintiffs and Superfish entered into a settlement agreement in which Superfish agreed to a non-reversionary $1,000,000 payment to settle the claims against it. Superfish agreed to provide substantial cooperation to Plaintiffs, including (1) producing additional documents and discovery relevant to the litigation, (2) providing assistance to establish the authenticity and admissibility of documents, (3) making knowledgeable persons then-employed by Superfish available for interviews, (4) responding to requests for assistance in understanding the facts at issue, (5) providing at trial in person, by deposition or affidavit, representatives to testify, and (6) assisting in seeking Settlement Class certification.
On April 27, 2018 Plaintiffs and Lenovo entered into a settlement agreement, in which Lenovo agreed to make a $7,300,000 non-reversionary payment to be added to Superfish’s payment. These two payments constitute the Settlement Fund, and were given preliminary approval via a November 21, 2018 Court order from Judge Haywood S. Gilliam Jr. of the United States District Court Northern District of California.
Lenovo has separately entered into a consent decree with the Federal Trade Commission and 32 attorneys general. The decree forbids Lenovo from misrepresenting any software features preloaded on laptops to inject advertising into browsing sessions or to transmit sensitive consumer information to third parties. Lenovo was also assessed a $3,500,000 penalty.