Last month, Zango filed a lawsuit against Australian software company PC Tools. That company’s “Spyware Doctor” product (at that time, version 5.0.0.169) literally and systematically eliminated Zango software from consumers’ machines without notice of any sort or any opportunity for them to object.

Prior to filing suit, Zango attempted to work with PC Tools to get it to update Spyware Doctor and put a stop to the anonymous and silent vandalism it was perpetrating. When PC Tools ignored those attempts, Zango had no choice but to proceed in a much more formal fashion.

Filing the litigation helped get PC Tools’ attention. Filing a motion for a temporary restraining order (TRO), an extraordinary and unusual legal remedy, really got its attention. Between May 25, when Zango made its TRO motion, and May 31, when PC Tools filed its opposition to the motion, PC Tools implemented dramatic changes to Spyware Doctor. Those changes were sufficient to convince a federal judge that the TRO was unnecessary, even though PC Tools has caused Zango (in the judge’s own words) “some degree of irreparable harm.”

So, while the TRO paperwork was denied today, the essential relief Zango sought in its TRO motion was in effect granted – by PC Tools itself. Spyware Doctor is now being distributed in version 5.0.0.186 and – surprise! – that version neither eliminates nor blocks Zango software. Spyware Doctor previously described Zango software as an “Infection” engaged in “Malicious Action” representing an “Elevated Risk; in telling contrast, version 5.0.0.186 attaches an “Info” label to our software, which (in the words of PC Tools’ Chief Operating Officer John Sarapuk) means Spyware Doctor finds “no known risks” associated with Zango.

The bottom line is that PC Tools has been forced by the lawsuit (and TRO motion) to publicly implement what it has been privately telling Zango for weeks.  Back in late March, PC Tools’ Malware Research Centre Director Jim Meem confirmed to Zango that internal testing at PC Tools had revealed that Zango’s software “is not malicious.”

Bloggers and others will accurately note that Zango’s TRO request against PC Tools has been denied. But the changes to Spyware Doctor made by PC Tools while that motion was pending make both Zango and – most importantly – Internet consumers the real winners here. We recognize the theoretical value that scanning applications like a Spyware Doctor provide to consumers; assisting consumers in preventing the surreptitious download of malicious software is a very good thing. Spyware Doctor version 5.0.0.169 was much too heavy-handed in its approach, as even PC Tools recognized.

Zango’s lawsuit against PC Tools will proceed, as issues like Zango’s damages remain unresolved. But the immediate threat to our livelihood and consumer choice appears to have been quelled by PC Tools’ decision to upgrade Spyware Doctor to version 5.0.0.186.