Rogue anti-spyware vendors should take a cue from this case.

The U.S. state of Washingtons first case brought under its Computer Spyware Act just reached a conclusion, with a $1 million settlement.

Secure Computer LLC was charged with marketing its security software with misleading spam and pop-up ads. Pop-ups resembling Windows system alerts would tell users that their computers were infected with spyware, and would then offer free spyware scans that would falsely detect infections on their computers.

Secure Computers "scare-ware" solution: pay $49.95 for their Spyware Cleaner software. The state of Washington answered back with their own solution for Secure Computer: pay $75,000 to compensate over 1,000 Washington consumers who were scammed into buying the software.

But that's a thing of the past, now. The settlement prohibits the company from using deceptive marketing techniques to promote its software. Not that it's really an issue anymore - the company stopped distributing its programs when the suit was filed in January, and its website claims it's out of business.

Will a million dollar settlement put a damper on these scams? We'll keep you posted with the latest news.