America Online Inc.’s subsidiary, Netscape, is being accused by New York attorneys of illegally monitoring downloads using SmartDownload software. The result of the claim against Netscape’s illegal spying on users is the filing of suit in federal court. The attorneys have asked that the legal claim be granted class action status.

Apparently users who have downloaded information from the internet have identifiable information transmitted back to Netscape. From there, information is compiled and profiles can be created of a customer’s downloads.

Depending on the resolution, this type of privacy violation could have an impact in other industries that would like to know who is downloading what information off the Internet. While most people seem to like the idea of maintaining web privacy, there are those who wouldn’t mind having access to what users are downloading. For instance, the music industry would just love to get the names of the many users it claims have downloaded copyrighted music illegally.