The suit is also the first filed under the state’s spyware law of 2005, and alleges that the company surreptitiously installed the spyware onto millions of compact music discs (CDs) that consumers load into their computers when they play the CDs, which can compromise their systems.

Certain CDs recently issued by Sony contain new anti-piracy technology which is designed to prevent the CDs from being copied more than three times. However, the technology also installs files onto consumers’ computers that hide other files installed by Sony. This secret “cloaking” component is installed without the knowledge of consumers and can cause their computers to become vulnerable to computer viruses and other forms of attack.

The Attorney General’s lawsuit alleges that Sony violated a new Texas law protecting consumers from the hidden spyware.

“Sony has engaged in a technological version of cloak and dagger deceit against consumers by hiding secret files on their computers,” argued Attorney General Abbott, continuing: “Consumers who purchased a Sony CD thought they were buying music. Instead, they received spyware that can damage a computer, subject it to viruses and expose the consumer to possible identity crime.”

SONY insists that it has recalled all affected CDs. However, privacy experts are calling on the firm to more widely publicise the recall, as many purchasers of the affected discs may not be aware that the software could create a security breach.

In his legal action, the Texas Attorney General is seeking civil penalties of $100,000 for each violation of the law, attorneys’ fees and investigative costs.