The U.S. Federal Trade Commission is arguing for passage of the Counter Spy Act which would allow for greater penalties for spyware use. From The Register:

"It has been the agency's experience in spyware cases, however, that restitution or disgorgement may not be appropriate or sufficient remedies because consumers often have not purchased a product or service from defendants, the harm to consumers may be difficult to quantify, or the defendants' profits may be slim or difficult to calculate with certainty," she wrote in prepared comments (PDF) submitted on Wednesday. "In such cases, a civil penalty may be the most appropriate remedy and serve as a strong deterrent."

The problem is that legislators need a reasonable definition of spyware and if they base that definition on the form or structure of the malware instead of the function, then the spyware writes craft their code to avoid the legal definition of spyware.

As noted by Maxim Weinstein, manager of StopBadware,

"StopBadware.org has changed its badware guidelines multiple times in just two and a half years, due to ongoing changes in technology and badware practices, as well as an ongoing desire to make sure that we're 'getting it right',"