ConsumerLab.com has dropped its lawsuit against the Council for Responsible Nutrition, both groups announced last week.
The suit originated after CRN asked the Federal Trade Commission in January 2005 to investigate ConsumerLab.com's business practices. ConsumerLab.com tests vitamins and supplements; companies that pay for testing are guaranteed to have positive results posted on the free section of the White Plains, N.Y., company's Web site, while negative results are not mentioned. Meanwhile, companies that do not pay the $3,750 fee risk having negative results published, and any positive results are posted on the subscription-only area of the Web site, according to the complaint. In its letter to the FTC and the media, CRN described these practices as "unfair and deceptive," and said the business model "intimidates manufacturers to pay for its services." CRN is a Washington, D.C., based trade association that represents ingredient suppliers and manufacturers of dietary supplements.
In March 2005, the FTC refused to take action on CRN's complaint, and the following month, ConsumerLab.com filed suit, claiming that CRN's letter defamed the company. CRN sought to have the case dismissed but a New York Supreme Court denied the motion.
According to a published statement by CRN, "All but one of ConsumerLab.com's claims in the lawsuit were dismissed by the court earlier this year. Today's voluntary filing vindicates CRN by dismissing the final count of ConsumerLab.com's lawsuit." The trade group also noted that "ConsumerLab.com received no money from CRN and no retraction of any kind in return for dropping the case. ConsumerLab.com dropped its lawsuit as CRN was about to ask the court to require ConsumerLab.com to produce additional information and documents about its business practices."
ConsumerLab.com had a different take on the final outcome. "CRN's legal tactics had forced ConsumerLab to divert an extraordinary amount of resources to the case. For practical purposes, ConsumerLab's position was already vindicated when the FTC found no reason to take action with respect to CRN's complaint," the company said in a statement. "It was clear that continuing at full steam to test our products and publish our reports for consumers was more important than eventually winning this case. We could not let CRN slow us down. We chose to drop the case."
Neither company seems ready to concede to the other, however. Steve Mister, president and chief executive of CRN, said "We were prepared to see through the litigation. We had concerns to begin with and we still have concerns," though he declined to say what the group's next step might be. Mister emphasized that CRN supports independent certification and testing programs, such as those offered by U.S. Pharmacopeia and NSF International. "They're good for consumers because they provide confidence in the products and they're good for industry because they level the playing field," he said.
But he said ConsumerLab's practices "play both sides of the aisle," taking money "from the industry on the one hand, and on the other they take money from consumers who are buying these test results. But they don't get to see everything, and that does a disservice to the consumer."
Tod Cooperman, president of ConsumerLab, defended his company's practices, saying its voluntary certification program "is no different than the ones that [CRN officials] endorse, that their members offer, where companies come to them and pay a fee." Cooperman said the voluntary certification program is distinct from its independent product reviews. "[CRN] tried to make it sound as if a company could pay us off in our independent product reviews, which is certainly not the case."