ConsumerLab.com has dropped its lawsuit against Washington DC-based Council for Responsible Nutrition (CRN), both groups have announced.
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 New York company's website, 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. However court hearings this year dismissed some of Consumerlab.com's claims.
In response to Consumerlab.com dropping its lawsuit, CRN stated: "Today's voluntary filing vindicates CRN … 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.
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."