The Federal Trade Commission and Roca Labs could soon resolve a high-profile dispute about whether the weight-loss supplement company wrongly attempted to stifle bad reviews.
The FTC said in new court papers filed with U.S. District Court Judge Mary Scriven in the Middle District of Florida that it has been negotiating with Roca Labs for several months about the possibility of settling charges.
"The parties continue to believe that settlement is likely," FTC attorney Carl Settlemyer wrote. The FTC and Roca Labs arrive at a deal as soon as March 1, when they're slated are slated to attend an official mediation conference.
The lawsuit dates to September, when the FTC alleged that Roca Labs engaged in an unfair business practice by trying to prevent buyers from publishing honest reviews. The move appeared to mark the first time the agency asserted in a lawsuit that suppressing commentary is in itself an unfair practice.
Roca Labs, which touts its weight-loss products as more effective than gastric bypass surgery, allegedly said in a former version of its sales terms (sent in package inserts and also available online) that Web reviews would be considered defamatory. The company also told consumers that they would be subject to $100,000 in damages for posting reviews, according to the FTC.
The agency also alleged that Roca Labs didn't disclose that it paid users to post positive reviews, and that it violated consumers' privacy by disclosing their personal health information in court filings and other documents.
Roca Labs lost an early round in the case last October, when Scriven granted the FTC's request for an injunction banning the company from continuing to tell consumers they can't post negative reviews.
The company unsuccessfully argued that the FTC isn't empowered to "dictate the terms of private contracts between private parties."
Roca Labs was involved in several lawsuits before the FTC filed its complaint. Among others, in 2014 Roca Labs sued a Pennsylvania resident and an Illinois resident who both allegedly posted public complaints about the products on Web sites operated by the Better Business Bureau. Roca Labs dropped the matter later that year.