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Yogurt Maker Dannon Settles Activia Lawsuit

Dannon Co was sued for claiming that its yogurt had added health benefits over the competition. The class action lawsuit was filed in Los Angeles federal court last year. It claimed that the company falsely represented Activia, Activia Lite and DanActive products. The class action lawsuit claims that the company tried to convince people of the added health benefits of its probiotics bacteria in an effort to encourage people to purchase the more costly product.

dannon.jpgThe LA Times reports that Dannon has settled the lawsuit. It also agreed to a $35 million fund to be set up to reimburse consumers who purchase these products. The company does not admit to any wrongdoing in the case. It settled the case to, “avoid the distraction and expense of litigation” says the company’s spokesman Michael Neuwirth.

The probiotics products are designed to add “good bacteria” to the human intestinal tract. In healthy, young adults, these good bacteria help to keep the body healthy by destroying microorganisms and helping with digestion. The probiotics often need to be supplemented in older people. In the U.S.to claim on a label that a food contains probiotics, it must have proven health benefits through research.

The company has agreed to amendments to its labeling practices. It will make the scientific names of the probiotics more visible on the label and will remove the term “immunity” from the labels of DanActive products. The current label claims that the DanActive product offers a positive benefit to the digestive tracts immune system.

Those who purchased the DanActive products will be able to receive up to $100 per customer, according to the LA Times. Consumers will need to submit a claim form, which must be approved.

The company launched the Activia and DanActive lines in 2006 and 2007 in an effort to boost the yogurt industry. They account for 40 percent of the company’s business.