In August 2012, California resident Raquel Torres called Nutrisystem's toll-free 800 number and engaged in a "sensitive, private and confidential discussion" with one of the weight-loss company's employees, according to a federal lawsuit.
Torres felt so comfortable that she provided her social security number because Nutrisystem did not advise her that the Pennsylvania-based business records all of its calls.
Using two powerhouse Orange County law firms--Callahan & Blaine, and Scott J. Ferrell's Newport Trial Group, Torres sued, claiming that Nutrisystem violated California law banning the secret recording of telephone calls.
But the case met a monumental opponent inside the Ronald Reagan Federal Courthouse in Santa Ana: U.S. District Court Judge Cormac J. Carney.
Carney refused in April to grant class-action status to the complaint for likely thousands of California residents who may have been secretly recorded by Nutrisystem.
In his ruling, the judge noted that the company had altered its policies to ensure all callers are informed they are being recorded.
Carney's decision, which equated to no potential for a meaningful, financial settlement, led this past week to Torres' lawyers asking to voluntarily dismissing the lawsuit.
On July 3, Carney formally closed the case.
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According to court records, both sides will pay their own legal expenses.
Manatt, Phelps & Phillips successfully represented Nutrisystem.