Ice cream chain sues over TV report criticizing product

NEW YORK (Reuters) - A chain of ice cream stores in New York is suing over reports by a television consumer watchdog reporter that its creamy desserts are less healthy than advertised, according to a lawsuit filed on Monday.

Arnold Diaz, a reporter for Fox 5 News, whose reports titled "Shame, Shame, Shame" are aimed at uncovering deceptive business practices that harm consumers, was named in the lawsuit filed by Matthew Prince. He recently opened three D'Lites Emporium ice cream stores in Long Island, New York.

Prince said his business has been ravaged after being featured in an eight-minute segment last month in which Diaz claimed that the stores were "selling a lie", according to documents filed in New York State Supreme Court.

D'Lites advertises its ice cream as being "low in sodium, sugar, fat, and carbohydrates." Diaz, in his segment, said his team had done laboratory tests that suggested the ice cream was unhealthier than had been claimed.

Prince contends that the laboratory tested unfrozen, concentrated ice cream mix, which does not reflect the frozen, aerated, relatively diluted product served to the customer. He says the laboratory used by Diaz's team conceded the point, and issued a supplemental report that agreed with D'Lites' own nutritional claims.

The lawsuit names parent company News Corp and FOX 5, alleging the makers of the broadcast knowingly ignored the laboratory's corrected verdict for the sake of good television.

A spokeswoman for Fox 5, who responded to Reuters' request to News Corp for comment, disputed Prince's claim. "FOX 5 stands by Arnold Diaz's story," the spokeswoman said in an e-mail.

D'Lites Emporium -- which is unrelated to the similarly named Tasti D-Lite ice cream chain -- is an ice cream company based in Coral Springs, Florida. Prince is one of the company's several licensees around the country. He says that as a result of the broadcast hundreds of customers have stayed away and that his business expansion plans have been derailed.

(Editing by Barbara Goldberg and Greg McCune)