Zango explained in a blog posting that it dropped the suit because PC Tools made changes to its software and no longer removes or blocks the Zango software.
PC Tools hailed the move as a victory, claiming that Zango had conceded defeat. The security vendor linked the withdrawal to a preliminary ruling when a judge denied Zango's demand for a temporary injunction against PC Tools.
PC Tools had previously dismissed the legal case as a cry for attention, and was in the process of reclassifying the adware application prior to the lawsuit.
Zango is no stranger to this tactic as it has a better track record of filing lawsuits than it has of waiting for a verdict.
The company dropped cases against a group of seven distributors, claiming that it interfered with a Federal case against some of the individuals.
Zango has previously dropped charges against ZoneLabs, a subsidiary of Check Point, after the security vendor stopped labelling Zango software 'high risk spyware'.
The Federal Trade Commission fined Zango US$3 million last year for unfair and deceptive business practices.
The firm promised at the time to stop its illegal practices, but security experts have repeatedly charged that the firm continues to violate the terms of the settlement.
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