Multnomah County prosecutors said there was no basis for prosecution following a four-week investigation.
Senior Deputy District Attorney Don Rees cited "contradictory evidence, conflicting witness statements, credibility issues, lack of forensic evidence and denials by Mr. Gore" in a memo to Multnomah County District Attorney Michael Schrunk.
According to Rees, Molly Hagerty — the woman who claimed that Gore propositioned her and tried to hug her when she came to his hotel room to give him a massage — failed a polygraph test and would not say if she was paid by a tabloid newspaper for her story. He also said her attorneys were uncooperative.
"The matter is closed and the investigative materials will be returned to PPB [the Portland Police Bureau]," Rees said.
"Mr. Gore unequivocally and emphatically denied this accusation when he first learned of its existence three years ago," Gore's spokeswoman said in a statement. "He respects and appreciates the thorough and professional work of the Portland authorities and is pleased that this matter has now been resolved."
According to police, the woman's lawyer contacted authorities in 2006, but she refused to be interviewed by detectives. The woman declined to participate in a criminal investigation because she planned to pursue a civil case at the time, Portland Det. Cheryl Waddell told The Oregonian. There is no evidence a civil suit has ever been filed, according to the newspaper.
Gore, 62, and his wife Tipper announced their separation in May.