ADA, AAO, Align hit with antitrust lawsuit

An antitrust lawsuit was recently filed against the ADA, the American Association of Orthodontists (AAO), and Align Technology, claiming they conspired to drive the now-defunct clear aligner company SmileDirectClub out of business.

CDS Litigation filed a lawsuit on December 18 in the Superior Court of California against Align and the associations accusing them of engaging in a multiyear coordinated and illegal conspiracy to eliminate SmileDirectClub, their "most serious market competitor to protect their industry dominance at the expense of consumers' ability to access effective, affordable, and proven orthodontic care," according to a press release dated December 23 from CDS' attorneys, Susman Godfrey and Benesch Friedlander Coplan & Aronoff.

SmileDirectClub filed for bankruptcy in the fall of 2023 and abruptly closed in December 2023. Due to these actions, CDS has the right to pursue litigation claims held by SmileDirectClub against the ADA, the AAO, and Align, according to the press release.

CDS alleges that the ADA, the AAO, and Align colluded to drive SmileDirectClub out of business after Align could no longer profit from the clear aligner company's growth. Initially, Align invested $59.5 million in SmileDirectClub and supported it as an investor, board member, lender, and manufacturer. However, the partnership disintegrated after SmileDirectClub rejected Align's proposed $1.5 billion buyout bid and an arbitrator later forced Align out of the company in 2019 for improperly using its access to confidential and proprietary information, according to the press release.

Also, Align is accused of working with the ADA and the AAO to spread false and misleading claims about SmileDirectClub's safety and efficacy to damage its reputation with consumers and industry professionals. Furthermore, they are accused of filing baseless complaints with the U.S. Food and Drug Administration and the U.S. Federal Trade Commission and leveraged exclusive agreements with dental support organizations to block SmileDirectClub from accessing vital market opportunities, according to the press release.

Additionally, CDS claims in the suit that the ADA supported and endorsed teledentistry for years but sang another tune once it began reportedly conspiring with Align to falsely denigrate SmileDirectClub's business model.

Moreover, CDS accuses the ADA and the AAO of leveraging their positions as influential trade associations and active market participants to shield giant sponsors, including Align, and block disruptors like SmileDirectClub. Also, the associations reportedly engaged in a monopolistic conspiracy to ensure that disruptive models like SmileDirectClub's affordable solution could not succeed, according to the press release.

In December 2024, the New York State Attorney General announced that SmileDirectClub will pay $4.8 million in refunds to more than 28,000 customers for improper billing. Customers were reportedly told by SmileDirectClub to continue paying monthly installments for clear aligner treatment although they could no longer receive any treatment from the company will receive refunds.