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SmileDirectClub slams NBC with $2.85B lawsuit for ‘hit piece’ about company

May 20, 2020

In a lengthy lawsuit that runs over 200 pages, SmileDirectClub—which claims to market its clear tooth aligners to straighten a buyer’s smile for up to 60% less than braces—has accused NBC Universal Media and reporter Vicky Nguyen of publishing false and misleading information about its operations and is seeking $2.85 billion for defamation, The Tennessean reports.

In a lawsuit filed on Tuesday, May 19, in Davidson County Circuit Court, attorneys for SmileDirectClub argue that the local NBC affiliate TV station aired over 40 false claims about the Nashville-based company during a February 13 broadcast. The newscast discussed the safety and effectiveness of SDC’s treatments and pushed back on the company’s practices at its hundreds of locations worldwide.

“The breadth of its misconduct is staggering,” the complaint reads, going on to call NBC’s claims inaccurate and a “hit piece.” 

“We stand by our reporting and believe this is a meritless claim,” an NBC News spokesperson said by email Monday.

Founded in 2014, the SmileDirectClub says that it “prides itself on providing affordable and accessible orthodontic care through its teledentistry.” Its dentists and orthodontists, 95% of whom the complaint says have their own practices, provide clear aligner therapy to straighten teeth.

The company says its patients would likely otherwise avoid treatment due to the cost or other accessibility issues. SDC patients pay up to 60% less than the typical rate for a retainer.

Indeed, The Tennessean reports, the lawsuit says opting for a treatment from SDC is not much different than seeking help in-person since the licensed doctors follow the same treatment protocols and render the same standard of care. 

During the broadcast, Nguyen, an investigative and consumer correspondent for NBC Nightly News, reported that SDC doctors didn’t follow standards and could be unsafe for patients.

Before the piece aired, SDC says in the complaint that they provided NBC with hundreds of documents with information about doctors and standards of care. They also made executives, doctors, and patients —even ones who initially had concerns about their treatment—available for interviews. NBC declined.

“SDC brought this lawsuit for its employees and officers, for its affiliated doctors, for its shareholders, and to recover from the damage NBC caused to its business and reputation,” said Erik Connolly, one of the attorneys representing SDC. “SDC respects the role that the media play in our society, but expects truthful accounts. NBC’s reports were defamatory, not truthful, and the facts show that NBC knew it was not telling the truth.”

The newscast featured interviews with people who said they were former patients of SDC and shared some issues they had with the company and their dental treatments.

In its complaint, SDC shrugged off responsibility, instead saying SDC-affiliated doctors are actually responsible for treatment, not the company itself. The company also pushed back on claims that it was offering “do it yourself” dentistry. 

After the report aired, SDC’s stock plummeted 15%, the lawsuit says, and it continued to. On Feb. 20, the stock price closed at $12.07 per share and by Feb. 26, it was down to $8.

Patients canceled their appointments, and the company lost an estimated $950 million in revenue. SDC employees had their reputations ruined, attorneys allege, because of NBC’s “reckless disregard.”

In additional to the $2.85 billion, The Tennessean notes, SDC is seeking a jury trial. 

Research contact: @Tennessean_d