The bad news just doesn't stop for defunct direct to consumer orthodontic company SmileDirectClub. The company filed for Chapter 11 bankruptcy on September 29, 2023 after rocketing into mainstream news as it grew, before crashing back to the ground and disappearing.
Without going into all the details of the company's rise and spectacular fall, I'll keep this post about the most recent news item. However, most doctors had concerns over a company that provided treatment to individuals without exams or monitoring by a licensed professional.
In February 2020 NBC News released a story about SDC. NBC had placed hidden cameras in 3 different SDC locations and recorded employees interactions with customers. The videos obtained were used in the news piece and were less than complimentary.
In the lawsuit SDC filed against NBC Universal Media the company stated that over 40 "false and misleading" claims were made. They were seeking $2.85 billion in damages.
Fortunately NBC is a large company and refused to be intimidated by a lawsuit that attempted to keep these types of reporting from being done.
In 2021 the lawsuit was dismissed by a judge in Tennessee (where the case was filed). In 2023 SDC appealed that decision and the question went before the Tennessee Court of Appeals. Now in September 2024, the Tennessee Court of Appeals upheld the lower court's decision. They stated:
“Considering the evidence in a light most favorable to the plaintiffs and disregarding all countervailing evidence, we have determined that the plaintiffs presented prima facie evidence of falsity to support some of their claims but failed to produce clear and convincing evidence of actual malice,” the decision stated. “Accordingly, we affirm the judgment of the trial court.”
Of course the end result doesn't really hurt SDC since they are bankrupt. The company is required to pay for NBC's attorney's fees, but one wonders where that money will come from. Odds are that those fees are never recouped by NBC.
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