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Smile Direct Club

SmileDirectClub, AG office reach settlement following refund policy litigation

June 22, 2023
The online orthodontics company and the DC attorney general's office have reached a settlement following a December 2022 lawsuit about the company's refund policy. Learn more.
Elizabeth S. Leaver, Digital content manager

A lawsuit filed against SmileDirectClub last year by the DC Office of the Attorney General has been settled, with the online orthodontics company agreeing to pay $500,000 and release thousands of customers from certain provisions that prohibited them from posting negative reviews of the company's products, according to financial website MarketWatch and WTOP, a DC news site.

In December 2022, stating its intent to “give voice to those who are silenced,” the AG’s office filed a suit against the company alleging that when customers tried to get their money back after 30 days, they were required to sign nondisclosure agreements (NDAs) to get their refunds, a violation of DC law.

For its part, SmileDirectClub stated in a press release that the company is “pleased to set the record straight” and that it doesn't require customers to execute a release or nondisclosure agreement before or during treatment to get a prorated refund.

The press release accuses the AG's office of “falsely alleging” that SmileDirectClub stifled consumer reviews by requiring consumers to agree to a confidentiality clause as a condition of getting a prorated refund for returning aligners after 30 days:

"SmileDirectClub does not require customers to execute a release or any form of nondisclosure before or during treatment or in order for a customer to retain a prorated refund. When a customer seeks a refund outside of the Lifetime Smile Guarantee, that form of release is modeled on a release form historically used in the industry. Given the infrequent use of the general release form (GRF) by SmileDirectClub over the years ... the Company already had plans to tailor the nondisclosure provision more narrowly in its GRF," states the release.

SmileDirectClub's chief legal officer, Susan Greenspon Rammelt, said the litigation gave SmileDirectClub an opportunity to address an "ongoing misinformation campaign" about its policies and to improve transparency.

“For too long there has been a misinformation campaign claiming SmileDirectClub stifles negative consumer feedback through the use of nondisclosure agreements,” she said in the press release. “While we were disappointed this misinformation caused the District of Columbia to file its complaint, we are pleased to set the record straight and work with the District of Columbia’s Office of Attorney General in its efforts to create new policy for the industry and increase customer transparency."