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The company that produces Invisalign teeth straighteners has agreed to pay $16 million to investors to settle claims it deceived them about its upcoming business challenges.
Align Technology Inc. and plaintiffs filed for preliminary approval of the Invisalign settlement Friday in a San Jose federal court, after two rounds of mediation, Law360 reported.
Investors first sued Align in 2018, alleging the company lied to investors about the increase in competition it was facing as patents on some of its technology expired.
Investors said share prices later plummeted by nearly $59 following news about a secret discount promotion that was hurting the prices of Align’s products, Law360 reported.
Since then, the complaint has been dismissed once, and filed with amendments.
The plaintiffs asked the court to approve the Invisalign settlement in the Friday motion, saying they would face significant challenges through litigation.
“Defendants would have vigorously challenged lead plaintiff’s ability to prove loss causation and damages, adding risk at summary judgment and trial,” the motion reportedly states.
“These risks had the real potential to diminish or eradicate the settlement class’s recovery.”
The settlement would be distributed proportionally among those who bought Align stocks during the class period and suffered losses that qualify for recovery, the motion states.
Counsel for the plaintiffs plan to apply for no more than 20% of the settlement, based on the time they put into the case. It is estimated lead counsel worked on the case for about 4,375 hours, the motion reportedly says.
The Invisalign class action settlement with investors comes as Align Technology faces multiple class action lawsuits from consumers.
In a May class action lawsuit, plaintiffs allege the company has been overcharging consumers through its stranglehold on the market.
Consumers allege Align has for the last several decades gained control of at least 80% of the aligner market through its massive patent holdings and litigious nature against potential competitors. However, as the patents began to expire in 2017, plaintiffs say Align implemented an anticompetitive scheme to maintain its monopoly position.
In 2019, a class action lawsuit alleged the company knew that maintaining a monopoly on intraoral scanners would influence dental practices to use the matching brand of dental aligners, prompting them to artificially increase prices and maintain control over the industry.
What do you think of this Invisalign lawsuit settlement? Let us know in the comments!
The plaintiffs are represented by Jennifer L. Joost, Stacey M. Kaplan and Johnston de F. Whitman Jr. of Kessler Topaz Meltzer & Check LLP.
The Align Investors Class Action Settlement is Lu v. Align Technology, Inc. et al., Case No. 5:18-cv-06720, in the U.S. District Court for the Northern District of California
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22 thoughts onInvisalign Company Reaches $16M Class Action Settlement With Investors
Dentist can chose to use whichever lab they want to create intraoral dental orthotic appliances or prosthetics. Dentists were not forced to use the scanner, or use it in conjunction with Invisalign trays. Although, I would support that. There are many products on the market that can only be used with the manufacturers parts. Patients are free to chose any dentist who uses clear aligners, that are not name brand Invisalign. These class action lawsuits are lawyer greed. They benefit the most. The lawyers make millions or billions in legal fees plus there percent of the settlement. The consumer only gets a few dollars to A few thousand. A lawyer would rather find a petty reason to sue a large corporation, than to provide legal services to an individual. Poor and middle class people can’t afford lawyers for serious injustices. They charge $300-400 for a consultation and upwards of $30,000 to litigate. That keeps the rich, rich, and the poor, poor. I know this from personal experience. The law should be for everyone, not just those who can afford it.