Antitrust Law Daily Wrap Up, STATE UNFAIR TRADE PRACTICES—N.D. Cal.: Fraud claims against manufacturer of orthodontic product not pleaded with particularity, (Aug 1, 2014)

By Edward L. Puzzo, J.D.

Allegations sounding in fraud against the manufacturer and seller of Invisalign orthodontic aligners lacked the particularity required by Fed. R. Civ. Proc. 9(b) for fraud allegations and had to be dismissed, the federal district court in San Jose, California has ruled (Buckley v. Align Technology, Inc., July 31, 2014, Davila, E.).

The Invisalign orthodontic appliance, manufactured and sold by Align Technology, is a thin, clear, plastic removable tooth alignment product prescribed by dentists. Susan Buckley alleged that she began using the product in December 2008 to treat malocclusions, or misalignments, of her teeth. She alleged that she wore the product as directed until November 2010, at which point she discovered that the product was not correcting her malocclusions. She underwent dental procedures in October 2011 to correct the dental problems that the Invisalign product failed to treat.

Buckley, on behalf of a putative class, alleged that Align Technology’s advertising, packaging, and website had fraudulently misrepresented that its Invisalign orthodontic product could improve malocclusions, when in fact other dental procedures were needed. She and the other class members claimed that they would not have purchased the product had they known it was not capable of treating malocclusions. Buckley’s lawsuit alleged, among other claims, violations of California’s Unfair Competition Law UCL), False Advertising Law (FAL), and Consumer Legal Remedies Act (CLRA).

Fraud. Buckley’s UCL, FAL, and CLRA claims all sounded in fraud, the court stated. The Ninth Circuit requires that the pleading for claims sounding in fraud to be pleaded with the particularity required by Federal Rule of Civil Procedure 9(b). The pleadings failed to meet this “who, what, when, where and How” requirement, the court stated.

First, the allegations focused on allegedly false advertisements, including those on Align Technology’s website and in brochures in dental offices, but failed to specify that the plaintiff relied on these advertisements to her detriment. Her pleadings also failed to allege that Buckley was exposed to these advertisements before beginning her Invisalign treatment.

Second, Buckley’s assertion that Invisalign cannot treat malocclusions is conclusory. Her personal experience was recounted, but her pleadings failed to show how the aligners were incapable of treating malocclusions in other customers.

Naked assertions devoid of further factual enhancement do not satisfy the heightened pleading requirements for fraud allegations and therefore cannot survive a motion to dismiss, the court ruled. The court therefore dismissed the claims, with leave to amend.

The case is Civil Action No. 5:13-CV-02812-EJD.

Attorneys: David Eldridge Bower (Law Office of David E. Bower) for Susan Buckley. Anthony J. Weibell (Wilson Sonsino Goodrich & Rosati) for Align Technology, Inc.

Companies: Align Technology, Inc.

Cases: Advertising ConsumerProtection StateUnfairTradePractices CaliforniaNews