SmileDirectClub closes, months after filing for bankruptcy

SmileDirectClub, a telemedicine company that sold teeth-straightening devices through the mail and faced criticism from medical groups, said Friday that it has closed its doors.

The company, founded in 2014, sold dental aligners online and in its stores for $1,850. It marketed them as a faster, cheaper alternative to braces. SmileDirectClub’s initial public offering in 2019 valued it at $8.9 billion.

SmileDirectClub has served more than two million customers in nearly a decade. But the company was unprofitable and filed for Chapter 11 bankruptcy in September with nearly $900 million in debt, court documents and financial statements show. And this year it settled a lawsuit brought by the District of Columbia attorney general’s office that had accused the company of using confidentiality clauses to stifle consumer criticism.

On Friday, SmileDirectClub said on its website that it would immediately halt its global operations. He apologized to customers for the inconvenience and urged them to consult a doctor or dentist for future treatment.

Pending orders have been cancelled, the company said. Customers on a monthly installment payment plan are expected to continue making all payments. Anyone who has completed the treatment will no longer be entitled to the free touch-ups that the company had guaranteed.

For customers requesting refunds, SmileDirectClub said it will have more information “once the bankruptcy process determines next steps.”

SmileDirectClub was founded in Nashville by childhood friends Alex Fenkell and Jordan Katzman. To order their products, customers made a cast of their teeth at home with a kit shipped by the company or had their teeth scanned at a “SmileShop” location. The scans were reviewed by dentists and orthodontists in the company’s network.

SmileDirectClub’s services, which did not require in-person visits, had drawn criticism from dentist and orthodontist groups. The company has sued some of these critics and accused the California Dental Board of stifling competition.

After the company went public, its shares traded at around $18 a piece, but later became a penny stock. As the company has failed to turn a profit, it has also faced legal battles throughout its existence and dissatisfied customers who have accused it of false advertising and violating Food and Drug Administration regulations.

SmileDirectClub offered refunds within 30 days of the arrival of its aligners, but anything after that was considered outside the company’s official refund policy and came with a nondisclosure clause, the New York Times reported in 2020. The deal prohibited customers from telling others about the refund and required them to delete negative social media posts and reviews.

The District of Columbia attorney general’s office sued the company in 2022, accusing it of preventing customers who had been harmed by its products from filing complaints with regulators or law enforcement. Under an agreement to resolve the litigation earlier this year, SmileDirectClub was required to release more than 17,000 customers from the settlements and pay $500,000 to the district. The company stated in the settlement that it had not violated the law or engaged in unfair or deceptive practices.