Align Technology Lawsuit

Align Technology Lawsuit

According to the Align Technology lawsuit, through the Class Period, defendants failed to properly disclose to plaintiffs their plan to change their loyalty program, namely the Align Technology Class Period, and made various false and/ or misleading representations and/ or failed to disclose at the end of the Class Period that: (1) in the second half of the Class Period plaintiffs had increased the discount qualifications from annual to semi-annually and added several additional incentive tiers that were primarily designed and intended to… (e.g., the plaintiffs’ incentive to engage in a specific level of customer service; the plaintiffs’ plan to reduce or eliminate survey burdens; and that, over a three-year period from the date of filing the lawsuit, the Company would pay a percentage of its bill for plaintiffs’ identified problems.) (2) defendants failed to provide adequate disclosure to plaintiffs of their plans to change their loyalty program; (3) they failed to inform the Class that the new loyalty program was an initiative of the Company and was not being forced upon plaintiffs. (4) The Align Technology lawsuit further claims that defendant failed to provide proper notice that the Company’s new loyalty program would take effect immediately and automatically, without the need for plaintiffs to seek approval of the new program.

In regard to the first prong of the complaint, the District Court relied on its inherent deference to facts found at trial when granting class motions. We have previously stated that a plaintiff may not argue that there were any misleading statements within the Derwent-Hubbell testimony because those statements would have been viewed as having been disclosed at trial. Accordingly, we affirmed the District Court’s denial of class certification on this basis, but noted that we could not enter a damages judgment based on the Derwent-Hubbell testimony because the evidence at trial did not establish that Derwent-Hubbell acted with deliberate deceit, misprision of the truth, or with fraud when making statements in support of their marketing plan for the development of the Derwent-Hubbell system. Accordingly, the District Court properly stated that Derwent-Hubbell could not be the basis for a damages claim against the Company.

The second factor presented by the complaint is that plaintiffs’ misstated statements resulted in a misrepresentation of fact. Assuming arguendo that plaintiffs provided truthful answers to questions posed by the defendants during the course of the case, the fact remains that the defendants knew or reasonably should have known, that plaintiffs’ answers were inaccurate. Accordingly, the Court cannot find that the Derwent-Hubbell testimony as a whole was misleading, or that any part of it was inaccurate. The Court also declined plaintiffs’ request that the trial court take into account the fact that Derwent-Hubbell was an outside vendor, a fact the Court found would have had a material effect on the accuracy of Derwent-Hubbell’s representations.

Plaintiffs next argue that defendants’ reliance on inaccurate statements after the fact injured their credibility. Again, assuming arguendo that plaintiffs provided truthful answers during the course of the case, the fact remains that the defendants failed to take reasonable steps to correct their inaccurate representations once they became aware that the information was inaccurate. Accordingly, this aspect of the complaint does not support a Derwent-Hubbell liability. In addition, assuming arguendo that plaintiffs waived their right to recover damages, the Court notes that the trial court did not err in allowing Derwent-Hubbell to introduce prior statements by Mr. Quirk, a non-practicing senior engineer, about the likelihood of Derwent-Hubbell’s products being accepted into the Medicare system.

Finally, the fourth factor the plaintiffs contend is that the defendants’ reliance on the accuracy of Derwent-Hubbell’s and align Technology’s financial statements resulted in the defendants’ reliance on unreliable information, which injured their credibility. Again, assuming arguendo that both statements were both accurate and appropriate, the Court again finds that the defendants’ reliance on such information did not have a substantial effect on the accuracy of the defendants’ financial statements, as the District Court found that the company’s financial statements accurately reflected the nature of its business at the time. Accordingly, the claim is not a Derwent-Hubbell liability. The Fifth Amendment requires that the statements must be made with “actual knowledge” in order to meet the strict requirement that the statements must be true.

Accordingly, the plaintiffs’ complaint against Align Technology is dismissed. The judgment of the Court is also affirmed. The parties are urged to enter into a reasonable agreement regarding the payment of all litigation expenses, including interest and fees. The District Court did not receive an allowance for the cost of its opinion as the trial court properly considered all relevant factors surrounding the granting of the motion to dismiss. The Court also expresses its opinion that the plaintiff’s claims against Align Technology are unfounded and that the case should be dismissed.

Laws