FEDERAL COURT OF AUSTRALIA

Invisalign Australia Pty Limited v SmileDirectClub LLC [2023] FCA 395

ORDERS

THE COURT ORDERS THAT:

1.    The applicant be granted leave to file and serve the Amended Concise Statement in the form set out in Annexure A to the proposed minutes of order received by the Court on 31 October 2022.

2.    The applicant’s claim be dismissed.

3.    The applicant pay the respondents’ costs of the claim, to be fixed by way of an agreed lump sum or, in default of agreement, by way of a lump sum fixed by a Registrar.

4.    The cross-claimant’s cross-claim be dismissed.

5.    The cross-claimant pay the cross-respondent’s costs of the cross-claim, to be fixed by way of an agreed lump sum or, in default of agreement, by way of a lump sum fixed by a Registrar.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

ANDERSON J:

INTRODUCTION

1    The applicant (Invisalign) and the respondents (collectively, SDC) are competing providers of clear aligner teeth straightening products in Australia. Invisalign alleges that SDC has engaged in false, misleading or deceptive conduct in relation to certain promotional material that it has published with respect to its clear aligners (SDC aligners). The promotional material that is the subject of Invisalign’s claim is listed in Annexure A to the Concise Statement (CS), which was later amended under Annexure A to the Amended Concise Statement (Amended CS). This promotional material was then further particularised in Schedule 1 to Invisalign’s closing submissions, which is annexed to these reasons for judgment at Annexure C.

2    The second respondent (SDC AU) has brought a cross-claim against Invisalign. SDC AU alleges that Invisalign has published or caused to be published material which is false, misleading or deceptive.

3    Both the claim and cross-claim are brought pursuant to ss 18 and 29 of the Australian Consumer Law (Schedule 2 to the Competition and Consumer Act 2010 (Cth)) (ACL).

4    This dispute revolves around two companies that offer clear aligner teeth straightening treatment.

5    Invisalign commenced operating in Australia in late 2001 and was the first supplier of clear aligners in Australia. SDC commenced operating in Australia from about 29 May 2019.

6    Clear aligners are teeth straightening products that are designed to gradually move and straighten a patient’s teeth over the course of a number of months. Clear aligners are seen as an alternative to braces and take the form of subtle, transparent mouthguards that are custom fit to each patient’s teeth.

7    Invisalign aligners and the dental treatment that is involved with it (Invisalign Aligner Treatment) is provided by dentists and/or orthodontists who supply the treatment to patients.

8    SDC aligners and the treatment that is involved with it (SDC Aligner Treatment) is supplied by SDC to customers at the direction of, and under the supervision and control of, an Australian registered dentist or orthodontist (Affiliated Dentists) via a web-portal administered by SDC (SDC Platform).

9    Invisalign, by its Amended CS, contends that SDC, in the course of promoting and marketing its SDC Aligner Treatment, made the following representations which it alleges are false, misleading or deceptive or are likely to mislead or deceive:

(a)    the total cost associated with treatment with SDC aligners is either $2,825 for upfront payment or $3,155 by instalments (Total Cost Representation);

(b)    the total cost associated with treatment with SDC aligners is less than $4 a day for the duration of treatment (or alternatively for the duration of a 90 day to 6-month treatment) (Less than $4 a Day Representation);

(c)    various representations set out at Amended CS [19] to the general effect that SDC Aligner Treatment is of comparable efficacy to treatment with traditional orthodontic treatment (being treatment from a dentist or orthodontist with an orthodontic appliance such as braces or Invisalign aligners) for all, or at least a majority of, patients (Comparable Treatment Representations);

(d)    various representations set out at Amened CS [20] to the effect that SDC Aligner Treatment is less expensive or ‘60% less’ or ‘up to 60% less’ expensive in all instances or alternatively for equivalent treatments obtained from an orthodontist or dentist such as braces or Invisalign (Price Comparison Representations);

(e)    SDC Aligner Treatment provides a comprehensive solution to all orthodontic issues or alternatively all non-severe issues (Comprehensive Solution Representation); and

(f)    SDC Aligner Treatment provides a comprehensive orthodontic solution to all orthodontic issues or alternatively all non-severe issues at significantly less cost than that of equivalent treatments with braces or Invisalign (Lower Cost Representation).

10    SDC AU, by its cross-claim, alleges that Invisalign made a number of representations about about the comfort, predictability and treatment time associated with its clear aligners (Invisalign aligners), that were false, misleading or deceptive or likely to mislead or deceive in contravention of ss 18 and 29 of the ACL.

11    SDC AU, by its cross-claim, also alleges that Invisalign has made certain representations about SDC aligners which are false, misleading or deceptive. SDC AU alleges that these representations were made in an “advertorial” published by a number of news outlets entitled, “DIY teeth straightening kits – Should you try this at home?” (DIY article). The DIY article was “created in partnership” with Invisalign. SDC AU alleges that the DIY article, without mentioning SDC by name, makes various statements which it contends the ordinary and reasonable consumer would understand as referring to SDC aligners.

12    SDC AU contends that the DIY article impliedly represents, inter alia, that SDC Aligner Treatment does not involve oversight by a dentist. SDC AU contends that the representations are false, misleading or deceptive as SDC Aligner Treatment is supplied by SDC to customers at the direction, and under the supervision and control of, Affiliated Dentists using the SDC Platform.

13    For the sake of completeness, these reasons for judgment will refer to “consumers”, “customers” and “patients”, however each of these groups are used interchangeably and refer to the same group.

RULINGS ON AMENDED CONCISE STATEMENT AND EVIDENCE

14    Before turning to the evidence, I will deal with certain outstanding issues which remain from the trial and which were articulated in the parties’ joint note to the Court which my chambers received on 7 December 2022.

15    These outstanding issues are:

(a)    Invisalign’s Amended CS;

(b)    Schedule 1 to Invisalign’s closing written submissions, including the affidavit evidence of Ms Jaimie Maree Wolbers as well as the material in annexure JMW-4 (exhibits 73 and 74); and

(c)    the evidence of Mr Cristofaro.

Invisalign’s Amended Concise Statement

16    Invisalign, in its closing written submissions, attached an Amended CS in which it sought to add the words “60% less, or further or alternatively” to the existing Price Comparison Representations allegations pleaded in sub-paragraphs 20(c) and (d), which Invisalign submitted reflected the case, as opened (T60.16-30), and ultimately run, by Invisalign.

17    SDC opposed the amendment to the CS on the basis that it substantially amended the case as pleaded under the Price Comparison Representations and would require SDC to adduce further and better pricing survey evidence. SDC also opposed the amendment on the basis that there has been no explanation for the delay in seeking to amend the CS until closing submissions were filed.

18    The Court’s power to grant leave to amend is broad and has the remedial objective of ensuring that any defect in the pleading is cured and that the real questions that are the subject of the controversy are properly agitated: Caason Investments Pty Ltd v Cao [2015] FCAFC 94; 236 FCR 322 (Caason) at [20] (Gilmour and Foster JJ) and AON Risk Services Australia Ltd v Australian National University [2009] HCA 27; 239 CLR 175 at [14]. The power to grant leave to amend must be exercised in a “way that best promotes the Court’s overarching purpose to facilitate the just resolution of disputes according to law as quickly, inexpensively and efficiently as possible”: Caason at [19].

19    Leave to amend should generally be granted unless the proposed amendment is futile, including, for example, because the issue sought to be raised by the amendment has no reasonable prospect of success, or will be liable to be struck out as not raising a reasonable cause of action, or where the amendment would cause substantial prejudice or injustice to the opposing party in a way that cannot be compensated by an award of costs: Caason at [21] and KTC v David [2022] FCAFC 60 at [110]-[111] (Wigney, Anastassiou and Jackson JJ).

20    I am satisfied that the amendment to the CS is minor in nature and reflects the manner in which Invisalign ran its case, as such the amendment will be allowed.

21    I am also satisfied that granting the amendment will not cause any prejudice or injustice to SDC and that it facilitates the just resolution of the disputes as quickly, inexpensively and efficiently as possible.

Schedule 1 to Invisalign’s Closing Written Submissions

22    Invisalign’s closing submissions include a Schedule 1, entitled, “Promotional material relied upon by the Applicant”. This Schedule 1 sets out, in table form, the promotional material exhibited to the affidavit of Jaimie Maree Wolbers sworn 4 April 2022 and annexure JMW-4, being a USB containing digital promotional material of SDC. On day eight of the trial, on 19 October 2022, I provisionally admitted the affidavit of Jaimie Maree Wolbers sworn 4 April 2022 and annexure JMW-4 and marked it exhibit 73, subject to an objection by SDC: T658.20-660.05.

23    Invisalign seeks to rely upon the promotional material identified in Schedule 1 to its written submissions in support of its claim. As stated above in these reasons at [1], this promotional material is annexed to these reasons for judgment at Annexure C (Annexure C or Schedule 1).

24    Invisalign accepts that the promotional material itemised in Annexure C contains material which goes beyond that identified in Annexure A to the Amended CS.

25    SDC objects to the admission into evidence of certain material identified in Annexure C, which was shaded in green in the version of Annexure C which was annexed to SDC’s closing written submissions. The material that was shaded in green is now redacted in the Annexure C to these reasons for judgment. The basis of SDC’s objection to this material that was shaded in green was that it goes well beyond Invisalign’s pleaded case as identified in the Amended CS and its Annexure A.

26    The promotional material falls into two categories.

27    First, material that contains the same, or substantially the same, statements as those in Annexure A. These statements do not fall outside Invisalign’s pleaded case. Second, promotional material that contains other unpleaded statements which, in SDC’s submission, falls outside Invisalign’s pleaded case.

28    This second category is the promotional material that was shaded in green in the version of Schedule 1 which was annexed to SDC’s written closing submissions.

29    SDC submits that Invisalign should not be permitted, at such a late stage of the proceeding, to tender and rely upon this additional promotional material. That is so, in SDC’s submission, for two reasons.

30    First, Invisalign’s closing submissions failed to squarely assert which of the many statements are said to convey the particular representations alleged. SDC also submits that it is not apparent what Invisalign was referring to in column VII of Schedule 1 entitled “Specific to Price Comparison Representation”.

31    Second, SDC submits that Invisalign has provided no explanation for the delay in identifying the new statements contained in Schedule 1 which were highlighted in green. SDC submits that with the exception of a relatively confined number of Facebook and Instagram advertisements that were produced during discovery and made available to Invisalign on 17 September 2022, the remainder of the promotional material referred to in Schedule 1 is taken from Ms Wolbers’ affidavit sworn 4 April 2022, annexure JMW-4 and the affidavit of Ms Niki Brown affirmed 1 July 2022.

32    SDC submits that Invisalign has been on notice of this additional promotional material for an extended period of time and has not sought to amend its claim. SDC submits that Invisalign is seeking to amend the Amended CS and its Annexure A by replacing it with Schedule 1, without any explanation as to why this was not done earlier and prior to the commencement of the hearing.

33    SDC submits that to permit Invisalign to tender the promotional material which is exhibit JMW-4 to Ms Wolbers’ affidavit sworn on 4 April 2022 for the first time in closing submissions is procedurally irregular and unfair. SDC submits that the new promotional material has no probative value in circumstances where it does not reflect the pleaded statements in Annexure A to the Amended CS.

34    Invisalign submits that SDC has been on notice since it filed and served Ms Wolbers’ affidavit sworn 4 April 2022 and that Invisalign confirmed, by letter dated 28 June 2022, that it intended to rely upon all of the material in Ms Wolbers’ affidavit as well as relevant promotional material that came to light during the course of the proceeding.

35    Invisalign submits that paragraph 15 of the Amended CS expressly stated that Annexure A to the Amended CS was a “sample” of the material ultimately to be relied upon and that Invisalign intended to rely on the entirety of the material in Ms Wolbers’ affidavit sworn on 4 April 2022 and any other relevant promotional material that came to light through discovery.

36    Invisalign contends that a concise statement is not a pleading and that as a consequence it is not required to expose issues in dispute to the same level of detail as in a pleading: Allianz Australia Insurance Ltd v Delor Vue Apartments CTS 39788 [2021] FCAFC 121; 396 ALR 27 per McKerracher and Colvin JJ at [140]-[150].

37    I will not admit into evidence those portions of Schedule 1 which were highlighted in green by SDC, and which are now redacted in Annexure C to these reasons. The additional promotional material goes beyond the scope of the Amended CS and Annexure A

38    Whilst an applicant may not be limited to matters strictly referred to in a concise statement, a respondent is entitled to fair disclosure of the case it is required to meet.

39    In my view, it is unfair for Invisalign, in its closing submissions, to seek to rely upon additional promotional material and to expand the scope of the evidence in circumstances where Invisalign has refused to provide particulars identifying the statements upon which it relies in the additional promotional material. This is particularly the case in circumstances where on 28 June 2022, SDC’s instructing solicitors wrote to Invisalign’s solicitors seeking to understand the relevance of the additional promotional material and how Invisalign put its case. At no point prior to closing submissions has Invisalign provided notice to SDC of the new statements contained in Schedule 1 upon which it now seeks to rely.

40    Invisalign has also failed to identify, in its closing submissions, which of the many statements are said to convey the representations alleged.

41    In those circumstances, in my view, it is unfair and prejudicial to SDC to admit into evidence the promotional material shaded in green which contain statements beyond those identified in the Amended CS and Annexure A.

42    It is also not apparent what Invisalign is referring to by column VIII entitled “Specific to price comparison representation”. The material in this column will also be ruled inadmissible.

Rulings on objections to the evidence of Mr David Cristofaro

43    Mr Cristofaro tendered three affidavits into evidence:

(a)    the affidavit of Mr Cristofaro dated 30 June 2022 (first Cristofaro Affidavit), marked exhibit 45;

(b)    the affidavit of Mr Cristofaro dated 26 September 2022 (second Cristofaro Affidavit), marked exhibit 46; and

(c)    the affidavit of Mr Cristofaro dated 13 October 2022 (third Cristofaro Affidavit), marked exhibit 47,

(collectively, the Cristofaro Affidavits).

44    Mr Cristofaro’s evidence is relevant to the pricing claims made by Invisalign in the Amended CS, in particular, the Price Comparison Representations at Amended CS [20].

45    Invisalign objects to each of the three Cristofaro affidavits on the basis that the evidence given by Mr Cristofaro does not comply with s 79 of the Evidence Act 1995 (Cth) (Evidence Act) and on the basis that aspects of his evidence is hearsay, conclusory and should be excluded pursuant to s 135 of the Evidence Act.

46    SDC filed written submissions on 11 October 2022 in support of the admission into evidence of the first and second Cristofaro Affidavits. Invisalign on 13 October 2022, filed written submissions objecting to the admission into evidence of the first and second Cristofaro Affidavits. On 13 and 14 October 2022, I heard oral argument from the parties as to the objections to Mr Cristofaro's evidence as contained in the first and second Cristofaro Affidavits together with the third Cristofaro Affidavit.

47    On 14 October 2022, I ruled that the first and second Cristofaro Affidavits be admitted into evidence (T407.8-16). At that time I informed counsel that I will publish my reasons for making that ruling in due course. On Monday, 17 October 2022, I heard brief oral argument from counsel for Invisalign seeking to object to admissibility of the third Cristofaro Affidavit on the same basis as the previous two affidavits. I informed counsel that the third Cristofaro Affidavit will be admitted into evidence, and that I will also publish my reasons for making that ruling in due course.

48    I now provide my reasons for the rulings made in respect of the Cristofaro Affidavits.

49    Mr Cristofaro is the principal of Actionable Research, a market research firm that he founded in 2002 in the USA that has clients including Johnson & Johnson, Pfizer, Roche and Invisalign’s parent company, Align Technologies, Inc.

50    Actionable Research specialises in providing primary research for participants in the oral care industry, including all facets of oral health care delivery. Actionable Research has conducted over 140 research projects involving dentists and orthodontists in numerous jurisdictions around the world, including Australia. Mr Cristofaro has personally been involved in the design of the research, the sampling for the surveys, and the analysis of the data.

51    Mr Cristofaro has written the survey and interview guide for approximately 70 percent of the studies conducted by Actionable Research. He also regularly moderates market research focus groups and conducts one-on-one interviews with dentists and orthodontists in order to inform his understanding of the dental and orthodontic industry and so as to appropriately design survey questions.

52    SDC submits that Mr Cristofaro gives evidence of fact about a market research survey he conducted (Actionable Study) and the responses given to the Study. SDC submits that Actionable Research was retained by SDC prior to the commencement of these proceedings in May 2021, to conduct market research into the prices charged for professional teeth straightening by dentists and orthodontists using braces and clear aligner treatment in Australia. In order to conduct this research, Mr Cristofaro developed a questionnaire (Questionnaire) and oversaw a team at Actionable Research that conducted the Study.

53    The first Cristofaro Affidavit sets out the relevant methodology and results of the Actionable Study, including:

(a)    the study participants and sample size: [15]-[17], [22];

(b)    the screening criteria used when selecting participants for the study: [18]-[21];

(c)    the demographics of the study participants, including their geographic location, their years of experience, the types of dental procedures they performed and the number of case starts per year in their practice: [24]-[34]; and

(d)    the results of the Actionable Study in relation to pricing habits for braces and clear aligners: [35]-[51].

54    The first Cristofaro Affidavit annexes the raw data containing the responses obtained to the Questionnaire (exhibit DDC-2) (Raw Data), which is a 300 page document. The affidavit also annexes:

(a)    the questions asked of dentists and orthodontists (exhibit DDC-1);

(b)    an Excel spreadsheet which calculates whether the average price reported in the Survey correlates to 60% less than Invisalign and braces (Calculation Spreadsheet) (exhibit DDC-3); and

(c)    two reports created during the course of preparing Mr Cristofaro's evidence which describe the results of the Actionable Study in respect of braces (Braces Report) (exhibit DDC-4) and Invisalign aligners (Invisalign Report) (exhibit DDC-5).

55    Invisalign has been provided with an electronic version of the Raw Data in response to a request made for it.

56    SDC submits that in respect of the First Cristofaro Affidavit, Mr Cristofaro provides a factual account of the processes he followed to conduct the Study and analyse and record its results, as well as the results of the Actionable Study.

57    SDC submits that the Second Cristofaro Affidavit was filed in reply to Invisalign's evidence (specifically the affidavit of Mr MacLean which calls into question the methodology of the Actionable Study) and further exposes Mr Cristofaro’s methodology in conducting the Actionable Study. In particular, it addresses:

(a)    the selection of participants for the Actionable Study (Study Participants), including how Actionable Research has developed its database of dentists and orthodontists in Australia and its practices in conducting market research: [8]-[26];

(b)    testing of the results of the Actionable Study to account for geographic spread of dentists and orthodontists in Australia, to respond to criticisms of Mr MacLean: [27]-[32];

(c)    description of how Mr Cristofaro calculated the sample size of the Actionable Study: [33]-[43];

(d)    the financial contribution offered for participation in the Actionable Study: [44];

(e)    the nature of the questions asked in the Questionnaire, including the lack of pilot study: [45]-[50]; and

(f)    whether it was appropriate to “trim” the results of the Actionable Study to remove outliers: [51]-[52].

58    Invisalign objects to parts of Mr Cristofaro’s evidence on the basis that it is hearsay.

59    SDC submits that some paragraphs to which the hearsay objection is advanced are not hearsay. These are:

(a)    [11]-[12] of the first Cristofaro Affidavit contain evidence of fact about the circumstances in which Actionable Research was retained by SDC and the instructions provided;

(b)    [15]-[16] of the first Cristofaro Affidavit again contain evidence of fact, this time about how Actionable Research identified potential Study Participants and invited them to participate in the Actionable Study;

(c)    [9]-[10] of the second Cristofaro Affidavit is factual evidence describing how Actionable Research developed its database of dentists and orthodontists in Australia;

(d)    [12] of the second Cristofaro Affidavit is factual evidence about how dentists were invited to participate in the Actionable Study; and

(e)    [20]-[26] of the second Affidavit is factual evidence about the Study Participants and their demographics, as well as some opinions offered about the sufficiency of the sample.

60    SDC submits that there are no prior representations contained in the above paragraphs.

61    Invisalign submits that the results of the Actionable Study that are recorded in [2] and [26]-[33] are hearsay and inadmissible. SDC accepts that insofar as Mr Cristofaro reports the answers given by dentists and orthodontists to the Questionnaire, this evidence is hearsay. However, SDC submits that the evidence is admissible as it falls within one of the exceptions to the hearsay rule.

62    SDC relies upon s 69 of the Evidence Act being the business records exception. SDC submits that the Raw Data are records belonging to or kept by Actionable Research in the course of completing the Actionable Study. The Actionable Study was conducted for the purpose of its business. The previous representations, being the responses from the participating dentists, were kept for the purpose of Actionable Research conducting the Actionable Study. In SDC’s submission, the Raw Data is a business record to which s 69 of the Evidence Act applies.

63    SDC further submits that s 69(2) of the Evidence Act provides that the hearsay rule does not apply to the document if the representation was made:

(a)    by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact; or

(b)    on the basis of information directly or indirectly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact.

64    Here, SDC submits that the Study Participants were dentists and orthodontists in Australia.

65    SDC submits that the Study Participants responded to questions about pricing for particular treatments at their own practices. As such, SDC submits that the representations were made on the basis of information directly supplied by a person who had or might reasonably be supposed to have had personal knowledge of the asserted fact.

66    Accordingly, SDC submits that the answers to the Actionable Study recorded in the first Cristofaro Affidavit, including the Raw Data, are business records of Actionable Research and admissible pursuant to s 69 of the Evidence Act.

67    SDC further submits that two further exceptions to the hearsay rule apply. First, s 64(2) of the Evidence Act provides an exception to the hearsay rule in civil proceedings where the maker is available, where it would cause undue expense or undue delay, or would not be reasonably practicable, to call the person who made the representation to give evidence. Here, SDC submits that the makers of the representations would be the 73 individual dentists and orthodontists who responded to the survey. SDC submits that to call that evidence first hand would require affidavits from each of those dentists and orthodontists and would cause undue expense, delay and would not be reasonably practicable.

68    Secondly, s 66A of the Evidence Act contains an exception for contemporaneous statements about a person's knowledge. SDC submits that the Raw Data records contemporaneous statements about the Study Participants’ knowledge about their experience, practices and pricing, given at a time prior to the proceedings brought by Invisalign against SDC.

69    Thirdly, SDC submits that insofar as the Raw Data is admissible, so too are Mr Cristofaro’s explanations of the results contained in his affidavit. Mr Cristofaro’s evidence simply summarises the evidence contained in the Raw Data, which spans some 300 pages.

70    SDC submits that s 29(4) of the Evidence Act provides that evidence may be adduced as explanatory material that aids comprehension of other evidence.

71    SDC submits that in the first Cristofaro Affidavit, Mr Cristofaro simply explains what is shown by the Raw Data in respect of particular categories of answers.

72    Fourthly, SDC submits that in relation to [36]-[50] of the second Cristofaro Affidavit, the evidence contained in these paragraphs relates to Mr Cristofaro's use of an online calculator to calculate an appropriate sample size for the Actionable Study.

73    SDC submits that the evidence in [36]-[50] of the second Cristofaro Affidavit, falls into two categories. First, [36] is evidence of the witness' direct knowledge of the formula used on the UBC Power Calculator website. Paragraphs [37] to [38] provide an explanation of the terms used in that formula and in SDC's submission, are not hearsay.

74    Second, [39] describes the process that Mr Cristofaro followed when using the UBC Power Calculator. SDC submits that this is not hearsay because it provides direct evidence of his processes. Similarly, SDC submits that [40] again provides direct evidence of the result generated by the calculator.

75    In relation to [40], SDC submits that it falls within s 146 of the Evidence Act. That section applies where a document is produced by a device or process and is tendered by a party who asserts that, in producing the document or thing, the device or process has produced a particular outcome. If it is reasonably open to find that the device or process is one that, or is of a kind that, if properly used, ordinarily produces that outcome, it is presumed (unless evidence sufficient to raise doubt about the presumption is adduced) that, in producing the document or thing on the occasion in question, the device or process produced that outcome. SDC submits Mr Cristofaro that explained the information he input into the calculator (at [39]) and produced a screenshot of the results generated by the calculator (at [40]). This, in SDC’s submission, is sufficient to meet the presumption in s 146 that the calculator produced the results in that paragraph.

76    Invisalign also objects to the first Cristofaro Affidavit on the basis that it does not comply with the Court’s Survey Evidence Practice Note (GPN-SURV) (Survey Evidence Practice Note). SDC submits that the Survey Evidence Practice Note is directed to the design of surveys conducted specifically for the litigation in which it is proposed to be used to address a particular issue in the proceedings (most commonly involving intellectual property disputes): Australian Competition and Consumer Commission v Australian Institute of Professional Education Pty Ltd (in liq) (No 2) [2018] FCA 1459 at [32].

77    SDC submits that the Actionable Study was conducted well before the commencement of proceedings and therefore cannot be assessed against the standards in the Survey Evidence Practice Note. Insofar as Invisalign objects to any opinion expressed by Mr Cristofaro about the Actionable Study and its results on the basis of his expertise, SDC submits that this objection is answered by Mr Cristofaro’s experience in conducting studies of this kind and in this industry. SDC submits that Mr Cristofaro has conducted market research surveys for around 20 years, and has been involved in around 100 surveys of dentists and orthodontists. SDC submits that he therefore has "specialised knowledge" based on his experience to bring him within s 79 of the Evidence Act and is qualified to offer his opinion about the adequacy of the Actionable Study.

78    Invisalign also objects to Mr Cristofaro’s evidence on the basis that he has not adopted the Expert Witness Code of Conduct.

79    SDC submits that the Expert Witness Code of Conduct and the Survey Evidence Practice Note have no application in this case where a witness, here Mr Cristofaro, has prepared a report prior to the commencement of litigation at a time when he or she was not retained to provide an independent opinion to the Court. SDC submits that Mr Cristofaro and Actionable Research were retained prior to litigation commencing for the purpose of carrying out their survey and were therefore not "retained" to give opinion evidence in the proceeding. In any event, SDC submits that non-compliance with the Expert Witness Code of Conduct does not mandate exclusion of the evidence. Rather, the issue is whether non-compliance gives rise to a reason to exclude the evidence pursuant to s 135 of the Evidence Act.

80    Invisalign also seeks to exclude Mr Cristofaro’s evidence on the basis that its probative value is substantially outweighed by the danger that the evidence might (a) be unfairly prejudicial to a party, (b) be misleading or confusing, or (c) cause or result in undue waste of time.

81    Mr Cristofaro’s affidavits purport to give evidence of an online survey undertaken by Actionable Research pertaining to various matters including the price of clear aligner therapy and braces. In his affidavits, Mr Cristofaro refers to this as the "engaged study". Invisalign’s overarching objection to Mr Cristofaro’s affidavits is threefold:

(a)    the Raw Data and the reports, opinions and conclusions that are derived from the Raw Data are relied on for a hearsay purpose and are inadmissible under s 59 of the Evidence Act;

(b)    much of this material also amounts to opinion evidence which should be excluded under s 76 of the Evidence Act, given that the conditions of expert opinion evidence under s 79 of the Act are not met, and in any event, SDC has expressly said that Mr Cristofaro is not an expert witness; and

(c)    while it seems that there may have been earlier versions of some of these materials, the versions of the Actionable Research reports and the Calculations included in the first Cristofaro Affidavit were prepared for the purpose of this proceeding. For this and other reasons, the evidence should be excluded under s 135 of the Evidence Act.

Section 69 Evidence Act – Business Records

82    Invisalign submits that the authorities consistently distinguish between the "business records" and the "products" of a business. Invisalign's submission is that only the former fall within s 69 of the Evidence Act. Invisalign submits that the Raw Data and all the records and conclusions derived from that data, are the products of Actionable Researcher's business as a market research firm.

83    Invisalign relies upon the decisions of Roach v Page (No 15) [2013] NSWSC 939 per Sperling J and Australian Competition and Consumer Commission v Air New Zealand (No 1) [2012] FCA 1355; 207 FCR 448 for the proposition that published output of a business in literary form such as books, magazines and newspapers are not "business records", but rather, are "products of the business", falling outside the business records exception in s 69(1) of the Evidence Act.

84    Invisalign also relies upon the decision of Middleton J in Hanson Beverage Co v Bickfords (Australia) Pty Ltd [2008] FCA 406; 75 IPR 505 at [110], [114], [131]-[133] where his Honour determined that television rating data (which Invisalign submits is analogous material to the Raw Data in the present case) did not fall within the business records exception to s 69(2) of the Evidence Act and were not admitted into evidence. Middleton J concluded that the ratings data were the "product of a business" and not a business record.

Consideration of objections to Mr Cristofaro’s evidence

85    The proposition that "output" or "product" of a business falls outside the business records exception in s 69 of the Evidence Act has been doubted, and rejected, in more recent authorities on the basis that s 69(1) includes records "kept … for the purposes of a business": Southern Cross Airports v Chief Commissioner of State Revenue [2011] NSWSC 347 (Southern Cross) per Gzelle J at 41-44 and Rodney Jane Racing Pty Ltd v Monster Energy Company [2019] FCA 923; 142 IPR 275 (Rodney Jane) per O’Bryan J at 175-176.

86    Similarly in Charan v Nationwide News Pty Ltd [2018] VSC 3 at [463], Forrest J stated:

…the distinction between 'product' and 'records' is problematic. It does not appear in the text of s 69(1). The language used in the provision is broad and appears to encompass any documents kept by a person, body or organisation 'in the course of, or for the purposes of' a business. To exclude documents that are part of the records of an organisation, however generated and for whatever purpose under this provision (as opposed to a subsequent discretionary exclusion under s 135) involves, I think, an artificial distinction not covered by the wording of the section.

(Emphasis added)

87    In Dr August Wolff GmbH & Co. KG Arzneimittel v Coombe International Ltd [2020] FCA; 149 IPR 1 39 at [112]-[134] (Dr Wolff), the relevant question before Stewart J was whether various survey reports were admissible as an exception to the hearsay rule: at [112]-[134].

88    The surveys were commissioned and obtained by the parties to the proceedings, prior to the commencement of proceedings, for the purpose of the conduct of their businesses. In relation to the reports, Stewart J noted at [122]:

Material common elements of all the reports are the following. First, they were commissioned by the relevant owner of the brand from specialist professional survey companies. Secondly, they record respondents' responses or answers to survey questions, or other feedback from the respondents. Thirdly, they aggregate particular responses and produce, or calculate, some statistical outcomes. Fourthly, they were commissioned in the course of the business of the owner of the brand for the purpose of the conduct of its business (i.e. in order to be able to rely on the information in the reports in taking business decisions), and they were produced by the survey companies in the course of their business. Fifthly, they were kept or stored as part of the records or archives of the commissioning company and (presumably) the survey company.

89    Stewart J did not accept that the survey reports were the “products of the business”. Rather, “guided by the provisions of s 69”, his Honour held that “the survey reports form part of the records belonging to or kept by [Combe or Combe Asia-Pacific] in the course of, or for the purposes of, a business” (at [131]-[132]). Stewart J admitted the survey reports and concluded in respect of whether the reports formed part of the records belonging to the business:

Clearly they do. They were commissioned for the purpose of the business of the owner of the brand in each case, with the intention that they would be relied on in various ways including in devising advertising campaigns and, possibly, in developing and marketing products. Whilst they do not record the activities of the business, they are records produced for the purpose of those activities. They were intended to be relied upon by the business, and there is no reason to suppose that the hearsay statements recorded in the report are other than accurate.

(Emphasis added)

90    Likewise in the present case, the survey was commissioned by SDC prior to the commencement of the proceedings, for the purpose of SDC's business and was intended to be relied on by SDC in its business activities: first Cristofaro Affidavit at [11]-[12].

91    The survey was carried by Actionable Research and the survey data collected in the ordinary course of Actionable Research business: Dr Wolff at [122]. There is no reason to suppose that the hearsay statements contained in the data are other than accurate responses. I am of the view that the survey data falls within the clear and unequivocal meaning of the words in s 69(1) of the Evidence Act and is admissible as an exception to the hearsay rule.

92    Each of the first, second and third Cristofaro Affidavits will be admitted into evidence.

THE EVIDENCE

93    A list of the affidavits tendered by the parties are in Annexure A to these reasons for judgment.

INVISALIGN’S EVIDENCE

94    Invisalign tendered affidavit evidence from a number of witnesses, some of whom were not required to attend for cross-examination. That evidence may be summarised as follows.

Ms Karen McGoldrick

Evidence in chief

95    Ms Karen McGoldrick is the Managing Director of Invisalign in Australia and New Zealand.

96    Ms McGoldrick affirmed one affidavit dated 4 April 2022, which was tendered in evidence and marked exhibit 29.

97    Ms McGoldrick deposed to her significant experience as a company director, having spent 28 years working in various directorship positions at Unilever, immediately prior to commencing as the Managing Director at Invisalign in August 2015.

98    In her current role, Ms McGoldrick is responsible for leading, managing and directing Invisalign’s business in Australia and New Zealand.

99    Ms McGoldrick gave evidence about the background to Invisalign, the Invisalign system and Invisalign treatment in Australia. Ms McGoldrick’s evidence on these topics can be summarised as follows.

100    Invisalign Australia is the Australian subsidiary of Align Technology, Inc. (Align Technology), a global medical device company whose corporate headquarters is located in the United States of America (USA).

101    Since about December 2001, clear dental aligners, under the Invisalign brand name and trade mark, forming an orthodontic appliance treatment system (the Invisalign system) have been available in Australia.

102    At the time of the lnvisalign system’s launch in Australia in 2001, Align Technology already had eight international sales offices in the United States, Europe and Latin America, and had over 30,000 patients that were receiving treatment using the Invisalign system. Invisalign also has around 10,000 doctors trained and certified to prescribe the Invisalign system.

The Invisalign system

103    The Invisalign system was originally designed and created by Align Technology in 1997, with a vision to design an orthodontic treatment system that could be offered by doctors to their patients as an aesthetic and comfortable alternative to traditional fixed braces. No metal or ceramic brackets nor wires are used as part of the Invisalign system.

104    Since about 2011, following the acquisition of Cadent Holdings, Inc., Align Technology has also been the supplier of the iTero intraoral scanner (iTero scanner), which doctors can use to take 3D scans of a patient’s teeth and gums.

105    The current version of the Invisalign system features:

(a)    the use of a series of clear removable aligners, worn over a patient’s teeth, that gently move teeth to a desired final position in order to correct or treat malocclusion;

(b)    the clear aligners are made with “SmartTrack” material, a proprietary and multilayer orthodontic aligner material;

(c)    “attachments” which are nearly always prescribed by the treating doctor as part of a patient's treatment plan, depending on the patient's individual circumstances. Attachments are small pieces of enamel-coloured composite which the doctor fixes onto the patient's teeth to help the aligner grip the teeth providing additional force and greater control over the movement of teeth than clear aligners alone. The combination of attachments in a treatment plan are custom designed for the individual patient's treatment; and

(d)    depending on the patient’s individual circumstances, the treating doctor may also use orthodontic elastics with the lnvisalign system.

Registration of the Invisalign system in Australia

106    Invisalign Australia is the sponsor, for the purposes of registration with the Therapeutic Goods Administration (TGA), of the Invisalign system in Australia.

107    In 2018, in anticipation of the likely regulatory developments in Australia, Invisalign Australia took steps to register the Invisalign system as a class I medical device with TGA.

108    Invisalign Australia holds the following registrations under the Australian Register of Therapeutic Goods (ARTG) for the Invisalign system:

Invisalign treatment options

109    Since 2018, Invisalign has offered a number of different treatment options and packages to trained doctors to offer to Invisalign customers. These were:

(a)    Invisalign Clear Aligners Express package;

(b)    Invisalign Clear Aligners Lite package;

(c)    Invisalign Clear Aligners Moderate package;

(d)    Invisalign Clear Aligners Comprehensive package;

(e)    Invisalign First Comprehensive package;

(f)    Invisalign System Comprehensive Phase 2 package; and

(g)    Invisalign Go,

(collectively, the Invisalign Treatment Packages).

110    Ms McGoldrick, in her affidavit, described each of the Invisalign Treatment Packages and the type of customers that would fit within a particular package. In short compass, each of the Invisalign Treatment Packages differ based on the idiosyncratic requirements of the level of aesthetic correction required by the customer (such as the amount of tooth movement required, the level of teeth spacing, crowding, malocclusion, as well as the age of the patient).

Training of doctors

111    Invisalign Australia only supplies the Invisalign Treatment Packages to eligible doctors who have received training in the use of the Invisalign system.

112    Since 2001, Invisalign Australia has continued to offer training courses in Australia, which is offered by the Invisalign Australia team as well as other independent practitioners. There are three training courses that Invisalign Australia offers:

(a)    the Invisalign Fundamentals training course, which is targeted at dentists to use the Invisalign system and is best designed for dentists and orthodontists that have existing teeth straightening experience;

(b)    the Invisalign Go Fundamentals training course, which is targeted at general dentists that have little to no teeth straightening experience; and

(c)    the Invisalign Ignite training course, which is targeted at dentists that have previous experience using Invisalign Go, but wish to expand their treatment repertoire to include the full suite of Invisalign Treatment Packages,

(each a Training Course, collectively, the Training Courses).

113    Ms McGoldrick, in her affidavit, described each of the Training Courses.

Marketing and promotion of the Invisalign system

114    Since the launch of the Invisalign system in Australia in 2001, Invisalign Australia has promoted its brand and the Invisalign system in Australia through consumer marketing and marketing which specifically targets doctors.

115    With respect to consumer marketing, Invisalign Australia has, since at least 2016, advertised and promoted its products in Australia through a number of channels, including the following:

(a)    the Invisalign Australia website located at www.invisalign.com.au;

(b)    television;

(c)    radio;

(d)    print;

(e)    social media;

(f)    digital channels;

(g)    out-of-home advertising commonly by way of digital panels at retail;

(h)    shopping centres and gyms; and

(i)    interactive customer experiences offered through the Invisalign Centre and popups in Westfield shopping centres.

116    Invisalign also sponsors events in Australia such as the Mercedes Benz Fashion Week in 2019. Ms McGoldrick deposed that advertising its brand at events such as Mercedes Benz Fashion Week offers increased media exposure and further promotes awareness of its products.

Cross-examination of Ms McGoldrick

117    Ms McGoldrick gave evidence that in order to provide Invisalign Aligner Treatment in Australia and indeed, to complete the Training Courses, it was a requirement that the course attendee was a dentist or an orthodontist.

118    Ms McGoldrick was asked about the Invisalign Go Fundamentals training course. Ms McGoldrick explained that the Invisalign Go Fundamentals training course is designed for dentists with little to no teeth straightening experience for simple teeth straightening cases, and involves a full day course. Once the dentist has completed this course, they are able to provide the Invisalign Go treatment in Australia.

119    Ms McGoldrick was asked about the Invisalign Fundamentals training course. Ms McGoldrick explained that this course is for dentists (more particularly, those dentists that have some experience in teeth straightening and have confidence in orthodontic treatment planning) and is designed to enable the dentist to use the full suite of the Invisalign Treatment Packages in Australia, once they have completed the Training Course.

120    Ms McGoldrick explained that the ClinCheck software is the system by which Invisalign interacts with the dentists and orthodontists that have completed one of its Training Courses. Once a dentist or orthodontist has completed a Training Course they are then an Invisalign provider (Invisalign provider).

121    After a dentist has completed the Invisalign Fundamentals training course they are then able to access the ClinCheck software, and that dentist, now an Invisalign provider, is able to access and order the full range of Invisalign Treatment Packages from within the system. Whereas a dentist that has completed the Invisalign Go Fundamentals training course is only able to order the Invisalign Go product through the ClinCheck system.

122    The Invisalign provider is then able to submit information to Invisalign through the ClinCheck system under what is called a “prescription form”. Then, based on the information that is provided within the prescription form, Invisalign, through its ClinCheck system, produces a 3D treatment plan with the help of certain Invisalign technicians (Invisalign technicians). Ms McGoldrick explained that these Invisalign technicians are based in Costa Rica and do not have Australian dental or orthodontic qualifications.

123    Ms McGoldrick gave evidence that Invisalign leaves the process of patient diagnosis entirely up to its Invisalign providers. Ms McGoldrick explained that the ClinCheck software allows Invisalign providers to approve or modify the 3D treatment plan that is generated. Any updates or modifications to these plans can be made by the Invisalign provider in minutes, or less. This process can also be done live, such that the Invisalign provider can work with the Invisalign technician in real time to update or modify the 3D treatment plan at their direction. Ms McGoldrick stated that Invisalign providers are encouraged to use the ClinCheck system in this way to speed up the turnaround time for customers.

124    Ms McGoldrick outlined, in further detail, the process surrounding the use of the ClinCheck system. Ms McGoldrick illustrated how, once an Invisalign provider has diagnosed a patient, they will then complete a treatment form and will enter the patient’s records into the system. These treatment forms are then sent to the Invisalign technicians in Costa Rica who then create the 3D treatment plan for that patient. The 3D treatment plan is then sent back to the Invisalign provider for their review to enable them to make sure that it is in line with the patient’s objectives for treatment. Ms McGoldrick gave evidence that there is usually a series of modifications that the Invisalign provider will make and send back to the Invisalign technician. Ms McGoldrick told the Court that, on average, an Invisalign provider will make three modifications to a patient’s treatment plan. Ms McGoldrick was able to provide this average based on data that is stored within the ClinCheck system. This process occurs until the Invisalign provider is satisfied with the treatment plan.

125    Ms McGoldrick was asked about the number of Invisalign providers in Australia. This information is confidential in nature, however Ms McGoldrick provided a confidential note to the Court, marked MFI-2, which contained the breakdown of these figures.

126    Ms McGoldrick was asked about Invisalign Virtual Care. Ms McGoldrick was played part of a YouTube video entitled “My Invisalign App – patient instruction video” published 7 October 2020, and marked exhibit 33. This YouTube video was annexure GB-126 to the affidavit of Greg Bodulovic affirmed on 10 October 2022. Exhibit 33 is an instructional video which shows the viewer how to use Invisalign’s mobile app (My Invisalign App or Invisalign Virtual Care). A screenshot of part of this video is extracted directly below.

127    Ms McGoldrick gave evidence that Invisalign Virtual Care allows Invisalign providers to monitor the progress of their patients’ Invisalign Aligner Treatment virtually. This is able to be done because Invisalign Virtual Care enables patients to take photos and videos of themselves and upload these photos directly to the My Invisalign App, which can be accessed by the Invisalign provider. The Invisalign provider can then respond to the patient through the app and can also review the progress photos that they receive via the My Invisalign App.

128    Ms McGoldrick was asked about the TGA process undertaken by Invisalign, with particular emphasis on the registration of its products that are registered on the ARTG. Ms McGoldrick gave evidence about the two ARTG identifiers that are each registered as “Medical Device Class 1” on the ARTG. Ms McGoldrick explained that the TGA changed their guidelines and in order to ensure that Invisalign complied with the TGA, Invisalign registered these products as medical devices on 23 November 2020.

129    Ms McGoldrick explained that the “sponsor” of these ARTG registrations was Invisalign Australia Pty Ltd, which means that this entity is the supplier of the product in Australia. Ms McGoldrick gave evidence that these ARTG registered products are subject to certain conditions. Ms McGoldrick, under cross-examination, stated that one of the conditions that has been imposed upon Invisalign is that it, as the sponsor, must report any adverse events which patients experience as a result of being treated with the Invisalign system to the TGA.

130    Ms McGoldrick gave evidence about Invisalign’s consumer marketing. Ms McGoldrick conceded that SDC’s brand is reasonably well-known in Australia and that, in her view, it has become reasonably well-known to Australian consumers that SDC offers a direct to consumer model. Ms McGoldrick agreed that the price of SDC aligners has become reasonably well-known to Australian consumers.

131    Ms McGoldrick was taken to the DIY article and was shown a sentence on the ultimate page of the article which reads:

Invisalign wants to ensure Australians considering teeth straightening know the facts, what to ask and what they’re getting, so they created the Be Clear on the Facts.

132    The above text is hyperlinked, such that when one clicks on the words “Be Clear on the Facts”, they are taken to Invisalign’s website and, in particular, to its webpage entitled “Be Clear on the Facts”, which Ms McGoldrick told the Court she is familiar with.

133    Ms McGoldrick identified that the DIY article would have been “driven” by Invisalign’s marketing team.

134    Ms McGoldrick gave evidence about Invisalign’s review committee. Ms McGoldrick explained that the review committee consists of a marketing representative, a legal representative and a clinical representative and they meet weekly to review material to ensure that it complies with all of these different areas before material gets published and before they take it to the consumer. Ms McGoldrick stated that she was not involved in any of the committee’s meetings in respect of the DIY article.

135    I find Ms McGoldrick to be a truthful witness whose evidence I accept.

Dr Bradley Stanley

136    Dr Stanley swore one affidavit dated 6 May 2022, which was tendered in evidence and marked as exhibit 78.

137    Dr Brad Stanley is an Australian registered dentist with more than 30 years of dental practice experience. Dr Stanley gave evidence relating to the pricing of treatment using the Invisalign system.

138    Dr Stanley deposed to the prices that he charges patients at his practice for the provision of Invisalign Aligner Treatment. Dr Stanley outlined how these prices vary depending upon the complexity of a patient’s treatment plan and the number of clear aligners that are needed to achieve the programmed treatment outcomes. The pricing structure adopted in Dr Stanley’s practice falls into four tiers, which are:

139    The price for each package includes the following products and services:

(a)    initial diagnostic assessment which includes an intraoral exam and diagnostic record taking (including radiographs, photographs and an intraoral scan);

(b)    treatment planning;

(c)    an appointment to place attachments and fit the aligners;

(d)    an in-person consultation approximately every 4 weeks to monitor the patient’s progress; and

(e)    fixed or removable retainers following completion of treatment.

140    Dr Stanley was not called for cross-examination.

Ms Jaimie Wolbers

141    Ms Jaimie Maree Wolbers is the solicitor employed by MinterEllison, the solicitors for Invisalign. Ms Wolbers gave evidence relating to SDC marketing material she had obtained by taking internet and other web-based searches.

142    Ms Wolbers swore two affidavits that were tendered in evidence. The first was dated 4 April 2022 and marked exhibit 73. The second was dated 5 August 2022 and marked exhibit 74.

143    Ms Wolbers’ affidavits detail searches which she and MinterEllison conducted. These searches related to:

(a)    SDC company information;

(b)    SDC website information as well as SDC’s social media webpages;

(c)    SDC’s advertisements and advertorial content;

(d)    Google search engine results for various terms including “DIY teeth straightening” among other things;

(e)    advertorial content of other similar aligner brands;

(f)    Australian Competition and Consumer Commission (ACCC) media releases; and

(g)    the Orthodontics Australia webpage.

144    Ms Wolbers was not called for cross-examination.

Mr Jack Stanley

145    Mr Jack Laurence Stanley is a solicitor employed by MinterEllison, the solicitors for Invisalign.

146    Mr Stanley affirmed one affidavit dated 5 August 2022, which was tendered in evidence and marked exhibit 77.

147    Mr Stanley’s affidavit provided a response to the affidavit of Mr Greg Bodulovic dated 1 July 2022.

148    Mr Stanley deposed to searches he made with respect to webpages that were referenced in Mr Bodulovic’s affidavit at [24] and [25] and shown at annexure GB-30. These searches were produced in order to negate any inference that Mr Bodulovic might have made to suggest that patients of dentists and orthodontists who utilise “DentalMonitoring”, (which is a remote monitoring solution that enables dentists and orthodontists to view the progress made by their patients by allowing patients to scan their teeth and take intraoral images with DentalMonitoring’s proprietary ScanBox Pro Device. The patient can then upload these images to the patient app for their dentist to view). Mr Stanley provided copies of screenshots which were annexed to his affidavit.

149    Mr Stanley was not called for cross-examination.

Dr Vicki Vlaskalic

150    Dr Vicki Vlaskalic is a practising orthodontist who owns and operates her own practice and is also a clinical instructor in the Department of Orthodontics at the University of Melbourne. Dr Vlaskalic is a Clinical Consultant to Invisalign. Dr Vlaskalic gave expert evidence relating to orthodontic treatment in Australia, including the use of clear aligner therapy and evidence relating to the price of treatment.

151    Dr Vlaskalic prepared two affidavits which were tendered in evidence. Dr Vlaskalic’s first affidavit sworn 6 May 2022, was marked as exhibit 2; and her second affidavit sworn 6 August 2022, was marked as exhibit 3. Dr Vlaskalic participated in an expert conference which produced a joint expert report dated 5 October 2022, which was tendered in evidence and marked exhibit 8 (Joint Expert Report). Dr Vlaskalic also gave concurrent evidence with the other dental and orthodontic experts called to give evidence in the proceeding.

152    Dr Vlaskalic, in her affidavit evidence, provided an overview of:

(a)    the concept of malocclusion, and her understanding of the phrase “mild to moderate malocclusion”;

(b)    the basic biomechanics that are involved in moving teeth;

(c)    the objectives of orthodontic treatment as well as the diagnostic and treatment planning processes that are involved in orthodontic practice; and

(d)    clear aligner therapy in further detail, including the background to clear aligner therapy;

(e)    the “Consent and History”, the “Pricing Page”, the “Night time Clear Aligners” and the “Smile Assessment” pages of the SDC’s website.

153    Dr Vlaskalic also provided a response to certain matters raised and opinions expressed in affidavits of Dr Derek Mahony, Dr Hendrick Lai and Dr Jeffrey Sulitzer.

154    Dr Vlaskalic’s affidavit evidence ran 169 pages, including annexures. Ultimately the issues between the experts were narrowly defined, which is exemplified by the Joint Expert Report and the evidence that was given in the expert conclave. I deal with Dr Vlaskalic’s evidence in greater detail below.

Dr Eugene Chan

155    Dr Eugene Chan is a practising orthodontist who owns and operates his own orthodontic practice. Dr Chan has been appointed by the Dental Board of Australia as an arbitration consultant regarding complaints or concerns raised relating to dental and orthodontic practitioners. Dr Chan is also a clinical consultant to Invisalign. Dr Chan provided expert evidence pertaining to orthodontic treatment in Australia, including the use of clear aligner therapy and evidence relating to the price of treatment. Dr Chan prepared two affidavits which were tendered in evidence. Dr Chan’s first affidavit sworn 6 May 2022, was tendered in evidence and marked as exhibit 1; and his second affidavit sworn 5 August 2022, was marked as exhibit 4. Dr Chan also gave concurrent evidence with the other dental and orthodontic experts called to give evidence in the proceeding.

156    Dr Chan, in his affidavit evidence, provided an overview of:

(a)    the orthodontic profession in Australia, including the educational and other requirements for registration as an orthodontist, and also the professional standards that orthodontists practicing in Australia are expected to meet;

(b)    general concepts relating to the underlying anatomy and biology that guide orthodontic treatment and practice;

(c)    malocclusion, its definition and meaning;

(d)    the biomechanical principles that guide tooth movement, as they apply to orthodontic treatments;

(e)    the type of orthodontic treatments available in Australia and commonly used in orthodontic practice;

(f)    the process of patient assessment and diagnosis in orthodontic treatment, including where clear aligners are used;

(g)    the factors that are considered in orthodontic treatment planning and implementation, including choice of orthodontic appliance, use of attachments in clear aligner therapy, and obtaining consent to treatment;

(h)    how the outcomes of orthodontic treatment are measured and evaluated;

(i)    how Dr Chan manages patients who present with requests for cosmetic-only treatment, (treatment that corrects the aesthetic aspects of their malocclusion without addressing co-existing functional problems);

(j)    how Dr Chan uses Invisalign clear aligners in his practice;

(k)    the cost of treatment using braces, Invisalign Aligner Treatment, or other clear aligners for treatment of a simple correction of overcrowding or spacing issues involving the front six upper and/or lower teeth; and

(l)    his awareness of SDC Aligner Treatment and how it is marketed.

157    Dr Chan also provided a response to certain matters raised and opinions expressed in affidavits of Dr Derek Mahony, Dr Hendrick Lai and Dr Jeffrey Sulitzer.

158    Dr Chan's affidavit evidence ran 270 pages, including annexures. Ultimately the issues between the experts were narrowly defined, which is exemplified by the Joint Expert Report and the evidence that was given in the expert conclave. I deal with Dr Chan’s evidence in greater detail below.

Mr Alan Scott MacLean

Evidence in chief

159    Mr Alan Scott MacLean is a marketing research and data analyst and is the Principal and Director of Nulink Analytics Pty Ltd (Nulink Analytics). Mr MacLean was retained by MinterEllison, the solicitors for Invisalign, to provide an expert opinion in relation to the market research Actionable Study undertaken by SDC’s marketing analytics expert, Mr David Cristofaro and his company, Actionable Research.

160    By way of brief background, Mr Cristofaro, conducted the Actionable Study that surveyed 73 Australian dentists and orthodontists about their pricing. Mr Cristofaro, in the first Cristofaro Affidavit, identified the objectives for the Actionable Study. These were:

(a)    to determine the average case numbers of a representative sample of general dentists and orthodontists in full-time practice in Australia;

(b)    to understand the Study Participants’ usage of aligner-based treatment products from different companies;

(c)    to determine the average price charged for aligner-based treatment and fixed appliances (namely braces) and the price charged most often (the mode price charged) as a function of treatment method, condition severity, and other relevant factors;

(d)    to determine the criteria used by dentists and orthodontists to determine pricing for treatment of their aligner-based and fixed appliance-based cases; and

(e)    to determine the difference between the amounts charged by dentists and orthodontists for aligner-based and fixed appliance-based cases and the amounts patients pay for these services.

161    Mr Cristofaro’s Actionable Study identified that the overall average fee charged for braces in treating mild to moderate malocclusion at the time of the data collection in July 2021 was $6,939 and the overall median fee was $7,100. Mr Cristofaro identified that the overall average fee charged for treatment using Invisalign Aligner Treatment for mild to moderate malocclusion was $6,926 and the overall median fee was $7,000. Mr Cristofaro found that the average and median prices were higher for severe malocclusion. Mr Cristofaro also identified that the fees charged for treating mild to moderate malocclusion by braces ranged from $3,500 to $9,180, whereas Invisalign Aligner Treatment ranged from $4,500 to $9,500.

162    Mr MacLean affirmed one affidavit dated 30 August 2022, which was tendered in evidence and marked exhibit 58 (MacLean Affidavit).

163    Mr MacLean deposed to his experience in marketing research and data analytics. Mr MacLean outlined how in order to design and implement any survey for the purpose of achieving the objectives identified above at, the following matters, at a minimum, are essential to achieve any kind of reliability in the interpretation of results:

(a)    the interviewed sample needs to be representative of the target population or able to be reweighted so as to represent the target population;

(b)    an appropriate sample size needs to be determined. In this regard, the considerations elucidated by William G. Cochran in 'Sampling Techniques, 2nd Edition' (1963, John Wiley & Sons Ltd) need to be followed, which includes the need to achieve a balance between the reliability in the results and controlling the costs of the work to be undertaken;

(c)    questions asked during the interview need to be unambiguously understood by respondents in order for them to frame their responses correctly, as detailed by Sudman, Bradburn, and Schwartz in ‘Thinking about answers – the Application of Cognitive Processes to Survey Methodology’ (1996, Jossey-Bass Publishers). This could be achieved, for example, through both the pre-piloting and piloting of the survey instruments and procedures;

(d)    objectives of the project need to be sufficiently clear to allow the appropriate questions to be asked in the appropriate manner;

(e)    prior to analysis, results should always be cleaned to remove “speeders” (respondents who answer too quick to sensibly be responding to the survey questions), and “flatliners” – (respondents who show little or no variation across their answers to the questions (e.g. answering 5, 5, 5, 5 for all questions)); and

(f)    the assumptions underlying the statistical tests utilised in the analysis need to be sustainable. For example, the “t-test” assumes at least approximate normality in the distribution of the target metrics within the population.

164    Mr MacLean provided evidence about the financial contribution that was offered as part of Mr Cristofaro’s survey. Mr MacLean’s evidence was that he understood that the Study participants in Mr Cristofaro’s Actionable Study were offered a “small financial contribution” to complete the Questionnaire in order to “increase the response rate to the Actionable Study”. Mr MacLean identified that he had not been told the amount of that financial contribution. Mr MacLean’s evidence was that the level of financial contribution can be an important factor in determining whether the Study Participants have been influenced in their willingness to participate in the questionnaire. This is because, in Mr MacLean’s view, if the financial contribution offered is well below a professional’s usual hourly rate, it may negatively affect a professional’s willingness to be interviewed or participate in a survey which can be an obstacle in obtaining the requisite number of respondents for the survey. Further, for those who agree to participate, it may affect the time and care that the individual devotes to answering the survey.

165    In relation to the Questionnaire that was used in the survey that Mr Cristofaro sent out to the Study Participants, Mr MacLean provided the following comments:

(a)    it does not appear that Actionable Research conducted a pilot survey before proceeding with the questionnaire. It is best practice to conduct a pilot first, or at least to run through the questions that one intends to ask with a handful of potential respondents;

(b)    you cannot in general assume that people understand the questions being asked in questionnaires. Particularly in the absence of a pilot, and given Survey Participants are not being guided through the questionnaire;

(c)    the questions in the Questionnaire, relating to prices charged, use terms such as “the fee you charged most often”, “average fees”, “range of fees”, and “minimum and maximum price”. It is unclear why the Study Participants were asked questions in relation to the fees they charge in all of these different ways. In particular, it is unclear why Actionable Research has asked for the fee charged most often as well as the average fee charged. A questionnaire designed to elicit information about prices charged, in order to prompt the most accurate responses, should include instead questions along the lines of: “of the fees you charged, what is the minimum, what is the maximum and what is the average?”. In Mr Maclean’s experience, there would also be a risk of respondent fatigue at this stage of the Questionnaire. Mr MacLean explained that respondent fatigue is a “well-documented phenomenon” that occurs when Study Participants become tired of the survey task and the quality of the responses they provide begins to deteriorate which can lead to unreliable results. It occurs when Study Participants’ attention and motivation drop toward later sections of a questionnaire, particularly in circumstances where the questions become repetitive and/or the cognitive load is large. In order to reduce survey fatigue, it is critical to design questionnaires to be as engaging and efficient as possible; and

(d)    when an online market research questionnaire asks participants for details of prices they have charged or have paid, participants do not usually consult their records to determine what they charged or paid but rather answer from their recollection. The answers are ultimately their guess, and perhaps their best/educated guess. Mr MacLean stated that the Study Participants would likely have completed the Questionnaire from their recollection rather than actually consulting their records which may have negatively affected the accuracy of the results.

Cross-examination of Mr MacLean

166    Mr MacLean was taken to [19] of the MacLean Affidavit, which sets out the minimum essential features, that in Mr MacLean’s view, are required in order to achieve reliable results in a survey of the kind conducted by Mr Cristofaro. Mr MacLean was taken to [19(c)] of the MacLean Affidavit, where he provides his view that “questions which were asked during the interview need to be unambiguously understood by respondents in order for them to frame their responses correctly”. It was put to Mr MacLean that he had not undertaken any assessment or testing of the survey questions in issue in this proceeding to see whether they were unambiguously understood by the respondents. Mr MacLean agreed that he had not done so.

167    Mr MacLean was taken to [44(f)] of the Maclean Affidavit, where Mr MacLean commented on the questions in Mr Cristofaro’s questionnaire in relation to the fees charged by dentists and orthodontists. Mr MacLean was taken to [44(f)] of the MacLean Affidavit in which he cited the proposition that “respondent fatigue is a well-document phenomenon” which occurs when survey participants become tired of the task and their answer begin to deteriorate, and stated, with respect to Mr Cristofaro’s Questionnaire that:

In my experience there would also be a risk of respondent fatigue at this stage of the questionnaire.

168    Mr Maclean was asked whether he had undertaken any independent assessment of whether the Study Participants did, in fact, experience respondent fatigue in answering the survey questions. Mr MacLean confirmed that he had not done so.

169    Mr MacLean was taken to [41] of the Maclean Affidavit, where he provides evidence in relation to the financial contributions that were offered to Study Participants. Mr MacLean was taken to the following part of this paragraph:

For instance, if the financial contribution offered is well below a professional's usual hourly rate, in my experience, it may negatively affect a professional's willingness to be interviewed or participate in a survey. This can therefore be an obstacle in obtaining the requisite number of respondents for the survey and, further, for those who agree to participate, it may affect the time and care that the individual devotes to answering the survey.

170    Mr MacLean was asked if he had conducted any independent assessment or analysis of whether the financial contributions that were made in relation to Mr Cristofaro’s survey did indeed affect the results. Mr MacLean conceded that he had not done so.

171    Mr MacLean accepted that, as a statistician, he had not undertaken any survey involving dentists or orthodontists.

172    Mr MacLean was taken to [19(b)] of the MacLean Affidavit, where he stated that one of the essential features of designing a survey that is reliable is to ensure that an appropriate sample size is determined which achieves a balance between reliability in the results and the cost of the survey being undertaken. Mr MacLean explained that, in general terms a larger sample size equates to a more reliable estimate, derived from the sample. Mr MacLean gave evidence that this needs to be balanced with the costs associated with achieving the result, as each extra interview that is conducted bares a cost, and therefore surveyors are subject to budgetary constraints. Mr MacLean stated that the factors that he set out at [19] of the MacLean Affidavit represent best practice in conducting a survey, but are not the requirements to create a “perfect study”.

173    Mr MacLean accepted that he did not conduct any independent analysis as to whether the respondents just addressed their responses.

174    Mr MacLean was an honest and forthright witness who made appropriate concessions during cross-examination. I accept his evidence.

Dr Marcus Tod

Evidence in chief

175    Dr Marcus Tod is a registered and practising orthodontist and a partner at Ethos Orthodontics in Brisbane, Australia. Dr Tod affirmed one affidavit dated 28 September 2022, which was tendered in evidence as exhibit 59 (Tod Affidavit).

176    Dr Tod deposed that he had received a request from Ms Sadie Gregory, in which she asked Dr Tod if he would be willing to speak to www.news.com.au in relation to the DIY article, which he agreed to do.

177    Dr Tod stated that he was interviewed on the phone for around 30 minutes by Ms Pilar Mitchell, a journalist whom he understood was associated with www.news.com.au.

178    Dr Tod stated that during that interview, Ms Mitchell asked him a number of questions relating to individuals undertaking their own dental or orthodontic treatment, including teeth straightening, teeth whitening, veneers and tooth filing. Dr Tod deposed that he did not receive any payment, compensation, or consideration from Invisalign Australia or any other person for participating in the interview.

179    At the time of the interview, Dr Tod was aware that there were a number of businesses that offered DIY teeth straightening products or treatments to Australians. Dr Tod gave evidence that he was aware that some of these businesses did not involve dentists or orthodontists, while some offered virtual oversight by dentists or orthodontists.

Cross-examination of Dr Tod

180    Dr Tod was asked about the request that he received from Ms Sadie Gregory to participate in the news.com.au interview. Dr Tod was taken to a series of email correspondence that occurred between him and Ms Gregory in July 2021 which was annexed to the affidavit of Mr Greg Bodulovic dated 13 October 2022 at GB-143, marked exhibit 60.

181    Dr Tod was taken to an email sent to him from Ms Gregory on 2 July 2021, as well as Dr Tod’s response to it that same day. The second sentence of Ms Gregory’s email sent on 2 July 2021 stated:

I work for Invisalign and worked closely with Alex on the Be Clear on the Facts campaign, I think you must have spoken to her earlier this year before your chat on ABC Perth Radio?

182    Dr Tod was asked to provide further information on “Alex” and to elaborate on the interaction that he had with Alex. Dr Tod told the Court that he has not previously met Alex, but he believes that Alex is engaged by an organisation called Keep Left. Dr Tod explained that Keep Left assist the Australian Society of Orthodontists (ASO) with their public education program.

183    Dr Tod was asked about the Be Clear on the Facts campaign, which was the subject of the 2 July 2021 emails. Dr Tod gave evidence that it was his understanding that the Be Clear on the Facts campaign was an Invisalign campaign.

184    Dr Tod was taken to the third and fourth paragraphs of Ms Gregory’s email sent on 2 July 2021, which stated:

We are looking at extending the Be Clear on the Facts campaign and have an opportunity for an editorial piece with News.com.au. They have asked us for a spokesperson for the campaign and we thought you would be a good fit, as the piece you delivered with ABC Perth was really well received.

Would you be happy to speak to News.com.au if we provide your details as a spokesperson? We're still confirming timings, but they will probably need get [sic] a statement from you at some point next week or W/C 12th July.

185    Dr Tod told the Court that he understood from this that he was being asked to be a spokesperson for Invisalign’s Be Clear on the Facts campaign. Dr Tod then confirmed that, given that context, at [14] of the Tod Affidavit where stated that he would be “willing to speak to News.com.au regarding the “Be Clear on the Facts” campaign for an editorial piece”, this sentence should rather be read as his agreement to be “a spokesperson for the Invisalign Be Clear on the Facts campaign”.

186    Dr Tod was taken to [17] of the Tod Affidavit, where he described that he was aware of a number of businesses that offered DIY teeth straightening products to Australians. Dr Tod was asked why he made no specific reference to SDC at [17], and whether this was because he did not know about SDC’s business. Dr Tod explained that he was aware of SDC, but was particularly aware of a company called EZ Smile, which Dr Tod recalled had received an infringement notice from the ACCC, which he deposed to at [17] of his affidavit. Dr Tod conceded that his affidavit contained no mention of SDC, but Dr Tod did not accept the proposition that this was because he did not know about SDC’s business at the time of the interview with Ms Pilar Mitchell on 9 July 2021.

187    Dr Tod was asked about his knowledge of SDC and its business. Dr Tod gave evidence that he had undertaken an online review into SDC previously, but not for the 9 July 2021 interview. Dr Tod explained that he had looked into SDC’s business before it came to Australia. Dr Tod stated that his review into SDC was undertaken around six years ago, when he first heard about direct to consumer aligners. Dr Tod conceded that none of this information was contained within his affidavit. Dr Tod gave evidence that, at the time of the 9 July 2021 interview, he knew that SDC had Affiliated Dentists in Australia that needed to approve all SDC Aligner Treatments. Dr Tod explained that he knew about this because he, in his capacity as a member of the ASO’s Communications and Information Committee, conducted a “secret shopper” exercise. This “secret shopper” exercise was done to gauge the level of investigation that was completed by SDC on its customers prior to commencing SDC Aligner Treatment. Dr Tod explained that the purpose of this exercise was to see if SDC’s patients were receiving an in-person examination by a qualified dentist with appropriate x-rays and other relevant checks prior to beginning SDC Aligner Treatment. Dr Tod recalled that it was not the case that SDC undertook x-rays prior to moving patients’ teeth.

188    Dr Tod was asked why the ASO considered it necessary to undertake this secret shopper exercise and to assess whether SDC’s patients were receiving x-rays. Dr Tod outlined that the ASO believes that every patient should have a prior examination before undergoing clear aligner therapy and this includes having x-rays completed. Dr Tod also noted, in cross-examination, that the ASO had taken the view that SDC was bypassing orthodontists, and Dr Tod personally shared this view.

189    Dr Tod was asked if, prior to agreeing to be a spokesperson for Invisalign, and prior to the 9 July 2021 interview with Ms Mitchell, he knew that the ASO held the view that every patient should have an x-ray prior to undertaking clear aligner therapy. Dr Tod agreed that he was aware of the ASO’s view in this regard.

190    Dr Tod was asked if he received a copy of the result of the secret shopper exercise. Dr Tod gave evidence that he did not receive a copy of the result, but explained that he was appraised of the result by the Chief Executive Officer of the ASO at the time, Ms Michelle Cutler. Dr Tod recalled that Ms Cutler told him that the secret shopper received the predicted outcome for their treatment from SDC after their visit and they were also given the name of the dentist that would oversee their treatment. Dr Tod stated that he was only aware that SDC’s Affiliated Dentists only receive a 3D scan of the patient’s teeth, which he understood resulted from a scan that the patient undertook at a SmileShop or from a mould that the patient self-administered. Dr Tod conceded that this was an assumption that he made.

191    Dr Tod conceded that this was the totality of the information that he believed was available to dentists at SDC.

192    Dr Tod was cross-examined about the interview on 9 July 2021 conducted by Ms Mitchell for www.news.com.au. Dr Tod gave evidence that, during this telephone interview, he spoke with Ms Mitchell about the risks that are associated with “direct to consumer” or DIY at-home dental treatment kits. Dr Tod’s evidence was that during this interview he explained that one has to be cautious when using such products without undergoing a thorough examination beforehand.

193    Dr Tod was asked about whether he made any of the following statements, or words to the effect of the below statements, which were quoted in the article:

At-home teeth straightening kits have been available for many years in America but they’re fairly new in Australia.

…

The premise is you get a kit in the mail.

…

You mix up the putty, make an impression of your teeth and send it back with a checklist of what you don’t like about your teeth.

…

Some companies are more hands-on, offering a scan centre where customers can have their teeth scanned.

…

The companies used the DIY teeth impressions or scans to create a set of plastic liners that will move your teeth into the desired position.

…

The practice is super dangerous.

…

Although costs of at-home kits and orthodontics vary, DIY kits cost about 60 per cent of what an orthodontist would charge.

194    Dr Tod agreed that he made those statements, or words to the effect of those statements to Ms Mitchell during his interview.

195    Dr Tod was asked what the basis was for making the following statement:

… DIY kits cost about 60 per cent of what an orthodontist would charge.

196    Dr Tod explained that he generally knew the average fees of orthodontists, including from the fees that he charges to his own patients.

197    Dr Tod further explained that he has seen, and generally is aware of the price of DIY aligner treatments after seeing various advertisements for brands such as SDC, EZ Smile and Wondersmile, which he recalled as all having similar costs.

198    It was put to Dr Tod, and he conceded, that the reason he did not make any statements in his affidavit in relation to SDC was because he was concerned that it would imply that he was talking about SDC directly.

199    Dr Tod was asked about the following statement and what he was referring to when he used the term “scan centre”:

Some companies are more hands-on, offering a scan centre where customers can have their teeth scanned.

200    Dr Tod gave evidence that the term “scan centre” was a reference to an SDC SmileShop in Brisbane. Dr Tod conceded that he did not mention this in his affidavit because he was concerned that making such a statement would imply that he was talking about SDC directly.

201    Dr Tod was asked whether he was aware that a draft article had been formulated and sent to Invisalign after his discussion with Ms Mitchell, but was not sent to him. Dr Tod told the Court that he was not aware of this, but that he did recall seeing the draft article prior to its publication.

202    Dr Tod was taken to an email between www.news.com.au and Invisalign in July 2021 which was annexed to the affidavit of Mr Greg Bodulovic dated 13 October 2022 at GB-138, marked exhibit 61. The email was sent from Ms Nicole Sembrano of www.news.com.au on 16 July 2021 to Ms Gregory of Invisalign, with a number of other people copied in, however Dr Tod was not a recipient of this email. Ms Sembrano’s email contained an attachment which was taken to be the draft DIY article, marked exhibit 62.

203    Dr Tod was taken to a number of passages within the draft DIY article marked exhibit 62, these were:

At-home teeth straightening kits have been available in America for many years but Dr Todd [sic] says they’re fairly new in Australia.

…

Some companies are more hands on, offering a “scan centre” where customers can have their teeth scanned.

…

Although costs of at-home kits and orthodontics vary, Dr Todd [sic] estimates DIY kits cost about 60 percent of what an orthodontist would charge.

204    Dr Tod previously agreed, as noted above, that he made the above statements to Ms Mitchell during the 9 July 2021 interview.

205    Dr Tod was asked if he was aware that those passages were removed from the DIY article. Dr Tod conceded that he was not aware of this.

206    Dr Tod was taken to another email within exhibit 61. This was an email from Ms Gregory to Ms Sembrano, with a number of other people copied in, that was sent on 26 July 2021. Ms Gregory’s email attached an updated draft article, marked exhibit 63. The email stated, in part:

Good news – the articles have been approved by our review committee. I’ve attached the marked up versions and also the clean versions of both articles.

Our lawyer ended up sending the articles to external legal council [sic] who recommended a few changes. I also sent the articles to Dr Tod to gain his approval on them and he is also happy with the articles but has requested that we add some wording at the end of the articles to reflect that he represents Orthodontics Australia. This has been marked up in both articles.

207    Dr Tod was asked if there were two articles that were being circulated during this time (being exhibit 62 and exhibit 63). Dr Tod confirmed this to be the case. The article marked exhibit 63 contained a number of amendments which were in mark up. Dr Tod was taken to paragraphs, within exhibit 63, which had been deleted during the editing process, these were:

While at-home teeth straightening kits have been available in America for many years, they’re …

…

Although costs of at-home kits and orthodontics vary, Dr Todd [sic] estimates DIY kits cost about 60 percent of what an orthodontist would charge.

208    Dr Tod was also shown that, during the editing process, the words “super dangerous” in reference to the practice of clear aligner therapy were replaced with “can be harmful”.

209    Dr Tod, was asked whether he had any recollection of anyone from Invisalign asking for his consent to make those changes to the article. Dr Tod did not recall anyone from Invisalign asking to make such a change. Dr Tod explained that he was aware of the changes that were made to the article in relation to the deletion of certain words, such as “super dangerous” but was otherwise unaware of other changes that occurred during the editing process. Dr Tod told the Court that changes to the article, in a marked up draft version, were shown to him by Invisalign.

210    Dr Tod was taken back to exhibit 60 and was shown an email sent from Ms Gregory to him on 26 July 2021. The email contained two attachments and stated:

The first attachment – ‘Confident Smile’ - has been approved by us and our legal team, please can you confirm that you are happy for this to go live?

The second attachment – ‘DIY Beauty’ - has a few comments from our lawyer as she would like to make a couple of minor tweaks to some of your statements. I have left her comments in the document, please can you review and make sure you are happy with the tweaks?

211    Dr Tod confirmed that the “DIY Beauty” article mentioned above is in fact the article marked exhibit 63, which also appears at pages 363 to 365 of exhibit 60. Dr Tod again confirmed that he was not aware of the changes that were made to the article and that he was not asked for his consent for those changes to be made.

212    Dr Tod was taken to an email that he sent on 26 July 2021 which was in response to Ms Gregory’s email that same day, which contained the two attachments of the “Confident Smile” and “DIY Beauty” articles. Dr Tod’s email copied in Ms Melanie Campbell as well as “Alex”, whom Dr Tod confirmed worked for Keep Left. Dr Tod’s response states, in part:

The articles are fine - I'll be guided by the thoughts of Mel as well. That said, I'm speaking as a spokesman for Orthodontics Australia so it would be ideal if we could give OA a plug.

213    Dr Tod was asked why he was willing to be guided by the thoughts of Ms Melanie Campbell, in his email of 26 July 2021. Dr Tod explained that Orthodontics Australia (OA) (being the consumer facing arm of the ASO) had received prior legal advice about concerns that SDC had with some of its online content, and he was willing to be guided by Ms Campbell because he wanted to avoid saying anything which could be “problematic”.

214    Dr Tod was asked why he was seeking for OA to “receive a plug”. Dr Tod gave evidence that he wanted it to be known that he was speaking on behalf of OA, in circumstances where it was also OA that shared the belief that patients should receive x-rays prior to undergoing teeth straightening treatment. Dr Tod was taken back to the “DIY Beauty” article mentioned above, marked exhibit 63, which also appears at pages 363 to 365 of exhibit 60. Dr Tod was asked to explain the choice of words he used when he described the practice of clear aligner treatment as “harmful” and whether this was a veiled comment about SDC’s practices in particular. Dr Tod told the Court that this statement was not a commentary on SDC’s Aligner Treatment. Dr Tod conceded that he did not hold the view, at the time that this article was written, that SDC Aligner Treatment could be harmful.

215    Dr Tod was then asked about the following statement that was also contained in the article:

Moving teeth is a medical procedure. It’s complex and for people not to have a proper investigation of their teeth beforehand, that’s concerning.

216    Dr Tod agreed with this statement and told the Court that this was also not a comment directed to SDC Aligner Treatment specifically. But Dr Tod did tell the Court that he did hold the view, at the time of this article that SDC did not conduct a proper investigation of its patients’ teeth, which was based on his shared belief with the ASO that x-rays and an in person examination are a necessary component in all cases of treatment.

217    Dr Tod was asked if he was aware that SDC’s Affiliated Dentists may and do reject cases until x-ray clearance is given. Dr Tod explained that he did know about SDC’s business based on his online reading into SDC, however Dr Tod conceded that he did not have specific knowledge that SDC would reject cases that required x-ray clearance before progressing to treatment.

218    It was put to Dr Tod that he was motivated to diminish SDC’s business because of his shared belief with ASO that SDC was bypassing orthodontists. Dr Tod agreed with that proposition, but he maintained that SDC Aligner Treatment does not involve a proper investigation of a patient’s teeth.

219    Dr Tod impressed me as a truthful witness that made proper concessions during the course of his cross-examination. I accept Dr Tod’s evidence.

Professor Craig William Dreyer

Evidence in chief

220    Professor Craig Dreyer is an Emeritus Professor and Senior Visiting Dental Specialist, with 48 years’ experience in the dental filed, including 42 years in orthodontics. Professor Dreyer was retained by MinterEllison, solicitors for Invisalign, to provide an expert opinion and, in particular, to respond to the affidavit evidence of Dr Marc Ackerman filed by SDC. Professor Dreyer affirmed two affidavits. Professor Dreyer’s first affidavit was affirmed on 28 September 2022 (first Dreyer Affidavit), which was tendered and marked exhibit 64 and his second affidavit was affirmed on 14 October 2022 (second Dreyer Affidavit), which was tendered and marked exhibit 65.

221    Professor Dreyer, based on his experience in the dental and orthodontic fields, outlined that the most prominent and credible journals are the American Journal of Orthodontics and Dentofacial Orthopedics, the European Journal of Orthodontics and Angle Orthodontist, which are all peer reviewed journals that have been critically assessed by experts and have undergone scientific rigour prior to publication.

222    Professor Dreyer deposed that he was asked to review and provide his comments on four articles:

(a)    Buschang, P. H. et al. ‘Comparative time efficiency of aligner therapy and conventional edgewise braces’ (2014) 84 (3) Angle Orthodontist, 391- 396 (the Buschang Article);

(b)    Gu, J. et al. ‘Evaluation of Invisalign treatment effectiveness and efficiency compared with conventional fixed appliances using the Peer Assessment Rating index’ (2017) 151 (2) American Journal of Orthodontics and Dentofacial Orthopedics, 259 - 266 (the Gu Article);

(c)    Miller, K. et al. ‘A comparison of treatment impacts between Invisalign aligner and fixed appliance therapy during the first week of treatment’ (2007) 131 (3) American Journal of Orthodontics and Dentofacial Orthopedics, 302.e1 - 302.e9 (the Miller Article); and

(d)    White, D. W. et al. ‘Discomfort associated with lnvisalign and traditional brackets: A randomized, prospective trial’ (2017) 87 (6) Angle Orthodontist, 801- 808 (the White Article),

(collectively, the four articles).

223    Professor Dreyer, in the first Dreyer Affidavit, provided the following comments on each of the four articles.

Buschang Article

224    The Buschang Article compares the time efficiency of Invisalign aligners with conventional edgewise braces. Professor Dreyer’s comments on the Buschang Article were limited to the methodology and outcomes of the study, insofar as it related to the total length of a patient’s treatment.

225    In order to assess the treatment time for patients treated with Invisalign compared to patients treated with conventional braces, the study obtained treatment information from 300 patients, of which 150 were treated with Invisalign and 150 with conventional “edgewise” braces.

226    The Buschang Article concluded that conventional braces required 5.5 months’ longer treatment duration than Invisalign Aligner Treatment.

227    Treatment time for patients using clear aligners depends, in part, on how frequently the aligner is changed. As a general rule, the more frequently the aligners are changed, the greater the reduction in the duration of treatment. The Buschang Article does not state how frequently aligners are changed for patients being treated with Invisalign, nor does it provide the precise frequency with which braces were adjusted for those patients that were treated with braces. The study only includes patients who have been treated with the “same highly experienced orthodontist”. Based on Professor Dreyer’s experience, this indicated to him that the orthodontist adopted their usual or routine practice in treating patients and, therefore, the results reported would be reflective of the treatment efficiencies (including the treatment time) of that orthodontist in the context of their usual practice.

Gu Article

228    The Gu Article compares the effectiveness and efficiency of Invisalign Aligner Treatment with fixed appliances (another term for braces). A cohort of 48 patients using Invisalign aligners, and 48 patients using fixed appliances, were compared in terms of:

(a)    post-treatment Peer Assessment Rating (PAR) scores;

(b)    post-treatment reduction in PAR scores;

(c)    treatment duration; and

(d)    malocclusion improvement.

229    The study was performed retrospectively, by analysis of pre-treatment and post-treatment records.

230    The Gu Article reports on differences between the pre-treatment and post-treatment weighted PAR scores between the Invisalign cohort and fixed appliance cohort. PAR is a measure of how much a patient’s teeth vary from “ideal occlusion” which is, in layman’s terms, where ones teeth are well aligned. Differences in pre-treatment weighted PAR scores were not statistically significant between the two cohorts.

231    The Gu Article found that overall, treatment with Invisalign reduced the total treatment duration by an average of 5.7 months, or 30%, when compared to the duration of treatment with fixed appliances.

232    In the study, patients’ aligners were changed every two weeks for the Invisalign group. The Gu Article does not disclose how frequently patients in the fixed appliance cohort were seen.

233    Overall, the Gu Article concludes that, based on these cohorts of patients, the total treatment duration with Invisalign is substantially quicker than conventional braces.

234    The Gu Article also concludes that fixed appliances improved malocclusion more effectively than Invisalign.

Miller Article

235    The Miller Article compares impact on the patients’ quality of life as reported by the patients treated with Invisalign, compared to patients treated with fixed appliances, during the first week of orthodontic treatment.

236    The first week of orthodontic treatment is usually the most difficult and challenging for patients, as it is associated with greater pain as a result of the initial pressure being applied to facilitate a patient’s teeth movement. After the first week the pain tends to subside. However, patients will still continue to experience discomfort associated with orthodontic appliances (whether it be aligners or fixed appliances) after the first week. Fixed appliances are more aggravating due to the roughness of all the attachments that are bonded to the teeth, which impacts the oral tissues and causes irritation and sometimes ulcers.

237    A daily diary was completed by each patient over the first 7 days of orthodontic treatment.

238    The patient group was restricted to patients over 18, in good general health, with no premolar and incisor extractions.

239    The Miller Article identifies that there were significant differences reported in terms of pain and quality of life between those treated with Invisalign and the patients treated with fixed appliances.

240    The patients that received treatment with Invisalign reported that, by the end of the first week, their pain scores had returned to baseline levels. The group that received treatment with fixed appliances reported that their pain scores remained below baseline (i.e. were more painful than pre-treatment) the entire week. The mean pain level of the cohort that received treatment with Invisalign aligners had returned to baseline level at day five, whereas the mean pain level of the cohort that received treatment with fixed appliances did not return to baseline level by day seven.

241    Professor Dreyer noted that it is important to understand that:

(a)    there may be a spike in patient pain after a visit to the orthodontist (subsequent to the first visit), where a patient’s fixed appliances have been adjusted or, otherwise, where a patient has changed into a new aligner in order to progress treatment; and

(b)    it can be difficult to assess pain objectively, as it is a highly subjective experience.

242    The conclusion reached by the authors of the Miller Article is that there was a significant difference in the quality of life between patients treated with Invisalign aligners compared to those treated with fixed appliances during the first week of treatment. In particular:

(a)    whilst both groups reported decreases in their quality of life after the start of treatment, patients treated with Invisalign aligners had a better quality of life during the first week than patients treated with fixed appliances;

(b)    the fixed appliance group reported more intense decreases in function as well as pain and psychological related aspects in their daily lives; and

(c)    the fixed appliance patients took more pain medication during days 2 and 3 of treatment.

243    Professor Dreyer stated that, in his view, the conclusions drawn by the authors of the Miller Article are reasonable.

White Article

244    The White Article evaluates the level of discomfort experienced by patients treated with Invisalign aligners compared with patients treated with fixed appliances. The study consisted of a group of 41 patients. Like the Miller Article, patients were asked to keep a pain diary and report on their pain levels in the seven days following their initial treatment appointment. However, patients also reported on their pain levels four days after subsequent adjustment appointments one month into their treatment time, and two months into their treatment time. Four days was chosen as the reporting period as patients have previously been shown to adapt to the pain and discomfort of orthodontic treatment devices within three to five days.

245    The results of the study showed that, in the seven day period following the initial appointment, patients treated with fixed appliances consistently demonstrated greater discomfort than those treated with Invisalign aligners. Patients treated with fixed appliances also recorded greater discomfort than patients treated with Invisalign aligners after their first and second month adjustments.

246    The authors of the White Article concluded that fixed appliances produce significantly more discomfort than aligners in the seven day period following the patient’s first appointment, and after the one and two month adjustment appointments.

247    The White Article offers many of the same conclusions as the Miller Article, in terms of the manner in which pain levels have been assessed and the outcomes produced.

248    Professor Dreyer, in the second Dreyer Affidavit, provided a response to Dr Ackerman’s affidavit evidence, wherein Dr Ackerman commented on the four articles.

249    Professor Dreyer provided the following comments.

250    Professor Dreyer agreed that the four articles do not employ perfect academic methodology, but opined that deficiencies can be found in all clinical treatment studies.

251    In terms of the Buschang Article, Dr Ackerman criticised the study for the patients being consecutively treated by one orthodontist. Dr Ackerman also opined that the Buschang study had no control group and was not randomised among other things.

252    Professor Dreyer, in response to Dr Ackerman’s critique, opined that:

(a)    implementing a controlled group in a comparative clinical trial of this nature would be impractical;

(b)    all subjects in the study fit the inclusion criteria making them candidates for either braces or clear aligners and that the absence of randomisation is not a particular flaw of the Buschang Article;

(c)    any selection bias would be mitigated, in part, by the fact that each patient within this clinical trial met the same limited set of diagnostic criteria;

(d)    because the patients were treated by one orthodontist, one would expect that the intervals between aligner changes and braces adjustments were consistent as all would conform to that orthodontist's usual practice; and

(e)    he would expect that any delays resulting from midcourse corrections in the aligner treatment group would be accounted for in the result of the studies.

253    In terms of the Gu Article, Dr Ackerman criticised the study for the patients being treated by multiple clinicians in the same group, many of whom were students. Dr Ackerman also opined that the Buschang study did not disclose the specific fixed appliance systems that were used and did not state the criteria for deciding when the treatment was complete among other things.

254    Professor Dreyer, in response to Dr Ackerman’s critique, opined that:

(a)    it is unclear why Dr Ackerman has criticised the Gu Article study for being a study based on results from subjects treated by multiple practitioners. There are weaknesses in studies which include patients treated by only one practitioner (like the Buschang Article) and studies which include patients treated by multiple practitioners. However, no study is without its flaws;

(b)    he does not consider it to be a major flaw of the Gu Article study that the kinds of braces were not disclosed. Multiple different fixed appliance systems were used. The kind of fixed appliance prescribed to the patient is the one that the clinician considers will deliver the best results for that patient in any case, based on their clinical judgment;

(c)    he accepted that the Gu study should have disclosed the generation of Invisalign, and it would be helpful to know this; and

(d)    he does not think that it is a flaw that the Gu Article study did not disclose whether, and how many, attachments were used in the treatment of each subject.

255    In terms of the Miller Article, Dr Ackerman criticised the study because the inclusion criteria for patients does not include the kind (or severity) of orthodontic problem being treated, the study did not discuss the patient's reasons for seeking orthodontic treatment, the type of braces and generation of Invisalign used was not disclosed, the methodology had not been validated for use in this setting among other things.

256    Professor Dreyer, in response to Dr Ackerman’s critique, opined that:

(a)    it is not a significant methodological flaw that the Miller Article does not base its selection criteria on the kind and severity of orthodontic problem being treated. Regardless of the severity of the orthodontic problem being treated, the first week of treatment will be uncomfortable for all patients;

(b)    the reason for the patient seeking treatment is not relevant to the level of pain experienced;

(c)    it is unclear whether the modified pain diary used in the Miller Article study has or has not been validated;

(d)    while the Miller Article does not disclose the types of braces, the generation of Invisalign and attachments used, this does not constitute a significant methodological flaw in the Miller Article study; and

(e)    he does not agree with Dr Ackerman's statement that the first week of treatment is not the most difficult.

257    In terms of the White Article, Dr Ackerman criticised the study because, in his view, the first week of treatment is not indicative of overall discomfort or pain during the entire duration of treatment. Dr Ackerman states that the White Article’s attempt to compensate for this by adding two additional time points for pain assessment (at one month, and two months) does not assist the reader in understanding different levels of pain experienced by either group of patients, as the braces adjustments are not reported as standardised.

258    Professor Dreyer, in response to Dr Ackerman’s critique, opined that, while he does accept that standardisation is ideal in the clinical trial setting, this is not always possible where a patient presents with their own unique biology and response to treatment. When a patient presents for an adjustment, the treating practitioner will take the best course of action available in response to that patient's unique circumstances. Professor Dreyer’s view is that subjecting all patients to a standardised adjustment at the one and two month intervals would be departing from implementing the best possible treatment that they know to be suited to that patient. The adjustments being performed were not radically different, because all patients have the same inclusion criteria with similar levels of severity in terms of their orthodontic problems.

Cross-examination of Professor Dreyer

259    Professor Dreyer was asked about the four articles that MinterEllison asked him to comment on in the first Dreyer Affidavit. It was put to Professor Dreyer that the four articles are only a selection of the available research that considers issues such as the time efficiency of aligners against braces. Professor Dreyer agreed with that proposition. Professor Dreyer gave evidence that he was not asked to consider any research about the efficacy of SDC Aligner Treatment and was not otherwise aware of any specific research on this topic. Professor Dreyer also noted that he had not conducted any independent research into the available literature on the time efficiency of aligner treatment versus braces.

260    During cross-examination, junior counsel for SDC, Mr Tynan, provided Professor Dreyer with a 2022 study entitled: Lin, E. et al. ‘Differences in finished case quality between Invisalign and traditional fixed appliances: a randomized controlled trial’ (2022) 92 (2) Angle Orthodontist, 173- 179 (the Lin Article), which was marked exhibit 66. One of the co-authors of the Lin Article is Dr Peter Buschang, who was the lead author of the Buschang Article. It was put to Professor Dreyer, and he accepted, that the stated purpose of the Lin Article was to compare patients that were treated with traditional braces against patients that were treated with Invisalign Aligner Treatment, which incorporated SmartForce features and attachments.

261    Professor Dreyer explained that “SmartForce features and attachments” are plastic attachments that are placed on a patient’s teeth to allow the aligner to grip more positively and firmly to the teeth to induce the type of tooth movement that the patient requires. Professor Dreyer opined that the Invisalign aligners that were the subject of the study described in the Lin Article are the latest generation (most up-to-date version) of Invisalign aligners because SmartForce features are a part of the most recent incarnation of Invisalign Aligner Treatment.

262    Professor Dreyer was taken to page 174 of the Lin Article under the heading “Data Collection” within the section “Materials and Methods”. Professor Dreyer was taken to the following paragraph which outlines the inclusion criteria for patients within the Lin trial:

Inclusion Criteria: Class I molar and canine relationships, non-extraction treatment, mandibular crowding of 4 mm or less, and no missing teeth (from the second molar to the second molar).

263    Professor Dreyer agreed that the trial that was in the subject of the Lin Article was a randomised controlled trial. Professor Dreyer explained that the benefits of conducting a randomised controlled trial is that it removes much of the bias from the participants and examiners, which is advantageous in a field such as orthodontics, which Professor Dreyer described as being subject to a “great deal of subjectivity”. Professor Dreyer outlined how there are a number of different biases that can occur within a study such as selection bias, personal bias, statistical bias and appliance bias, among others. Professor Dreyer explained that “personal bias” is a type of bias wherein an operator might have a preference for a particular appliance system and a mechanism for tooth movement that they prefer to use on patients. Professor Dreyer explained that “selection bias” is a type of bias wherein an operator might select patients that would fit more easily within a particular appliance system. Operators that conduct a study may select patients that have particular characteristics, which are more conducive to a certain type of treatment. Professor Dreyer outlined how the patients within the four articles were selected as their idiosyncratic teeth characteristics were best suited to success with aligner treatment.

264    Professor Dreyer was asked about the “ABO Discrepancy Index” which was a method of assessing the pre-treatment occlusion of each of the patients that were a part of the trial described within the Lin Article. The statistical analysis in this study revealed that pre-treatment occlusion for the patients that were treated with Invisalign aligners was “4.5”, whereas for braces it was “7.0”. Professor Dreyer accepted the fact that pre-treatment occlusion for those patients treated with braces was more complex than the pre-treatment occlusion of patients treated with Invisalign aligners and considered such a discrepancy to be statistically significant.

265    Professor Dreyer was taken to page 177 of the Lin Article under the heading “Discussion”. Professor Dreyer accepted that even though the pre-treatment occlusion of patients with braces was more complex than patients treated with Invisalign aligners, the patients in this study that were treated with braces completed their treatment 4.8 months earlier than those treated with the aligner treatment, which sits in contrast to the findings made in the Buschang Article.

266    Professor Dreyer also accepted that, based on this research, patients with braces that had more complex pre-treatment occlusion, were treated faster with braces than they were with Invisalign aligners.

267    Professor Dreyer identified that the trial that was the subject of the Buschang Article:

(a)    was not random;

(b)    was a retrospective study;

(c)    was performed by one treatment professional who undertook 50 braces treatments and 150 Invisalign treatments; and

(d)    did not identify which generation of the Invisalign clear aligners was used in the study.

268    Professor Dreyer was a careful and considered witness whose evidence I accept.

Ms Monina Tanya Rivera

269    Ms Monina Tanya Rivera is an Associate Marketing Director and the consumer marketing lead for Australia and New Zealand at Invisalign Australia. Ms Rivera is responsible for (among other things) locally managing the Invisalign plan, consumer, communications and the website. Ms Rivera is responsible for developing the consumer marketing strategy, implementation and management of budgets of all consumer marketing and lead generating initiatives across Australia and New Zealand, including brand of campaigns, digital platforms, social media, PR projects, consumer event activations, ambassador relationships and consumer-facing communications. In this role, Ms Rivera also manages the media and creative agencies and works closely with regional and global marketing, analytics and research teams in developing localised brand standards, campaign best practice and key performance measures.

270    Ms Rivera affirmed an affidavit on 23 September 2022, which was tendered in evidence and marked as exhibit 76. Ms Rivera, in her affidavit, deposed to the following.

271    Since about 2003, Invisalign Australia has published content on their website which is hosted at the domain: www.invisalign.com.au (Invisalign Website).

272    In July 2020, the content of the Invisalign Website was refreshed and relaunched. The changes made to the Invisalign Website during this refresh included an updated “look and feel” of the website, to create consistency between the Invisalign Website and websites for other markets. Ms Rivera deposed that content which is published on the Invisalign Website is reviewed to ensure that it is consistent with the legal and regulatory requirements in Australia and is otherwise appropriate for the Australian market.

273    Ms Rivera identified the following webpages of the Invisalign Website and outlined how they appeared at the time of the change (or “refresh”) in July 2020.

Invisalign vs Braces webpage

274    The “Invisalign vs Braces” section is shown at the following web address: https://www.invisalign.com.au/invisalign-vs-braces. This page first appeared on the Invisalign Website in about July 2020, and includes:

(a)    a description of metal, lingual and ceramic braces;

(b)    a description of Invisalign clear aligners;

(c)    a statement of the potential benefits of Invisalign clear aligners; and

(d)    a call to action to seek out an expert opinion as to the appropriate course of treatment.

275    The statement regarding the potential benefits of Invisalign clear aligners appears as follows:

276    Each of the footnotes within the statement shown in the image above provides a hyperlink to studies which have been conducted and published in orthodontic and dental journals.

Grid of photographs and quotations

277    From July 2020 to 21 June 2022, a grid showing photographs and quotations from patients who had undertaken treatment with the Invisalign system was displayed on the lower half of the homepage of the Invisalign Website (Grid). A copy of the Grid is set out below:

278    The Grid was removed from the Invisalign Website on 21 June 2022 in order to ensure that the Invisalign Website was compliant following amendments that the Australian Government made to the Therapeutic Goods Advertising Code (No 2) 2018 (Cth) which came into effect on 1 July 2022 and expressly prohibited the use of testimonials in the promotion of therapeutic goods from individuals who have received valuable consideration for their testimonial.

279    During the period in which the Grid was visible on the Invisalign Website, the Grid featured testimonial quotes from the following individuals:

(a)    Ms Shannon Lawson;

(b)    Ms Lauren Arbonne; and

(c)    Ms Lyndl Kean.

280    Each of Ms Lawson, Ms Arbonne and Ms Kean had undertaken Invisalign Aligner Treatment under the supervision of a dentist or an orthodontist. The testimonials included in the Grid were genuine testimonials from those individuals, which quoted content from posts that they had made on their own social media accounts.

281    Each of Ms Lawson, Ms Arbonne and Ms Kean received monetary compensation from Invisalign Australia to create social media content and to post that content on their own social media pages.

282    Ms Rivera deposed that on all social media platforms operated by Invisalign Australia, if a person has received compensation (monetary or otherwise) from Invisalign Australia for providing their photograph and/or a testimonial, the post included words or a hashtag denoting that the person had been paid for their promotion. Examples of hashtags used to denote that the person had been paid are: “#spon”, “#sp”, “#paidpartnership”, “#brandambassador” and “#ad”. If a person had not been provided compensation by Invisalign Australia for providing their photograph and/or testimonial, the post included words or a hashtag denoting that the post was unpaid, user-generated content, for example: “#repost”.

283    Invisalign Australia communicates to consumers when a person has been compensated for use of their image or testimonial in the context of social media, but it does not do so when it uses a testimonial or image on the Invisalign Website. Ms Rivera deposed that the reason for this is because, on social media platforms it is customary for an advertiser to denote what content may be organic and what is sponsored content. This is usually achieved through the use of hashtags described above. Whilst it is customary to provide some kind of indication that a person providing a review or testimonial on social media has been compensated, it is not customary to do so on a company’s own website. A company's website is an environment that is controlled by the company. From a marketing perspective, the website is a channel through which the company can directly communicate information and promotional content about the company and its products and/or services to the public.

Facebook posts

284    From about March 2010, Invisalign Australia has published content, including advertising material, on Facebook under the handle @invisalignau which is shown at the following web address: https://www.facebook.com/invisalignau/ (Invisalign Facebook Page).

285    The way in which Invisalign Australia has used Facebook (and subsequently other social media platforms such as Instagram) for consumer marketing has evolved over time as new features have been developed and made available on the platform.

286    In and around the period of 2019 to 2020, Invisalign Australia worked with its advertising agencies to plan content to be published on the Facebook platform on a month by month basis. Most of this content was paid advertising that would appear in a user’s Facebook feed.

287    In and around the period of 2019 to 2020, it was typical for Invisalign Australia to promote 6 to 10 pieces of content on the Facebook platform each month. On 18 May 2019, a post was published on the Invisalign Facebook Page which contained the following statement:

Invisalign® aligners are made with our flexible proprietary SmartTrack® material, which makes them comfortable to wear, insert and remove, unlike other teeth straightening solutions.

288    This post was accompanied by a moving image in the form of a graphics interchange format, otherwise known as a “GIF” (which is an electronic file format that displays a moving image on a loop) which showed a woman taking Invisalign aligners out of an aligner case with a hyperlink to the Invisalign Website and a call to action to “Find out more about Invisalign treatment”. A screenshot of the GIF that accompanied the post is set out below:

289    On or about 6 April 2022, the 18 May 2019 Facebook post was removed from the Invisalign Facebook Page.

290    Further, on 4 March 2020, a post was published on the Invisalign Facebook Page which contained the following statement:

With the world's most advanced clear aligner system, you can straighten your teeth the comfortable and convenient way. Take our free smile assessment to start your Invisalign journey today.

…

Invisalign treatment is a series of clear plastic removable orthodontic aligners that gently move patients' teeth. An orthodontist or Invisalign trained dentist will be able to advise whether Invisalign treatment is right for you. You should always read and follow their directions for use. In rare cases, allergies may occur.

291    This post was accompanied by an image of a woman holding an Invisalign aligner and an aligner case, a hyperlink to the Invisalign Website with a call to action to “Discover Invisalign treatment”. A copy of the post is set out below:

292    On about 2 June 2022, the 4 March 2022 Facebook post was removed from the Invisalign Facebook Page.

293    Ms Rivera was not called for cross-examination.

Ms Georgia Louise Holt

294    Ms Georgia Holt is a former customer of SDC. Ms Holt affirmed an affidavit on 29 September 2022, which was tendered in evidence and marked as exhibit 81. Ms Holt deposed to her experience as an SDC customer.

295    Ms Holt attended an SDC SmileShop in Melbourne on 2 July 2019. A SmileShop is a physical retail space operated by SDC AU in which a patient can receive an intraoral scan of their teeth which is then used by SDC to create a treatment plan for the patient. During this appointment Ms Holt had a digital scan of her teeth taken by an SDC employee.

296    On 9 July 2019, Ms Holt received an email from SDC which included a link to her treatment plan. The treatment plan showed the 3D model of her teeth and how SDC Aligner Treatment would facilitate the movement of her teeth. Around this time Ms Holt made a further appointment with SDC in order to make further inquiries about SDC Aligner Treatment. Ms Holt recalled that, during this appointment, she spoke with a woman who introduced herself as a “Smile Guide”. Ms Holt deposed that she used an iPad or tablet to fill in some information about herself and had a conversation with the Smile Guide to the following effect:

Ms Holt: I’m worried that the scan might be incorrect and the aligners might not fit because I am going to have my two front teeth trimmed by my dentist soon. Will this affect my SmilePlan?

Smile Guide: Good question. I’m not entirely sure. It’s good that you've been proactive. This won't affect anything. If there are any issues you can pop in.

297    On 12 July 2019, Ms Holt received an email from Dr Jeffrey Sulitzer, the Chief Dental Officer of SDC (from the email address: drs.dentalteam@email.smiledirectclub.com) which informed Ms Holt that she would receive “the highest level of dental care”.

298    On or about 16 July 2019, Ms Holt confirmed, via an online portal, that she wanted to undertake treatment with SDC and placed her order. About two weeks later, she received a box from SDC in the mail. The box contained the aligners that had been prescribed for her treatment by SDC. Ms Holt then commenced SDC Aligner Treatment shortly after receiving the first set of aligners contained in this box.

299    Ms Holt gave the following evidence about her experience using SDC Aligner Treatment. Ms Holt deposed that her SDC aligners did not fit properly and she was not able insert them without a great deal of difficulty. In order to push the aligners onto her teeth, she needed to use the “chewies” (which are little, soft plastic tubes that eliminate the air space between the aligner and the teeth). Ms Holt also explained that the aligners cut into her gums. Ms Holt recalled purchasing other products including pain relief and mouth wash to assist in relieving the pain she was experiencing.

300    Ms Holt explained that after a week into her treatment she had some concerns about small gaps that were developing between her two front teeth (which she now understands are referred to by orthodontists as “black triangles”). Ms Holt posted about her concerns in a Facebook group referred to as “Smile Direct Club Members”. Ms Holt did not receive any response to her post. Ms Holt also called the SDC hotline number (1800 515 198) but was unable to speak to anyone about her concerns.

301    Ms Holt completed her SDC Aligner Treatment despite enduring what she described as “ongoing pain” which was, at times, “excruciating”.

302    On 5 December 2019, Ms Holt attended a SmileShop for a further scan of her teeth as she “was not happy with the result and wanted to investigate obtaining refinements”. Ms Holt subsequently received an email from Dr Hendrik Lai who informed her that the dental team at SDC were reviewing her plan. On 11 December 2019, Ms Holt placed an order for the refinements.

303    Ms Holt, in her evidence, stated that she never received the additional aligners that she ordered on 11 December 2019. After making numerous attempts to follow up on her order via SDC’s Facebook page from January 2020 to April 2020, Ms Holt eventually received a response from the SDC Dental Team.

304    On 12 April 2020, SDC sent a Facebook message to Ms Holt informing her that she would need to take an additional impression of her lower teeth to prepare for the refinements. Ms Holt received the new impression kit on 15 May 2020 and around this time took her impression and provided it to SDC.

305    On 31 May 2020, Ms Holt received a Facebook message from SDC indicating that it would take 6-7 weeks for the refinement aligners to be manufactured and shipped to her.

306    Ms Holt did not receive the aligners in this time period. Ms Holt made around 10 calls to SDC after this period but she was not able to speak to anyone.

307    On 17 September 2020, Ms Holt reached out to SDC again via Facebook message, as she had still not received her new refinement aligners. A copy of this message is set out below:

308    Ms Holt continued her correspondence with SDC at this time. SDC asked Ms Holt to provide a number of photos of her teeth and to outline her concerns using a dental chart. Ms Holt provided photos of her teeth to SDC. SDC then informed her that a dental professional would be in contact with her, however Ms Holt deposed that this did not occur.

309    Ms Holt was not called for cross-examination.

Ms Janelle Pyne

310    Ms Janelle Pyne swore two affidavits which were tendered in evidence. The first dated 7 October 2022, marked exhibit 79 (first Pyne Affidavit) and the second dated 10 October 2022, marked exhibit 80 (second Pyne Affidavit).

311    Ms Pyne is the Director, Clinical Support of Australia and New Zealand at Invisalign.

312    The first Pyne Affidavit was made in response to a request for a subpoena issued by the Invisalign to Full Face Orthodontics (East) Pty Ltd on 27 September 2022.

313    Ms Pyne deposed that she had access to Invisalign’s books and records, including the “Invisalign Doctor Site” (or IDS) portal. Ms Pyne’s evidence was that Invisalign maintains a separate IDS in this portal for each Doctor who prescribes Invisalign treatment to their patients.

314    Dentists and orthodontists who prescribe Invisalign Aligner Treatment to their patients are required to submit their prescriptions via the IDS portal, and the patient’s treatment is managed by the dentist or orthodontist and Invisalign using the IDS portal, including through the creation and maintenance of a “ClinCheck” treatment plan with respect to each patient. The IDS portal contains a search function for patients’ names and ID number. The patients are divided into separate lists, which are:

(a)    “In treatment”, which means that a patient has current treatment underway (including those patients who are also listed in the ‘Action required’ list);

(b)    “Action Required”, which means that action is required in relation to that patient, such as reviewing a ClinCheck plan, submitting a prescription, or adding information to that patient's records; and

(c)    “Archived”, which consists of patients for whom treatments did not proceed, older orders, or any patient file that a doctor opts to archive within their IDS.

315    Ms Pyne deposed that she undertook a search of patient records on 4 October 2022. During this search, Ms Pyne caused a review of all patient records held in the IDS for “Dr Derek Mahony” to be undertaken. Ms Pyne caused this review to be undertaken by:

(a)    accessing the IDS for Dr Mahony; and

(b)    clicking into the 'Patient' tab of Dr Mahony’s IDS.

316    This search has revealed that Dr Derek Mahony created patient profiles for 70 patients.

317    In relation to these patients, the IDS portal records details with respect to:

(a)    9 patients whose profiles are active (or “in treatment”);

(b)    12 patients of Dr Mahony whose profiles have been archived with ClinCheck treatment plans on file; and

(c)    39 patients of Dr Mahony whose profiles have been archived, but for whom no ClinCheck treatment plan was available on Dr Mahony’s IDS.

318    Ms Pyne caused for the records stored for each of these patients on Dr Mahony’s IDS to be exported through causing screenshots to be taken of the data which appears in each patient profile. These screenshots of patient records were provided by way of a confidential exhibit.

319    Ms Pyne, in the second Pyne Affidavit, deposed to the following.

320    Ms Pyne deposed that she accessed Invisalign’s books and records, including the “Patient Central” platform. Ms Pyne explained that the Patient Central platform is a central repository that contains information on its Invisalign Providers. This platform is not the same as the IDS.

321    The Patient Central platform allows staff members of the Invisalign, its parent company, Align Technology, Inc., and other entities in the same group to search for Invisalign Providers by entering details of the Invisalign Provider into a search field.

322    Ms Pyne deposed that, to the best of her knowledge, all Invisalign Providers who have ever been trained to provide Invisalign treatment have a file in Patient Central, regardless of whether they are currently providing Invisalign treatment to patients. Ms Pyne was otherwise not aware that these files expire after any period.

323    Ms Pyne deposed that on 10 October 2022, she caused a search of Patient Central for all records pertaining to Dr Hendrik Lai to be undertaken by searching for the name “Hendrik Lai” in Patient Central. Ms Pyne located one result for Dr Hendrik Lai, a screenshot of this search result was provided as a confidential exhibit.

324    The confidential exhibit shows that Dr Hendrik Lai was certified as a general dentist, was based in the US and that he has made no Primary Orders, Secondary Orders, and no orders for Vivera Retainers.

325    Ms Pyne was not cross-examined on her affidavit evidence.

SDC’S EVIDENCE

326    SDC tendered affidavit evidence from a number of witnesses. A summary of SDC’s evidence is as follows.

Ms Niki Brown

327    Ms Niki Brown has, since SDC commenced operations in Australia in May 2019, been its marketing director. Ms Brown is responsible for the marketing of SDC which has included adopting SDC’s global marketing strategy for an Australian audience and developing and implementing direct to consumer strategies.

328    Ms Brown affirmed one affidavit, dated 1 July 2022, which was tendered in evidence and marked exhibit 16 (Brown Affidavit).

Evidence in chief

329    Ms Brown deposed to the following.

SDC Australia website

330    Since around May 2019, SDC AU has promoted and advertised its products and services to Australian consumers via the SDC AU website, which can be accessed at the domain name: smiledirectclub.com.au (SDC Australian Website). As part of Ms Brown’s role, she reviews the SDC Australian Website to ensure its content is optimised for an Australian audience, provides input into local promotions and also provides comments or suggestions to the SDC US team about the content of the SDC Australian Website.

Smile Assessment webpage

331    The homepage of the SDC Australian Website contains buttons in the purple colour commonly used by SDC in its promotional and advertising materials. These buttons on the homepage read “AM I A CANDIDATE?”, as shown below.

332    These buttons link to a page within the SDC Australian Website entitled “Free 30-second smile assessment”, which can also be accessed at: https://smiledirectclub.com.au/enau/smile assessment/ (Smile Assessment Page), shown below.

333    The Smile Assessment Page asks the customer a number of questions including:

(a)    “why are you thinking about straightening your teeth?”;

(b)    “have you worn braces or invisible aligners in the past”; and

(c)    what their biggest concern is with their smile. The customer is then asked to select that the image which best portrays the crowding and spacing they experience with their teeth.

334    The consumer is then required to enter their postcode and email address to “get their results”, which then takes them to the “Product Landing Page”.

335    The Smile Assessment Page does not determine whether an Australian consumer is suitable for treatment with SDC Aligner Treatment (as such determination can only be made by an Affiliated Dentist).

336    The Smile Assessment Page also asks the customer for their postcode and email address. If the customer is within 50 miles of a SmileShop, the Product Landing Page gives the customer two options to initiate the process of having their teeth assessed for suitability for treatment with SDC Aligner Treatment, namely, visiting the consumer’s nearest SmileShop or purchasing an impression kit to be delivered to the customer’s address of choice.

Pricing on the SDC Australian Website

337    The homepage of the SDC Australian Website contains a section entitled “Which aligners are right for you?” which compares standard SDC aligners and SDC Nighttime Aligners with traditional braces, shown below.

338    The current prices shown for standard SDC aligners and SDC Nighttime Aligners in the Website Table are a single upfront payment of $2,825 or monthly payments of $119.

“Up to 60% less than braces” claim on the SDC Australian Website

339    The homepage of the SDC Australian Website also contains a section on pricing which offers its customers “two easy ways to pay” and states that:

… either way it's up to 60% less expensive than braces:*

340    The pricing is shown below.

341    The “two easy ways to pay” referred to in this statement are the option to make a single upfront payment and the option to pay by monthly instalments.

342    The asterisk after the word “braces” links the statement at the end of the SDC Homepage which states as follows:

*Price comparison between treatment with SmileDirectClub aligners (single payment of $2,825) and $7,000 total cost for an 18 month treatment using traditional orthodontics for a patient with low to moderate crowding. Source.

343    The final word, “Source” in the above statement on the SDC Homepage links to a webpage on the SDC Australian Website titled “SmileDirectClub Marketing Claims” which can also be accessed at: https://smiledirectclub.com.au/en-au/claims/ (Claims Page).

344    As can be seen from the image above, the first paragraph of the Claims Page states:

“Up to 60% less than braces” claim is based on price comparison between treatment with SmileDirectClub aligners (single payment of $2,825) and $7,000 median cost for an 18-month treatment using most traditional metal braces for a patient with mild to moderate misalignment. Source.

345    The final word, “Source” in the above statement on the Claims Page links to an article published by Orthodontics Australia titled “How much do braces cost?”, which can also be accessed at: https://orthodonticsaustralia.org.au/how-much-braces-cost/ (OA Article).

346    In addition to the SDC Homepage, the SDC Australian Website currently includes various versions of the “up to 60% less than braces” claim, examples of which are set out below. However, in each instance, the word “braces” is followed by an asterisk.

SDC’s “Lifetime Smile Guarantee”

347    On the SDC Australian Website, there is a webpage titled “Lifetime Smile Guarantee” which can be accessed at: https://smiledirectclub.com.au/en-au/guarantee/ (SDC Lifetime Smile Guarantee Page).

348    The SDC Lifetime Smile Guarantee Page states:

Our Lifetime Smile Guarantee™, complete with a 30-Day Money-Back Promise, protects your smile for life with free aligner touch-ups during your treatment – or even long after it ends.

349    The “Lifetime Smile Guarantee” referred to on this page is a reference to the three guarantees SDC provides consumers who undergo SDC Aligner Treatment. These are:

(a)    a “30-day money back promise”, where a consumer can obtain a refund of 100% of the cost paid for SDC aligners if the consumer decides not to proceed with treatment with SDC aligners within their first 30 days of use of SDC aligners;

(b)    “aligner touch-ups during treatment”, where during a consumer's course of treatment with SDC aligners, if the consumer’s teeth are not moving to plan, or the consumer has concerns about their current set of aligners, and if the consumer’s treating Affiliated Dentist considers it necessary, a company in the SDC group of companies will manufacture and SDC will send new aligners to the consumer at no extra cost to the consumer; and

(c)    “lifetime aligner touch-ups after treatment”, where, provided the consumer continues to wear retainers obtained from SDC following the completion of treatment with SDC aligners, and replaces their retainers every six months, the consumer can request from SDC a free aligner touch-up every year, if they need it.

Other statements on the SDC Australia Website

350    The SDC Australian Website contains the statement “SmileDirectClub created the first end-to-end solution for your smile”, located at: https://smiledirectclub.com.au/enau/about.

351    Ms Brown understood an “end-to-end solution” to be describing the fact that, in relation to SDC Aligner Treatment, SDC is involved in the process from the start of the customer’s treatment until it is finished. At the beginning, customers may commence the process by having a 3D scan taken of their teeth at a SmileShop, operated by SDC, or by ordering an impression kit from SDC directly.

352    Throughout the course of the treatment, patients use the SDC Platform to track their treatment and check-in with their treating dentist or orthodontist. Finally, following treatment, patients may obtain retainers from SDC to keep their smile in place.

353    The SDC Australian Website also contains the statement “Get a smile you’ll love with clear aligners sent directly to you. No braces. No in-person monthly office visits required. No paying a fortune”, located at: https://smiledirectclub.com.au/en-au/why-smile-directclub/.

354    Ms Brown understood the words “No paying a fortune” to be a reference to SDC aligners being up to 60% less than braces. In Ms Brown’s opinion, “No paying a fortune” is a common phrase made in reference to the price of a product being less than what a consumer would usually expect to pay.

SDC Australia Social Media

355    SDC AU promotes and advertises its product and services to Australian consumers through the following social media accounts:

(a)    its Facebook account, with the associated handle: “@SmileDirectClubAU”, which can be accessed at: https://www.facebook.com/SmileOirectClubAU/ (SDC AU Facebook Account); and

(b)    its Instagram account, with the associated handle: “@smiledirectclub_au” which can be accessed at: https://www.instagram.com/smiledirectclubau/ (SDC AU Instagram Account).

356    There is also a YouTube channel named “SmileDirectClub Australia”. This YouTube channel was created on 20 June 2019, however, it has been inactive for at least two years at this stage and is no longer used by SDC AU.

357    Ms Brown deposed that SDC US also has a YouTube channel named “Smile Direct Club”, which can be accessed at: https://www.youtube.com/c/smiledirectclub (the SDC US YouTube Channel). However, neither Ms Brown nor anyone else employed by SDC AU reviews the content that is posted on the SDC US YouTube Channel as it not directed towards Australian consumers and, accordingly, is outside Ms Brown’s remit.

358    Ms Brown deposed that she is also aware that SDC US has a LinkedIn page which can be accessed at: https://www.linkedin.com/company/smiledirectclub/ (SDC US LinkedIn Page). However, neither Ms Brown, nor anyone else employed by SDC AU reviews content on the SDC US LinkedIn Page as it is not targeted towards Australian consumers and, accordingly, is also outside Ms Brown’s remit.

Advertorials

359    SDC AU also engages in advertising through advertorials which are published in online media publications. Ordinarily, the publication of this material is undertaken through the public relations agency engaged by SDC AU, Red Havas Australia (Red Havas). SDC AU provides a brief to the online media publication, which will publish the advertorial. The online media publication then prepares a draft advertorial for review by SDC AU, and there is usually a maximum of two rounds of amendments by SDC AU. After final amendments are made, the draft is published as an advertorial on the publication’s website. Advertorials were published by SDC AU in Marie Claire, Women’s Health and Men’s Health and GQ Magazine.

Examination in chief of Ms Brown

360    Prior to the commencement of cross-examination, junior counsel for SDC, Mr Tynan, tendered two physical exhibits, which were handed up to the Court as well as to the witness. The first exhibit, marked exhibit 17 is a white box with the text “Let’s make a great first impression”. Exhibit 17 is SDC’s impression kit. The impression kit contains an impression guide which provides a step-by-step guide for the patient, putty, impression trays and nitrile gloves to enable the customer to take an accurate impression of their teeth, which is the first step in the SDC Aligner Treatment. Pictures of exhibit 17 can be seen below.

361    The second exhibit, marked exhibit 18 is a purple box with the text “Open for a lifetime supply of confidence”. Exhibit 18 contains the set of SDC aligners, which the customer receives after their impressions have been finalised. This box contains SDC’s “Aligner Guide” as well as instructions for how long to wear each set of aligners and how many hours per day the aligner should be worn. The box also contains an aligner case, lip balm, a “Smile Stretcher” (to enable the customer to take photos of their progress for virtual check-ins), an emery board to smooth out aligners for personal comfort, four teeth whitening pens and a tool to assist the customer in removing the aligners from their mouth. Images of exhibit 18 can be seen below.

Cross-examination of Ms Brown

362    Ms Brown was provided with a hard copy of her LinkedIn profile, which was tendered in evidence and marked exhibit 19. To give brief context, LinkedIn is a professional networking social media application which is used by people to look for jobs, connect with other professionals and share posts and stories that others may interact with. Each LinkedIn user has a profile which typically details their employment history, education history, publications and awards, among other things.

363    Ms Brown was taken, in cross-examination, to the “About” section of her LinkedIn profile, which provides a brief synopsis of her professional profile, which states:

Senior Marketing professional with solid experience leading customer-centric data driven marketing strategy across paid, owned and earned media with a focus on performance marketing. Able to pivot strategy when required.

364    Ms Brown agreed that the above passage from the “About” section on her LinkedIn profile set out, generally, her experience in marketing.

365    Ms Brown was asked to explain what “paid media” means. Ms Brown explained that “paid media” refers to marketing channels where the advertiser has to pay to have their advertisements shown to the relevant audience, such as television and social media, for example Meta (formerly Facebook) and Instagram, TikTok, Snapchat as well as Google. With respect to advertising on Google, companies purchase search terms in order to optimise their ranking when people use the Google search engine so that they appear at the top of the webpage, this is referred to as “search engine optimisation”.

366    Ms Brown was asked to explain what “owned media” means. Ms Brown explained that “owned media” refers to media that the company or brand own, for SDC this would be the SDC Website, as an example.

367    Ms Brown was asked to explain what “earned media” means. Ms Brown explained that “earned media” refers to publicity that a company receives for free, for instance, an article is written about them and promotes their company or brand.

368    Ms Brown was asked to explain what “influencer marketing” entails. Ms Brown told the Court that “influencer marketing” is when a company approaches an individual, known as a social media influencer, to provide social media posts about their product. Ms Brown explained that the social media influencer would sign a contract with SDC whereby they are required to meet certain deliverables (typically to post about the product on their social media account(s)) and undergo SDC Aligner Treatment.

369    As a brief aside, a social media influencer is a person that has a large and/or dedicated group of followers on social media. An “influencer” is generally paid or given free products in exchange for posting and tagging pictures of products as a sign of their endorsement of it, a technique that uses the influencers brand or celebrity to drive sales for the company or product they are endorsing. In that regard, “influencer marketing” is simply a form of advertising that uses an endorsement from an influencer to make social media users aware of the product or service.

370    Ms Brown explained that SDC maintains a marketing budget wherein it would pay an “influencer” to post about SDC Aligner Treatment so that it is seen on the influencer’s social media channel and is promoted to their followers.

371    SDC also maintains a budget whereby it pays social media companies (e.g. Instagram) to “promote” its posts as well as the influencer’s posts. This means that SDC pays a premium to have a post that is made by an influencer seen by a larger audience than just their followers – much like an advertisement on the social media platform. Ms Brown described, in greater detail, the process for “promoting” a post. Ms Brown outlined how, as part of this process, SDC would upload the content which has been published by the influencer on their social media account and would then choose a target audience (e.g. people 18 years or older) with which to promote the content to, and would also elect how much money to dedicate to promoting such a post, which is usually an allocation of an amount of dollars per day.

372    Ms Brown was taken to the “Activity” section of her LinkedIn profile which was captured on 9 October 2022. The “Activity” section shows all the posts that Ms Brown has made as well as any posts she has “reposted”, commented on, “liked” or otherwise interacted with, in chronological order. Two versions of Ms Browns “Activity” page were tendered in evidence. Exhibit 20 identifies the most recent posts that Ms Brown has made as well as any posts she has “reposted”. Exhibit 21 identifies the posts that Ms Brown has “liked” or commented on. Ms Brown accepted that the record of posts marked as exhibit 20 accurately recorded her posts. Ms Brown also agreed that exhibit 21 shows that she has reposted material from team members outside of Australia, for instance from SDC employees based in the USA. However, Ms Brown stated that she has no control over, or responsibility for, the marketing content of SDC outside of Australia and would not check whether any of the reposts that she published on her LinkedIn feed were in compliance with Australian law.

373    Ms Brown was shown annexure JMW-15 to Ms Wolbers’ affidavit dated 4 April 2022, which contained the SDC US LinkedIn profile page. Ms Brown was shown the “Jobs” page of SDC’s LinkedIn profile. The “Jobs” page allows LinkedIn members to search for available employment opportunities within a company, here within SDC. Ms Brown was shown a job advertisement for a SmileShop Manager in Perth, Western Australia. Ms Brown gave evidence that she was aware that the SDC US LinkedIn page advertises jobs in Australia. Ms Brown gave evidence that Mr Mitchell Payne was the relevant person is in charge of advertising jobs on SDC’s LinkedIn page.

374    Ms Brown was asked about her interaction with SDC Affiliated Dentists. Ms Brown told the Court that the only involvement that she has with the dental team within SDC is when an influencer is contracted to SDC. When this occurs, she liaises with the dental team to ensure that influencer’s treatment is properly managed. Ms Brown would ordinarily contact Ms Chelsea Easley and Alicia Issa, who are part of SDC’s dental team. Ms Brown explained that she was not sure if Ms Easley or Ms Issa are Australian registered dentists or orthodontists.

375    Ms Brown gave evidence that she reported to the Chief Marketing Officer of SDC, Mr John Sheldon.

376    I wish to note at this point that the Court was played:

(a)    two SDC television adverts, marked exhibit 22 and exhibit 23 which ran for 30 seconds and 15 seconds respectively; and

(b)    three SDC Snapchat posts which were collectively tendered and marked exhibit 24. I will describe each of these below and will refer to each of them separately as exhibits 24.1, 24.2 and 24.3 as this is how the documents were ultimately provided to my chambers in the tender bundle.

377    Ms Brown accepted that the advertisements, being exhibits 22 and 23 and the Snapchat posts, collectively tendered as exhibit 24, were part of SDC’s social media marketing.

378    Ms Brown accepted that SDC used social media platforms such as Meta (Facebook), Instagram, TikTok and others to market SDC’s clear aligners. Ms Brown accepted that the SDC business model was one where SDC set prices.

379    The Court was played three Snapchat posts. A screenshot of exhibit 24.1 can be found below.

380    A screenshot of exhibit 24.2 can be found below.

381    The above images portray a cartoonish filter of one of the contracted SDC influencers, showing a before and after SDC Aligner Treatment comparison with an exaggerated smile.

382    In exhibit 24.1, SDC’s logo also appears the top right hand corner with the caption:

Straighter teeth for up to 60% less

383    In exhibit 24.2, SDC’s logo also appears in the top right hand corner with a purple tag on the lower right hand side of the screen which states:

Straighter teeth with clear aligners for less than $4/day

$150 off your aligners

384    Ms Brown told the Court that SDC pays Snapchat to make filters (which also contains the SDC logo and promotion of the SDC Aligner Treatment), such as the one portrayed above. The filter is then made available to Snapchat users who are then able to take photos of themselves which they can play around with and send to friends. This is a way of promoting SDC and its aligner treatment.

385    Ms Brown was then played another Snapchat video, which was identified as exhibit 24.3. A screenshot of exhibit 24.3 can be found below.

386    Similar to exhibit 24.1 and 24.2, the above screenshot of exhibit 24.3 depicts an SDC influencer showing a before and after SDC Aligner Treatment comparison with an exaggerated smile. The text here reads:

Straighter teeth for up to 60% less than braces with SmileDirectClub clear aligners

387    Ms Brown agreed that the statements made in each of the snapchat videos in exhibit 24 are in line with SDC’s marketing message.

388    Ms Brown was then taken to SDC’s Meta Ad Library, which was tendered in evidence and marked exhibit 25. SDC’s Meta Ad Library shows all of the advertisements that SDC has advertised on the Meta platforms. Ms Brown was then played one of the advertisements contained within SDC’s Meta Ad Library, which was tendered in evidence and marked exhibit 26. A screenshot of the exhibit 26 advertisement can be found below:

389    Ms Brown was played a recording of an Instagram post made by one of SDC’s contracted influencers, Ms Erin Oprea, which was tendered and marked exhibit 27. A screenshot of exhibit 27 can be found below:

390    Ms Brown agreed that this Instagram post is an example of how SDC engages with influencers to market its product. Ms Brown told the Court that Ms Oprea is an American citizen, and SDC AU does engage overseas influencers in its paid marketing campaigns from time to time. It should also be noted that this Instagram post has been made on SDC AU’s verified Instagram account under the handle “@smiledirectclub_au”. Ms Brown told the Court that, typically, paid Instagram posts such as this will appear in an Instagram user’s feed as a paid advertisement and therefore these posts will appear to a user even if the user does not “follow” the “@smiledirectclub_au” Instagram account (which is the ordinary way an Instagram user will see and curate the content on their Instagram feed). This, as explained above, is the method by which posts are “promoted” on social media websites as paid advertising. Instagram users are targeted for these promoted posts based on an algorithmic selection in line with the target audience that is preselected by the SDC marketing team.

391    Ms Brown was asked about the SDC business model and the prices that it charges to consumers for SDC Aligner Treatment. Ms Brown gave evidence that SDC pays its Affiliated Dentists a fee for aligners that are ultimately purchased and sent to SDC customers. SDC controls the various steps that are taken in the process from the very beginning, when a customer undertakes their first scan to the completion of a customer’s SDC Aligner Treatment. SDC also controls the whole treatment process including the marketing strategy and the various steps in the technological process and the creation of the aligners, which occurs in the SDC laboratory situated in Costa Rica.

392    Ms Brown was then taken to [16] of the Brown Affidavit, which states:

SDC is engaged by Australian registered dentists or orthodontists (Affiliated Dentists) to supply SDC Aligners to consumers who the dentist or orthodontist has determined is suitable for treatment with SDC Aligners.

393    It was put to Ms Brown, in cross-examination, that the evidence she gave while under cross-examination is inconsistent with the above passage of her evidence at [16] in the Brown Affidavit. Ms Brown agreed with this assertion.

394    Ms Brown was then cross-examined in relation to the consent process on the SDC Platform.

395    Ms Brown was asked about the concept of “default bias” in marketing. The concept of “default bias” was explained by Ms Brown to be when a consumer is given a preselected choice or option by default, which, implicitly encourages the consumer to accept the default position. The alternative would be to leave it to the consumer to actively make the choice to select between options, without having any influence that a preselection may cause.

396    Continuing with this concept, Ms Brown was taken to annexure NB-4 to the Brown Affidavit, which shows a series of questions that prospective SDC consumers are asked, prior to commencing SDC Aligner Treatment. A screenshot of the webpage and associated questions can be found below:

397    Ms Brown accepted that all of the questions are all preselected and set to “no”. Ms Brown accepted that this was a marketing technique which is used to push customers in a particular direction, namely the default direction, here, being the “no” box.

398    Ms Brown was then taken to annexure NB-10 of the Brown affidavit. Annexure NB-10 sets out a chain of emails as well as text messages that Ms Brown received from SDC’s client service representatives which occurred between June and November 2021. Ms Brown told the Court that she undertook this journey as part of an exercise to test the SDC process in order to understand the SDC customer’s journey and experience, from start to finish. The email chain beginning at page 134 of the Brown Affidavit in annexure NB-10 also shows how SDC, as part of customer’s journey, engages in customer relationship management (CRM). CRM is a system that helps companies stay connected to customers, streamline processes, and improve company profitability. Ms Brown had no responsibility for the marketing and CRM within the customer’s journey. An example of the customer’s journey and the CRM is shown below:

399    Ms Brown agreed that the statement in the first image, “Niki, your new smile is waiting for you. All you have to do is buy it, for up to 60% less than other brands. Join the club now” and the follow up email from Miley at SDC are examples of the way that SDC engages in CRM and encourages the customer to approve their treatment plan.

400    Ms Brown was taken to part of another email within annexure NB-10, which was sent to Ms Brown on 17 October 2021. The email is sent from SDC to Ms Brown as a reminder to switch to her new set of aligners. At the bottom of this email is a purple box which outlines SDC’s Lifetime Smile Guarantee, this can be seen below:

401    Ms Brown was asked about SDC’s Lifetime Smile Guarantee and was taken to the following sentence within the above image:

… after your treatment, you can get a touch-up every year if you need it. That's free too. Forever. Your whole life.

402    It was put to Ms Brown that SDC’s Lifetime Smile Guarantee, which includes a free yearly touch up is not free because the customer must pay for the retainers. Ms Brown accepted that, for the Lifetime Smile Guarantee to be valid, it does require a customer to purchase a retainer every six months at the cost of, what is now, $167. Ms Brown initially refused to accept that it was false to say that the Lifetime Smile Guarantee was free. Ms Brown initially said that the Lifetime Smile Guarantee came with terms which applied to the Lifetime Smile Guarantee. Ms Brown ultimately accepted and agreed that the Lifetime Smile Guarantee was not free. Ms Brown said there was no additional aligner treatment cost. Ms Brown accepted that the yearly touch up was not free because it required the patient to purchase a retainer every six months.

403    Ms Brown was asked about the content that SDC posts to its various social media channels. Ms Brown explained that SDC has a number of social media channels where it publishes content that helps drive organic growth, attracts followers and receives interactions from its followers which assists in marketing the SDC brand and business. SDC does not pay for these social media channels, unlike the paid social media posts which it pays to be promoted and boosted to a wider audience of users of these social media platforms that do not necessarily follow SDC. Some of the paid media posts do ordinarily get reposted by SDC on its own social media channels.

404    Ms Brown had detailed knowledge of SDC’s marketing strategy, and impressed me as an honest and forthright witness who made concessions as required. I accept her evidence.

Dr Jeffrey Sulitzer

405    Dr Jeffrey Sulitzer is the Chief Clinical Officer at SDC, which is a global role. SDC tendered two affidavits of Dr Sulitzer in this proceeding. Dr Sulitzer’s first affidavit was sworn on 30 June 2022, and was marked exhibit 34 (first Sulitzer Affidavit), and his second was sworn on 29 September 2022, and was marked exhibit 35 (second Sulitzer Affidavit). SDC also tendered two confidential exhibits to the affidavit evidence of Dr Sulitzer, these were confidential exhibit JS-15, which was marked exhibit 36 and confidential exhibit JS-16, which was marked exhibit 37.

406    Dr Sulitzer in his affidavits deposed to the following.

Evidence in chief

407    As Chief Clinical Officer, Dr Sulitzer manages a global network of dental practices and Affiliated Dentists who use SDC’s services and telehealth platform to assess, diagnose, and (where they consider clinically appropriate), provide treatment using SDC aligners.

408    Dr Sulitzer indicated that he provides some support to SDC’s retail staff if they have questions but is otherwise not involved with retail staff and does not supervise them.

409    Dr Sulitzer identifies dentists and orthodontists who may be interested in becoming part of SDC’s affiliate network, and ensures that each dentist and orthodontist who provides treatment with SDC aligners is appropriately qualified and is registered to practice in the jurisdiction in which they practice.

410    Dr Sulitzer is also responsible for managing the relationship with each Affiliated Dentist and providing them with any assistance that they might require in relation to their use of SDC’s services. Additionally, Dr Sulitzer is involved in managing SDC employees including:

(a)    staff that work at SmileShops;

(b)    dental hygienists, dental nurses, dental assistants and dental lab technicians (Dental Team) who work with Affiliated Dentists to assist patients who are undertaking SDC Aligner Treatment;

(c)    dentists, orthodontists and technicians who prepare draft treatment plans for consumers (Treatment Setup Team).

411    Dr Sulitzer also acts as a subject matter expert for SDC’s customer care and service representatives (Customer Care Team) who interact with consumers.

Treatment with SDC aligners

412    Dr Sulitzer, in the first Sulitzer Affidavit, provided a thorough explanation about what SDC Aligner Treatment entails, how the treatment works and the steps that are involved in providing treatment to SDC’s customers.

413    Dr Sulitzer explained that SDC supplies SDC aligners, which are clear aligners that are designed to gradually move and straighten teeth for patients with mild to moderate crowding and spacing of teeth. SDC aligners are custom designed to fit Individual patients’ teeth. Each SDC aligner is individually manufactured by a company within the SDC group of companies, in its 3D printing facility in the USA.

414    SDC aligners can be used in the treatment of mild to moderate crowding and spacing of teeth, which Dr Sulitzer explained is not a term that is settled within dental practice. Crowding of teeth occurs when there is a lack of space for all the teeth to fit normally within the jaw. When this occurs, teeth can crowd together, twist and can overlap with each other. Spacing of teeth occurs when there is an excess of space for teeth within the jaw which results in gaps between teeth.

415    In Australia, consumers who are considering treatment with SDC aligners are required to provide information (including their medical and dental history) for evaluation by an Affiliated Dentist. Consumers may either visit a SmileShop, or request an impression kit from SDC.

SmileShops

416    A SmileShop is a physical shopfront where consumers can have a 3D scan of their teeth and gums taken by SmileShop staff using the iTero scanner.

417    SmileShop employees do not carry out any screening of consumers for suitability for treatment with SDC aligners, nor do they provide any dental treatments or procedures. Rather, SmileShop employees gather information for subsequent evaluation by Affiliated Dentists.

418    When a consumer visits a SmileShop and expresses an interest in undertaking SDC Aligner Treatment, a SmileShop employee gathers information from the consumer about the consumer's concerns with their teeth, including any specific improvements the consumer wishes to make about their smile and takes digital photographs of the customer’s face, teeth and gums.

Impression kits

419    Instead of attending a SmileShop, a consumer may opt to do an impression kit and take a mould of their teeth from their home. An impression kit can be ordered online through the Australian SDC Website. If a consumer requests an impression kit online, SDC arranges for the impression kit to be delivered to the consumer at their nominated address. Consumers then mail the impression kit back to SDC once they have taken their mould and the impression kit is completed.

420    After SDC receives the customer’s impression kit, SDC then sends the customer’s kit to its dental laboratory which inspects the impressions for completeness and accuracy. If the dental lab approves the customer’s impressions, they are then used to generate a 3D image of the customer’s teeth and gums. The customer is also directed to sign up to the SDC Portal and upload photographs of their teeth, complete the medical and dental history form and provide their chief complaint to the SDC team.

SDC Customer Care Team

421    If a customer has any questions about the impression kit or SDC aligners generally, the customer can contact the Customer Care Team. The SDC Customer Care Team comprises customer care and service representatives who are employed by SDC and perform administrative functions that are traditionally conducted by non-clinical staff in dental clinics. If the Customer Care Team is asked a question that is not administrative in nature, the Customer Care Team escalates the enquiry to the Dental Team.

422    The Dental Team have a higher level of expertise in relation to dental issues than the Customer Care Team. The Dental Team undertake activities such as gathering clinical data. For customers who have ordered an impression kit, the Dental Team are able to answer questions about how to use the impression kit to take impressions and how to take photographs of their teeth.

Pre-Screening and Creation of the Draft Treatment Plan

423    The customer information, 3D scan and photographs of the customer’s teeth and gums, as well as their chief complaint are then provided to SDC’s Treatment Setup Team. The Treatment Setup Team performs two main functions:

(1)    to create a draft treatment plan, which is a series of 3D models that shows the predicted teeth movement from the start to end of treatment using proprietary software; and

(2)    pre-screen cases that are not suitable for treatment with SDC aligners.

424    The Treatment Setup Team comprises over 10 orthodontists, approximately 50 general dentists and around 115 software technicians, all of whom are full time employees of SDC and based in San Jose, Costa Rica. The orthodontists within the Treatment Setup Team oversee the work of the dentists and technicians, including by conducting quality reviews of the work performed by general dentists.

425    If a case is not rejected during the pre-screening process, the Treatment Setup Team, prior to commencing the process of creating the draft treatment plan, evaluates the quality of the 3D image to ensure that it meets the relevant standards that Affiliated Dentists require.

426    If the quality of the 3D image is determined to be acceptable, a software technician in the Treatment Setup Team then, having regard to the chief complaint, creates a draft treatment plan based on the submitted photographs and 3D image of the patient’s teeth.

Evaluation by Affiliated Dentists

427    If a case passes the pre-screening process and a draft treatment plan has been created and reviewed for quality purposes by the Treatment Setup Team, SDC then provides the case to an Affiliated Dentist registered to practise in the jurisdiction where the patient resides. Through the Affiliated Dentist internal SDC Portal (Provider Portal), the Affiliated Dentist can access the patient’s information, photographs and documents submitted by the patient, as well as the draft treatment plan, for their evaluation and determination of whether the patient is suitable for treatment with SDC aligners.

428    In order to become an Affiliated Dentist, the practitioner must:

(a)    be registered (or licensed) to practise in their jurisdiction;

(b)    the registration (or licence) must be in good standing;

(c)    the dentist or orthodontist must have at least four years of experience treating patients with clear aligners in a traditional “brick and mortar” setting; and

(d)    the dentist or orthodontist must have completed at least one clear aligner training course administered by another clear aligner company such as Align Technology or Clear Correct.

429    Prior to treating patients Affiliated Dentists are instructed about how to use the Provider Portal including how to evaluate, treat and communicate with patients using the Provider Portal. This comprises a one-on-one demonstration (by video conference) by either Dr Sulitzer or members of the Dental Team who explain how it works. Affiliated Dentists are also provided with a copy of the Dental Practitioner Policies, Procedures and Instructions about the SDC Platform (SDC Instructions).

430    SDC expects Affiliated Dentists to use their own clinical judgment and experience when evaluating cases for treatment with SDC aligners. Should an Affiliated Dentist have questions about SDC Aligner Treatment or how to work within the Provider Portal, Dr Sulitzer is responsible for answering those questions.

431    The process for evaluating a case requires the Affiliated Dentist to access the Provider Portal and assess the patient’s records, including the patient’s chief complaint, medical and dental history, consent form, photographs of the patient’s teeth, the 3D images that were taken at a SmileShop, the draft treatment plan and any other relevant documents such as x-rays and clinical notes.

432    Once the Affiliated Dentist has reviewed all of the information provided about a case via the Provider Portal, in exercising their clinical judgment, the Affiliated Dentist may approve, revise or reject the patient’s case.

Treatment process

433    If the Affiliated Dentist approves the draft treatment plan, the treatment plan is then provided to the patient through the SDC Platform, together with any additional comments made by the Affiliated Dentist when approving the treatment plan. The patient can then review the treatment plan approved by the Affiliated Dentist and can elect to commence treatment according to the approved treatment plan through the SDC Platform.

434    If the patient elects to commence treatment, an SDC affiliate manufactures the SDC aligners that have been approved for the patient, and SDC delivers the SDC aligners to the customer in a box, which is the purple box which was tendered and marked as exhibit 18, shown and described above under the evidence of Ms Niki Brown.

435    Once a customer has received their SDC aligners, the patient may then start their course of treatment by wearing the first set of SDC aligners, in accordance with their approved treatment plan.

436    Customers are also required to register their set of SDC aligners on the SDC Platform so that their progress through the treatment can be tracked by the Affiliated Dentist with the support of the Customer Care Team and Dental Team.

437    Once a patient has started their SDC Aligner Treatment, they are required to take photographs of their teeth and gums and upload the photographs to the SDC Platform, as well as answer a short questionnaire every 60 days, or more frequently if the Affiliated Dentist considers it appropriate.

438    Customers are notified of any upcoming progress reviews that they are required to complete through the SDC Platform and via emails and telephone calls from the Customer Care Team.

439    Customers generally also have an appointment with a dentist or orthodontist every 60 or 90 days. The purpose of these appointments is for the patient to collect their next set of clear aligners and to make the next instalment of their payment.

440    The completed progress review is then pre-screened by the Dental Team to consider if any requests for mid-course correction should be made by the Affiliated Dentist. The Affiliated Dentist is then provided with the progress review via the Provider Portal. The Affiliated Dentist can monitor the progress of the customer and, if required, evaluate any requests for mid-course correction. A mid-course correction is a variation to the approved treatment plan in circumstances where the patient’s teeth are not moving according to the plan and, as a consequence, the aligners do not fit.

441    At any point during the treatment process a patient can also make contact, whether via telephone, email or live webchat, with the Customer Care Team to discuss any questions or issues they may have about their treatment. If the question is clinical or not administrative in nature, the Customer Care Team refers the patient to the Dental Team.

442    In addition to the Dental Team, patients can, at any time, request to speak to the Affiliated Dentist that is overseeing their case by contacting the Customer Care Team.

Cross-examination of Dr Sulitzer

443    Dr Sulitzer explained that he is the Chief Clinical Officer of SDC which is a global role.

444    Dr Sulitzer was taken to [12] of the first Sulitzer Affidavit, where Dr Sulitzer set out his roles and responsibilities at SDC. Dr Sulitzer agreed that his role encompasses identifying and recruiting dentists that may be interested in becoming Affiliated Dentists. Dr Sulitzer also manages SDC’s existing global network of Affiliated Dentists.

445    Dr Sulitzer was asked if he had any involvement with any of the staff that work at SDC’s SmileShops. Dr Sulitzer gave evidence that he does support them, but not in Australia and only within the states of Washington and California in the USA Dr Sulitzer also explained that he assists in the management of the Affiliated Dentists, the Dental Team and Treatment Setup Team.

446    Dr Sulitzer was taken to [14] of the first Sulitzer Affidavit, where he explains that he acts as a “subject matter expert” for the Customer Care Team. Dr Sulitzer explained that because he is a trained clinical dentist, he is able to support this team in responding to any clinical questions, hence his self-description as being a “subject matter expert”.

447    Dr Sulitzer was asked to explain how he interacts with, and provides advice to the Customer Care Team. Dr Sulitzer gave evidence that he assists the Customer Care Team in delineating between clinical questions and administrative questions, as the Customer Care Team does not respond to clinical questions. Dr Sulitzer explained that this does not include providing the Customer Care Team with clinical answers to customers’ questions. Therefore, if a member of the Customer Care Team approaches Dr Sulitzer with a query that they have received from a customer, Dr Sulitzer is able to advise the Customer Care Team representative whether they are permitted to answer the question or not (based on whether it is clinical in nature). Dr Sulitzer gave evidence that hypothetical interactions like this are rare.

448    It was put to Dr Sulitzer that he does not act as a subject matter expert for SDC’s Customer Care Team such that he would confer with individual representatives that handle day-to-day customer queries, but that rather his contact is limited to the managers in the Customer Care Team. Dr Sulitzer explained that he does speak directly to representatives within the Customer Care Team from time to time, but explained that this is not the main role that he assumes as a subject matter expert. Dr Sulitzer told the Court that this role mainly involves advising and assisting in training for the Customer Care Team representatives.

449    Dr Sulitzer was taken to [15] of the first Sulitzer Affidavit, where Dr Sulitzer explains that he participates in providing information to the public about SDC’s products and services. Dr Sulitzer agreed that this is part of his role. Dr Sulitzer explained that this also includes appearing in videos that are available to the public on YouTube and other platforms. The SDC Platform also sends emails and text messages to customers as part of their marketing strategy and as part of the customer experience, once a customer has signed up to a treatment plan with SDC.

450    Dr Sulitzer gave evidence that he is also known as the “Chief Dental Officer”, however this is not a different role from the Chief Clinical Officer role.

451    Dr Sulitzer was shown an example pro-forma email that is sent to SDC customers at the point in time where their treatment plan has been approved (at annexure NB-10, page 135 to the Brown Affidavit).

452    The email signature was that of Dr Sulitzer’s and stated, in part:

A registered dentist or orthodontist has approved your new smile plan, and they will be with you every step of the way. We already sent a 3D rendering to you that lets you see how your teeth will move over time. In case you missed it, you can log in here to see your new smile in our 3D SmileViewer now. You no longer have to imagine how a smile transformation can change your life.

…

If you don't have any questions and are ready to begin your smile journey today, you can go directly to our site and purchase your aligners now.

I can’t wait to see your new smile.

Sincerely,

Jeffrey Sulitzer, DMD

Chief Dental Officer

SmileDirectClub

414 Union Street

Nashville, TN 37219

453    Dr Sulitzer explained that these emails are part of SDC’s marketing strategy, and while he is generally aware that emails of this kind are sent to SDC customers, he does not approve all of these communications to be sent, and is not otherwise informed when they are sent out to SDC customers.

454    Dr Sulitzer told the Court that he is not a registered dentist in Australia and SDC relies upon four registered dentists in Australia to be SDC’s Affiliated Dentists that are capable of approving SDC’s Aligner Treatment for its Australian customers. There are no affiliated orthodontists in Australia. Dr Sulitzer’s role as the Chief Clinical Officer requires him to identify and recruit dentists and orthodontists that may be interested in becoming Affiliated Dentists. Dr Sulitzer and his staff also perform a “credentialing process” as part of this recruitment to ensure the prospective Affiliated Dentist is appropriately qualified.

455    Dr Sulitzer was taken to [12] of the first Sulitzer Affidavit, where he stated:

… It is part of my role to identify dentists and orthodontists who may be interested in becoming part of the affiliated network, and to ensure that each dentist and orthodontist who provides treatment with SDC Aligners is appropriately qualified and registered to practice in the jurisdiction in which they practice.

456    Dr Sulitzer explained that, as part of the process of identifying dentists to become Affiliated Dentists, he partakes in assessing their clinical capabilities, background and history and experience with using clear aligners. Dr Sulitzer also makes sure that they are appropriately qualified to deliver SDC’s service and are registered to practice in the relevant jurisdiction where the SDC customers (that they intend to service) are located, which is what he meant by the reference “in which they practice”. Dr Sulitzer accepted that an Affiliated Dentist may be a dentist which has a registration in the jurisdiction other than from where the patient resides. Dr Sulitzer accepted that the Affiliated Dentist may be registered in the jurisdiction but may not be practicing within that jurisdiction.

457    Dr Sulitzer accepted that Dr Hendrik Lai has not practiced in Australia since 2017.

458    Dr Sulitzer accepted that the process of verifying dentists’ registration involves searching of dental board records and other publicly available records that record the registration and licensing of dentists to practice within the relevant jurisdiction. Dr Sulitzer explained that SDC would access these records via dental board websites as well as other websites to verify that proposed Affiliated Dentists were in fact registered to practice in a particular jurisdiction, that they had good standing, that their registration was current and active and that there were no conditions imposed upon their registration to practice dentistry. Dr Sulitzer said that SDC requires a minimum of four years’ experience using clear aligners in a “bricks and mortar” setting from start to finish in order to become an Affiliated Dentist. Dr Sulitzer explained that a “bricks and mortar” setting means treating and diagnosing patients in person at a traditional dentist clinic. When it comes to monitoring patients, Dr Sulitzer explained that this could be done by the dentist either in person, or through remotely via tele-dentistry.

459    Dr Sulitzer explained that SDC also requires dentists to have completed a clear aligner training course. SDC does not have its own certified training course. Therefore it requires Affiliated Dentists to undertake other clear aligner training courses, such as those offered by its competitors including, Invisalign.

460    Dr Sulitzer was taken to SDC’s “Credentialing Application” at CB1864 (Credentialing Application). Dr Sulitzer explained that this application is completed by dentists that wish to become Affiliated Dentists. Affiliated Dentists are also required to complete this application every two years. These records are maintained by SDC.

461    Dr Sulitzer explained the relevance of the “W9” tax form, which is required as part of the Credentialing Application, and in doing so, he also provided a brief overview of SDC’s business model. Dr Sulitzer told the Court that SDC does not pay dentists, rather dentists pay SDC. The way this works is that dentists pay SDC for the services that SDC provides to the dentist, and SDC operates as a dental support organisation (DSO). The DSOs are responsible for providing administrative support such as billing and setting up appointments for the Affiliated Dentists. There are other teams and support mechanisms which are also offered by SDC to its Affiliated Dentists such as the creation of the aligners themselves through a laboratory that is affiliated with SDC. Because the dentist pays SDC for these services and one of these services is the collection of fees from the customers, the W9 form is lodged with the United Stated Internal Revenue Service (IRS) because of the requirement to declare retained revenue for Affiliated Dentists.

462    Dr Sulitzer was asked about the price of SDC Aligner Treatment and how the price that is charged to customers is decided. Dr Sulitzer explained that the price charged for SDC Aligner Treatment is the same in every jurisdiction, but SDC does not set the price that is charged to consumers, rather, the Affiliated Dentists that provide SDC Aligner Treatment agree upon a set number to charge the patients. Dr Sulitzer, in the face of cross-examination on the issue of who decides the price, was adamant that SDC is not the arbiter that sets the price for its Affiliated Dentists in providing SDC Aligner Treatment, but rather, it is the Affiliated Dentists that do so. Dr Sulitzer told the Court that this process is done through a professional corporation that makes decisions that are set under a “management services agreement” which is an agreement between SDC and the professional corporation. Dr Sulitzer gave evidence that all of SDC’s Affiliated Dentists are comfortable with the price charged for SDC Aligner Treatment.

463    Dr Sulitzer gave evidence that Affiliated Dentists are not employees of SDC.

464    Dr Sulitzer was taken back to SDC’s Credentialing Application. Dr Sulitzer agreed that the application form did not specify a minimum number of aligner treatments that the dentist had previously performed. Rather, the form asked for the percentage of aligner treatments out of a total number of teeth straightening treatments that the dentist had performed. It was pointed out to Dr Sulitzer that there is an inherent issue with disclosing this figure based on a percentage, rather than a total number. This is because it is not possible to know the actual number of aligner treatments that a dentist had undertaken upon a review of the Credentialing Application (i.e. the figure could be listed as “100%” but the dentist had only performed one aligner treatment). Dr Sulitzer explained that while it may be the case that there is no set number of aligner treatments that a dentist is required to complete in order to become an Affiliated Dentist, Dr Sulitzer told the Court that he is able to get a sense of their level of experience during the recruitment process and through his discussions with the dentist and is confident in his assessment of the relevant dentist’s ability to provide the service, having had extensive experience in recruiting dentists.

465    Dr Sulitzer was taken to page five of the Credentialing Application at CB1867, which set out the disclosure questions which the prospective Affiliated Dentists are required to answer. Dr Sulitzer was asked about the first question, being “Are you compliant with all current HIPAA/HITECH rules and regulations?”. Dr Sulitzer explained that HIPAA/HITECH are US-based requirements for the management of patient health records. Therefore some of the disclosure questions on the form were relevant only to the USA. Because this particular question, and some others, did not apply to all prospective Affiliated Dentists, Dr Sulitzer explained where a question did not apply, to a particular dentist, they could simply cross out a particular question and put in an answer that is relevant to the dentist’s particular jurisdiction and SDC will undertake investigations into this.