SmileDirectClub, LLC v. Battle et al

COMPLAINT with Jury Demand filed by SmileDirectClub, LLC. (Filing fee $400.00, receipt number 113E-7894540) Please visit our website at http://www.gand.uscourts.gov/commonly-used-forms to obtain Pretrial Instructions and Pretrial Associated Forms which includes the Consent To Proceed Before U.S. Magistrate form.

Northern District of Georgia, gand-1:2018-cv-02328

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7 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION SMILEDIRECTCLUB, LLC, Plaintiff v. Civil Action No. __________________ GEORGIA BOARD OF DENTISTRY; TANJA D. BATTLE, in her official JURY TRIAL DEMANDED capacity as Executive Director of the Georgia Board of Dentistry; and THOMAS P. GODFREY, GREGORY G. GOGGANS, RICHARD BENNETT, REBECCA B. BYNUM, TRACY GAY, STEVE HOLCOMB, LOGAN NALLEY, JR., ANTWAN L. TREADWAY, H. BERT YEARGAN, and WENDY JOHNSON, individually and in their official capacities as Members of the Georgia Board of Dentistry, Defendants. COMPLAINT FOR DAMAGES, DECLARATORY, AND INJUNCTIVE RELIEF Plaintiff SmileDirectClub, LLC ("Plaintiff" or "SDC") alleges the following against Defendants the Georgia Board of Dentistry (the "Board"), Thomas P. Godfrey, Gregory G. Goggans, Richard Bennett, Rebecca B. Bynum, Tracy Gay, Steve Holcomb, Logan Nalley, Jr., Antwan L. Treadway, H. Bert Yeargan, and 7 Wendy Johnson (each of the foregoing individuals is sued in his or her individual capacity and in his or her official capacity as Members of the Board), and Tanja D. Battle in her official capacity as Executive Director of the Board: INTRODUCTION 1. This is an action to enjoin the enforcement of an unauthorized and improper rule adopted by the Georgia Board of Dentistry. Specifically, the Board recently approved a rule that purportedly "expanded" the list of duties a dental assistant may perform if directly supervised by a licensed dentist under Georgia Rule of Dentistry 150-9-.02(3). A true and correct copy of Rule 150-9-.02, including the list of ten "expanded" duties, is attached hereto and incorporated herein by reference as Exhibit A. Subparagraph (aa) of the new Rule provides that a dental assistant may perform "[d]igital scans for fabrication (sic) orthodontic appliances and models" only "under the direct supervision of a licensed dentist." Digital scanning, however, is not the practice of dentistry or dental hygiene and, thus, the Board lacks the authority to regulate this conduct. 2. By including "digital scans" within the framework of Rule 150-9- .02(3), Subparagraph (aa) bars technicians from performing digital scans of a patient's teeth and gums unless under the direct supervision of a licensed dentist. Notably, the supervision contemplated by the new Rule simply requires that a 2 7 licensed dentist be in the building while the digital scanning is performed. It does not require that the licensed dentists perform the digital scan themselves, observe the digital scans, or even be in the same room as the patient when the digital scan is performed. Thus, effectively, Subparagraph (aa) is aimed uniquely at shops that offer digital scan services apart from dental services. As a result, Subparagraph (aa) unlawfully restricts Georgia residents' access to affordable aligner treatment, fails to protect the public in any manner, stifles competition, harms consumers, and makes it virtually impossible for Plaintiff to lawfully conduct business in the State of Georgia without making costly and prohibitive changes to its present business model. THE PARTIES 3. Plaintiff SDC is a dental service organization that provides non- clinical administrative support services to contractually affiliated dental practices in Georgia that wish to offer doctor-directed at-home clear aligner treatment for cases of mild to moderate malocclusion (i.e. improper positioning of the teeth when the jaws are closed). SDC is licensed to practice business in the State of Georgia. 4. The Board consists of eleven members appointed by the Governor to regulate and enforce the standards of the practice of dentistry. By statute, nine 3 7 members of the Board must be dentists, one member of the Board must be a dental hygienist who is not a dentist, and one member of the Board must be an individual who is neither a dentist nor a dental hygienist. O.C.G.A. § 43-11-2. Upon information and belief, one of the nine seats allocated to dentists is presently vacant, meaning that the Board presently consists of ten members, eight of whom are dentists. The Board's authority is limited to regulating the practice of dentistry and dental hygiene and those who practice dentistry or dental hygiene in the State of Georgia. The Board has no authority over activities that do not constitute dentistry or dental hygiene or individuals and organizations, such as SDC, that provide non-clinical administrative support services to dental providers. 5. Defendant Tanja D. Battle is the Executive Director of the Georgia Board of Dentistry. 6. Defendant Thomas P. Godfrey, D.M.D., is the President and one of the eight current dentist members of the Board. Upon information and belief, Dr. Godfrey is a licensed, practicing dentist with an office in Atlanta, Georgia. 7. Defendant Gregory G. Goggans, D.M.D., is the Vice President and one of the eight current dentist members of the Board. Upon information and belief, Dr. Goggans is a licensed, practicing orthodontist with offices in various locations throughout Georgia. According to the website for his practice, Dr. 4 7 Goggans offers patients clear aligner treatment products and services that compete with the products and services offered by SDC and its affiliated dental practices. 8. Defendant Richard Bennett, D.M.D., is one of the eight current dentist members of the Board. Upon information and belief, Dr. Bennett is a licensed, practicing dentist with an office in Gainesville, Georgia. 9. Defendant Rebecca B. Bynum, R.D.H., is a current member of the Board. Upon information and belief, Ms. Bynum is a registered dental hygienist. 10. Defendant Tracy Gay, D.M.D., is one of the eight current dentist members of the Board. Upon information and belief, Dr. Gay is a licensed, practicing dentist with an office in Dublin, Georgia. According to the website for his practice, Dr. Gay offers patients clear aligner treatment products and services that compete with the products and services offered by SDC and its affiliated dental practices. 11. Defendant Steve Holcomb, D.M.D., is one of the eight current dentist members of the Board. Upon information and belief, Dr. Holcomb is a licensed, practicing dentist with an office in Byron, Georgia. 12. Defendant Logan "Buzzy" Nalley, Jr., D.M.D., is one of the eight current dentist members of the Board. Upon information and belief, Dr. Nalley is a licensed, practicing prosthodontist with an office in Augusta, Georgia. 5 7 13. Defendant Antwan L. Treadway, D.M.D., is one of the eight current dentist members of the Board. Upon information and belief, Dr. Treadway is a licensed, practicing oral surgeon with an office in Atlanta, Georgia. 14. Defendant H. Bert Yeargan, D.M.D., is one of the eight current dentist members of the Board. Upon information and belief, Dr. Yeargan is a licensed, practicing dentist with an office in Brunswick, Georgia. 15. Defendant Wendy Johnson is a current member of the Board. JURISDICTION AND VENUE 16. This Court has subject matter jurisdiction over the claims asserted in this Action pursuant to 28 U.S.C. §§ 1331, 1337, 1343, 1367 and 42 U.S.C. § 1983. 17. The Board was created by the Georgia Legislature to regulate and enforce the standards of the practice of dentistry in the State of Georgia. See O.C.G.A. §§ 43-11-1 et seq. The Board operates in the State of Georgia and the events giving rise to the claims asserted in this Action occurred in the State of Georgia. Upon information and belief, Defendants Battle, Godfrey, Goggans, Bennett, Bynum, Gay, Holcomb, Nalley, Treadway, and Yeargan are all citizens of the State of Georgia. See O.C.G.A. § 43-11-2 (requiring members of the Georgia Board of Dentistry to be citizens of the State of Georgia). Accordingly, Defendants are subject to personal jurisdiction in Georgia. 6 7 18. Venue is proper in this District pursuant to 28 U.S.C. § 1391 and 15 U.S.C. § 22 because the Board is deemed to reside in any judicial district in which it is subject to personal jurisdiction with respect to this Action, which includes this District. Venue is also proper in this District because a substantial part of the events or omissions giving rise to the claims asserted in this Action occurred in this District. 19. The Defendants' actions substantially and adversely affect interstate commerce in the "Relevant Market" as described herein. Defendants provide services in interstate commerce and certain of the Defendants perform aligner treatment using products that are sold across state lines and from outside the State of Georgia into the State of Georgia. In addition, by restraining competition for aligner treatment in Georgia, the flow of interstate commerce is interrupted because the purchase of supplies needed for such treatment, and any related services, from outside of Georgia is reduced. Thus, Defendants' actions have the effect of reducing the amount of interstate commerce to the detriment of consumers. 7 7 FACTUAL BACKGROUND A. SDC Provides Non-Clinical Administrative Support Services to Licensed Dental Providers. 20. SDC is a dental service organization that provides non-clinical administrative support services to contractually affiliated dental practices that wish to offer doctor-directed at-home clear aligner treatment for cases of mild to moderate malocclusion using the teledentistry platform and portal provided by SDC. A clear aligner is a removable appliance made from a strong plastic material that is fabricated to fit an individual's mouth to move the individual's teeth in increments until the desired positioning is achieved. Teledentistry enables the provision of dental treatment and care via remote technology, rather than on-site personal contact with patients. 21. Through SDC's teledentistry platform, dentists and orthodontists licensed in the state of Georgia who affiliate with SDC are able to offer at-home aligner treatment at a substantially lower price than traditional aligner treatment offered in an established dental office and are therefore able to treat many patients who otherwise would not have access to an orthodontist. The SDC platform is built around its proprietary SmileCheck system, a web-based portal that connects patients and doctors, facilitating timely and convenient interaction. 8 7 22. SDC's affiliated practices are revolutionizing orthodontic treatment by dramatically lowering the price of aligner treatment for mild to moderate cases of malocclusion and providing greater access to aligner treatment for the residents of the State of Georgia. 23. SDC's mission of providing affordable aligner treatment to the underserved is important in the State of Georgia, where approximately 63.5% of Georgia counties do not have a licensed orthodontist. 24. Among the suite of non-clinical administrative support services offered by SDC is the provision of a SmileShop to SDC-affiliated licensed dentists and orthodontists. 25. SmileShops are locations where customers may receive digital photographs of their teeth and gums through the use of an iTero scanner to determine if they are a candidate for SDC's clear aligner product. The iTero scanner is cleared as safe and effective by the FDA. And unlike devices that are used for medical or dental procedures, such as x-ray machines, the iTero scanner does not need to be registered with or inspected by the state prior to use. The digital photographs created by the iTero scanner are necessary for SDC's licensed dentists and orthodontists to provide aligner treatment and thereby compete in the "Relevant Market" as defined below. 9 7 26. The digital scan at the SDC SmileShops in Georgia is performed by a trained technician or assistant using an iTero scanner, which is essentially a wand with a camera, to take thousands of photographs of a customer's teeth and gums. The photographs are sent to the SDC lab, where trained technicians receive the patient's scans on behalf of the treating dentist or orthodontist,