Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 1 of 36
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`
`
`Steve W. Berman (pro hac vice forthcoming)
`HAGENS BERMAN SOBOL SHAPIRO LLP
`1301 Second Avenue, Suite 2000
`Seattle, WA 98101
`Telephone: (206) 623-7292
`Facsimile: (206) 623-0594
`Email: steve@hbsslaw.com
`
`Rio S. Pierce (SBN 298297)
`HAGENS BERMAN SOBOL SHAPIRO LLP
`715 Hearst Avenue, Suite 202
`Berkeley, CA 94710
`Telephone: (510) 725-3000
`Facsimile: (510) 725-3001
`Email: riop@hbsslaw.com
`
`Attorneys for Plaintiffs
`
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF CALIFORNIA
`
`MISTY SNOW, individually and on behalf of
`
`No.
`others similarly situated,
`
`
`
`CLASS ACTION COMPLAINT
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`ALIGN TECHNOLOGY, INC.,
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`JURY TRIAL DEMANDED
`
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`
`
`
`
`Plaintiff,
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`Defendant.
`
`v.
`
`CLASS ACTION COMPLAINT
`CASE NO.:
`010976-11/1509838 V1
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`I. 
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`II. 
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`III. 
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`IV. 
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 2 of 36
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`TABLE OF CONTENTS
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`Page
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`NATURE OF THE CASE ....................................................................................................... 1 
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`JURISDICTION AND VENUE .............................................................................................. 5 
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`PARTIES ................................................................................................................................. 6 
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`FACTS ..................................................................................................................................... 6 
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`A. 
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`B. 
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`C. 
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`D. 
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`E. 
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`F. 
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`G. 
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`Algin’s profits largely derive from its domination of the Aligner
`Market .......................................................................................................................... 6 
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`The expiration of Align’s Intellectual Property Exposed it to
`Competition ................................................................................................................. 9 
`
`Align implemented a closed system of scanners and aligners that
`would protect its monopolies in the respective markets ............................................ 10 
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`Align terminated its interoperability agreement with 3Shape,
`sacrificing short-term profits in order to gain long term profits from the
`anticompetitive effects of its refusal to deal. ............................................................. 11 
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`Align signed exclusive dealing contracts with Dental Service
`Organizations to entrench its monopoly power. ........................................................ 15 
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`Align’s “Fusion Program” Tied Together iTero Links, iTero Prices and
`Invisalign Sales. ......................................................................................................... 16 
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`Align’s set of actions substantially foreclosed competition in the
`aligner and scanner markets. ..................................................................................... 17 
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`V. 
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`VI. 
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`INTERSTATE COMMERCE ............................................................................................... 19 
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`CLASS ACTION ALLEGATIONS ...................................................................................... 19 
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`VII.  RELEVANT MARKETS ...................................................................................................... 23 
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`VIII.  ANTITRUST INJURY .......................................................................................................... 25 
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`IX. 
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`CAUSES OF ACTION .......................................................................................................... 26 
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`FIRST CLAIM FOR RELIEF MONOPOLIZATION OF THE ALIGNER
`MARKET (15 U.S.C. §2) ...................................................................................................... 26 
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`SECOND CLAIM FOR RELIEF MONOPOLIZATION OF THE SCANNER
`MARKET (15 U.S.C. §2) ...................................................................................................... 27 
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`CLASS ACTION COMPLAINT - i
`Case No.
`010976-11/1509838 V1
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 3 of 36
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`THIRD CLAIM FOR RELIEF (VIOLATIONS OF THE CARTWRIGHT ACT,
`CAL. BUS. & PROF. CODE §§ 16700, ET SEQ.) ............................................................... 28 
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`FOURTH CLAIM FOR RELIEF (VIOLATIONS OF CALIFORNIA’S UNFAIR
`COMPETITION LAW, CAL. BUS. & PROF. CODE §§ 17200, ET SEQ.) ....................... 30 
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`FIFTH CLAIM FOR RELIEF (VIOLATION OF STATE ANTITRUST AND
`RESTRAINT OF TRADE LAWS) ....................................................................................... 31 
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`REQUEST FOR RELIEF ...................................................................................................... 31 
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`DEMAND FOR JURY TRIAL ............................................................................................. 33 
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`X. 
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`XI. 
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`CLASS ACTION COMPLAINT - ii
`Case No.
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 4 of 36
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`Plaintiffs bring this action on behalf of themselves individually and on behalf of a plaintiff
`class consisting of all persons and entities who purchased Invisalign Aligners for personal use sold
`by Align Technology, Inc. (“Align” or “Defendant) from at least March 15, 2015 until the present
`(Class Period).
`
`I.
`NATURE OF THE CASE
`Aligners are orthodontic devices that, in essence, are a plastic form of dental braces.
`1.
`Over a course of treatment, a patient generally uses a successive series of aligners that slowly realign
`the teeth. Aligners possess several significant advantages over dental braces. Aligners, unlike braces,
`can be removed from the mouth for short periods of time, such as for eating, brushing, or flossing.
`Aligners, made out of clear plastic, are also more visually inconspicuous than dental braces that are
`usually made out of metal.
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`For decades, Align dominated the market for Aligners with its Invisalign products.
`2.
`Align controlled more than 80 percent of the market and earned consistent, durable profit margins.
`Align used its intellectual property to protect its dominant market position. Align frequently filed
`litigation, such as patent infringement lawsuits, against potential competitors in the aligner market
`who threatened Align’s dominance.
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`CLASS ACTION COMPLAINT - 1
`Case No.:
`010976-11/1509838 V1
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 5 of 36
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`However, by 2017, Align’s intellectual property that had helped drive its market
`3.
`dominance had begun to expire. Align publicly acknowledged the risk that “[w]hen patents expire,
`we lose the protection and competitive advantages they provided to us, which could negatively
`impact . . . operating results.”
`4.
`Align had been able to charge high prices and earn high profit margins on Invisalign
`because the product was protected by a thicket of hundreds of patents that Align wielded
`aggressively to protect its Aligner monopoly. As Align CEO Joe Hogan stated in 2017: We’ve been
`in business now for almost 20 years, and we’ve had so few competitors and people think it’s because
`we have this great IP, it’s true we have good intellectual property, but it took 15 years for people to
`really believe that you can move teeth with plastics[.] ... It gave us this period of time to really iterate
`and learn without the outside influence of other competitors coming in.1
`5.
`Faced with competition from the loss of patent exclusivity, Align implemented a
`anticompetitive scheme to willfully acquire and maintain its monopoly position. Align’s scheme
`centered around its efforts to foreclose competition in the linked markets of (1) aligners; and (2) hand-
`held digital intraoral scanners (“scanners”).
`6.
`Dental offices use scanners to take digital images of the jaws, teeth, and bite of a
`patient. These digital images are then used by aligner manufacturers to create individualized Aligners
`for patients. During the course of a treatment, patients will generally take regular scans and have a
`series of individual Aligners manufactured for their usage.
`7.
`Align sells a scanner product called the iTero. Align’s primary competitor in the
`Scanner market is 3Shape, who sells a “Trios” scanner. Digital scanners make it more convenient
`and efficient for Dental Practices to order Aligners. Align has stated that “Invisalign doctors with an
`iTero scanner have notably higher utilization rates than non-iTero doctors” i.e. – Invisalign doctors
`with an iTero scanner order Invisalign Aligners at significantly higher levels than doctors without
`iTero scanners. Align itself has also emphasized that Dental Practices need a fast and accurate way to
`
`
`1 Michela Tindera, Out of Silicon Valley, A Billion-Dollar Orthodontics Business Built with
`Plastic and Patents, Forbes (April 25, 2017) (emphasis added).
`CLASS ACTION COMPLAINT - 2
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 6 of 36
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`create digital scans that can be used to create Aligners and to transfer those scans to the Aligner
`manufacturer.
`8.
`Align’s iTero and 3Shape’s Trios are the two Scanners specifically designed for
`ordering Aligners. However, the two scanners have an obvious difference. Trios allows for dentists
`to order Aligners from a number of different Aligner manufacturers, thus encouraging competition in
`the market for aligners. By contrast, iTero is a closed system because it imposes substantial costs on
`dentists who attempt to use the iTero for ordering Aligners that are not manufactured by Align.
`9.
`As a result of this distinction, the spread of iTero’s closed-system scanner across
`dentists drives sales towards Invisalign and excludes rival Aligner manufacturers. For example, in
`2019, Invisalign stated that the “use of the iTero scanners for Invisalign case submission continues to
`grow and remains a positive catalyst for Invisalign ultilization” and that the “iTero scanner and
`services business has become an integral part of our business and is key to our end-to-end digital
`workflow.”
`Align’s anticompetitive scheme was designed to monopolize the Scanner and Aligner
`10.
`markets, creating a self-reinforcing cycle where Align’s dominance of the Scanner market ensured
`continued dominance of the Aligner market. Align’s scheme contained several key components: (1)
`the economically irrational, unilateral termination of Align’s longstanding and profitable agreement
`with 3Shape that allowed the Trios Scanner to be used to order Invisalign (“Interoperability
`Agreement”) – a termination that sacrificed short-term profits and only made sense because of the
`anticompetitive effects that it subsequently caused; (2) exclusive dealing contracts with two of the
`largest dental service organizations (“DSO”) that effectively prevented DSO members from dealing
`with Align’s competitors in the Scanner and Aligner markets, and (3) the Fusion program, which
`bundled iTero and Invisalign Aligner sales together, effectively preventing dentists from ordering
`either Aligners or Scanners from rivals.
`11.
`Align’s scheme substantially foreclosed competition in the Aligner and Scanner
`markets. Align successfully tied Invisalign to iTero in order to monopolize both markets – with
`dentists that used iTero scanners effectively forced to use Invisalign because Align’s terminated its
`interoperability agreement with its primary rival, 3Shape.
`CLASS ACTION COMPLAINT - 3
`Case No.:
`010976-11/1509838 V1
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 7 of 36
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`A rival Aligner manufacturer looking to compete against Invisalign would have to
`12.
`offer below-cost prices to offset the penalties and overcome the restrictions Align has placed on its
`customers through this Scheme. Likewise, Align has foreclosed Trios, its only true rival in the
`Scanner market. Because Align controls approximately 90 percent of the Aligner market, that has
`effectively foreclosed the ability for a rival Scanner manufacturer to compete.
`13.
`Invisalign Aligners are sold through dental offices. Full dental courses of treatment
`using Invisalign Aligners are expensive, generally costing up to $8,000. The cost of Invisalign
`Aligners are incorporated into the prices that dentists charge for Invisalign Aligner treatment. Dental
`insurance, if it is available, generally only covers a minority portion of the overall Invisalign Aligner
`treatment, generally capping benefits at 25-50% of the overall cost of the Invisalign Aligner
`treatment. Therefore, Plaintiff consumer purchasers pay much or all of the cost of Invisalign Aligners
`out-of-pocket.
`Align itself recognizes that Plaintiff consumers pay much of the cost for Invisalign
`14.
`Aligner treatment. On its own website, Align describes various out-of-pocket payment options for
`consumers purchasing Invisalign Aligners, including the usage of HSA or FSA spending accounts, or
`monthly payment plans:
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`CLASS ACTION COMPLAINT - 4
`Case No.:
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 8 of 36
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`Align has specifically emphasized that it works to arrange third party financing
`15.
`programs for end user consumers to shoulder the high cost of Invisalign Aligners. For example,
`Align introduced a third party financing program where the cost of Invisalign Aligners would be
`specifically paid to Align. Invisalign’s CEO, Joseph Hogan, explained the program as follows:
`“When consumers finance their treatment through us, Invisalign providers no longer pay
`Align. Instead they just receive payment for the treatment fee minus Align's lab fee. By changing the
`financial relationship between the patient, Align and the provider, Invisalign treatment becomes a
`revenue source for the provider.” Align also specifically recognized that dentists otherwise
`passthrough the cost of Invisalign Aligners to patients, with Hogan stating that the new financing
`program “eliminates the need for [dentists] to pass on the high down payments to patients.”
`16.
`Therefore, ultimately, whether they pay directly to Invisalign through financing or
`through payments for the cost of Invisalign Aligner treatment provided by dentists, it is Plaintiffs,
`consumer purchasers of Invisalign Aligners, who have paid the price for Align’s anticompetitive
`scheme through supracompetitive prices on Invisalign Aligners.
`II.
`JURISDICTION AND VENUE
`Plaintiffs bring this action under Section 16 of the Clayton Act (15 U.S.C. § 26) to
`17.
`secure injunctive relief against Defendant for violating Section 2 of the Sherman Act (15 U.S.C. § 2).
`Plaintiffs also bring these state law class claims on behalf of all the classes to recover actual and/or
`compensatory damages, double and treble damages as permitted, pre- and post-judgment interest,
`CLASS ACTION COMPLAINT - 5
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 9 of 36
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`costs, and attorneys’ fees for the injury caused by Defendant’s conduct in monopolizing the Aligner
`and Scanner markets. Plaintiffs seek damages in excess of $5,000,000. This Court has subject matter
`jurisdiction under 28 U.S.C. §§ 1331, 1337, and Sections 4 and 16 of the Clayton Act, 15 U.S.C. §§
`15(a) and 26.
`Venue is proper in this District pursuant to 28 U.S.C. §§ 1391(b) and (c) and 15 U.S.C.
`18.
`§§ 15 and 22, as Defendant resides, transacts business, committed an illegal or tortious act, has an agent,
`and/or can be found in this District.
`19.
`This Court has personal jurisdiction over the Defendant, as it has corporate offices in
`the District, markets and distributes Aligners and Scanners in this District, had corporate headquarters
`in this District during the majority of the class period during which it engaged in anticompetitive acts,
`enters into contracts within this District, and otherwise transacts business within this District.
`III.
`PARTIES
`Plaintiff Misty Snow purchased Invisalign Aligners in January 2019, during which
`20.
`time she was a resident of Oregon. Snow initially paid for the entire cost of Invisalign Aligners out-
`of-pocket through payments to her dental office. Snow was subsequently partially reimbursed by
`insurance for her purchase but was still individually responsible for paying the majority of the cost of
`the Invisalign Aligners. Plaintiff Snow purchased Invisalign Aligners at prices that were artificially
`inflated because of Defendant’s anticompetitive scheme, and thereby suffered antitrust injury.
`21.
`Defendant Align Technology, Inc. is a Delaware corporation that had its corporate
`headquarters in San Jose, California for the majority of the class period until January 1, 2021.
`Defendant still maintains its primary research hub in San Jose, California. Upon information and belief,
`Defendant has corporate offices in the Northern District of California, has many Invisalign providers in
`the Northern District of California which are trained by Defendant to prescribe Invisalign and which
`purchase both iTero scannera and Invisalign Aligners from Defendant for usage on Plaintiffs.
`IV.
`FACTS
`Algin’s profits largely derive from its domination of the Aligner Market
`22.
`Align’s largest source of revenue comes from its Invisalign brand Aligners, by far the
`dominant product in the Aligner market, with an approximately 90 percent share of the Aligner
`CLASS ACTION COMPLAINT - 6
`Case No.:
`010976-11/1509838 V1
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 10 of 36
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`market. Align earns well over a billion dollars per year selling Invisalign products at gross margins
`exceeding 75 percent. Its revenues and profits continue to grow year after year, and it continues to
`raise prices, despite the (largely unsuccessful) efforts of other companies to break into the Aligner
`market.
`Align also sells the iTero Scanner. Align acquired the iTero technology through a
`23.
`corporate acquisition and then integrated it with the Invisalign system. The iTero Scanner’s integration
`with Invisalign, as well as Align’s anticompetitive conduct described herein, have enabled iTero to
`become the dominant Scanner. Align now controls approximately 80 percent of the Scanner market,
`which earns Align hundreds of millions of dollars a year. An example of an iTero scanner is pictured
`below:
`
`CLASS ACTION COMPLAINT - 7
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 11 of 36
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`The iTero Scanner is highly profitable, with profit margins above 60 percent. Align’s
`24.
`only real competitor in the Scanner market is 3Shape, which sells the Trios Scanner. Trios, like iTero,
`is designed for ordering Aligners.
`25.
`Because of its dominance, Invisalign is a “must have” for Dental Practices that offer
`Aligner treatment to patients. When a patient seeks Invisalign treatment, that patient would visit a
`Dental Practice authorized by Align to prescribe the treatment. A dentist or staff member would then
`normally perform a scan of the patient’s jaws, teeth, and bite using a Scanner, and the dentist would
`review the scan. If the dentist determines that Invisalign treatment is appropriate, the Dental Practice
`will then purchase a set of custom-made Invisalign Aligners directly from Defendant for that
`patient’s treatment.
`26.
`Align knew that the use of digital Scanners, like iTero, would make it more likely that
`a Dental Practice would use Aligners—because of the Scanner’s design and “digital workflow,”
`because it provides a more accurate impression of a patient’s jaws, teeth, and bite for the improved
`design of that patient’s Aligners, and because once a Dental Practice makes a large investment in a
`digital Scanner, that practice would be more likely to order more Aligners as a way to pay for the
`Scanner. In addition, as described below, Dental Practices are able to access non-penalty pricing on
`Aligners as the number of Invisalign orders increases, thus making Scanners—and in particular ones
`that can be used to order Invisalign—a critical piece of a Dental Practice’s business.
`27.
`The primary focus of Align is selling more Aligners at extremely high profit margins.
`As Align’s Chief Executive Officer, Joe Hogan, stated in a July 2017 investor call, “[W]e’re in the
`clear aligner business and anything that help us to sell more clear aligners directly . . . would be in our .
`. . range. So, that’s why we have a scanner business. We have a scanner business not from a
`diversification standpoint. We have a scanner business because it allows us to sell more clear aligners.”
`28.
`The bottom line was that more iTero Scanners meant more Invisalign orders for Align.
`As Joe Hogan told investors in an April 2018 call, “So yeah, [iTero] is another component of growth in
`the company overall. What’s great is it’s synergistic growth, right. You have equipment growth, but it
`really leads to the growth of our core product line which is Invisalign.” And as Mr. Hogan reminded
`
`CLASS ACTION COMPLAINT - 8
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 12 of 36
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`Wall Street analysts when discussing Scanner sales in an October 2018 investor call: “[R]emember, it’s
`just a wonderful footprint for us for future Invisalign business once we have those scanners in place.”
`29.
`The fact that Scanners make it easier to order Aligners could have spelled trouble for
`Align’s market dominance in the Aligner market if the two available Scanners (iTero and Trios) were
`able to send scans to any Aligner manufacturer. Then Dental Practices could have offered Invisalign
`and competing Aligners on equal footing, which would have engendered competition among Aligner
`manufacturers that would have lowered prices and/or improved quality or innovation. Indeed, Trios is
`such an “open” platform—as a technological matter, Trios can be used to order Aligners from a wide
`range of manufacturers. But Align has created a “closed” system for iTero, which limits the ability of
`Dental Practices to use it to order competing Aligners. And Align has imposed contractual
`commitments to limit access to Trios and competing Aligners and—after 3Shape refused Align’s
`demand to send scans for Aligner orders only to Align—terminated the highly profitable
`Interoperability Agreement with 3Shape, all to create a bulwark to defend Invisalign from
`competition.
`Thus, for Align, monopolizing the Scanner market was not just about increasing price
`30.
`(and profits) in the Scanner market—which it did—but also about maintaining its monopoly power
`in the Aligner market, and thereby maintaining its supracompetitive prices and profits on Aligners.
`B.
`The expiration of Align’s Intellectual Property Exposed it to Competition
`31.
`Defendant held hundreds of patents on its Aligner technology. These patents, along
`with other high barriers to entry, largely deterred entrants into the Aligner market. Align has
`aggressively wielded those patents as well, filing patent and trade proceedings against potential
`competitors in the Aligner market as necessary to maintain its monopoly position.
`32.
`The Invisalign brand has become synonymous with Aligners generally. As a result,
`Dental Practices engaged in the business of straightening teeth must carry Invisalign to satisfy the
`demands of customers. And as described below, for those Dental Practices who want to offer
`Invisalign, Align has essentially made it impossible to offer competing Aligners or to use Scanners
`that compete with Align’s iTero.
`
`CLASS ACTION COMPLAINT - 9
`Case No.:
`010976-11/1509838 V1
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 13 of 36
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`Align’s monopoly started to come under threat in 2017 due to the expiration of many
`33.
`of its key patents, with additional key patents expiring by the end of 2019. Having enjoyed years of
`operating without “the outside influence of other competitors coming in,” as patent expiry loomed,
`Align changed its message to investors from reliance on the patents to protect its monopoly, to
`concern that “[w]hen patents expires, we lose the protection and competitive advantages they
`provided to us, which could negatively impact . . . operating results.” But instead of competing on
`the merits of its products and its pricing, Align responded to the emerging threat of competition by
`implementing the Scheme, described in detail below, to use its monopoly power in both the Aligner
`and Scanner markets to maintain and/or increase its monopoly power in each market and continue to
`charge supracompetitive prices for both Aligners and Scanners.
`C.
`Align implemented a closed system of scanners and aligners that would protect its
`monopolies in the respective markets
`34.
`One piece of the bulwark protecting Align’s monopoly power is Align’s “closed system”
`design of its Scanner and Aligner technology. For example, iTero is the only Scanner with integration
`into the Align treatment system, including Align’s Invisalign Outcome Simulator. Because of the way
`iTero is integrated into the “digital workflow” a Dental Practice would use to order Invisalign, Align
`knew that placing its Scanners in Dental Practices was going to drive those Dental Practices to use
`Invisalign exclusively.
`35.
`Second, iTero is intentionally designed in such a way that it is expensive, inefficient,
`and impracticable to use it to order non-Invisalign Aligners. For example, iTero does not create scans
`in the standard file format used by other Aligner manufacturers, and thus, a Dental Practice wishing to
`order non-Invisalign Aligners using iTero scans must either undertake an expensive and time-
`consuming process of converting iTero scans to a format that can be used for other Aligners, or use
`silicone-based molds to create a cast of a patient’s mouth and teeth, which is a messy, uncomfortable
`for the patient, time-consuming, and inefficient method. By contrast, 3Shape’s Trios Scanner uses
`standard file formats and cloud technology to work with numerous Aligner brands, including Invisalign
`(prior to Align’s termination of 3Shape’s Interoperability Agreement). For this reason, Trios
`represented a breach in Align’s bulwark protecting Invisalign from competition.
`
`CLASS ACTION COMPLAINT - 10
`Case No.:
`010976-11/1509838 V1
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 14 of 36
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`Third, Align intentionally does not accept scans from any Scanner for Invisalign
`36.
`orders, but rather, only allows Invisalign orders from a limited group of authorized scanners. Until the
`termination of Align’s Interoperability Agreement with 3Shape, discussed below, the Trios Scanner
`was one such authorized Scanner. Upon information and belief, Align has only allowed
`interoperability for scanners that are not designed for ordering Aligners, that do not compete with
`iTero in the Scanner market, and that do not represent a threat to Align’s dominance of the Aligner
`market. According to 3Shape, at the Greater New York dental meeting in November 2017, Align
`executive Raphael Pascaud communicated to 3Shape that Align will no longer validate any non-iTero
`intraoral scanner for use with Invisalign. Given that Invisalign orders are highly profitable for Align,
`this decision by Align terminated a previously highly profitable course of conduct for Align for the
`sole reason of furthering Align’s exclusionary conduct.
`37.
`Scanners are essential for Dental Practices to offer and sell Aligners (particularly
`Invisalign) to their patients, and Dental Practices typically do not purchase more than one Scanner
`due to the expense. In the case where a Dental Practice buys more than one Scanner, that practice
`nonetheless would tend to use only one brand of Scanner due to the cost of maintaining multiple
`software subscriptions and the time and expense to train personnel to use different Scanners and
`software programs. And like most such capital investments, a Scanner is meant to last several years.
`38.
`Thus, the iTero Scanner and Invisalign operate as a de facto product bundle by (a)
`making iTero the only viable option for Dental Practices seeking to sell the market-dominant
`Invisalign to their patients, and (b) preventing other Scanners from becoming established in the
`market that would allow dentists to order competing Aligners without undue burden. In order to
`cause the vast majority of Dental Practices to have long-term dependence on both the iTero Scanner
`and Invisalign Aligners, Align has engaged in the anticompetitive Scheme to entrench its monopoly
`power in the Aligner and Scanner markets.
`D.
`Align terminated its interoperability agreement with 3Shape, sacrificing short-term
`profits in order to gain long term profits from the anticompetitive effects of its refusal to
`deal.
`3Shape has been selling the Trios Scanner internationally since 2011, and in the
`39.
`United States since 2012. Unlike Align’s iTero, the Trios can send scans to any manufacturer of
`CLASS ACTION COMPLAINT - 11
`Case No.:
`010976-11/1509838 V1
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`Case 3:21-cv-03269 Document 1 Filed 05/03/21 Page 15 of 36
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`Aligners without any fees, delays, conversion process, or loss of image resolution. This was an
`advantage to Trios customers because it allowed for choice of Aligners and would have benefitted
`Dental Practices had other Aligner manufacturers been able to compete with Invisalign on the merits
`with lower prices and/or better quality for Aligners.
`40.
`Indeed, Align’s then-Chief Operating Officer told industry analysts in an April 23, 2015
`investor call (when its Aligner market dominance was protected by patents), such open systems:
`are better for our customers. No one wants to have to redesign, start
`over, buy multiple pieces of equipment if they can have greatest utility
`from a scanner... So, we believe what we hear from our customers is
`they don’t want to be forced to buy a system from you for the pleasure
`of offering Invisalign to their patients and other therapies we may have
`down the road. So we feel actually very strongly . . . . There’s no
`reason for us not to act in complementary ways because it’s good for
`the customer. So in our minds, we don’t need to own the channel. We
`don’t need to have exclusivity. In fact, we want probably more high-quality
`scanners that can make it easier to do Invisalign and other chair-side
`procedures that we have the unique capabilities to fulfill.
`In December 2015, Align and 3Shape entered into the Interoperability Agreement,
`41.
`under which the parties worked together to build an interface so that dental professionals could send
`Trios scans into Align’s Invisalign workflow. According to 3Shape, Align executive Raphael
`Pascaud testified in prior litigation that Align had entered into this Interoperability Agreement to
`increase Aligner sales, including from Dental Practices that were already using the Trios Scanner.
`42.
`But even as Align was preparing to enter into the Interoperability Agreement, according
`to 3Shape, Align was seeking to change the terms of its relationship with 3Shape by proposing an
`agreement