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Smile Direct Club Goes Bust in the US and UK Services Stop

Published on : 11th December, 2023 | Updated on : 11th December, 2023
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Robert Moore

Written ByRobert Moore

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Rob has over a decade of experience in web and general marketing. He has extensive knowledge of the Insolvency sector and has helped many worried directors with their questions.

Rob is now working with the Board at KSA Group Ltd to develop strategic marketing programmes to support the business plan and drive more company rescues.

Robert Moore

Smile Direct Club in the UK closed months after US Parent filed for bankruptcy (Chapter 11) in the US Court.

Best known for selling clear aligners remotely, the company claimed it made the “incredibly difficult decision” to close late Friday.

US-based dentistry company offered aligners for £1,800 without a dentist appointment. Established in 2014, the orthodontics startup aimed to disrupt the “bricks-and-mortar” dental sector.

Traditional dentists and orthodontists or orthodontic therapists fit “train-track” braces and transparent aligners following an in-person consultation.

Smile Direct Club’s lower prices and home aligner moulds attracted many clients.

Company treatment spans four to six months and includes online check-ins with authorised dentists.

On its website, the company claims to have “improved more than two million smiles and lives”.

However it appears that the sheer level of the companies debts thwarted any rescue plan.

 

Customers in the US, UK, and others are confused because the company states its customer service line will no longer be available, even though they may need aligner check-ins or changes.

It advises patients to contact a local dentist to continue therapy.

It further outraged clients by announcing that its “lifetime smile guarantee” was no longer valid, but payment plan holders must continue paying.

It stated refund information will be provided once bankruptcy progresses and “next steps” are established.

On its website, Smile Direct Club apologised for the inconvenience.

She noted that liquidators will issue reimbursements. “But customers will be at the back of a long queue of creditors so this is unlikely to amount to much, if anything at all,” added.

She suggested that UK customers who are still waiting for products and have not cancelled or paid by credit card try to seek their money back under Section 75 of the Consumer Credit Act.

In late September, Smile Direct Club filed for US Chapter 11 bankruptcy, which gave it time to reorganise its debts or sell pieces of the business.

However, a last-ditch rescue arrangement failed on Friday.

Attorney Spencer Winters told a bankruptcy court judge that its founders’ arrangement to supply funds and buy Smile Direct Club out of bankruptcy failed because its most important lender refused.

Despite being valued at $8.9bn (£7bn), Fortune magazine said that it filed for bankruptcy with roughly $900m in debt.

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