California AG Settles with Aspen Dental for $2M Over False Advertising

A dental services provider is paying more than $2 million to settle charges of false advertising by California Attorney General Rob Bonta.

Bonta’s office reached a settlement with Aspen Dental Management Inc. for engaging in false and misleading advertising. Aspen Dental describes itself as a dental support organization that provides business management and administrative services to dental offices, each of which operates under “Aspen Dental.”

The California DOJ says the company exceeded that role by unlawfully directing the practice, ownership, and management of dentistry in California.

The settlement, which remains subject to court approval, includes injunctive terms, $2 million in penalties, and $300,000 in restitution funds for certain patients.

Aspen Dental reports more than 1,000 offices nationwide. It entered California in 2019 and has 19 offices. As part of its expansion, it is alleged that Aspen Dental did not contract with existing dental offices, but selected, purchased, staffed, and advertised its offices without clearly identifying an independent dentist-owner. According to the California DOJ, Aspen Dental designed, built out, and furnished all of its offices and made detailed decisions about each location. It also selected, purchased, and installed all dental equipment across offices.

Aspen Dental also encouraged the sale of particular products and services through direct incentives to its clinical employees. The company implemented an incentive program for hygienists to encourage the sale of clear aligners. The program offered hygienists $50 per sale to new patients or $100 per sale to existing patients. Such business practices limited dentist-owners, restricted staff, misguided patients, and violated California’s ban on the corporate practice of dentistry and California’s Unfair Competition Law, according to the California DOJ.

In numerous advertisements, Aspen Dental created misleading or false representations, including misleading testimonials, ambiguity, misleading cost claims, and inexact pricing language, according to the California DOJ,

As a part of the settlement, Aspen Dental has agreed to $2 million in penalties, $300,000 in restitution funds, and injunctive terms, including:

• Not replacing any practice owner with another dentist of its choosing.
• Not owning the property for any practice.
• Not basing service fees on revenue, sales, or profits.
• Providing a written fee schedule for products and laboratory services.
• Clearly identifying the practice owner’s name when creating, publishing, or disseminating advertisements.

Topics California