Juul Labs Inc. agreed to pay $462 million to six states and the District of Columbia to resolve lawsuits and investigations into the e-cigarette manufacturer’s marketing of addictive vaping products to children.
The deal requires Juul to stop flouting state laws that protect the privacy rights of minors and bar false advertising and unfair competition, New York Attorney General Letitia James and California Attorney General Rob Bonta said Wednesday.
“Juul lit a nationwide public health crisis by putting addictive products in the hands of minors and convincing them that it’s harmless,” James said during a live-streamed press conference with the other states. “Today, they are paying the price for the harm they caused.”
States involved in the deal, which includes Colorado, Illinois, Massachusetts and New Mexico, weren’t part of an earlier agreement Juul reached seven months ago to pay a total of $439 million to 33 states. California’s share of the new payout—$175.8 million—is the biggest, with New York getting $112.7 million.
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“Today is another step forward in our fight to protect our kids from getting hooked on vaping and nicotine,” Bonta said in a statement. “Juul simply saw dollar signs,” and used “nefarious tactics” to “hook our children on their products,” including bright attractive ads, giveaways at concerts and festivals, and sleek, easily concealed products and “fun flavors” to ratchet up the amount of nicotine, Bonta said.
“Juul knew all along how dangerous and addictive its products were,” District of Columbia Attorney General Brian Schwalb said during the press conference. “It knew, but did not care. It chose to prioritize its profits over kids’ health and safety.”
In a statement, Juul said the deal moves the company toward “total resolution” of its legal challenges, with more than $1 billion in settlements with 47 states and territories. Juul said underage use of its products has fallen by 95% since the company’s “reset” in 2019, citing the National Youth Tobacco Survey.
“Now we are positioned to dedicate even greater focus on our path forward to maximize the value and impact of our product technology and scientific foundation,” Juul said.
The multi-state agreements follow some earlier ones with individual states. In April 2022, Juul reached a $22.5 million settlement with Washington state over claims that it unlawfully targeted underage consumers. North Carolina struck a $40 million accord with Juul in 2021 over how the company markets products to underage users.
California will use its share of the money to fund research, education and enforcement efforts related to e-cigarettes, Bonta said.
As with earlier state agreements, the new deal restricts Juul’s ability to market to underage consumers. Among other things, the accord requires Juul to secure its products behind store counters and verify the age of consumers that directly sell or promote its products online, according to the statement.
The Food and Drug Administration in June banned Juul products on U.S. shelves, citing a lack of evidence demonstrating their overall safety. The regulator also noted Juul’s “disproportionate role in the rise in youth vaping.”
Juul won a court order temporarily blocking that decision, and the agency separately stayed its ban, allowing the company to continue selling products for now. A ban would wipe out a substantial portion of Juul’s revenue, and the company has been considering options including new financing and a potential bankruptcy filing if that happens.
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