E-cigarette company Juul has agreed to a $438.5 million settlement with 34 states and territories, effectively ending a two-year investigation into its marketing and sales practices, Texas’ attorney general announced Tuesday.
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The bipartisan investigation revealed that Juul ascended to its dominance in the vaping industry by carrying out advertising campaigns targeted to youths, according to Texas Attorney General Ken Paxton. Those marketing tactics included launch parties, social media posts and free samples of its e-cigarette products, Paxton said in a statement. Juul also knowingly used ineffective age verification methods.
“When I launched this investigation over two years ago, my goal was to make sure Juul was held liable for any wrongdoing done in the past and ensure that they change direction to fully comply with the law going forward,” Paxton said in a statement. “This settlement helps accomplish both of those priorities.”
A Juul spokesperson highlighted that the settlement is part of its commitment to resolve past issues.
“The terms of the agreement are aligned with our current business practices which we started to implement after our company-wide reset in the fall of 2019,” the spokesperson noted. “With today’s announcement, we have settled with 37 states and Puerto Rico, and appreciate efforts by attorneys general to deploy resources to combat underage use.”
Consumers were coaxed into believing that inhaling one Juul e-liquid pod was the equivalent of smoking a single pack of cigarettes, and that Juul e-cigarettes were smoking cessation devices, even though the U.S. Food and Drug Administration never approved such claims, according to Paxton.
The settlement is to be paid out over a six- to 10-year period, and the amounts paid will increase if the company takes longer to complete payment, according to the attorney general.
If Juul chooses a decade-long payment period, the final settlement total would reach $476.6 million, the attorney general said.
As part of the agreement, Juul also agreed to marketing and sales restrictions, such as restrictions on marketing to consumers younger than 35, limits on in-store displays and age verification requirements on all sales.
“We believe that once the FDA does a complete review of all of the science and evidence presented, as required by law, and without political interference, we should receive marketing authorization,” Juul’s spokesperson said. “As we go through the FDA’s administrative appeals process, we continue to offer our products to adult smokers throughout the U.S.”
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Source: https://www.law360.com/articles/1527757/juul-pays-438m-to-settle-with-34-states-territories
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