Vape Company Forced to Pay Over 400 Million

Juul Labs Inc. reached an agreement in principle to pay $438.5 million to 33 states to resolve a two-year bipartisan probe into the e-cigarette manufacturer’s marketing and sales practices, particularly claims that it marketed addictive nicotine products to children.

The accord, which also includes Puerto Rico, would force Juul to comply with a series of “strict injunctive terms severely limiting their marketing and sales practices,” Connecticut Attorney General William Tong, who led the negotiations with Texas and Oregon, said Tuesday in a statement.

Juul Labs Inc. reached an agreement in principle to pay $438.5 million to 33 states to resolve a two-year bipartisan probe into the e-cigarette manufacturer’s marketing and sales practices, particularly claims that it marketed addictive nicotine products to children.

The accord, which also includes Puerto Rico, would force Juul to comply with a series of “strict injunctive terms severely limiting their marketing and sales practices,” Connecticut Attorney General William Tong, who led the negotiations with Texas and Oregon, said Tuesday in a statement.

“Juul’s cynically calculated advertising campaigns created a new generation of nicotine addicts,” Tong said in the statement. “They relentlessly marketed vaping products to underage youth, manipulated their chemical composition to be palatable to inexperienced users, employed an inadequate age verification process, and misled consumers about the nicotine content and addictiveness of its products.”

Juul said in a statement that the settlement is a “significant part of our ongoing commitment to resolve issues from the past,” adding that the terms of the deal are in alignment with its current business practices.

“We remain focused on the future as we work to fulfill our mission to transition adult smokers away from cigarettes — the number one cause of preventable death — while combating underage use,” the company said.

The agreement follows some earlier deals with individual states. Juul in April 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.

Texas Attorney General Ken Paxton said in a statement that his state will receive nearly $43 million under the deal. 

“My commitment to protecting consumers from deceptive business practices is unwavering, and any company that misleads Texans, especially our youth, will be held accountable for their actions,” Paxton said.

The multi-state investigation revealed that Juul became the dominant player in the vaping market by deploying an advertising campaign that appealed to youth, according to the statement.

“The investigation found that Juul relentlessly marketed to underage users with launch parties, advertisements using young and trendy-looking models, social media posts and free samples even though its e-cigarettes,” according to the statement.