Juul Labs has agreed to pay $438.5m in a settlement following an investigation lasting two years by 33 states into the electric cigarette maker’s marketing of vaping products containing high levels of nicotine.
The products have been blamed for an increase in vaping among teenagers across the US, according to the Associated Press.
Connecticut Attorney General William Tong revealed the settlement on Tuesday. The 33 states as well as Puerto Rico joined forces in 2020 to investigate Juul’s promotion schemes and its claims concerning the safety and other advantages of its technology serving as an alternative to smoking.
Juul remains the target of nine other lawsuits from other states and hundreds of personal lawsuits filed on behalf of teenagers who argue that they’ve become addicted to vaping products.
The probe by the states found that Juul tried to sell e-cigarettes to teenagers via launch parties, giveaways, ads and social media posts.
“Through this settlement, we have secured hundreds of millions of dollars to help reduce nicotine use and forced Juul to accept a series of strict injunctive terms to end youth marketing and crack down on underage sales,” Mr Tong said in a statement.
The settlement will be paid over the course of between six and 10 years, the AP reported. According to Mr Tong, the payment to Connecticut, which amounts to at least $16m, will be used to prevent vaping as well as education efforts.
Juul has settled several lawsuits previously, including in Arizona, Louisiana, North Carolina and Washington.
Most of the restrictions that the lawsuit puts in place won’t affect the company’s actions, as it ceased the use of parties, giveaways, and other marketing techniques after coming under fire some years ago.
The US Food and Drug Administration (FDA) announced that there was an “epidemic” of underage vaping among teens following Juul’s launch in 2015 and the subsequent spike in teen vaping.
Juul has been backing down since 2019, when it started to roll back advertising efforts as well as removing fruit and candy-like flavours from stores.
The FDA took action to ban all Juul e-cigarettes from the market earlier this summer, which the company challenged in court, prompting the FDA to restart its review of Juul’s technology, according to the Associated Press.
A small number of e-cigarettes have been cleared for use for adults searching for a less damaging alternative to smoking.
Juul has moved away from targeting younger people.
In a statement, the company said, “we remain focused on our future as we fulfill our mission to transition adult smokers away from cigarettes - the number one cause of preventable death - while combating underage use”.
Some of the marketing tactics Juul has agreed not to use as part of the settlement include cartoons, social media influencers, showing people under 35 in their ads, billboards, public transportation advertising, and advertising in any outlet where fewer than 85 per cent of users are adults.
There are also limits on where Juul products can be placed in stores, age verification is required for all sales, and limits have been placed on online and retail sales.
The use of Juul products was initially widespread across high schools in the US, when flavours included mango, mint, and creme, according to the AP.
Recent surveys show that teenagers are no longer as avid users of the products, with most now choosing disposable e-cigarettes, which are still on the market in sweet and fruit-like options.
Federal survey data reveals that teen vaping decreased as much as 40 per cent as students attended school from home during the pandemic. However, officials noted that the data had been gathered online and not in classrooms, urging caution when interpreting the results of the survey.