Juul Agrees to $438.5 Million Settlement for Targeting Teens

E-cigarette maker Juul Labs Inc. has agreed to a $438.5 million settlement in a lawsuit filed by several states that claim the company’s marketing tactics targeted teenagers. Here’s the Juul settlement explained in more detail.

In 2018, Massachusetts was the first state to start an investigation into Juul’s marketing practices. After a two-year investigation, the Massachusetts Attorney General’s office filed a lawsuit claiming that Juul created a youth vaping epidemic by intentionally marketing and selling e-cigarettes to underage teens.

Thirty-three states and Puerto Rico eventually joined the lawsuit against Juul. The investigation into Juul’s marketing practices found that the company promoted its products through launch parties, product giveaways, social media posts, and advertising in teen-focused media outlets such as Nickelodeon, Cartoon Network, and Seventeen magazine.

In 2018, then U.S. Surgeon General Jerome Adams said e-cigarette use among teens had increased “at a rate of epidemic proportions.” A 2019 National Youth Tobacco Survey found over five million youth were using e-cigarettes, and about one million were vaping daily, the Brookings Institution reported.

Juul was the most popular brand of e-cigarette used, the survey found. Juul had over 70 percent of the e-cigarette market share. A Juul cartridge, or pod, contained as much nicotine as a pack of 20 cigarettes, Adams’ office reported in 2018.

Juul officials deny any wrongdoing and have claimed the company’s products are marketed more toward adults trying to quit smoking traditional cigarettes. As part of the tentative settlement, Juul agreed to stop its:

• Youth marketing

• Funding education programs

• Depicting persons under age 35 in any marketing

• Use of cartoons

• Paid product placement

• Sale of brand name merchandise

• Sale of flavors not approved by the FDA

• Allowing access to websites without age verification on the landing page

• Representations about nicotine not approved by FDA

• Misleading representations about the nicotine content

• Sponsorships/naming rights

• Advertising in outlets unless 85 percent audience is adult

• Advertising on billboards

• Public transportation advertising

• Social media advertising (other than testimonials by individuals over the age of 35, with no health claims)

• Use of paid influencers

• Direct-to-consumer ads, unless age-verified, and

• Offering free samples.

In a statement to the New York Times, the company said the settlement “is a significant part of our ongoing commitment to resolve issues from the past. The terms of the agreement are aligned with our current business practices, which we started to implement after our companywide reset in the fall of 2019.”

Once the settlement is finalized, the $438.5 million would be paid out to the participating states and territories over six to ten years, with the amounts paid increasing the longer the company takes to make the payments. The funds have been earmarked for public efforts to curb underage tobacco and e-cigarette use.

This new settlement is in addition to four other state lawsuits Juul previously settled with Arizona ($14.5 million), Louisiana ($10 million), North Carolina ($40 million), and Washington ($22.5 million). Each state filed similar lawsuits accusing Juul of targeting youth in their marketing. According to Drugwatch.com, about 3,986 lawsuits have been filed against Juul as of July 15.