Juul Labs settles litigation in the United States
By Rob McLean, CNN Business
E-cigarette maker Juul Labs said Tuesday that it has settled litigation it faced in the United States, resolving a substantial amount of legal issues for the company.
“The global resolution covers more than 5,000 cases brought by approximately 10,000 plaintiffs against Juul Labs and its officers and directors,” the company said in a news release.
The company said the cases were from personal injury, consumer class action, government entity and Native American tribes groups.
Juul Labs said that it “cannot disclose the settlement amount at this time, but has secured an equity investment to fund the resolution.”
The development comes after a September announcement that Juul would pay $438.5 million to 34 states and territories in a settlement following a two-year investigation into the company’s marketing and sales practices. The investigation found that Juul deliberately marketed its products to young people, even though e-cigarette sales to children are illegal.
Marketing efforts included free samples, social media campaigns, launch parties, and the use of young-looking models in its advertising campaigns. In 2019, the US Food and Drug Administration chastised the company for its marketing, which included a presentation to kids while they were at school in which company representatives said the product was “totally safe.” The packaging was easy to hide and the flavors such as mango, fruit and mint were popular among underage users.
In the past, Juul Labs has sold some of the most popular vaping products in the United States, especially its flavored products.
E-cigarette products have grown in popularity among young people, leading to a vaping epidemic in high schools nationwide.
In a national survey from last year, more than 2 million US teens said they use e-cigarettes, with a quarter of them saying they vape daily. The survey found that they still reported using e-cigarettes and other vape devices.
In June, the US Food and Drug Administration ordered Juul Labs Inc. products to be removed from the US market as the agency issued marketing denial orders for its vaping devices and pods. A court temporarily blocked the FDA ban, so the products are still for sale in the United States.
On Monday, the company said it had “taken a series of steps to stabilize its business operations and address past legal issues.”
“With both new investments in the company’s mission and a resolution like the one achieved today, Juul Labs is charting a path forward to continue to advance tobacco harm reduction through science and technology, for over 31 million adult smokers in the U.S. and over 1 billion adult smokers worldwide,” it said.
– CNN’s Carma Hassan, Jacqueline Howard and Jen Christensen contributed to this report
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