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Juul to pay six states $462 million to settle teen marketing claims

The six states and D.C. accused Juul of violating state laws by targeting young people in its advertising,

(CN) — Vape giant Juul Labs has agreed to pay six states and the District of Columbia $462 million — its largest settlement to date — to resolve claims it marketed vape pens and other products to teens.

California — which announced the settlement Wednesday — will receive the largest amount at $175.8 million. New York comes in second, securing $112.7 million, while Colorado, Illinois, Massachusetts, and New Mexico will receive $31.7 million, $67.6 million, $41.7 million, and $17 million respectively. Juul will pay the District of Columbia $15.2 million.

On Monday, West Virginia announced they had reached a $7.9 million settlement with the vape manufacturer. Last year, Juul entered into a $438 million settlement with 34 other states. The electronic cigarette company has been embroiled in hundreds of lawsuits from school districts, governments, tribes and private individuals around the United States.

Juul said the settlement is a good deal not just for the states, but for itself as well.

“With this settlement, we are nearing total resolution of the company’s historical legal challenges and securing certainty for our future,” the company said in a statement Wednesday. “We have now settled with 47 states and territories, providing over $1 billion to participating states. This is in addition to our global resolution of the U.S. private litigation that covers more than 5,000 cases brought by approximately 10,000 plaintiffs.”

The company added: “This settlement with seven state attorneys general represents another critical part in our ongoing commitment to resolve issues from the company’s past.”

That past has been well investigated by numerous state attorneys general. Colorado Attorney General Phil Weiser — like his colleagues in other states — placed the blame squarely on Juul for the record numbers of young Coloradans who saw Juul's advertising and picked up the habit.

When Colorado filed its lawsuit against the company in 2020, it had the highest number of teen vapers per capita in the United States. According to the most recent data from 2021, 16% of the state’s youth said they had vaped within the previous 30 days.

“Juul targeted ‘cool kids’ in their ads and social media campaigns, including using brand ambassadors to give free samples to young people at Colorado convenience stores and hiring social media influencers to promote their products with the goal of introducing e-cigarettes to younger Coloradans. Under the agreement announced today, Juul will be prohibited from using those marketing tactics in the future,” Weiser's office said in a statement.

A study published by the American Academy of Pediatrics in May 2022 found the surge in Juul’s sales between 2017 and 2019 “was associated with a sharp rise in daily e-cigarette vaping and daily tobacco use among U.S. youth, not young adults.”

The study’s authors estimated that around 600,000 Americans under the age of 21 used Juul products on a daily basis in 2019, “a rate 2.5 times those aged 25 to 34 years.”

The agreement between Juul and the states include more than money. The company also had to agree to restrictions on how it advertises itself to potential customers. In Colorado’s case, Juul will have to bring a compliance officer on board to oversee how the company complies with the agreement and provide the public with regular reports about its progress.

“Millions of Juul’s internal documents will also be disclosed through a public document depository,” Weiser's office said.

In California, state Attorney General Rob Bonta called the settlement “another step forward” in the state’s efforts to keep kids off vaping.

“By using advertising and marketing strategies to lure young people to its products, Juul put the health and safety of its vulnerable targets and the California public at risk,” Bonta said. “Today’s settlement holds Juul accountable for its actions and puts a stop to its harmful business practices. What’s more, it will bring millions in funding to help California abate and prevent the harms of e-cigarettes and nicotine addiction.”

Juul’s settlement with the District of Columbia is the largest in the district’s history and Attorney General Brian Schwalb was blunt in his criticism of the company.

“Juul preyed on children for profit, implementing an intentionally deceptive, manipulative marketing campaign targeting underage users with the intention of creating addicted customers,” Schwalb said in a statement. “Juul knew how addictive and dangerous its products were and actively tried to cover up that medical truth.”

Categories / Business, Consumers, Health

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