MINNEAPOLIS (CN) — Minnesota Attorney General Keith Ellison personally opened the state’s case against e-cigarette makers JUUL Labs and Phillip Morris parent company Altria on Tuesday morning, arguing that the companies violated state and federal consumer protection laws by marketing their products to minors.
Ellison and Assistant Attorney General Tara Sutton argued in their opening statements that JUUL’s use of sweet flavors, smoother nicotine delivery systems than other e-cigarette companies and social-media focused advertising created an “epidemic” of youth nicotine addiction that reversed the state’s own work toward eliminating teen tobacco use — thus damaging the state to the tune of $100 million.
“Their goal was to make their products … appealing to ‘cool kids.’ Their words,” Ellison said in his opening statement. Sutton, who followed Ellison and led the state in arguing objections during the companies’ statements, said that the evidence would show that “JUUL’s market was … mostly kids” and that Altria, seeing the growth of youth e-cigarette use amidst declining tobacco use, invested in JUUL in an effort to capitalize on those trends. Sutton also pointed out that JUUL’s prevalence among youth had grown to the point where “JUULing” had become a common term for nicotine vaping of any kind.
JUUL had near-total dominance of the e-cigarette market in late 2018, when Altria purchased a 35% interest in the company for $12.8 billion. A year later, Ellison joined a dogpile of state attorneys general filing suit alleging that JUUL’s marketing practices had led to massive youth nicotine addiction in their states. JUUL has settled 39 of those suits with other states and U.S. territories, along with many of the thousands of suits brought by private parties. Altria gave up its stake in the company earlier this month, saying that it had effectively lost its money, but quickly announced a $2.75 billion investment in e-cigarette maker NJOY.
Sutton argued that the Altria investment and a subsequent marketing contract had allowed JUUL prime placement in convenience stores around the state in display cases right next to Altria’s Marlboro cigarettes. She also pointed to JUUL coupons placed in Marlboro packs as evidence that Altria was heavily involved in marketing the e-cigarettes.
Attorneys for JUUL and Altria pointed out that by the time Altria purchased its interest in JUUL and began aiding its marketing efforts, JUUL had already pulled its most kid-friendly flavors from the market. JUUL stopped selling fruit, mango, creme and cucumber-flavored pods in 2018 and mint pods in 2019 in response to increased scrutiny of youth vaping — a move that JUUL attorney David Bernick and Altria attorney Bill Garrity said was a good-faith response to reports of increased youth vaping, but which Sutton characterized as a lazily implemented, last-ditch effort to avoid repercussions.
“They only did it when they were under the gun from regulators and really angry parents,” Sutton said. “They also didn’t do a really good job of pulling the flavors,” she added, noting the delayed removal of mint pods and pointing out that “pulled” flavors lingered on shelves well after the company discontinued them.
Both Bernick and Garrity said that JUUL’s intent was always to make its products a more appealing option than cigarettes for young-adult smokers, providing the same nicotine hit with fewer health impacts. The elements the state pointed to as targeting kids — a USB-drive design, iPhone-like packaging, sweet flavors, and social media driven ad campaigns with young models and bright colors — were all meant to appeal to smokers from ages 25-34, they said. The products’ use by teens was an unfortunate side effect rather than the intent, they said.
“It was all about mature adults, saying ‘switch,’” Bernick said of one of the company’s ad campaigns. Vaping, he said, had indeed contributed to a decrease in smoking among adults, and JUUL’s substantial sales between 2017 and 2019 had helped drive that.
Garritty argued that Altria had not, as Sutton said, added “fuel to the fire” when it purchased its JUUL interest. Rather, it had invested in the company following the failure of its own e-cigarette brands and had an interest in complying with the law in order to maintain JUUL’s then-dominant position in the e-cigarette market.
“Altria had a 12.8 billion dollar incentive for Juul not to have a youth-use problem,” Garrity told the jury. “Even if you believe, ladies and gentlemen, that the only thing companies like Altria care about is making money, then Altria would not want youth use.”
Garrity also gestured toward locally made flavored nicotine products still on the market in Minnesota, prompting a battle with Sutton over whether his statement complied with a prior order that defense attorneys could not point to the question of whether Ellison’s office had brought similar suits against those companies. Judge Laurie Miller ultimately warned Garrity that she did think “there is an implication that could be drawn from these remarks” and sought a proposed curative instruction to provide to the jury on Wednesday morning. “That’s your homework for tonight,” she said.
The trial, held at the Hennepin County Courthouse in downtown Minneapolis, is expected to last three weeks. With opening statements complete, Wednesday’s proceedings are expected to be taken up with testimony from a doctor called by the state as an expert witness.
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