E-cigarette company Juul on Tuesday tentatively agreed to pay $438.5 million to settle an investigation by 34 states and territories into the company’s marketing and sales practices that were alleged to fuel the youth vaping crisis.
The investigation found the company deliberately engaged in an advertising campaign that appealed to youth with launch parties, advertisements using young and trendy-looking models, social media posts, and free samples.
According to Connecticut Attorney General William Tong (D), who was one of the leaders of the investigation and negotiations, Juul also manipulated the chemical composition of its product to make the vapor less harsh on the throats of young and inexperienced users.
“JUUL’s cynically calculated advertising campaigns created a new generation of nicotine addicts. They relentlessly marketed vaping products to underage youth, manipulated their chemical composition to be palatable to inexperienced users, employed an inadequate age verification process, and misled consumers about the nicotine content and addictiveness of its products,” Tong said in a statement.
Juul was once the leading vaping product on the market and was the most popular brand used by teens. But Juul has fallen out of favor ever since it stopped selling its fruity flavors, after coming under pressure from lawmakers, advocates, and regulators at the Food and Drug Administration (FDA).
The settlement would severely limit Juul’s marketing and sales practices. It would prohibit Juul from marketing to youth and from funding education programs in schools. Nobody under the age of 35 would be depicted in any of the company’s marketing materials, and the company would be prohibited from misrepresenting the level of nicotine in its products.
In a statement, Juul 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 began with a companywide “reset” in 2019.
Juul is currently embroiled in a fight with the FDA over whether it can continue to sell its products. The agency in June denied Juul’s marketing authorization request, saying Juul did not prove that keeping its products on the market “would be appropriate for the protection of the public health.”
A federal appeals court a day later temporarily blocked the ban, and the FDA eventually said it would allow the products to stay on the market pending additional review of “scientific issues.”
Electronic cigarettes were first introduced on the market as a “healthier” alternative to traditional tobacco cigarettes, but they began to spread to young people, who were drawn in by sweet and fruit-flavored e-cigarette pods easily accessible in stores. Since 2014, e-cigarettes have been the most commonly used tobacco product among U.S. youth.