Juul Labs has tentatively agreed to pay $438.5 million to settle an investigation by nearly three dozen states focused on the company’s sales and marketing practices that they claim are helping the vaping crisis teenagers.
The investigation revealed that the company was targeting young people by hiring young models, using social media to woo teenagers and giving out free samples. Connecticut Attorney General William Tong said in a news conference that the investigation found the company had a “porous” age verification system on its products and 45 percent of its Twitter followers were between the ages of 13 and 17.
“We believe this will go a long way in stemming the tide of youth vaping,” said Mr. Tong. “We are under no illusions and cannot claim that it will discourage the youth from vaping. It remains an epidemic. It’s still a big problem. But we essentially took away a large chunk of the former leader.”
Juul said Tuesday that the settlement “is an essential part of our ongoing commitment to resolve issues of the past. The terms of the agreement are consistent with our current business practices, which we began implementing following our company-wide reset in Fall 2019.”
However, the company said it did not acknowledge any wrongdoing in the settlement.
The preliminary agreement prohibits the company from marketing to youth, funding education in schools and misrepresenting the nicotine content of its products. Juul had already halted several marketing practices and withdrawn many of its flavored capsules that appealed to teenagers a few years ago, under public pressure from lawmakers, parents, and health experts when the vaping crisis was at its height.
The company’s ability to continue selling its products has been in question for the past few months. The Food and Drug Administration announced in June that it was denying the company’s marketing application to sell the vapes because its application lacked evidence to show they would benefit public health. The agency also cited “insufficient and conflicting” data from the company. The company quickly went to court and was granted a temporary pardon.
The company responded days later that it had helped two million adult smokers quit combustible cigarettes and took offense at the agency’s conclusions about chemicals in its products. The FDA then announced that it would allow the products to remain on the market pending an additional “scientific question” review.