Juul will pay $14.5 million to settle vaping lawsuit in Arizona

Juul will pay $14.5 million to settle vaping lawsuit in Arizona

Phoenix E-cigarette giant Juul Labs will pay $14.5 million in Arizona and pledge not to market to youth in the state to settle a consumer fraud lawsuit.

The settlement announced by Attorney General Mark Brnovich Tuesday is the second Juul has reached with prosecutors. It ended the lawsuit that the Republican Senate candidate filed in January 2020 against Juul and another e-cigarette maker, alleging that they illegally targeted young people in their marketing.

Arizona previously secured a $22.5 million court ruling against discontinued e-cigarette product maker Eonsmoke, but it has not and is not likely to raise any of the money.

Juul Labs admitted no wrongdoing in settling the case and called it “another step in our ongoing effort to reset our company.” The company had halted all advertising before filing a lawsuit against Brnovich and ending the sale of all flavored products except for menthol.

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Juul has faced lawsuits from multiple states over marketing its products, which it considers safer alternative regular tobacco products. In June, it reached a similar agreement with the North Carolina attorney general that included a $40 million payment, promises not to market to minors, and enhanced enforcement for retailers selling its products. Lawsuits with a handful of other states persist.

E-cigarettes are touted as safer than tobacco cigarettes because while they deliver the addictive nicotine drug, they do not emit smoke that contains carcinogens. But it is still addictive and a health hazard, especially for teens whose brains are still developing.

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The US Food and Drug Administration approved the first e-cigarette last month, saying the RJ Reynolds product has a clear benefit because it can reduce the use of regular cigarettes. The Juul product is still under FDA review. Some adulterated vaping products have caused serious health effects.

All but $2 million of the $14.5 million settlement in Arizona will be used for programs that discourage use of e-cigarette products, including smoking cessation and education programs designed to prevent nicotine use and addiction in young people. Juul also agreed in a decree of approval to implement a strict monitoring program for retailers where it will conduct compliance checks for at least 25 stores a month across Arizona for two years and take action against those who sell illegally to underage smokers.

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The agreement requires Goal not to advertise near schools or target anyone under 21 and not to use social media for marketing. It’s not ads at all.

The other $2 million will go to a government account that the attorney general uses to fund consumer fraud investigations.

“Today’s settlement holds Juul responsible for its irresponsible marketing efforts that drove Arizona minors toward nicotine and the next addiction,” Brnovich said in a statement. “Combating the youth vaping epidemic remains a priority for our office with our secret Counter Strike program and zero tolerance for vaping companies that mislead or deceive.”

Juul said in its statement regarding the Arizona settlement that it will “continue to work with state and federal stakeholders to promote a fully regulated, science-based market for steam products.”

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It said it would continue to support the Tobacco 21 anti-smoking group and support enforcement action against illegal vaping products that “endanger the harm reduction potential of alternative vapor products.”

The company, which is partly owned by tobacco giant Altria Group, said it was in discussions to settle lawsuits brought by other countries.

Vaping has exploded among young adults in recent years, sparking concerns from health experts and state and federal regulators. But a report released by the US Food and Drug Administration in September showed a sharp decline in the number of young people vaping with schools closed due to the coronavirus pandemic.

This was the second consecutive annual decline in teen vaping, and was followed by the enactment of a new 2019 federal law raising the purchase age for all tobacco and vaping products from 18 to 21. E-cigarettes based on products blamed for the surge in teenage use.

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