Juul to pay California $175 million to settle lawsuit over marketing vaping products to teens

LOS ANGELES - Juul Labs has reached a $462 million settlement with California, New York, and several other states over lawsuits claiming the company marketed its e-cigarettes to young people and fueled the nation's vaping crisis. 

Of the $462 million settlement amount, California will receive a total $175.8 million, the highest amount of any state settlement yet reached with Juul, according to a statement from California Attorney General Rob Bonta's office. The money will help California fund research, education, and enforcement efforts related to e-cigarettes, the statement said. Juul will also be prohibited from targeting youth in its advertising and promotion under the terms of the deal.

"Today is another step forward in our fight to protect our kids from getting hooked on vaping and nicotine," said Bonta. "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. 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. As a father and as our state’s top law enforcement official, I remain committed to protecting the health, quality of life, and future of California’s children."

In its lawsuit, California claimed that for months, Juul did not disclose in its advertising that its devices contained nicotine, detailing the company’s early marketing efforts, which included handing out free samples of the e-cigarettes in 2015 at popular events including Nocturnal Wonderland in San Bernardino and a "Movies All Night Slumber Party" in Los Angeles. 

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In November 2019, DOJ, the Los Angeles County District Attorney's Office, and the County of Los Angeles sued JuuL for allegedly violating multiple California laws and regulations, including those on privacy rights of minors, unfair competition, and false advertising.

Under the terms of the settlement, Juul will also be required to stop targeting youth in its advertising and promotion, ensure retailers are complying with restrictions on selling to minors, establish minimum price requirements, and make its internal documents open and accessible to the public.

"The company opted to illegally market its products to our children and now Juul is going to pay a steep price for its mistakes," said Los Angeles County District Attorney George Gascón. "Educating our youth about the harms of these types of products is essential to improving our communities. We hope that Juul and other companies understand that risking the health of our youth will not be tolerated and we will ensure that they follow the law."

The agreement with California, New York, Colorado, Illinois, Massachusetts, New Mexico and Washington, D.C. marks the latest in a string of recent legal settlements Juul has reached across the country with cities and states.

Like some other settlements reached by Juul, this latest agreement includes various restrictions on the marketing, sale and distribution of the company’s vaping products. For example, it is barred from any direct or indirect marketing that targets youth, which includes anyone under age 35. Juul is also required to limit the amount of purchases customers can make in retail stores and online.

A spokesperson for the Washington D.C.-based Juul said that with Wednesday’s settlement, "we are nearing total resolution of the company’s historical legal challenges and securing certainty for our future."
The spokesperson added that underage use of Juul products has declined by 95% since 2019 based on the National Youth Tobacco Survey. According to the CDC though, since surveys were administered online instead of on school campuses during the pandemic, the results cannot be compared to prior years.

Juul rocketed to the top of the U.S. vaping market about five years ago with the popularity of flavors like mango, mint and crème brûlée. But the startup’s rise was fueled by use among teenagers, some of whom became hooked on Juul’s high-nicotine pods.

The Associated Press contributed to this report.