Juul to pay Mass. $41 million in multi-state settlement

MASSACHUSETTS WILL RECEIVE $41 million as part of a $462 million settlement between e-cigarette maker Juul Labs Inc. and six states plus the District of Columbia for the company’s role promoting nicotine vaping among young people. 

The settlement announced Wednesday concludes lawsuits from New York, Massachusetts, California, Illinois, Colorado, New Mexico and Washington, DC, alleging that Juul intentionally marketed its product to minors and created an epidemic of youth vaping. As part of the settlement, Juul is bound by a series of marketing and sales restrictions for their products.

“Vaping is dangerous. It’s even toxic,” Attorney General Andrea Campbell said at a press conference over Zoom with the other attorneys general. “It harms your lungs, your heart, your brain, and your development. Juul knew all of this and still intentionally sold their products to young people. They targeted those young people, and they hooked them on Juul products to ensure the continued and long-term use of vapes by one of our youngest, most vulnerable populations. Today marks the next chapter to hold this company accountable for their wrongdoing.”

This is the largest multi-state settlement with Juul to date. Juul has now settled with 47 states for over $1 billion, the company said in a statement after the announcement. “With this settlement, we are nearing total resolution of the company’s historical legal challenges and securing certainty for our future,” the company said.

“Juul’s lies led to a nationwide public health crisis and put addictive products in the hands of minors who thought they were doing something harmless,” New York Attorney General Leticia James said during the press conference. It led to a nationwide surge in youth e-cigarette usage after Juul sprang onto the market in 2015, she said.

The company promoted sleek and colorful designs for the e-cigarettes, pods with fun and fruity names and flavorings, and leaned into youth-centered promotional images with celebrities featuring large, young social media followings. At one point, Juul controlled 75 percent of the national e-cigarette market. 

Massachusetts launched the first state broadside against Juul with an investigation in 2018 by the attorney general’s under Maura Healey. Her predecessor as AG, Martha Coakley, took a job in government affairs with Juul in 2019, but left the company last year.

While the attorney general’s office was investigating Juul and the US Food and Drug Administration was starting to crack down on illegal sales to children, Gov. Charlie Baker responded to an outbreak of vaping-related illnesses by banning the products statewide for four months in 2019. The ban was challenged and weakened in a Supreme Judicial Court ruling because of Baker’s unilateral action, and withdrawn before it would have elapsed. 

The Legislature passed a law authorizing additional tobacco regulations and the state’s Public Health Council imposed new restrictions on the products when they returned to the market in Massachusetts. Baker said later that he was “mystified” why other New England states did not follow Massachusetts’s lead with total bans while the state’s ban was still in effect, rather than only targeting the flavored versions, given the severity of illnesses and deaths attributed to vaping in the region.

Healey sued Juul in 2020 for its youth-focused advertising blitz, based in part on internal company documents her office discovered during the investigation. In Massachusetts, the recent settlement will create a “robust document depository” so the “world can see the documents that we uncovered through that investigation,” Campbell said.

Juul said it began a “company-wide reset” in the fall of 2019, rolling back some of its products like fruit flavored vapes. The terms of this new agreement, “like prior settlements, provide financial resources to further combat underage use and develop cessation programs and reflect our current business practices,” the company said. 

E-cigarette usage rates remain high among teens, though Juul has slipped from its spot as the top brand preferred by minors in recent years. The Centers for Disease Control and Prevention reported more than 1 in 7 high school students used e-cigarettes in 2022. 

Massachusetts regulations now ban all flavored nicotine vaping products and limit the sale of products with more than 35 milligrams per milliliter of nicotine. To combat youth-targeted marketing, the latest settlement bars Juul from showing anyone under the age of 35 in promotional material.

Along with existing sales restrictions, stores that sell Juul products in Massachusetts will undergo unannounced compliance checks for at least four years to make sure they adhere to state regulations. The company will also not be allowed to give away for free or severely underprice samples of their vaping pods to consumers.

Campbell said Massachusetts’s settlement share is based on the share of young people in the state who identify themselves as addicted to nicotine products. The $41 million will be paid out, starting this year, in eight annual payments, which Campbell said will go to vaping addiction services informed by conversations with community and advocacy organizations. 

“Juul reignited an epidemic of youth nicotine use,” said California Attorney General Rob Bonta. “It was under control until Juul resparked it. They didn’t just take a page out of Big Tobacco’s playbook. They took the whole thing.”