Juul Labs has agreed to pay $462 million to settle claims from six U.S. states, including New York and California, that it illegally sold its products to minors.
With the deal, Juul has now reached settlements with 45 states worth more than $1 billion. The company has not admitted wrongdoing in the settlement, which also includes the states of Colorado, Illinois, Massachusetts and New Mexico, and the District of Columbia.
Juul announced Dec. 6 that it had secured an investment to pay for the settlement. The company has been in talks with two early investors to fund a bailout that covers legal liability.
States have accused Juul of falsely promoting its e-cigarettes as more addictive than cigarettes and targeting minors with a glamorous ad campaign, according to Reuters.
“Juul’s lies have contributed to a national public health crisis and put an addictive product in the hands of minors who thought they were doing something harmless,” New York Attorney General Letitia James said at a news conference.
The company said usage of its products by people under 18 has dropped 95% since fall 2019, when it changed its marketing practices as part of a “company-wide reset.”
In September, Juul Labs agreed to pay nearly $440 million to settle a two-year investigation by 33 U.S. states into its marketing of vaping products.
Juul’s e-cigarettes were briefly banned in the United States in late June after the Food and Drug Administration concluded the company had failed to demonstrate that the sale of its products was appropriate for public health. But after an appeal, the health regulator set aside the ban and agreed to additional review of Juul’s marketing application.
In October, Juul released details of its MDO appeal. In late September, Juul shareholder Altria Group exercised its option to terminate its non-compete agreement with the e-cigarette maker.
In March of this year, Altria swapped its entire investment in Juul Labs for a non-exclusive, irrevocable, worldwide license to certain of Juul’s heated tobacco intellectual property.
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