Juul settles Washington state deceptive advertising suit for $22.5M

E-cigarette company Juul will pay $22.5 million to settle a lawsuit brought by Washington state that accused it of marketing its products to underage customers, state Attorney General Bob Ferguson (D) announced in a statement.

Ferguson sued the company in September 2020, alleging that it violated the Consumer Protection Act tens of thousands of times by creating and marketing products catered toward underage customers. The lawsuit also accused the company of deceiving customers about how addictive its products are.

“JUUL’s unlawful conduct fueled a pervasive and staggering rise in e-cigarette use and nicotine addiction among youth,” Ferguson’s office wrote in a statement announcing the lawsuit.

In addition to the multimillion-dollar payment, which the company must pay over four years, the settlement also requires that Juul does not use advertisements that appeal to youth and halts most social media promotions. The company, however, announced in 2019 that it was suspending all broadcast, print and digital product advertising in the U.S.

The settlement also requires that Juul factually markets the content and effects of the nicotine contained in its products. It mandates that the company conducts at least 25 secret shopper checks per month at Juul retailers in the state for at least two years. At least one check must be conducted in every county in the state per year.

Juul must provide the state attorney general’s office with a regular report of the program every 90 days.

Ferguson in a statement on Tuesday said “Juul put profits before people.”

“The company fueled a staggering rise in vaping among teens. JUUL’s conduct reversed decades of progress fighting nicotine addiction, and today’s order compels JUUL to surrender tens of millions of dollars in profit and clean up its act by implementing a slate of corporate reforms that will keep JUUL products out of the hands of underage Washingtonians,” he added.

His office said it will use the resources from the settlement to create a new Health Equity unit.

A Juul company spokesman told The Hill in a statement on Wednesday that the settlement with Washington state is “another step in our ongoing effort to reset our company and resolve issues from the past.”

The spokesman said the conditions in the settlement are “consistent” with the company’s current business practices and previous agreements.

“We support the Washington State Attorney General’s plan to deploy resources to address underage use, such as future monitoring and enforcement. The terms of the settlement are consistent with our current business practices and past agreements to help combat underage use while offering adult smokers access to our products as they transition away from combustible cigarettes,” the spokesman said.

Juul’s settlement with Washington State comes after the company previously settled lawsuits filed by attorneys general in Arizona and North Carolina, which cost $14.5 million and $40 million, respectively.

The Juul spokesman referenced the previous settlements in his statement on Wednesday.

“Thus far, we have entered into a number of settlement agreements with state attorneys general, including Louisiana, Arizona, and North Carolina. We will continue working with federal and state stakeholders to advance a fully regulated, science-based marketplace for vapor products,” the spokesman said.