Juul to pay back $14.5 mln to settle AZ lawsuit more than youth internet marketing

Juul brand vape cartridges are pictured for sale at a store in Atlanta, Georgia, U.S., September 26, 2019. REUTERS/Elijah Nouvelage

(Reuters) – E-cigarette giant Juul Labs Inc has agreed to pay $14.5 million to settle a lawsuit by the point out of Arizona accusing it of fueling a vaping epidemic by promoting its merchandise to minors.

The settlement, introduced Tuesday by the workplace of Arizona Attorney Normal Mark Brnovich, supplies for $12.5 million to be set aside for anti-dependancy applications. The remaining $2 million will go to a normal customer defense fund and litigation expenditures.

“Modern settlement holds Juul accountable for its irresponsible marketing and advertising efforts that pushed Arizona minors toward nicotine and the addiction that follows,” Brnovich reported in a assertion.

Beneath strain from regulators, Juul in 2018 pulled popular flavors these types of as mango and cucumber from retail retailer cabinets and shut down its social media channels on Instagram and Facebook. The corporation on Tuesday mentioned it supported the anti-addiction provisions of the offer.

“This settlement is one more stage in our ongoing work to reset our organization and we applaud the Attorney General’s plan to deploy sources to handle underage use,” Juul explained in a statement. “We will keep on doing work with federal and point out stakeholders to progress a fully regulated, science-based mostly market for vapor products.”

Arizona is the second state to arrive at an agreement with Juul above its promoting tactics. The enterprise formerly agreed to pay out $40 million to take care of a identical lawsuit by North Carolina.

Juul’s e-cigarettes resemble USB flash drives and work by vaporizing a nicotine-laced liquid.

In its 2020 lawsuit, Arizona accused the firm of using fruit-flavored liquid pods, social media strategies and absolutely free giveaways to charm to youthful clients, leading to a spike in addiction amid teens.

The enterprise nevertheless faces much more than 2,000 lawsuits, like from state and regional governments, producing identical statements. Marlboro cigarette maker Altria Group Inc, which in 2018 acquired a 35% stake in Juul, is also named as a defendant in a lot of of the lawsuits.

Alongside with other e-cigarette makers, Juul was necessary to implement for U.S. Foods and Drug Administration acceptance for its goods underneath a 2016 federal rule, however it was allowed to continuing internet marketing them in the meantime. The company has not yet acted on the software, indicating in September that it necessary a lot more time.

The case is Arizona v. Juul Labs Inc, Outstanding Court of the Condition of Arizona, Maricopa County, No. CV2020-000371.

For Arizona: Joseph Sciarrotta of the Attorney General’s place of work

For Juul: David Rosenbaum of Osborn Maledon

Read much more:

Juul to spend North Carolina $40 mln about claims it qualified youth

U.S. Fda claims it needs extra time to determine on Juul, other e-cigarettes