Juul Labs reaches $440 million settlement with state attorneys general

Juul Labs has reached a legal settlement of nearly $440 million with 32 state attorneys general, as well as many other attorneys general from various states and regions across the United States. The settlement reflects efforts to abide by the 1998 Master Settlement Agreement which outlines the current state of tobacco in the United States.

Court documents reveal that the settlement funds will be paid out over the course of six to ten years, with a majority of the money going towards youth prevention programs for vaping and other state and local public and community health initiatives.

The Attorney General of Connecticut, William Tong, issued a statement claiming that he and his office "led the fight" to hold Juul accountable. Oregon Attorney General Ellen Rosenblum also stated that her office "led the fight." She said, "The social costs and public health consequences are enormous and devastating." Texas Attorney General Ken Paxton also stated that his department "led the fight." "When I launched this investigation more than two years ago, my goal was to ensure that JUUL was held accountable for any past wrongdoing and to ensure that they change direction to fully comply with future laws," Paxton said. Other attorneys general are still continuing their victory lap. But who really led the effort to reach a multi-state, multi-jurisdictional settlement with this electronic cigarette company once touted as the largest in the entire US market? Technically, Paxton, Rosenblum, and Tong led the coordinated interstate investigation with assistance from other AG offices. But the true leader behind it all was what's been called the moral panic machine of the US federal government, three US presidents, and several regulatory agencies.

According to a national news report by the state-run broadcaster, Juul is now required to pay this amount to compensate for promoting high-nicotine closed electronic cigarette devices and committing legal offenses that have contributed to the national youth vaping epidemic. The former Food and Drug Administration (FDA) commissioner appointed by former President Donald Trump, Scott Gottlieb, declared the youth vaping trend in 2018. Following this, Trump signed legislation to raise the minimum legal age for sales of all tobacco products nationwide from 18 to 21 years old.

It was under the leadership of Donald Trump that the FDA quashed its stance on simplifying the implementation of PMTA regulatory procedures, resulting in companies being unable to operate within expensive regulatory environments and ultimately being forced to shut down.

Prior to this, President Barack Obama signed the Tobacco Control Act which authorized pre-market approval of tobacco products and halted years of product innovation. This law also gave the FDA the power to regulate tobacco products without considering other harm reduction methods. President Joe Biden signed legislation targeting synthetic nicotine and other legal tools in an attempt to eliminate the entire product category of nicotine ENDS. All three presidents were appointed and supported by the FDA commissioner, a surgeon and the Secretary of Health and Human Services who debunked the claim that e-cigarettes are just as bad or worse than smoking.

The settlement behind Juul's settlement is the result of a short history. As stated in the settlement, Juul must abide by certain mandatory activities: not marketing its products to young people; absolutely not funding pilot programs to reduce the harm of its products; not depicting people under 35 years old in any promotional materials or collateral; not using cartoons in marketing; no paid product placements; not selling branded merchandise; banning the sale of unapproved e-cigarette flavors by the FDA; no feasible age verification measures on the landing page, which prevents access to the website; no unapproved nicotine statements by the FDA; no false nicotine content statements; no sponsorship or naming rights; advertising not permitted unless 85% of the audience of the outlet is adult viewers; no billboards; no public transportation ads; no social media ads claiming health benefits, only recommendations for consumers over 35 years old; no use of paid influencers; advertising not permitted to be directly targeted at consumers unless age-verified; and no free samples of Juul products.

The demands for a settlement are similar to those for a master settlement agreement and tobacco advertising regulations. While I do not oppose some measures in a settlement, what is disheartening is the underlying meaning behind it. The master settlement agreement and laws requiring the payment of tobacco taxes essentially created a funding source worth billions of dollars for federal, state, and local governments.

However, some of these states have not used the funds they received for future youth prevention and public health education, despite having departments and offices that are underfunded compared to other regions of the country.

Lindsey Stroud, Director of the Consumers’ Center for the right-wing taxpayer protection alliance, also made this point.

Instead, each state is seeking funding from a company.

In her column on right-wing political blog Townhall.com, the author wrote: "The state's spending on youth tobacco and e-cigarette prevention is so low that the funds seven states have secured from electronic cigarette manufacturers to settle with Juul will exceed the funds their states have invested in these programs over the past six years." The author, Stroud, noted in her column that the states investigating and settling with Juul have little or no funding from tobacco control programs, including those aimed at preventing youth from using e-cigarettes. "In fact, 2016 was the last year that the state spent any of its own money on preventing youth from using e-cigarettes, and Juul will be paying Connecticut $16.2 million," she said.

This is a standard for many countries involved in the entire solution. Over the past six years, Stroud has cited data she obtained from the "Smoke-Free Kid" movement, pointing out that the states in the agreement have only funded tobacco control education programs in the tens of millions. One can imagine that states claiming to protect public health through tobacco control measures would invest more funds from their general budgets or cash funds.

Many people point out that this is clearly a case of the company paying for the government's failure.

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