MADISON, Wis. — The Wisconsin Department of Justice (DOJ) and 32 other states and territories finalized a $435 million agreement with JUUL Labs.
It comes after a two-year bipartisan investigation into the e-cigarette manufacturer's marketing and sales practices, the DOJ announced Thursday.
Wisconsin's allocated share of the agreement is more than $14.7 million, according to the DOJ. The agreement also forces JUUL to "comply with a series of strict terms severely limiting their marketing and sales practices."
JUUL was formerly the "dominant player" in the vaping market. According to the DOJ, the multistate investigation showed the company willfully advertised to the youth, even though it's illegal for minors to purchase e-cigarettes and it's unhealthy. The DOJ says JUUL "relentlessly marketed to underage users with launch parties, advertisements using young and trendy-looking models, social media posts and free samples."
The investigation also revealed JUUL has a sleek design that can easily be concealed and was sold in flavors "known to be attractive to underage users."
The DOJ said in a news release Thursday, "The investigation further revealed that JUUL’s original packaging was misleading in that it did not clearly disclose that it contained nicotine and later packaging implied that it contained a lower concentration of nicotine than it actually did. Consumers were also misled to believe that consuming one JUUL pod was the equivalent of smoking one pack of combustible cigarettes. The company also misrepresented that its product was a smoking cessation device without FDA approval to make such claims."
The agreement will be paid out over six to 10 years. If JUUL extends the payment period to 10 years, the final settlement will reach $472.6 million.
According to the DOJ, JUUL agreed to refrain from the following:
- Youth marketing
- Funding education programs
- Depicting persons under age 35 in any marketing
- Use of cartoons
- Paid product placement
- Sale of brand name merchandise
- Sale of flavors not approved by FDA
- Allowing access to websites without age verification on landing page
- Representations about nicotine not approved by FDA
- Misleading representations about nicotine content
- Sponsorships/naming rights
- Advertising in outlets unless 85 percent audience is adult
- Advertising on billboards
- Public transportation advertising
- Social media advertising (other than testimonials by individuals over the age of 35, with no health claims)
- Use of paid influencers
- Direct-to-consumer ads unless age-verified, and
- Free samples.
The following states joined Wisconsin in the agreement: Alabama, Arkansas, Connecticut, Delaware, Georgia, Hawaii, Idaho, Indiana, Kansas, Kentucky, Maryland, Mississippi, Missouri, Montana, North Dakota, Nebraska, New Hampshire, New Jersey, Nevada, Ohio, Oklahoma, Oregon, Puerto Rico, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Vermont, and Wyoming.
