By Emma Nitzsche
Juul Labs Inc. paid $40 million to the state of North Carolina to settle a lawsuit claiming the company targeted advertisements to underage users. Anti-vaping advocates argued that the e-cigarette company fueled an explosion in teen vaping and applauded North Carolina Attorney General Josh Stein for pursuing legal action.
“Today’s court order will go a long way towards ensuring that Juul’s e-cigarette product is not in kids’ hands, its chemical vapor is out of their lungs, and that the nicotine does not poison or addict their brains,” Stein said in a brief court hearing.
North Carolina was the first state to sue Juul in 2019. Lawmakers and activists alleged that Juul’s sleek advertising, small devices, and sweet flavors targeted young people and fostered early nicotine addictions. According to North Carolina’s Youth Tobacco Survey, the use of e-cigarettes rose by 78% between 2018 and 2019.
Juul did not admit any wrongdoing as part of the settlement. Instead, the company agreed to pay $40 million to North Carolina over six years and change its advertising in the region. The state will use the settlement money for scientific research on preventing youth vaping and how to help young people addicted to nicotine. Under the agreement, Juul cannot target its advertising at underage people or feature anyone under 35 in its advertisements.
In 2015, Juul launched its first marketing campaign called “vaporized.” The brand was pitched as a trendy accessory with images of people in their 20s and 30s. Many teenagers saw the advertisements and purchased the product. Months after the launch, teen use of e-cigarettes skyrocketed more than 70%. In 2017, sales of Juul devices rapidly increased, and more young people posted pictures of themselves using their Juul devices on Instagram and Twitter. The U.S. Food and Drug Administration noted the spike in underage vaping among teenagers and declared it an “epidemic.”
After the surge in teen vaping, the Juul foresaw federal regulations and investigations into its marketing practices. As a result, the company stopped most of its U.S. advertising and pulled sweet, fruity, and mint-flavored products from shelves. In 2020, a series of federal regulations raised the legal age to purchase vape pens to 21, drastically reducing e-cigarette sales.
In 2020, Juul reported a loss of $777 million sales of $1.5 billion, according to a disclosure Juul made to employees. Today, the company’s value is estimated to be about $4 billion compared to $38 billion in 2018.
