Colorado is expected to receive $31.7 million from electronic cigarette manufacturer Juul Labs in a multistate settlement over claims the company used deceptive marketing tactics and promoted products to teens, the state’s attorney general announced Wednesday.
The lawsuit, filed in 2020, claimed Juul was misrepresenting the health risks of their vapes and targeted young people by hiring social media influencers to promote e-cigarettes and brand ambassadors to give free samples to teens at Colorado convenience stores.
“This settlement is a victory for the state of Colorado and everyone who fell victim to Juul’s reckless, deceptive, and unconscionable marketing tactics,” Attorney General Phil Weiser said in a statement Wednesday. “While no amount of money or new restrictions on Juul’s business practices can undo the harms caused by the teen vaping epidemic, this settlement will make great strides toward reducing it and can support young people who are hurting now more than ever.”
Vapes typically contain the same addictive nicotine as other tobacco products.
The settlement funds will be used solely to address tobacco prevention and teen mental health programs, Weiser said in a news conference Wednesday, despite a news release his office sent earlier in the day that said it would be used in part to cover attorneys’ fees.
“That $31 million is going to be dedicated entirely to supporting young people who have suffered both from a public health and from a mental health perspective,” Weiser said. “The kids are not OK. Right now they’re suffering. This vaping epidemic is part of that, it has inflicted harms that remain and that need to be addressed.”
The attorney general’s office will send $167,000 to the National Association of Attorneys General to reimburse them for a grant they provided for investigation and litigation costs, according to the settlement.
Under the settlement agreement, Juul will be prohibited from using those marketing tactics in the future, Weiser said. The company will also be required to hire a compliance officer and provide the public opportunities to review documentation of their compliance with the agreement.
Most recent state data shows that 16% of Colorado teens reported they had vaped in the past month. When Colorado filed the suit, the state had the highest rate of vaping teenagers in the nation at 27%, double the nation average, according to the Healthy Kids Colorado Survey.
Juul has settled lawsuits with 47 states and territories, paying more than $1 billion, the company said.
“With this settlement, we are nearing total resolution of the company’s historical legal challenges and securing certainty for our future,” a company spokesman said. “Since our companywide reset in the fall of 2019, underage use of JUUL products has declined by 95% based on the National Youth Tobacco Survey.”
Colorado sued Juul with other attorneys general, including from California, the District of Columbia, Illinois, Massachusetts, New Mexico and New York. The total settlement was $462 million.
Late last year, Juul announced it settled more than 5,000 cases brought by about 10,000 plaintiffs in the U.S., sidestepping a substantial amount of legal issues for the company.
“These settlements represent a major step toward strengthening Juul Labs’ operations and securing the company’s path forward to fulfill its mission to transition adult smokers away from combustible cigarettes while combating underage use,” the company said in a news release.