In agreeing to pay in excess of $1 billion to settle more than 5,000 marketing-related lawsuits, vape products marketer Juul Labs Inc. can now focus more of its legal resources on two ongoing conflicts with the federal government.
Last week, Juul put to rest cases brought by more than 10,000 plaintiffs in a consolidated proceeding in U.S. District Court in California involving accusations that the company wrongfully marketed its products to children and teens.
Citing people with knowledge of the case, both The New York Times and The Wall Street Journal reported the settlement amount as $1.7 billion.
In a statement, Juul reiterated its November announcement that it had secured new financing “to stabilize its business operations and address past legal issues.”
Asked by Marketing Daily to clarify the amount of last week’s consolidated settlement, a Juul rep said, “Due to provisions in the settlements and related legal documents and the court-structured settlement process, at this time Juul Labs is not able to provide further information.”
According to the law firm of Lieff Cabraser Heimann & Bernstein—which represented some of the plaintiffs—last week’s settlements do not release similar claims against Altria Group Inc., which acquired a 35% stake in Juul for $12.8 billion in 2018.
Litigation against Altria is scheduled for trial in California in April of 2023.
In September, Juul agreed to pay $438.5 million following an investigation of its marketing practices by 33 states and Puerto Rico.
Among the terms of that settlement was that Juul could not depict anyone younger than 35 in its marketing images.
Meanwhile, there is no end in sight for Altria and Juul’s struggle with the Federal Trade Commission and Juul’s dispute with the U.S. Food and Drug Administration.
The FTC is still trying to prove its 2020 allegation that Altria unlawfully agreed not to market its own vaping products as a condition of its investment in Juul.
In February of this year, an FTC administrative law judge dismissed the FTC’s case and the agency immediately appealed.
Last month, the FTC asked both companies for more information with an intention to issue a final ruling toward the end of March of next year.
Juul is still challenging the FDA’s decision in June to ban the company’s products by rejecting Juul’s premarket tobacco product applications (PMTA)—a move on which the FDA subsequently backtracked.
Juul is suing the FDA for refusing to disclose the scientific reviews that led to the agency’s rejection of its PMTAs.