E-cigarette giant Juul accused of marketing to teens in new lawsuit
By Brian Pascus
/ CBS News
The Lake County State's Attorney's Office in Illinois filed a lawsuit Tuesday against Juul Labs that accuses the e-cigarette giant of violating the Illinois Consumer Fraud and Deceptive Business Practices Act for allegedly using deceptive marketing aimed at teens. The State's Attorney's Office is also seeking punitive damages.
In the lawsuit, the Lake County State's Attorney Michael G. Nerheim also accuses Juul of violating the Prevention of Tobacco Use by Minors and Sale and Distribution of Tobacco Products Act by allegedly marketing to teens.
"Just like cigarette companies did in the past, Juul preyed on teens by using advertisements that glamorized their product in order to get kids hooked on nicotine," said Nerheim said in a statement. "It will take years of education and money to right the wrongs and cover the damages caused by Juul's marketing campaigns. To that end, the company should be held accountable for the massive expected cost to undo the damage they created."
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Juul holds more than 75% of the e-cigarette market. In August 2018, Phillip Morris, one of the largest tobacco companies in the world, purchased a 35% stake in Juul for $12.8 billion. Juul Labs uses e-cigarette technology that includes a rechargeable battery and heating element that works with pre-filled pods of flavored nicotine oil to emit a smokable vapor that users inhale.
The lawsuit argues that beginning in the 1990s, adolescent smoking rates began to fall, only to sharply rise due to a combination of Juul Labs' nicotine delivery technology as well as its innovative social media campaign targeting teens through "advertisements, hashtags, and paid influencers."
The lawsuit argues that "Juul sought to fill the void left by big tobacco by creating a new-age electronic cigarette, the 'Juul,' that is so addictive it led to the 'largest ever recorded increase in substance abuse in the past 43 years for any adolescent substance used in the U.S.' By utilizing new technologies and social media, Juul picked up right where the big tobacco companies left off."
In response to the lawsuit, Juul issued a statement saying the company has "never marketed to youth and do not want non-nicotine users, especially youth, to ever try our product." Juul pointed to its exit of Facebook and Instagram as part of their effort to "remove inappropriate social media content generated by others."
"We have no higher priority than to prevent youth usage of our products which is why we have taken aggressive, industry leading actions to combat youth usage," Juul's statement said. "We strongly advocate for Tobacco 21 legislation, we stopped the sale of non-tobacco and non-menthol based flavored Juul pods to our traditional retail store partners, enhanced our online age-verification process and strengthened our retailer compliance program with over 2,000 secret shopper visits per month. "
The lawsuit claims that between 2016 and 2018 "those who reported using e-cigarettes within the past 30 days increased 40% among 8th graders, 82% among 10th graders, and 72% among 12th graders."
The Lake County State's Attorney's Office contends that Juul deliberately engaged in deceptive marketing practices that misrepresented the non-addictive claims of Juul products, its nicotine level, its nicotine content strength, and that its products are an alternative path to quit traditional cigarette smoking. The Lake County Office argues Juul engaged in marketing that specifically targeted minors.
According to the lawsuit, the e-cigarette industry had a 2016 market revenue of $7.1 billion, and the e-cigarette industry as a whole expected to see its valuation rise to $44.61 billion by 2023. Juul is valued at $38 billion.
Studies have shown Juul's electronic cigarette exposes users to nicotine at a much higher rate than traditional cigarettes, while there have been multiple reports of teens suffering from addiction to nicotine after using e-cigarette pods for extended periods and experiencing sudden health emergencies with their respiratory systems.
The lawsuit alleges adolescent nicotine use from e-cigarettes presents the risk of developing major depressive disorder, agoraphobia, and panic disorder, while the vapor emitted from this technology includes 31 harmful chemical carcinogens and respiratory irritants. The Lake County State's Attorney's Office contends Juul failed to disclose that its products contained these adverse health elements.
First published on August 13, 2019 / 6:23 PM
© 2019 CBS Interactive Inc. All Rights Reserved.
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