On September 7, according to foreign reports, Juul Labs agreed in principle to pay at least $438.5 million to 34 U.S. states to resolve allegations that the company deceived consumers and engaged in advertising and marketing aimed at young people. The settlement also requires Juul to adhere to certain standards in its future marketing.

The settlement is the result of a two-year investigation led by the attorneys general of Connecticut, Oregon and Texas. The $438.5 million figure is based on a six-year payment schedule.

According to Texas Attorney General Ken Paxton, if the company splits the payments to the states over 10 years, it could be as much as $470 million.

Juul accused of selling to young people

Anyone who has followed vaping news over the past four years will be familiar with the allegations made by the attorney general.

According to Connecticut AG William Tong, Juul Labs relentlessly marketed vaping products to minors...and misled consumers about the nicotine content and addictiveness of its products.

Paxton's press release said: "JUUL uses technology-focused, easy-to-hide, sleek designs to market its products in flavors that appeal to underage users. JUUL also manipulated the chemistry of its products to make the steam less harsh to the throats of young and inexperienced users. To protect its underage customer base, JUUL relies on age verification techniques it knows to be ineffective.

According to Texas AG Paxton, the states and territories joining the settlement are: Alabama, Arkansas, Connecticut, Delaware, Georgia, Hawaii, Idaho, Indiana, Kansas, Kentucky , Maryland, Maine, Mississippi, Montana, North Dakota, Nebraska, New Hampshire, New Jersey, Nevada, Ohio, Oklahoma, Oregon, Puerto Rico, Romania Texas, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Vermont, Wisconsin and Wyoming.

Juul had earlier settled with a few individual states, including a $40 million deal with North Carolina in June 2021 and a later $40 million deal with Arizona, Louisiana and Washington.

The company still faces several lawsuits from other state attorneys general, as well as a multi-district lawsuit (MDL) that consolidates hundreds of complaints from individuals, municipalities, school districts and Indian tribes.

States ask Juul to ban what it already does

The agreement requires Juul to stop any marketing to people under the age of 35, restrict in-store display and access, set limits on online and retail sales, require age verification of all sales, and enforce requirements such as a retail compliance inspection protocol.

Most, if not all, of the agreed practices listed in the settlement have been standard Juul practice for years, and some others have been federally banned since 2016 under the FDA's presumptive rule.

Allegations surrounding what Connecticut AG Tong describes as Juul's cynical ad campaign creating a new generation of nicotine addicts stemmed from Juul's first ad campaign, which was briefly active in 2015 -- two years before the first campaign Rumours of the so-called "teenage vaping epidemic" are starting to make headlines.

Additionally, Juul pulled most of its flavored products from the market in 2018—more than a year before the FDA forced flavored pod-based vaping products to be removed from shelves in January 2020, and before the AG’s investigation began two years.

Most recently, the company removed all U.S. advertising.

Since peaking in 2019, vaping in middle and high school levels has fallen by 60%, and recent teen vaping surveys suggest Juul is a small player in teen vaping at this point.

On June 23, the FDA issued a Marketing Denial Order (MDO) to Juul Labs, ordering the company to immediately remove its products from retail shelves.

A day later, Juul sought and obtained a temporary stay in federal court, allowing the company to continue selling its products. Less than two weeks later, the FDA itself shelved the MDO, acknowledging that it left out 6,000 pages of evidence in Juul's marketing application.