Juul reaches settlements in thousands of lawsuits

E-cigarette maker was sued by individuals, users’ families, school districts, tribes

Embattled vaping company Juul Labs has reached settlements covering thousands of lawsuits over its e-cigarettes, which in recent years became a scourge in schools and communities nationwide.

Financial terms of the settlement were not disclosed, but Juul said that it has secured an equity investment to fund it.

Buffeted by lawsuits, Juul announced hundreds of layoffs last month and bankruptcy appeared increasingly likely as it secured financing to continue operations.

The e-cigarette maker faced more than 8,000 suits brought by individuals and families of Juul users, school districts, city governments and Native American tribes. This week’s settlement resolves most of those cases, which had been consolidated in a California federal court pending several bellwether trials.

“These settlements represent a major step toward strengthening Juul Labs’ operations and securing the company’s path forward,” a company spokeswoman said in a statement.

Attorneys for the plaintiffs said in a statement the deal would “put meaningful compensation in hands of victims and their families,” and provide schools and local governments with funding for anti-vaping education programs. A judge is expected to soon review and approve the settlement.

Juul rocketed to the top of the U.S. vaping market five years ago on the popularity of flavors like mango, mint and creme brulee. But the startup’s rise was fueled by use among teenagers, some of whom became hooked on Juul’s high-nicotine pods.

Parents, school administrators and politicians largely blamed the company for a surge in underage vaping, which now includes dozens of flavored e-cigarette brands that are the preferred choice among teens.

Amid the backlash of lawsuits and government sanctions, Juul dropped all U.S. advertising and discontinued most of its flavors in 2019.

In June the Food and Drug Administration rejected Juul’s application to keep its product on the market as a smoking alternative for adults, throwing its future into uncertainty. The FDA said Juul did not adequately address key questions about the potential for chemicals to leach from its device. The FDA has placed a temporary hold on its initial decision while Juul files an appeal.

Then, in September, the San Francisco-based company agreed to pay nearly $440 million to settle a two-year investigation by 33 states into the marketing of its high-nicotine vaping products.

A competitor, Reynolds American’s Vuse, has recently edged past Juul to become the leading U.S. vaping brand.

Anti-tobacco advocates said Wednesday it was impossible to evaluate the settlement without knowing how much Juul will pay. “We are extremely troubled by the lack of settlement details provided and by Juul’s apparent public controlling of this settlement narrative,” said Meredith Berkman of Parents Against Vaping E-cigarettes.