North Carolina attorney general Josh Stein said on Monday that he had reached an agreement with Juul labs Inc., an e-cigarette maker, to pay $40 million and carry out “major reforms” in its business model, according to the Wall Street Journal.
According to reports, under the terms of the agreement, Juul agreed to avoid marketing activities that are attractive to people under the age of 21. Josh Stein said the company would reduce its use of “most social media ads, influential ads, outdoor ads near schools, and sponsorship of sports events and concerts.”; Among other conditions, Juul will ensure that its products are sold over the counter.
Juul will pay North Carolina $40 million over the next six years to fund programs to help people quit e-cigarettes, prevent e-cigarette addiction and research e-cigarettes, Stein said.
A Juul spokesman responded that the agreement is in line with “we are trying to redefine the company and its relationship with stakeholders, we will continue to combat underage smoking and provide opportunities to reduce the harm of adult smokers,” the report said. We look forward to working with attorney general Stein and other manufacturers to develop potential industry wide marketing practices based on science and evidence. In addition, we support the attorney general’s desire to deploy funds for appropriate scientific research to support public health interventions in North Carolina to reduce underage use. “
According to public reports, Juul is currently facing investigations from a number of federal agencies, including the food and Drug Administration (FDA), the Federal Trade Commission (FTC) and the securities and Exchange Commission (SEC). The reasons for the investigation include whether the company illegally sells its products to minors and whether it is suspected of monopoly. In addition, federal prosecutors in San Francisco are investigating Juul’s honesty in cooperating with the FDA investigation, according to people familiar with the matter.
In the spring of 2018, FDA launched a formal investigation on Juul, requiring Juul to submit documents to explain the reasons why teenagers use the company’s products a lot and why teenagers especially indulge in the company’s products. In November 2019, Juul was sued by the California government for “designing, marketing and selling e-cigarettes to attract young people, and falsely claiming the efficacy and danger of nicotine in its products”.