Minnesota settles case against Juul over marketing e-cigarettes to teens

Minnesota settled its youth vaping lawsuit against Juul Labs on Monday just as closing arguments were set to begin.

The late-hour settlement echoed the same action in the state's landmark lawsuit against Big Tobacco, which was settled in 1998 for $6.5 billion after a four-month trial.

Under the arrangement, the terms of the new settlement won't be public for 30 days. The jury was expected to begin deliberations on Tuesday. Instead, Hennepin County Judge Laurie Miller dismissed the panel Monday morning.

In recent years, numerous states have sued Juul, but Minnesota was the only one to take the manufacturer to trial. Attorney General Keith Ellison said he wasn't satisfied with the pretrial offers made by the manufacturer and that Minnesota has been a leader in holding tobacco companies accountable.

"One of my goals in bringing this case was to send a message: We will not tolerate youth marketing of nicotine products in Minnesota," Ellison said in a statement. "My office will continue to do its part to protect kids from getting hooked on these harmful products."

Juul spokesman Austin Finan said that resolution of the company's legal challenges was a priority. "We are pleased to have reached a settlement with the state and will work to finalize this agreement over the coming weeks," he said in a written statement, adding that Juul has settled with 48 states and territories, providing over $1 billion to combat underage use and develop cessation programs.

The company has also settled private litigation in the United States, covering more than 5,000 cases brought by approximately 10,000 plaintiffs.

In opening statements on March 28, Ellison, making the state's case, said youth smoking was nearly eliminated before the e-cigarette manufacturer lured teens with fruity flavors, fun ads and sleek, colorful designs. He portrayed the suit as a continuation of the earlier fight against Big Tobacco.

Juul and co-defendant Altria Group, Ellison said, "baited, deceived and addicted a whole new generation of kids after Minnesotans slashed youth smoking rates down to the lowest level in a generation. Big Tobacco is back with a new name — but the same game."

Minnesota was seeking more than $100 million in damages from San Francisco-based Juul and co-defendant Altria in the suit, which was filed against Juul in 2019. Altria was added as a defendant in 2020 because it had bought a $12.8 billion minority share in Juul in December 2018.

Juul settled cases with six states last week, agreeing to pay $462 million.

Minnesota presented 11 witnesses before resting April 11.

"Today's announcement sends a clear message that the state of Minnesota will not tolerate tobacco companies putting our state's youth at risk with deceptive marketing," Robins Kaplan attorney Tara Sutton said in a written statement.

Ellison and Sutton claimed in court that Altria boosted Juul sales through its marketing muscle as manufacturer of Marlboro cigarettes.

Altria's attorney William Geraghty and Juul attorney David Bernick denied that the companies marketed their products to kids and asserted that vaping among youth took off in Minnesota in 2011, long before Juul began selling products here in 2015.

The Richmond, Va.-based Altria is the tobacco company formerly known as Philip Morris.

Bernick and Geraghty both said e-cigarettes were created with the aim of helping adult smokers transition from traditional cigarettes, which they claim are more harmful than vaping. Adults liked the Juul e-cigarettes and kids would get them through "leakage," meaning from adults or friends, not by purchasing them at stores, Bernick said.

Of particular concern for the state was a marketing effort called "Vaporize" that featured colorful ads and social media campaigns and enticing flavors like mango, cucumber, crème brûlée and fruit medley.

In fall 2019, Juul Labs stopped distributing the fruity-flavored pods. The company also suspended all advertising in the United States and shut down its social media accounts.

Last summer, the federal Food and Drug Administration barred Juul from selling its vaping device along with tobacco- and menthol-flavored cartridges. Juul appealed the decision and the order was stayed by the courts pending that appeal.

Finan said that as the company resolves the litigation, it's focused on the future and a mission of reducing tobacco harm for more than 31 million adult smokers in the United States and more than 1 billion worldwide.