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JUUL settles, Toll Brothers results, Stitch Fix loss and more: Wednesday’s 5 things to know

Here are the key events taking place on Wednesday that could impact trading.

JUUL LABS: Announced it has reached a settlement covering more than 5,000 lawsuits and about 10,000 individual plaintiffs, ending legal uncertainty for the e-cigarette company.

Financial terms were not disclosed.

Juul said Tuesday that it had secured an equity investment to cover the cost of the settlement, according to the Wall Street Journal.

JUUL SETTLES OVER 5,000 VAPING LAWSUITS, SETTLEMENT NOT DISCLOSED

Juul products are displayed at a smoke shop in New York. (AP Photo/Seth Wenig / AP Newsroom)

Juul has been in talks with investors, including longtime board members, Hyatt Hotels heir Nick Pritzker, and California investor Riaz Valani, about a financial bailout, first reported by the Journal.

TOLL BROTHERS: Reported higher fiscal fourth-quarter revenue as the home builder delivered more homes in the recent period. 

The company said profit rose to $640.5 million, or $5.63 per share, compared with $374.3 million, or $3.02 per share, a year ago. Analysts polled by FactSet expected $4.01 per share. 

Revenue rose to $3.71 billion from $3.04 billion a year ago, topping the expectation for $3.17 billion. Home sales revenue increased 21% to $3.6 billion.

HOME DELISTINGS HIT RECORD AS MORTGAGE RATES, HOME PRICES REMAIN ELEVATED

A nearly finished Toll Brothers home is seen in Broomfield, Colorado. ( REUTERS/Rick Wilking  / Reuters Photos)

The company delivered 3,765 units in the quarter, up from 3,341 units delivered a year ago, according to Dow Jones.

Toll Brothers said backlog value was $8.9 billion with 8,098 homes at the end of the quarter, which is lower from a year ago.

STITCH FIX: Reported a wider fiscal first-quarter loss on lower sales.

The online personal-shopping and styling service’s loss widened to $55.9 million, or 50 cents per share.

That compares to a loss of $1.83 million, or two cents per share, a year ago. Analysts polled by FactSet expected a loss per share of 47 cents.

 Revenue declined 22% to $455.6 million. Analysts expected $459.6 million according to Dow Jones.

The company reported nearly 3.71 million active clients during the period, down 11% from a year ago. Net revenue per active client was flat at $525, the company said.

EARNINGS: Reports in the morning will include Brown-Forman,  Campbell’s Soup, and United Natural Foods (Whole Food’s largest supplier).

Storage tanks are seen at Marathon Petroleum’s Los Angeles Refinery. (REUTERS/Bing Guan / Reuters Photos)

OIL INVENTORIES DUE: Futures traded higher Wednesday on hopes for improved Chinese demand while uncertainty about how a Western cap on Russian oil prices would play out.

A potential drawdown in U.S. crude stockpiles of around 6.4 million barrels, according to API figures, also gave some sentiment support on the supply front.

U.S. crude futures traded around $74.00 a barrel.

Brent crude futures traded around $79.00 a barrel, after they fell below $80 in the previous trading session.

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Oil prices have dropped by more than 1% for three straight sessions, giving up most of their gains for the year, according to Reuters.

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Juul settles over 5,000 vaping lawsuits, settlement not disclosed

Juul Labs announced it has reached a settlement covering more than 5,000 lawsuits and about 10,000 individual plaintiffs, ending legal uncertainty for the e-cigarette company.

Financial terms were not disclosed.

Juul said Tuesday that it had secured an equity investment to cover the cost of the settlement, according to the Wall Street Journal.

Juul has been in talks with investors, including longtime board members, Hyatt Hotels heir Nick Pritzker, and California investor Riaz Valani, about a financial bailout, first reported by the Journal.

JUUL DISCUSSES A POSSIBLE BAILOUT WITH TWO OF ITS BIGGEST INVESTORS

Juul products are displayed at a smoke shop in New York. (AP Photo/Seth Wenig / AP Newsroom)

“In our ongoing fight for our company and mission, today’s news represents yet another significant step to secure our path forward,” Juul Chief Executive K.C. Crosthwaite wrote in a memo to staff Tuesday. 

He said the settlement “addresses the vast majority of outstanding litigation facing our company.”

Many of the lawsuits accused Juul of marketing to children and teens.

Juul has said it never targeted young people, but has been working to regain the public’s trust.

Electronic cigarettes and pods by Juul, the nation’s largest maker of vaping products, are offered for sale at the Smoke Depot in Chicago, Illinois.  ((Scott Olson/Getty Images) / Getty Images)

JUUL SUES FDA FOR NOT DISCLOSING DOCUMENTS JUSTIFYING E-CIGARETTE BAN

The settlement covers two trials that were set to go to court early next year, and four broad groups including personal-injury plaintiffs, Juul consumers, government entities such as school districts, and Native American tribes. 

Lawsuits brought by several attorneys general are pending. 

A shopkeeper demonstrates smoking a Juul brand vaping pen to customers. (Reuters/Ajeng Dinar Ulfiana/File Photo / Reuters Photos)

JUUL SLASHES 400 JOBS AS EMBATTLED VAPING COMPANY FACES GROWING SETBACKS

Last month, Juul announced plans to lay off about a third of its staff and secured financing from some of its early investors to stave off bankruptcy. 

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FDA weighs oversight changes after formula, Juul troubles

WASHINGTON (AP) — The head of the Food and Drug Administration has asked for a review of the agency’s food and tobacco programs following months of criticism over their handling of the baby formula shortage and e-cigarette reviews.

Tuesday’s announcement comes as FDA Commissioner Robert Califf attempts to push past several controversies that have dominated his second stint running the agency, including the delayed response to contamination problems at the country’s largest infant formula plant.

“Fundamental questions about the structure, function, funding and leadership need to be addressed” in the agency’s food program, Califf said in a statement. The agency’s tobacco center, which regulates traditional cigarettes and vaping products, is facing challenges navigating policy and enforcement issues from “an increasing number of novel products that could potentially have significant consequences for public health,” he said.

Califf said the Reagan-Udall Foundation — a non-governmental research group created by Congress to support FDA’s work — would convene experts to deliver evaluations within 60 business days of both the food and tobacco operations. The experts are expected to consult with FDA staff along with outside groups to gather a broad range of opinions. Califf and his team have already begun meeting with outside stakeholders, the FDA noted.

The review announcement comes one day before Califf is scheduled to testify before the Senate agriculture committee about FDA’s oversight of food safety.

More than two dozen consumer groups have called on Califf to appoint one official to oversee all FDA food operations, which are dispersed across multiple centers responsible for nutrition standards, plant inspections and animal food. But Califf told The Associated Press in an interview that he believes more fundamental changes are needed.

“I don’t think structure alone is really the fix, or that leadership alone is the fix,” Califf said. “There’s a consistent concern out there that we need to really fix the fundamentals, which includes all those elements.”

Califf said he agreed with critiques that the food program has been underfunded compared with FDA’s drug program, which receives more than $1 billion annually in industry user fees. The agency recently sought more food funding and authority to help track supply chains in order to head off future shortages.

Parents and politicians also have expressed frustration over the agency’s handling of a recent decision to ban all e-cigarettes from Juul, the leading U.S. vaping company. A federal court quickly blocked the agency’s order. FDA then backtracked further in court, saying it needed more time to review Juul’s application due to its “unique scientific issues.”

The FDA has also struggled to review millions of other applications from vaping companies, prompting multiple missed regulatory deadlines over the last two years.

Califf again cited funding challenges, pointing out that the FDA cannot collect user fees from vaping companies who submit their products. The agency has asked Congress for that authority.

“I don’t think anyone anticipated that there would be 6.7 million vaping product applications that came rolling in during a pandemic that was stressing the entire agency,” Califf said.

Last week, the FDA announced it would miss another deadline to remove thousands of illegal e-cigarettes that use synthetic nicotine. FDA officials specifically asked Congress to give the agency authority over those products, which had used a legal loophole to skirt regulation.

Sen. Dick Durbin, an Illinois Democrat, suggested Califf should resign if the agency can’t swiftly remove such products.

President Joe Biden tapped Califf for the FDA job largely because of his prior experience at the agency, which he briefly led during the Obama administration. A cardiologist and respected researcher, Califf planned to focus his time at FDA on fighting medical misinformation and streamlining the agency’s data systems.

But those efforts have been eclipsed by newer controversies, including political outrage over the formula shortage, which has forced the U.S. to airlift millions of containers of formula from Europe. Recently, the FDA said it would help foreign manufacturers stay on the U.S. market for the long term, in an effort to diversify the formula supply here.

Califf previously predicted the formula shortage could last until July. He said Tuesday that retail data show that supplies have improved with increases in both U.S. production and imports.

“What you’re going to see is a gradual climbing out of the current situation as more and more formula becomes available,” Califf said.

In May, Califf testified before Congress about missteps that slowed the agency’s response to contamination problems at the Michigan formula plant that triggered the shortage. While many of the problems happened before Califf started on the job, he struggled to explain who was ultimately responsible for food safety within FDA’s bureaucracy.

FDA’s food program has a byzantine leadership structure in which there is a director for food and a separate deputy commissioner for “food policy and response.” The deputy commissioner has more of a safety focus, but has no direct authority over food center staff nor regional personnel who inspect plants.

“You have serious structural leadership issues,” Rep. Rosa DeLauro told Califf during the hearing.

DeLauro, a Connecticut Democrat, said Tuesday the FDA’s evaluation must contain input from non-FDA experts and interest groups to be credible.

“A report that includes recommendations to preserve the status quo is unacceptable,” she said in an emailed statement.

Responding to multiple crises is a standard part of leading the FDA, which regulates industries that account for an estimated one-fifth of all U.S. consumer spending.

Despite the recent controversies, some experts say Califf has done a good job, considering the increasing polarization surrounding the issues and products FDA oversees.

“Leading the FDA is becoming as complicated as, maybe more complicated than, leading a cabinet-level executive department,” said Daniel Carpenter, a professor of government at Harvard University. “I think Califf has navigated a pretty politically fraught environment and he has done it with remarkable skill.”

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Follow Matthew Perrone on Twitter: @AP_FDAwriter

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The Associated Press Health and Science Department receives support from the Howard Hughes Medical Institute’s Department of Science Education. The AP is solely responsible for all content.

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US bans Juul but young vapers are already switching to newer products | E-cigarettes

This week, the US effectively banned Juul after the Food and Drug Administration ordered the e-cigarette maker to remove its popular products from the marketplace.

Experts have hailed the move as significant. But they are also concerned that such efforts are failing to keep up with a fast-moving vaping industry – one where young people leap quickly from one product to another.

The FDA ban caps years of controversy for Juul, whose discreet vapes have been accused of helping hook an entire new generation on nicotine. In 2020 the FDA ordered mint- and juice-flavored e-cigarette pods off the shelves, hitting many of Juul’s products. This week’s escalation came because regulators said Juul failed to provide sufficient evidence to assess their toxicity and hazards of their tobacco and menthol-flavored e-cigarettes, leaving the FDA unable to “assess the potential toxicological risks of using the Juul products”.

Juul, meanwhile, has argued its vapes help regular smokers quit cigarettes, and has said it will fight back. On Friday, an appeals court temporarily put the ban on hold while Juul appeals.

The ban is still momentous, says Lauren Czaplicki, a researcher at Johns Hopkins Bloomberg School of Public Health, because it’s one of the first marketing denials for a brand with substantial market share in the US and for a menthol-flavored product. She points out that other brands like Vuse, Logic and NJOY have received market authorization for various tobacco flavored e-cigarette products and systems, but Juul was denied.

Research shows that bans of flavored cigarettes do make a difference – a 2020 study by George Mason University analyzed a 2009 FDA flavored cigarette ban, and found it reduced smoking by underage youth by 43% and young adults by 27%.

“It is likely that the FDA’s marketing denial will have an impact,” says Czaplicki. “Juul is still a popular product among young people who do use e-cigarettes, and Juul has a certain level of brand recognition and cultural cachet among youth that may be susceptible to nicotine use.”

But while Juul still commands a dominant share of the US market, its popularity among young people has waned over the last few years, says Dr Devika Rao, a pediatric pulmonologist at UT Southwestern. A recent federal survey found Juul was only the fourth most popular product among middle and high school students: the disposable e-cigarette Puff Bar came in first, with Vuse and Smok the second and third most popular.

“We know from data that Juul is not the most commonly used,” says Rao. “Adolescents today are favoring disposable vapes, devices you can purchase online or in a store.” They cost as little as $10 each for a single-use device and do not fall under the 2020 flavor ban, even though they use the same technology as Juul.

Adolescents often switch from product to product, creating a Whac-a-Mole prevention strategy, says Monica M Zorilla, a researcher at Stanford. When the FDA prioritized enforcement against flavored e-cigarette devices like Juul in 2020, it exempted disposable e-cigarettes and menthol-flavored e-cigarette products, says Zorilla. A Stanford study found that adolescents then moved to those e-cigarettes that were exempt. “Youth went from pod-based [like Juul] to disposables like Puff Bar,” Zorilla says. “As a youth said to me, ‘anything with fruit’ is popular among their peers. This was in part due to the enforcement and in part because the disposables continued to have many flavors.”

Rao points out that social media marketing is clever – and insidious – enough so teens will switch vaping products before adults are even aware of them. She points out that the newest trend is so-called wellness vapes which are not even marketed as e-cigarettes. “You can vape things like melatonin or vitamins to feel better and fall asleep faster,” she says. These are really vaping devices disguised, and companies are not required to state the concentration or what is in these products. “Newer products present a whole new level of risk.”

Flum Float disposable vape flavored vaping e-cigarette products are displayed in a convenience store in El Segundo, California Photograph: Patrick T Fallon/AFP/Getty Images

More action is needed, says Czaplicki. She says the FDA should immediately issue an order to remove all vape products that are being sold without market authorization, from retail shelves and online. This would include Puff Bar. “Reducing the number and type of flavored, e-cigarette devices for sale in the US is likely to have a substantial impact on reducing youth vaping,” she says. “At the same time, it is unlikely to reduce the usefulness of tobacco flavored e-cigarettes from helping adult smokers completely quit smoking.”

Vaping is exposing a new generation to nicotine addiction, says Rao – and researchers are still figuring out how to treat nicotine addiction in kids rather than adults.

These products are often perceived as less harmful than smoking, but they still come with risk because adolescents are wired to become addicted to substances. Rao, who cares for patients at Children’s medical center in Dallas, explains that Juul had figured out how to make the nicotine more potent to give a more potent hit to the brain – allowing for a greater sense of pleasure from using the vape.

“It may take just a few hits of a vape before they are addicted, and it affects things like school performance, athletic performance, and can lead to severe consequences like lung injury,” says Rao. Studies also show that vaping leads to an increase in heart rate and blood pressure.

She says that the rates of vaping declined for two years during the pandemic, but doctors are now concerned that re-establishing of social networks and easing restrictions mean that those rates could again rise.

“When I talk to my patients, they are either vaping or all their friends are vaping and they may be feeling pressure to start using these products,” says Rao. “Parents and educators need to have these conversations about the harm they can have.”

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Juul can keep selling e-cigarettes, after an appeals court paused the FDA’s ban

Juul can continue selling its e-cigarettes despite the Food and Drug Administration ordering a ban Thursday, according to the US Court of Appeals for the District of Columbia (via TechCrunch). In its order, the court says it’s issuing the temporary stay to give Juul time to file an emergency motion, which it can then consider along with a response from the FDA.

The FDA says the reason for the ban is that there’s “insufficient evidence to assess the potential toxicological risks of using the Juul products.” Juul had petitioned for clearance to sell its tobacco and menthol-flavored vape products, but the FDA turned down the application. The regulator notes that it’s only illegal to sell the Juul device and Juul pods, not to own or use them.

According to the court’s order, uploaded by Axios, Juul has until noon on the 27th to file its emergency motion. As the FDA’s website notes, the court says it’s not permitting Juul to sell its vaping products based on the merits of the company’s request — that decision will come later.

In its petition for the stay, which you can read in full below, Juul said that it faced “significant irreparable harm” if it wasn’t allowed to sell its products while it prepared its full motion for a stay. “FDA cannot credibly argue that there is a critical and urgent public interest in removing JLI’s products from the market right now, rather than after this Court reviews FDA’s action,” the company wrote (emphasis Juul’s).

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FDA’s ban on Juul e-cigarettes delayed by appeals court

The U.S. Court of Appeals for the District of Columbia temporarily delayed the FDA’s ban on Juul devices on Friday after the e-cigarette giant called the agency’s order “extraordinary and unlawful” in a court filing, the Wall Street Journal reports. 

The FDA said Thursday that it has not “received clinical information to suggest an immediate hazard associated with the use of” Juul devices, but that there is “insufficient evidence to assess the potential toxicological risks” of using the products.

Packages of Juul e-cigarettes are displayed for sale in the Brazil Outlet shop on June 22, 2022 in Los Angeles, California.  (Photo by Mario Tama/Getty Images / Getty Images)

Juul hit back on Friday, arguing that it will “suffer significant irreparable harm.”

FDA BANS JUUL E-CIGARETTE PRODUCTS

“In our applications, which we submitted over two years ago, we believe that we appropriately characterized the toxicological profile of JUUL products, including comparisons to combustible cigarettes and other vapor products, and believe this data, along with the totality of the evidence, meets the statutory standard of being ‘appropriate for the protection of the public health,’” Juul said. 

A shopkeeper demonstrates smoking a Juul brand vaping pen to customers. (REUTERS/Ajeng Dinar Ulfiana/File Photo / Reuters Photos)

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The Wall Street Journal reported that Juul is considering a bankruptcy filing and other options if it is unable to avoid the FDA’s ban. 

Juul did not immediately respond to a request for comment on Friday. 

Reuters contributed to this report. 

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U.S. bans sales of Juul e-cigarettes, company to seek stay on enforcement

June 23 (Reuters) – Sales of Juul e-cigarettes were blocked by the U.S. Food and Drug Administration on Thursday, in a major blow to the once high-flying firm whose products have been tied to a surge in teenage vaping.

The agency said the applications “lacked sufficient evidence” to show that sale of the products would be appropriate for public health, following a nearly two-year-long review of data provided by the company.

Some of the findings raised concerns due to insufficient and conflicting data, including whether potentially harmful chemicals could leach out of the Juul pods, the FDA said.

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“We respectfully disagree with the FDA’s findings … intend to seek a stay and are exploring all of our options under the FDA’s regulations and the law, including appealing the decision and engaging with our regulator,” said Joe Murillo, chief regulatory officer at Juul.

The company said it had appropriately characterized the toxicological profile of its products and that the data met the statutory standard of being “appropriate for the protection of the public health”.

Juul and other e-cigarette brands, including British American Tobacco’s (BATS.L) Vuse and Imperial Brands’ (IMB.L) Blu, had to meet a September 2020 deadline to file applications to the FDA showing the products provided a net benefit to public health.

The heath regulator had to judge whether each product was effective in getting smokers to quit and, if so, whether the benefits to smokers outweighed the potential health damage to new e-cigarette users, including teenagers, who never smoked.

BAT’s Vuse Solo was the first e-cigarette to get the agency’s clearance in October. read more

“The agency has dedicated significant resources to review products from the companies that account for most of the U.S. market. We recognize … many have played a disproportionate role in the rise in youth vaping,” FDA Commissioner Robert Califf said in a statement.

Teenage use of e-cigarettes surged with the rise in popularity of Juul in 2017 and 2018. Its use among high school students grew to 27.5% in 2019 from 11.7% in 2017, but fell to 11.3% in 2021, a federal survey showed.

Juul did not provide evidence to show the products were up to its standards and that raised “significant questions”, the FDA said, but added it has so far not received clinical information to suggest an immediate hazard tied to the device or pods.

“Without the data needed to determine relevant health risks, the FDA is issuing these marketing denial orders,” Michele Mital, acting director of the FDA’s Center for Tobacco Products, said.

Shares of tobacco giant Altria Group Inc (MO.N), which partly owns Juul, have lost about 7%, or nearly $6 billion in market value, since Wednesday when the Wall Street Journal first reported the FDA was preparing to order Juul’s e-cigarettes off the market.

‘HAWKISH FDA’

Juul had sought approval for its vaping device and tobacco and menthol flavored pods that had nicotine content of 5% and 3%.

E-cigarette makers have been selling products in the United States for years without being officially authorized by the FDA, as regulators repeatedly delayed deadlines for the companies to comply with federal guidelines.

Thursday’s decision was cheered by public health groups, who had long warned that e-cigarettes were getting a new generation of teenagers hooked on nicotine after major strides in reducing youth cigarette use.

In 2020, the FDA banned all flavors except tobacco and menthol for cartridge-based e-cigarettes such as Juul. The company pulled all other flavors including mint and mango in late 2019.

The Biden administration has been looking at other ways to help people quit smoking in an effort to cut down on preventable cancer deaths. It said this week it plans to propose a rule establishing a maximum nicotine level in cigarettes and other finished tobacco products to make them less addictive. read more

The surprise decision was an indication of a more hawkish FDA, some analysts said, as it was expected that some Juul products would be approved, following the agency’s clearance of several other e-cigarette products.

BAT overtook Juul as the leader of the U.S. vaping market in April, according to data Nielsen provided to brokerage J.P. Morgan. Juul led the market in 2021, with a 38% share of the $11 billion retail sales market.

“The only opportunity for Juul to create value may be in international markets, but we expect other regulators to take a similar stance to the FDA in limiting the marketing of e-cigarettes to minors,” Morningstar analyst Philip Gorham said.

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Reporting by Chris Kirkham and Aishwarya Venugopal; Additional reporting by Praveen Paramasivam, Ananya Mariam Rajesh and Uday Sampath in Bengaluru; Editing by Bill Berkrot, Sriraj Kalluvila and Shounak Dasgupta

Our Standards: The Thomson Reuters Trust Principles.

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Juul e-cigarettes to be ordered off U.S. shelves – WSJ

A woman holds a Juul e-cigarette while walking in New York, U.S., September 27, 2018. REUTERS/Brendan McDermid

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June 22 (Reuters) – The U.S. Food and Drug Administration is preparing to order Juul Labs Inc to take its e-cigarettes off the market in the United States, the Wall Street Journal reported on Wednesday, citing people familiar with the matter.

Shares in tobacco giant Altria Group (MO.N), which owns a 35% stake in the vaping products maker, fell 8.5% following the report. The decision could come as early as Wednesday, the report said.

Juul has faced heightened scrutiny from regulators, lawmakers and state attorneys general over the appeal of its nicotine products to teenagers. Under pressure, the company in late 2019 had halted U.S. sales of several flavors.

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The FDA declined to comment on the report, while Altria and Juul did not respond to requests for comment from Reuters.

“This clearly comes as a surprise to the market … we would expect that Juul would appeal the decision, and remain on the market through that process, which would likely take a year or more,” Cowen analyst Vivien Azer said.

The looming verdict comes nearly two years after Juul had applied for approval to keep selling e-cigarettes in the country.

The FDA’s review of the applications was based on whether the e-cigarettes are effective in getting smokers to quit and, if so, whether the benefits to smokers outweigh the health damage to new users, including teenagers.

In October, the FDA had allowed Juul rival British American Tobacco Plc (BATS.L) to market its Vuse Solo e-cigarettes and tobacco-flavored pods, the first-ever vapor product to get clearance from the health regulator. read more

The estimated fair value of Altria’s investment in Juul was $1.6 billion as of March end, a fraction of the $12.8 billion it paid in 2018, as a crackdown on vaping has upended the once fast-growing industry.

“The investment in Juul was always a mistake, the company paying top dollar for a business which was already clearly (on) the wrong side of the regulators,” said Rae Maile, analyst at Panmure Gordon.

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Reporting by Praveen Paramasivam and Deborah Sophia in Bengaluru; Editing by Devika Syamnath and Sriraj Kalluvila

Our Standards: The Thomson Reuters Trust Principles.

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Juul to pay N.C. $40M and stop targeting kids after igniting vaping “epidemic“

Enlarge / Juul went with a fashionable, “cool” marketing strategy.

Electronic cigarette maker Juul and the state of North Carolina have reached a settlement over the state’s claims that Juul aggressively targeted its “highly addictive” products to youth, igniting a vaping epidemic.

While still denying any wrongdoing, Juul has agreed to pay North Carolina a total of $40 million over six years. Additionally, the company will adhere to a list of restrictions aimed at blocking any promotion and sales of its products to youths. According to the list, Juul won’t use advertisements that may appeal to youth; it will avoid most social media advertising and the use of influencers; it won’t sponsor sports and entertainment events, like concerts; and it won’t use anyone under the age of 35 in its marketing.

The company also agreed to help enforce age restrictions by running a “secret shopper” program. Juul will send undercover representatives, ages 21 to 27, into at least 50 stores throughout the Tar-Heel State per month to check whether retailers verify buyers’ ages.

The settlement comes after years of allegations and fiery criticism that Juul intentionally and egregiously targeted adolescents in its marketing campaigns and advertisements, which critics say were directly responsible for soaring levels of vaping among teens. According to a lawsuit filed last year by Massachusetts Attorney General Maura Healey, Juul’s marketing campaigns in 2015 and 2016 included running ads on websites such as Cartoon Network’s cartoonnetwork.com and Nickelodeon’s sites Nick.com and NickJr.com. And congressional testimony in summer 2019 revealed that Juul representatives gave presentations to teens inside schools, without teachers present or parental consent.

Wins and cases

According to the Centers for Disease Control and Prevention, the use of e-cigarettes among high schoolers jumped from 1.5 percent in 2011 to 27.5 percent in 2019—meaning that more than one in four high school students reported using e-cigarettes within the previous 30 days at the time of the 2019 survey. That percentage fell just shy of 20 percent in 2020, following a crackdown in Juul advertising and sales of flavored products. The federal government also increased the vaping age restriction to 21.

North Carolina Attorney General Josh Stein sees the settlement as another step in dragging down e-cigarette use among teens.

“For years, JUUL targeted young people, including teens, with its highly addictive e-cigarette. It lit the spark and fanned the flames of a vaping epidemic among our children–one that you can see in any high school in North Carolina,” Stein said in a statement. “This win will go a long way in keeping JUUL products out of kids’ hands, keeping its chemical vapor out of their lungs, and keeping its nicotine from poisoning and addicting their brains.”

In its own statement, Juul said the settlement “is consistent with our ongoing effort to reset our company and its relationship with our stakeholders, as we continue to combat underage usage and advance the opportunity for harm reduction for adult smokers… We seek to continue to earn trust through action.”

The resolution of the lawsuit with North Carolina is likely just the start of legal movement for Juul. Several other states, including Massachusetts, have filed lawsuits against the company. The Associated Press reports that 39 state attorneys general have also been working together since February 2020 to investigate the company’s marketing and products. In addition, the company faces hundreds of personal injury lawsuits, which have been consolidated in a California federal case.

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