Minnesota Attorney General Keith Ellison personally opened his state\u2019s case against Juul Labs on Tuesday, accusing the e-cigarette maker of using \u201cslick products, clever ads and attractive flavors\u201d to hook children on nicotine as the first of thousands of cases against the company reached trial.
Minnesota is seeking more than $100 million in damages, accusing Washington, D.C.-based Juul of unlawfully targeting young people to get a new generation addicted to nicotine.
\u201cThey baited, deceived, and addicted a whole new generation of kids after Minnesotans slashed youth smoking rates down to the lowest level in a generation,\u201d Ellison said. \u201cNow, big tobacco is back with a new name but the same game. Juul wiped out the work of our state with their slick products, clever ads, and attractive flavors.\u201d
Juul has faced thousands of lawsuits nationwide but most have settled, including 39 with other states and U.S. territories. Not Minnesota, which won a landmark $7.1 billion settlement with the tobacco industry in 1998. Minnesota added tobacco industry giant Altria, which formerly owned a minority stake in Juul, as a co-defendant in 2020.
Altria completed its divestiture this month and says it effectively lost its $12.8 billion investment.
David Bernick, an attorney for Juul, promised jurors an \u201cintense and interesting\u201d trial. He said the purpose of Juul was always to convert adult smokers of combustible cigarettes to a less-dangerous product that would still provide a satisfying nicotine experience \u2014 not to lure kids. E-cigarettes aren\u2019t safe but aren\u2019t deadly either, he said; they\u2019re somewhere in between. And Juul did nothing to intentionally drive youth demand, he argued, suggesting that the growth in youth vaping was more likely due to increasing adult demand resulting in \u201dleakage\u201d to kids.
William Geraghty, an attorney for Altria, denied Ellison\u2019s assertions that Altria invested heavily in Juul because it ultimately wanted to hook kids on its cigarettes, which include Marlboro. He said Altria bought its passive stake because Juul had found the key to successfully switching adult smokers of conventional cigarettes to a less harmful product, while Altria\u2019s competing e-cigarettes had failed in the marketplace.
The lawsuit against Juul, filed in 2019, alleges consumer fraud, creating a public nuisance, unjust enrichment and conspiracy with Altria. The jury trial before Hennepin County District Judge Laurie Miller is expected to last about three weeks
Juul Labs launched in 2015 on the popularity of flavors like mango, mint, fruit medley and creme brulee. Teenagers fueled its rise, and some became hooked on Juul\u2019s high-nicotine pods. Amid a backlash, Juul dropped all U.S. advertising and discontinued most of its flavors in 2019, losing popularity with teens. Juul\u2019s share of the now multibillion-dollar market has fallen to about 33% from a high of 75% in 2018.
In his opening statement, Ellison argued that Juul and Altria broke the law by using deceptive actions to sell tobacco products to minors. Juul purposely made its products small and sleek to make detection by adults difficult, formulated them to deliver high doses of nicotine to addict children, added flavors that would appeal to young people and used a marketing campaign they knew would appeal to teens, Ellison said.
\u201cYoung people are innocent, and they want to explore,\u201d Ellison said. \u201d\u201cKids are attracted to what is shiny, slick, cool \u2014 and that is exactly who Juul and Altria were targeting and preying upon.\u201d
Bernick gave the jury an alternative explanation. Adult smokers don\u2019t like to be seen smoking because of the social stigma, he said. So Juul designed its products to look different from conventional cigarettes and other e-cigarettes then on the market so that adults could use them discretely, he said, not so that kids could use them in school.
Bernick said Minnesota had experienced an \u201cexponential increase\u2019 in youth vaping even before Juul arrived on the local market in late 2017. And he asserted that the company had already ended some of its most-criticized practices, suggesting that Juul itself wasn\u2019t to blame for the rise.
Richmond, Virginia-based Altria Group \u2014 formerly known as Phillip Morris Cos. \u2014 says it had nothing to do with the design of Juul, nor its creation of its fruit and other flavors, nor the running of the company.
In fact, Geraghty said, Juul stopped selling several of those flavors at the retail level before Altria invested in it. He denied that the marketing services that Altria provided Juul for about a year \u2014 which included the use of its shelf space at convenience stores and Juul coupons tucked into Marlboro packs \u2014 did anything to increase youth vaping in Minnesota. State health department statistics show youth vaping actually flattened out in the state between 2017 and 2020, he said.
And Geraghty said Altria never made anything off Juul sales \u2014 it would have made money only if they company\u2019s value had increased, which it didn\u2019t.
Juul is now appealing the Food and Drug Administration\u2019s rejection of its application to keep selling its vaping products as a smoking alternative for adults. Juul is still being sued by New York, California, Massachusetts, New Mexico, Alaska, Illinois, West Virginia and the District of Columbia.<\/p>\n\n\n\n