JUUL Labs Inc., tobacco company Altria, individual JUUL board members, and other defendants will face Racketeer Influenced and Corrupt Organizations (RICO) Act charges in the JUUL multidistrict litigation (MDL). The court issued the ruling to hold the vaping giant responsible for intentionally targeting teens with its nicotine-containing e-cigarettes to bolster profits, creating a youth vaping epidemic. The ruling marks a very important addition to the JUUL lawsuit, harkening back to similar RICO charges waged years ago against Big Tobacco.
The ruling came six months after U.S. District Judge William H. Orrick, who is overseeing the JUUL MDL, dismissed RICO charges against Altria, which owns a 35% stake in JUUL, for not being specific enough. But Judge Orrick left the door open for plaintiffs to fine-tune their argument and amend court documents regarding the RICO claims.
Then in April, Judge Orrick denied all motions to dismiss RICO charges against JUUL Labs Inc. and other defendants, including individual board of director defendants. Judge Orrick also ruled that plaintiffs’ amended RICO claims against Altria “are plausible and sufficient for pleading purposes to allege a RICO enterprise.”
“Whether [JUUL] could be the enterprise given its own alleged fraudulent conduct and whether defendants were acting primarily in [JUUL’s] corporate interests may be revisited on summary judgment,” he said. “I have already held that the predicate acts of mail and wire fraud were sufficiently alleged and am not inclined to revisit that issue.”
JUUL lawsuit plaintiffs also accused Philip Morris USA, and JUUL board members Nicholas Pritzker, Hoyoung Huh, and Riaz Valani of participating in RICO conduct. Plaintiffs alleged the additional defendants were aware of JUUL’s appeal to teens and that the company profited billions off that interest.
The JUUL MDL includes school districts, Native American tribes, and local governments across the country. They claim that JUUL deliberately targeted tweens, teens, and young adults with candy- and fruit-flavored vape juices, stealthy e-cigarette devices, and social media influencers popular with teens as JUUL product ambassadors. As a result, JUUL created a youth vaping epidemic that schools and municipalities have been forced to deal with by redirecting funds and resources.
The RICO law dates back 40 years and was originally created to bring down the mafia. It allows for the prosecution and civil penalties for racketeering activity performed as part of an ongoing criminal enterprise. In the years since the RICO Act was created, it has expanded and been used to attack many other types of organized crime, including street gangs, gang cartels, corrupt police departments, and corrupt politicians.
In 2007, the United States Justice Department brought RICO charges against nine tobacco companies for conspiring to deceive the American public about nicotine addiction and the adverse health effects of cigarettes and for targeting youth as new smokers. Judge Gladys Kessler ultimately found that the evidence overwhelmingly established that the companies had violated RICO by coordinating their public relations, research, and marketing efforts to deceive consumers.
Beasley Allen lawyers Joseph VanZandt, Sydney Everett, James Lampkin, Beau Darley, Soo Seok Yang, and Mass Torts Section Head Andy Birchfield are currently representing a number of individuals who are suing the top U.S. vape maker JUUL for the negative impact its products have had on their lives. These lawyers currently make up our firm’s JUUL Litigation Team. Lawsuits have also been filed on behalf of school districts and public entities across the country, which seek to protect students and recover resources spent fighting the vaping epidemic. If you have a potential claim or need more information on JUUL, contact any of the lawyers on the team.