JUUL Labs and Altria Group are trying to worm their way out of Racketeering Influenced and Corrupt Organizations (RICO) Act claims they face in federal multidistrict litigation (MDL) accusing them of deceptive marketing practices that created a youth vaping epidemic.
The RICO Act was established in 1970 to prosecute organized crime but was later used in civil cases including those targeting the tobacco industry. If JUUL can’t shake the RICO claims, the company could get hit with three times the damages as well as plaintiffs’ attorneys’ fees. Legal experts say that with RICO claims at stake, JUUL would have a strong incentive to settle the hundreds of lawsuits it faces in the MDL.
JUUL and Altria, a subsidiary of tobacco giant Philip Morris USA and minority stakeholder of JUUL, argued Monday to U.S. District Judge William H. Orrick that the consumers and school districts suing them didn’t provide sufficient evidence to prove they conspired to defraud consumers. Furthermore, the companies deny that there was any illegal “enterprise” or “racketeering.”
The school districts disagree, claiming the companies took a page from Big Tobacco’s playbook to market their nicotine-containing vapes to teens.
“They hired young models and advertised using bright, ‘fun’ themes, including on media long barred to the cigarette industry, such as billboards, on children’s websites such as ‘Nick Junior’ and Cartoon Network, and on websites providing games and educational tools to students in middle school and high school,” according to the consolidated class-action complaint.
JUUL is further accused of marketing e-liquids in candy and fruit flavors that appealed to youth and using social media influencers popular with teens to promote their products. And the company wasn’t forthright about the amount of nicotine its vapes contained — as much as a pack of cigarettes in some cases. As a result, youth vaping skyrocketed since JUUL hit the market in 2015, forcing school districts to redirect resources and money to tackle teen nicotine addiction.
Legal experts say that the biggest challenge facing JUUL in its effort to shake the RICO claims is the similarities it shares with Big Tobacco. In 1999, several tobacco companies including Philip Morris were found in violation of the RICO Act for conspiring to deceive consumers about the dangers of smoking and the addictiveness of nicotine.
Beasley Allen lawyers Joseph VanZandt and Sydney Everett, together with Mass Torts Section Head Andy Birchfield, are currently representing several individuals who are suing the top U.S. vape maker JUUL for the negative impact its products have had on their lives. Recognizing the critical threat to young people ensnared by nicotine addiction, and its effect on our nation’s educational system, our firm has also joined other nationally recognized law firms to represent school districts and public entities across the country in the fight to stop the school vaping crisis.