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Juul cuts class-action checks – some consumers demand payouts of up to $9,000

Topline

Payouts from a 2022 settlement between e-cigarette company Juul and tobacco company Altria have begun, with users on platforms like Reddit and X claiming they received thousands of dollars from the $300 million settlement.

Important facts

Juul has settled a class action lawsuit that claimed customers paid more for its e-cigarettes than if the company had accurately described the product's addictiveness and safety.

The lawsuit, which also accused Juul of unlawful marketing to minors, was settled by Juul for $245 million and Altria, formerly known as Philip Morris, for $45 million.

Payments to applicants were approved earlier this month, although the r/juul subreddit suggests that payouts may have increased this week, with users claiming they received anywhere from a few hundred dollars to over $9,000.

The settlement includes consumers who purchased Juul products before December 7, 2022.

Juul did not admit any wrongdoing in the settlement and Altria denied the allegations against it.

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Is it too late to claim a settlement?

Yes: The deadline to file a claim was February 5th.

How are payouts calculated?

Some factors affect payouts, including how much money applicants spent on Juul products, what year they purchased the products and what age they were when they purchased the products. It appears that those who spent more money on Juul products during the eligible periods will receive larger payouts.

Important background

The class action lawsuit arose from more than 8,000 lawsuits filed by municipalities, school districts, Native American tribes and individuals against Juul, which halted U.S. advertising and discontinued most of its flavors in 2019 following litigation and government sanctions. The $300 million settlement followed a nearly $440 million settlement following a federal investigation into its marketing practices. The litigation cost the company nearly $3 billion last year when Altria, which invested nearly $13 billion in Juul in 2018, pulled out of the e-cigarette company and invested in a rival startup. Since then, Juul has avoided bankruptcy through cost-cutting measures, large layoffs and the help of wealthy investors such as private equity entrepreneur Riaz Valani and former Hyatt board member Nick Pritzker. Juul has raised $1 billion for Juul, the Wall Street Journal reported.

Further reading

Juul to pay $1.2 billion to settle youth vaping lawsuits (Forbes)

CDC says e-cigarette use in US high schools reaches lowest level in 10 years after crackdown (Forbes)

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