A federal judge in San Francisco has ruled to uphold racketeering claims waged against JUUL Labs, inc. and its major shareholder, Altria Group, Inc. Lawsuits filed against JUUL Labs accuses the e-cigarette maker of deliberately targeting teenagers in the marketing of its products. Most of the claims were made by consumers, school districts and local governments and founders and directors within JUUL have become the new focus of the litigation, as reported recently by Bloomberg.
Originally, the claims against JUUL were dismissed in October 2020 but plaintiffs in the case were allowed to revise their complaint. The amended court filing allowed for a new Racketeer Influenced and Corrupt Organizations Act (RICO) argument that alleges JUUL’s founders and directors used the company for an “unlawful pattern of racketeering.” The RICO law, which originated in 1970, was created to prosecute organize crime but has since been used in civil suits, including those against tobacco companies. U.S. District Judge William Orrick found that the allegations describing individuals within and associated with JUUL advancing their self interests were “adequate” and that false or misleading advertisements that failed to acknowledge the nicotine content and potency of JUUL’s products were used. This could have potentially led to an increase in youth access to JUUL’s products.