FTC probes marketing practices of e-cigarette maker Juul - WSJ

Credit: REUTERS/Ronen Zvulun

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Aug 29 (Reuters) - The Federal Trade Commission is investigating the marketing practices of e-cigarette maker Juul Labs Inc, the Wall Street Journal reported on Thursday, citing people familiar with the matter.

Shares of Altria Group Inc MO.N, which has a 35% stake in Juul, fell 2% to $44.88 in afternoon trading.

Juul has already come under scrutiny for its marketing practices, including its use of social media influencers to promote its vaping devices that have become extremely popular among teens.

The U.S. House and some state attorneys general have also launched separate investigations into the company's marketing practices. Last year the Food and Drug Administration conducted a surprise inspection at Juul's San Francisco headquarters and seized certain documents.

"Without commenting on any specific investigation, we fully cooperate and are transparent with any government agency or regulator who have interest in our category," a Juul spokesman said.

The company "never marketed to youth", but has changed its advertising to feature adult smokers aged 35 and more, and has stopped advertising on social media, the spokesman added.

A May 2019 court filing from lawyers suing Juul disclosed that an unnamed government agency was investigating the company's marketing practices.

The filing said that while Juul had not turned over documents about its marketing practices to the lawyers, it "has presumably already gathered and produced many of these documents in response to investigatory demands from the FDA, (REDACTED), and Attorneys General for California, Massachusetts, and Washington, as well as the Los Angeles District Attorney."

FTC investigators are examining Juul's involvement in deceptive marketing, including by targeting minors or using influencers, and is also determining whether to seek monetary damages, according to the Wall Street Journal report. (https://on.wsj.com/32e8KqU)

Altria did not immediately respond to Reuters' request for comment, while an FTC spokesman declined to comment.

(Reporting by Tamara Mathias, Saumya Sibi Joseph, Chris Kirkham and David Shepardson; Editing by Shinjini Ganguli)

((saumya.joseph@thomsonreuters.com; within U.S. +1 646 223 8780, outside U.S. +91 80 6749 2290; Twitter: @SaumyaSibi;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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