Altria, the tobacco giant, announced Tuesday that an administrative judge dismissed a federal suit alleging that Altria’s partnership with Juul Labs, an e-cigarette manufacturer, was an anticompetitive agreement that harmed consumers.
The Federal Trade Commission will review the preliminary decision of the judge at the agency and it is likely to be appealed. Altria did not immediately have access to the judge’s decision at the time. Altria, which owns brands such as Marlboro cigarettes or Copenhagen smokeless tobacco, stated that the ruling will be made available online in the latter part of this month.
In 2020 , the Federal Trade Commission sued Altria to end its pact with Juul. Juul is the embattled vaping business that has been the subject of numerous government investigations as well as lawsuits. Separate from this issue, the FTC filed a case alleging that Altria’s 2018 stake in startup violated anticompetitive law.
Altria will continue to profit from Juul e-cigarette sales if the decision is upheld. Altria provided legal, regulatory, and marketing support to Juul as part of the agreement.
Altria’s future prospects are still in jeopardy with e-cigarettes. , a Richmond, Virginia-based company, has repeatedly reduced Juul’s value to about one-tenth the original amount. It now claims that its stake in Juul is worth only $1.7 billion.
Altria was a major player in the rapidly growing e-cigarette market for many years. Altria’s Nu Mark brand fell to Juul in 2017. The startup Juul quickly rose to the top of this industry due to its small, high-nicotine, and fruity-flavored e-cigarettes. The devices were not only popular among adult smokers but also became a problem in middle and high school vaping areas and between classes.
Juul withdrew all its flavors, except tobacco and menthol, in 2020 under heavy government pressure.
FTC claimed that Altria had illegally agreed not to continue using e-cigarettes, just before it took the 35% share in Juul. FTC investigators claimed that Altria had internal documents showing it planned to upgrade its e-cigarettes, until Juul executives stated that a non-compete agreement would have to be signed before any investment deal could be made between the two companies.
A spokeswoman for the FTC declined to comment on Tuesday. She stated that the agency would not have any statement until the ruling is posted.
Juul faces many challenges due to the possibility that U.S. health regulators could ban the products permanently because of a history underage use. The Food and Drug Administration still considers whether Juul should be allowed to continue as a safer alternative to smoking.
According to the latest survey data, teens are switching away from Juul. Puff Bar, a disposable ecigarette that can be used in high school was the top-rated brand. It comes in strawberry, strawberry, and mango flavors. Juul was fourth in popularity.