E-Cigarette Hearings May Open the Door for Million-Dollar Vaping Settlements

By  //  August 6, 2020

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The presidents and CEOs of America’s five largest e-cigarette companies faced questions from a congressional subcommittee last month over their records of marketing vaping products to young people.

The presidents and CEOs of America’s five largest e-cigarette companies faced questions from a congressional subcommittee last month over their records of marketing vaping products to young people.

E-cigarettes were invented as a product to help addicted smokers wean themselves off tobacco. However, recent federal surveys have indicated that e-cigarettes have had the opposite effect, reaching a whole new market of non-smokers.

After reports of vaping’s exploding popularity among high school students, the Trump administration moved to ban several vape products, especially those in flavors they saw as marketed toward kids.

The hearings with the House of Representatives oversight committee intend to build on the ban’s demand for accountability. Many may see echoes of the rise and fall of traditional cigarettes in the United States.

“Until the 90s, tobacco companies won almost every lawsuit against them, whether in initial rulings or appeals,” Attorney Charles Boyk of Charles E. Boyk Law Offices, LLC recalls.

“They argued that smokers knew the risks they were taking on, and the courts agreed. It wasn’t until the Waxman hearings that the floodgates opened. That was when it became common to see Philip Morris and R.J. Reynolds paying out millions of dollars. When I look at these e-cigarette hearings, I see the same thing happening again — and for the same reason, that they’re targeting kids who don’t know better.”

In the mid 20th century, practically everybody smoked. Characters in movies would light up cigarettes constantly, even when it had nothing to do with the script. Advertisements bragged that doctors recommended their brands.

Today, that is all gone. When cigarettes are present in popular culture, they are usually in the role of a social pariah.

The seeds of tobacco’s downfall were planted as early as the 1950s when the first significant retrospective studies established the now well-known correlation between smoking cigarettes and lung cancer.

However, for some observers, the turning point came in 1994, when the U.S. Representative Henry Waxman summoned “the Seven Dwarves” — seven captains of the tobacco industry — and got them to swear under oath that nicotine was not addictive. Later hearings revealed that the seven executives had buried internal research that contradicted their testimonies.

What followed was a cascading series of lawsuits. In 1998, lawsuits by 46 state attorney generals resulted in the Tobacco Master Settlement Agreement, which forbade tobacco companies from engaging in certain advertising practices and forced them to pay annual sums to state governments.

In 2000, tobacco giant Philip Morris paid $51.5 million in damages to a terminal lung cancer patient in California.

It is too early to tell if the hearings on e-cigarettes will have similar impacts on the vaping industry, both on their pocketbooks and public relations. Congress itself does not have any open desire to ruin the vaping industry financially.

Most tend to interpret their efforts through a partisan lens: those who support regulating vape companies say the committee is seeking accountability, while those opposed to regulations deride the hearings as a moral panic.

In the hearings, lawmakers wanted information on any internal knowledge e-cigarette executives might have about the health effects of vaping.

They also grilled the executives about their marketing practices, and whether they specifically targeted teens with fruit and mint flavors.

The hearings established that the leaders of vaping companies believe their products to be justified in the name of helping people quit smoking, citing scientific studies about conversion rates. It remains to be seen whether any of their statements will have the same seismic impact as the “Seven Dwarves” testimonies in the Waxman hearings.

So far, no settlements have been paid out to any plaintiffs harmed by e-cigarette products, but legal observers are keeping a close eye on a mass litigation against JUUL, Inc. JUUL is by far the largest e-cigarette manufacturer in the U.S., owning about three-fourths of the market and acting as the face of the 21st-century vaping boom.

As of last month, 331 lawsuits are pending against JUUL in California district courts. Plaintiffs assert that JUUL knowingly marketed its products to minors, misleadingly claimed vape pods were less addictive and harmful than traditional cigarettes, and failed to adequately document the health effects of other pod ingredients.

Mass litigation is slightly different from a class-action lawsuit. There is more than one plaintiff, but arguments and evidence can be shared across different suits.

Due to this structure, it might be a while before we can be sure what effects congress’s hearings and the president’s vaping bands have on the industry. For now, the outcome is far from certain, and a lot of people have a stake.