For years, Altria competed in the burgeoning e-cigarette space. But Altria’s Nu Mark brand was quickly overtaken by the startup Juul, which rocketed to the top of the industry in 2017 on the popularity of its small, high-nicotine and fruity flavored e-cigarettes. In addition to their use among adult smokers, the devices became a scourge in middle and high schools where students were caught vaping in bathrooms and between classes.
In 2020, under intense government pressure, Juul pulled all of its flavors except menthol and tobacco.
The FTC argued that Altria illegally agreed to discontinue its own e-cigarettes in 2018, shortly before taking the 35% stake in Juul. FTC investigators alleged that internal company documents showed Altria planned to upgrade its own e-cigarettes until Juul executives indicated a non-compete agreement would be a prerequisite for any investment deal between the companies.
An FTC spokeswoman declined to comment Tuesday, saying the agency wouldn’t have a statement on the ruling until it is posted.
Among the many headwinds facing Juul is the possibility that health regulators will permanently ban its products from the U.S. market due to a history of underage use. The Food and Drug Administration is still weighing whether to allow Juul to remain as a less-harmful alternative for smokers.
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