Juul Co-founder Ordered to Answer Questions in Tobacco Lawsuit
Juul Co-founder Ordered to Answer Questions in Tobacco Lawsuit
(Bloomberg) -- A Florida state court judge ordered the co-founder of the e-cigarette maker Juul Labs Inc. to answer questions under oath in a case involving a woman suing the cigarette-maker Philip Morris USA.
While Juul has challenged the judge’s order, it’s the first time that the Silicon Valley startup has been dragged into a thicket of longstanding tobacco product-liability litigation since it sold a $12.8 billion stake of the company to Altria Group Inc., which owns Philip Morris USA, the maker of Marlboro cigarettes.
Judge Carlos Rodriguez ordered James Monsees to submit to questioning by lawyers for the estate of Rita Shifrin. She died of smoking-related illnesses, including emphysema and coronary heart disease, after years of smoking Pall Malls, Benson & Hedges and Marlboro cigarettes. Monsees was also ordered to bring documents to the deposition, which is scheduled to take place in California in early December. The judge issued the order in October, but lawyers for Shifrin say Monsees was officially served this week.
Scott Schlesinger, who represents Shifrin’s estate, argues that Monsees could shed light on whether Altria purchased a stake in Juul for the company’s attractiveness to youth, and as a way to make up for declining cigarette consumption. “Philip Morris is still in the youth addiction business,” Schlesinger said. Any such determination could potentially affect the amount of damages his client could get, he argues.
Juul and Altria didn’t immediately respond to requests to comment.
Juul has asked the judge to set aside the order for the deposition, noting that the company isn’t even a party to the case, which originated more than a decade ago -- before Juul was even in existence. “The discovery is an improper end-run around federal court orders,” George LeMieux, an attorney for Juul and Monsees, wrote in a filing.
Deposing Monsees would be an unusual -- and unusually high-profile -- win for plaintiffs’ attorneys who are scrambling to obtain valuable information about the company. Juul has been thrust into a global controversy surrounding the safety of using e-cigarettes and the company’s role in sparking an epidemic of teen vaping: More than 5 million teens now report using the products, according to the National Youth Tobacco Survey.
There have been 2,290 cases of acute lung injuries tied to vaping this year and 47 deaths, according to the Centers for Disease Control and Prevention. Health officials have not singled out Juul for the illnesses, and instead have largely zeroed in on THC-containing products that are made with a thickening agent called vitamin E acetate.
Juul is being probed by several federal agencies for its marketing practices, and several states have sued the e-cigarette maker for allegedly enticing teens with fruity flavors and Instagram ads. California and New York sued Juul this week. Dozens of individual federal lawsuits against Juul have been consolidated in San Francisco, including several brought by Schlesinger’s firm.
The judge in the consolidated cases had put a hold on the collection of information ahead of trial.
Since Altria took a 35% stake in the e-cigarette maker last December, the two companies have become even more closely intertwined. Juul has hired several Altria executives to help steer it through choppy legal and regulatory waters. In September, Juul named K.C. Crosthwaite, a former Altria executive, as its new chief executive officer.
The Shifrin case is part of a group of personal injury and wrongful death lawsuits that remains among the longest-lasting sets of litigation against tobacco companies. It’s one of several cases that were originally part of a class-action lawsuit filed in 1994 by Miami pediatrician Howard Engle.
Twelve years later, a Florida Supreme Court judge ruled the people couldn’t sue as a group, but said that individual cases against the major tobacco companies could proceed. That resulted in thousands of individual cases, known as “Engle progeny” litigation. Many of them continue to wind their way through the Florida courts.
To contact the reporter on this story: Lauren Etter in Los Angeles at letter1@bloomberg.net
To contact the editors responsible for this story: Flynn McRoberts at fmcroberts1@bloomberg.net, Joe Schneider
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