A recent lawsuit alleges that JUUL Labs, the most popular e-cigarette brand, knowingly shipped a million contaminated vape pods without notifying customers or issuing a recall. The tainted nicotine products were sent to retailers earlier this year and have since been sold to customers.
The lawsuit is only one of the latest in a series of PR headaches for the San Francisco-based company, which is facing backlash for getting millions of kids and young adults hooked on nicotine.
Siddharth Breja, a former senior vice president of global finance at JUUL, filed the suit on Tuesday in the U.S. District Court of the Northern District of California.
The lawsuit claims that Breja learned in an executive meeting in March 2019 that some batches of JUUL’s mint-flavored e-liquid had been found to be contaminated. By that point, some 250,000 contaminated “refill kits” — equal to 1 million vape pods — had already been shipped to retailers and, in turn, sold to unsuspecting customers.
JUUL Lawsuit Alleges Contamination
The court filing does not specify what the e-liquid batches were contaminated with, and representatives from the company have categorically denied any and all such allegations.
According to the lawsuit, however, the issue arose after reports surfaced of customers suffering seizures after using JUUL products. Rather than issue a recall for the contaminated refill kits, JUUL opted to charge the supplier, who the company internally blamed for the problem. Breja protested to the lack of public response, citing the need to, at the very least, issue a public health and safety notice. He was rebuffed.
The reason for allowing the contaminated products to reach the market, Breja claims, was pure greed. Responding to Breja’s suggestion, JUUL Chief Finance Officer Tim Danaher warned that such a move would compromise billions of dollars in lost sales. According to the lawsuit, Danaher also challenged his former employee’s loyalty to the company.
JUUL Lawsuit Alleges Employee Was Unlawfully Terminated Over Raising Safety Concerns
Breja says his termination from JUUL, which came a week after raising concerns about the tainted products, was a form of unlawful retaliation. This is another claim JUUL has denied. In a statement issued to Ars Technica, a JUUL spokesperson said:
“Mr. Breja’s claims are baseless. He was terminated in March 2019 because he failed to demonstrate the leadership qualities needed in his role. The allegations concerning safety issues with Juul products are equally meritless, and we already investigated the underlying manufacturing issue and determined the product met all applicable specifications. The company will vigorously defend this lawsuit.”
Tuesday’s filing also asserts that, earlier in the year, Breja had raised concerns over a separate incident: A shipment of JUUL products that were past expiration.
In that allegation, JUUL made the decision to distribute pods that were almost a year old. Breja wanted to include an expiration date on the packaging. That suggestion was turned down by JUUL’s then-CEO Kevin Burns, who, according to allegations, told Breja, “Half our customers are drunk and vaping like mo-fos, who the f-ck is going to notice the quality of our pods?”
In a statement to Buzzfeed News, Burns, who left the company in September, said the following:
“I never said this, or anything remotely close to this, period… As CEO, I had the company make huge investments in product quality and the facts will show this claim is absolutely false and pure fiction.”
Whether the lawsuit’s allegations will be proven true remains to be seen. Nevertheless, JUUL’s legal and public relations problems have been mounting for some time. Last month, the White House moved to ban flavored e-cigarettes, singling out JUUL for getting young people hooked on their nicotine products through fruit- and mint-flavored vaping oils.
FDA and White House Aligned on Tougher Vaping Laws
The U.S. Food and Drug Administration (FDA) says the White House’s proposed move is meant to “protect kids from the dangers of nicotine addiction and tobacco-related disease and death.”
A number of states, including Michigan and New York, have already taken steps to prohibit flavored vape products. Massachusetts, as well as the city of San Francisco, has gone so far as to enact a complete ban on all vaping products, although the Massachusetts action is only a temporary measure.
The same day that the lawsuit was filed in the Northern District of California, JUUL confirmed reports that it plans to lay off 500 workers.
Juul’s new CEO, K. C. Crosthwaite, is the former chief growth officer at Altria Group — the parent company of Philip Morris.