Altria Group sank as much as 5% Thursday after The Wall Street Journal reported the Federal Trade Commission is investigating Juul Labs for dubious ads.
Altria purchased a 35% stake in Juul for $12.8 billion in December. The FTC investigation began before the acquisition was made, according to WSJ.
Juul - Advertisements - Scrutiny - Device - Accessory
Juul's advertisements have fallen under scrutiny for portraying its vaping device as a lifestyle accessory, complete with appealing flavors and popularity among people in their 20s and 30s.
Teen vaping grew 78% from 2017 to 2018, according to federal data. Photos of young people using Juul's product flooded social media after sales skyrocketed in 2017, WSJ said.
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Altria Group shares fell as much as 5% Thursday after The Wall Street Journal reported the Federal Trade Commission is investigating Juul Labs for deceptive marketing.
FTC - Investigators - Juul - Advertising - Campaigns
FTC investigators are looking into whether Juul's advertising campaigns targeted minors by using young people and attractive flavors. The commission is also deciding whether to seek damages against Juul, WSJ reported.
Altria purchased a 35% stake in Juul for $12.8 billion in December. The cigarette maker's acquisition valued Juul at about $38 billion. The FTC began its investigation before the December acquisition, according to the report.
Juul - Ads - Flavors - Cappuccino - Mango
Juul has been scrutinized for ads that tout flavors like "Cappuccino" and "Mango." It also ran ads in 2015 that showed images of people in their 20s and 30s using the device as trendy accessory.
The Food and Drug Administration and some state attorneys general are already investigating Juul's ads. The FDA held an unscheduled inspection of Juul's headquarters in October to seize documents related to its marketing practices.
Juul - Products - Adults - Cigarettes - Consumers
Juul has previously said its products are intended for adults who have already smoked cigarettes, and that it never marketed to young consumers. Juul CEO Kevin Burns told nonsmokers not to use the company's products...
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