FTC sues to unwind Marlboro owner's $12.8 billion Juul investment
The two companies are accused of illegally restraining trade.
While e-cigarettes may have been quickly replaced in headlines by a new threat to public health, it appears the government has not forgotten about vaping. However, this time the news isn't about banning flavored pods or raising the legal age, instead the FTC is suing to unwind Altria's $12.8 billion investment in vaping giant Juul. While the folks at Altria might be having similar thoughts after lawsuits and regulation cut the value of that stake to around $4.2 billion in January, the feds take issue with the way the two companies "turned from competitors to collaborators by eliminating competition and sharing in Juul's profits."
At the time the investment even upset people within Juul, due to the suddenly hypocritical stance of claiming to be a way to help people quit smoking despite having a major investor that's a tobacco giant (Altria owns brands like Marlboro and Virginia Slims). According to the FTC, the partnership came about after Altria agreed not to compete with the upstart in exchange for getting that big stake.
In a statement, Altria VP Murray Garnick said "We believe that our investment in JUUL does not harm competition and that the FTC misunderstood the facts. We are disappointed with the FTC's decision, believe we have a strong defense and will vigorously defend our investment."
