Juul has announced a settlement that will cover more than 5000 lawsuits. The company was sued by American Indian tribes, municipalities, school districts, and individuals on different grounds.
The settlement which runs into a billion dollars will cover the American Indian tribes, personal injury, government entities, and consumer class actions.
While the company’s woes almost forced it to file for bankruptcy, they have received new investments to cover the settlements and stabilize its operations. However, they have cut down their workforce to a third in a bid to cut costs.
Juul’s additional challenges
Juul is still facing hostilities from the FDA and cut-throat competition in the market. Currently, Juul is selling products without full authorization from the FDA.
As the company awaits FDA approval, there are fears that a reaffirmation of the previous denial might force the company out of the market.
Analysts speculate that Juul could be a potential target for bigger companies like Philips Morris International (PMI) or Altria. These brands are seeking to enter the US market and it is easier to buy an existing business than start from scratch in the vaping industry.