Analysts and investors are worried that Altria paid as well a great deal for its 35% stake in Juul, in particular provided all the scrutiny and lawsuits that the e-cig manufacturer is facing. Defending the terms of the deal, Willard stated that the e-cigarette marketplace wasn’t expanding a great deal just before Juul entered it, adding that Altria’s personal MarkTen solutions had hardly gained traction, prompting Altria to cease promoting them altogether. “I’m extremely pleased for the chance to make the investment and think it will spend dividends down the road,” he told analysts.
A Lawsuit Filed Against Juul/Altria Alleging Fraudulent Misinformation
Meanwhile, Juul is similarly taking some hits for striking the deal with Altria. Final month parents of a Florida teenager filed a lawsuit against Juul/Altria, alleging that their son has come to be addicted to the Juul device and accusing the firms of fraud, negligence, and violation of the RICO statute.
The lawsuit was filed in the federal district court for the middle district of Florida, and is clearly a consequence of the deal. In reality 1 of the initial complaints of the lawsuit is that considering that Altria purchased a 35% stake in Juul, Juul’s infrastructure has been corrupted and is working with the very same fraudulent marketing and advertising measures that the tobacco organization itself has employed.
Study Additional: CNBC