Embattled e-cigarette maker Juul Labs is no longer going to be running ads in support of Prop C, the local ballot measure it bankrolled to overturn San Francisco's ban on vape products.
Newly installed CEO K.C. Crosthwaite, the Altria executive who took over last week after Kevin Burns stepped down, said in a statement that the company would cease all "active support" of the ballot measure, as the SF Business Times reports. "I am committed to seeing that Juul engages productively with all stakeholders, including regulators, policymakers and our customers. This decision does not change the fact that as a San Francisco-founded and headquartered company we remain committed to the city," Crosthwaite said.
SF became the first city in the country to outright ban e-cigarettes and the sale of vape cartridges altogether when the Board of Supervisors passed an ordinance to do so in June. The law not only banned the manufacture and sale of all non-FDA-approved vape products in city limits, it also banned the mail-order delivery of such products to SF addresses.
The Supervisors felt that the law was necessary to protect consumers in light of the fact that the FDA has yet to approve any vape pens or products, and the fact that state law preventing everyone under the age of 21 from buying vape products was not being adequately enforced to protect teenagers.
The law ended up being prescient given the stories that began emerging shortly after it passed about a mysterious lung illness connected to e-cigarettes that was landing many young people in intensive-care units across the country. Some anecdotal evidence suggests that the people who have become sick — now over 800 across 46 states, with 14 deaths — may have been using counterfeit or black-market vape pods, particularly those containing marijuana. But, thus far, public health officials and the Centers for Disease Control have not determined a specific ingredient or product to be the culprit — of a group of 514 patients surveyed, 77 percent said they had used THC-containing vape products, with only 36 percent of those exclusively using marijuana. The CDC has now issued a broad warning against all types of vaping, which has already taken a hit to Juul's business.
As ABC 7 reports, the Juul-supported Prop C must legally remain on the November ballot now that it's there, and to date Juul Labs has spent over $10 million on a campaign to get out the vote to overturn it. As the Chronicle reports, after unpaid bills, the Yes on C campaign is expected to return $7 million in unspent funds to Juul.
Meanwhile, Juul is under criminal investigation by the feds, though the focus of the probe is not yet known. And the FTC is investigating Juul as well for what it says were misleading marketing practices.
The No on Prop C campaign, which has seen some significant funding from former New York City mayor and anti-smoking activist Michael Bloomberg, will presumably continue.
Previously: Juul CEO Steps Down; Layoffs Are In Store