Eonsmoke Loses $22.5 Million in First Fraud Lawsuit
Credit: Eonsmoke
The Arizona Attorney General’s Office (AGO) obtained a $22.5 million judgment and a permanent injunction against New Jersey-based vapor company Eonsmoke, LLC. The ruling could set precedent for other states suing vapor companies over marketing practices.
“Eonsmoke is being held accountable for its unlawful conduct in Arizona, including marketing flavored vaping pods to children,” said Attorney General Mark Brnovich. “If you are an Arizona retailer and have Eonsmoke products on your shelves, they are illegal. This final judgment includes comprehensive injunctive relief, and our office will continue to monitor Eonsmoke’s presence in Arizona and ensure its compliance with all state and federal laws.”
Eonsmoke is known for selling its Juul compatible fruit-flavored pods.
Arizona may have to visit the courts again in order to collect any funds from the judgment. Eonsmoke’s website launches with a statement saying it has ceased operations “due to rapidly declining circumstances, coronavirus, regulatory, and competitor litigations.”
The Consumer Protection Section of the AGO filed a consumer fraud lawsuit in January 2020 to stop Eonsmoke from selling illegal vaping products and targeting youth in Arizona. In October 2019, the FDA informed Eonsmoke that it was manufacturing and selling 96 illegal products that did not receive proper FDA approval.
“Eonsmoke is being held accountable for its unlawful conduct in Arizona, including marketing flavored vaping pods to children,” Brnovich said in a statement.
In February 2020, the Superior Court granted the State’s preliminary injunction request, ordering Eonsmoke to immediately cease the sales of illegal vaping products. In the wake of this ruling, the AGO’s Tobacco Enforcement Unit sent over 4,880 letters to retailers informing them that they were facilitating the sale of illegal vaping products, an article on sedona.biz states.
On July 27, 2020, the Court issued a final judgment against Eonsmoke. The judgment:
- Permanently enjoins Eonsmoke from: (i) advertising, marketing, or selling any illegal products in Arizona; (ii) marketing, appealing to, or targeting underage consumers in Arizona; and (iii) providing any products to underage consumers in Arizona or distributing products to retailers with three or more violations of the underage sales statutes.
- Awards the State a total judgment of $22,535,136:
- $21,974,000 in civil penalties
- $511,136 in disgorgement of revenues, and
- $50,000 in attorneys’ fees
Also in January of 2020, the Arizona AGO, alongside numerous other states and local municipalities, filed a similar consumer fraud lawsuit against Juul Labs.
