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New York Sues Online E-Cigarette Sellers Amid Vape Crackdown

Chris Dolmetsch

(Bloomberg) -- New York City sued more than a dozen online retailers for allegedly selling e-cigarettes to underage residents, expanding a U.S. crackdown on the industry after a wave of lung illnesses tied to vaping.

The city asked a federal judge in Brooklyn on Wednesday to block the 22 online retailers from marketing and selling e-cigarettes to residents who are younger than 21. The city also demanded that the companies install systems to verify the age of customers, saying that purchases were made even when the buyers indicated they were underage.

“The kids of New York are the pride of our city, but to these companies, they’re just a source of profit,” Mayor Bill de Blasio said in a statement. “Preying on minors and hooking them on a potentially lethal, lifelong nicotine addiction is unconscionable.”

Lawsuits against e-cigarette makers and sellers are on the rise. At least 18 deaths have been tied to vaping by the U.S. Centers for Disease Control and Prevention along with more than 1,000 lung injuries. Officials haven’t identified any single product or substance responsible for causing the injuries.

”Any online-sales company that irresponsibly violates New York City’s tobacco laws should be subject to the same penalties as a business that violates the law within New York City,” said Gregory Conley, president of the American Vaping Association, a non-profit trade group. “The excessive penalties the city is aiming for are the type they would never seek against a business owner in the Bronx for selling a pack of Marlboros to a 20-year-old.”

‘Full Responsibility’

Mirza Baig, head of business development for the first company named in the suit, Irving, Texas-based Artisan Vapor Franchise, said the suit came as a “huge surprise” to his company, which runs a website and about 45 brick-and-mortar stores in states including Texas, New Jersey and Illinois. Baig said his company employs a third-party service to verify customers’ ages and is trying to determine how a minor could have purchased the products at issue in the suit.

“We will take full responsibility of course if anything like that has happened,” Baig said. “That’s not our business. That’s not what we do. We all have kids.“

Juul Labs Inc., the largest U.S. e-cigarette maker, is a defendant in almost a dozen federal lawsuits consolidated in San Francisco for pre-trial information exchanges. Some also target Altria Group Inc. Juul also faces more than 40 suits in state courts. Some plaintiffs include parents claiming their children became nicotine addicts after using e-cigarettes.

An emergency ban on flavored e-cigarettes instituted by New York state earlier this month was blocked by a state appeals court following a challenge by the Vapor Technology Association, a Washington-based trade group. The association said the overwhelming majority of the illnesses are directly tied to black-market products containing THC, the psychoactive ingredient in marijuana, and not regulated nicotine products.

The case is New York City v. Artisan Vapor Franchise, 19-cv-5693, U.S. District Court, Eastern District of New York (Brooklyn).

(Updates with comment from trade group and defendant)

To contact the reporter on this story: Chris Dolmetsch in Federal Court in Manhattan at cdolmetsch@bloomberg.net

To contact the editors responsible for this story: David Glovin at dglovin@bloomberg.net, Steve Stroth

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