Public Nuisance Claims: Altria's Vaping Trial Highlights Potential Expansion

• Jurisdiction: California,United States
• Law Firm: Foley & Lardner
• Subject Matter: Food, Drugs, Healthcare, Life Sciences
• Author: Mr James Matthews, Katy Koski, Graham D. Welch and Gregory Heinen
• Published date: 23 May 2023

The recent trial in a case now settled highlights the potential expansion of public nuisance claims under California law, and in large-scale public nuisance actions more broadly.

On April 24, 2023, opening arguments began in San Francisco United School District v. JUUL Labs, Inc., et al., Case No. 19-op-8177 (N.D. Cal.), sparking a momentous trial in federal court involving the San Francisco Unified School District (SFUSD) and tobacco manufacturer Altria Group, Inc. (Altria).

The trial was a bellwether in the multi-district litigation (MDL) involving approximately 5,000 cases concerning claims that the marketing of JUUL Labs, Inc. (JUUL) products caused a youth vaping crisis that warranted recovery by public entities. In re: JUUL Labs, Inc. Marketing, Sales Practices and Products Liability Litigation, Case No. 19-md-02913-WHO (N.D. Cal.).

JUUL and related individual defendants were no longer in the case at trial following a $1.2 billion settlement agreement reached in December 2022, so the sole remaining defendants at trial were affiliates of Altria, which acquired a 35% stake in JUUL in December 2018. And on May 10, a day after the plaintiffs rested their case, the parties announced a settlement of the claims against Altria as well, averting a verdict.

In the trial, Altria argued that not only did the SFUSD not have authorization to sue under California law, but even if it did, the SFUSD failed to allege any actions by Altria that caused or contributed to the alleged nuisance. Meanwhile, the SFUSD argued that it was authorized to sue under a theory of "property damage" as the result of youth vaping crisis and that aggregate evidence of youth use of e-cigarette devices was sufficient to establish that Altria's presence in the market contributed to the nuisance risk.

The expansions of traditional public nuisance claims as advocated by SFUSD would create new liability risks for manufacturers of products in many industries.

Expansion of Authorization to Bring a Public Nuisance Claim

The SFUSD case has already expanded the scope of authorization for public entities to bring public nuisance claims under California law.

Cal Civ. Proc. Code ' 731 and 3493 provide two separate types of authorizations for public nuisance claims: (1) by private persons whose "property is injuriously affected" or whose "personal enjoyment is lessened;" and (2) by authorized counsel for municipal bodies where a nuisance exists.

On summary judgment, Altria argued that the SFUSD was...