The attorneys general of 39 states have launched an investigation of the risks associated with e-cigarette (vaping) products made by Juul Labs and how the products were promoted to children. According to a press release from the office of Texas Attorney General Ken Paxton, the multistate investigation focuses on Juul’s marketing and sales practices.

Paxton commented:

I am pleased to be working alongside other states to determine whether any of JUUL’s statements or business practices mislead or otherwise harmed consumers. Protecting Texans from deceptive business practices is a high priority for my office, and I am committed to holding companies accountable for the quality, effects, and marketing of their products.

Nevada Attorney General Aaron Ford, who has joined the investigation, added:

The 39-state coalition is investigating Juul’s marketing and sales practices, including targeting of youth, claims regarding nicotine content, and statements regarding risks, safety and effectiveness as a smoking-cessation device.

The announcement noted that the U.S. Food and Drug Administration (FDA) estimated that more than 5 million U.S. middle and high school students used e-cigarettes last year and that nearly 1 million used the devices daily.

In January, cigarette maker Altria Inc. (NYSE: MO) took a fourth-quarter pretax, non-cash impairment charge of $4.1 billion related to its $12.8 billion investment for a 35% stake in Juul. In the third quarter, the company wrote down $4.5 billion related to the investment. The total $8.6 billion impairment leaves Altria with a value of just $4.2 billion in Juul.

On the company’s conference call following its fourth-quarter report, Chief Financial Officer Billy Gifford said the $4.1 billion write-down was related to Juul’s legal difficulties and the threat of regulatory restraint hobbling the e-cigarette market.

Juul and other makers of vaping devices have until May 12 to submit applications to the FDA for approval to sell flavored vaping pods to consumers. Altria has a “heat-not-burn” device called IQOS developed in conjunction with its sister company, Philip Morris International (NYSE: PM), that has been approved for sale in the United States. As part of its original investment in Juul, Altria cannot sell a vaping device in the United States unless Juul is banned from selling to U.S. consumers for at least one year or if the value of Altria’s investment drops below $1.28 billion (10% of its original total).

Altria stock was trading down by about 2.2% shortly after the noon hour Tuesday, at $42.84 in a 52-week range of $39.30 to $57.88. The consensus price target on the stock is $54.89. Altria pays an annual dividend yield of 7.32%.

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