Commission Order Vacates ALJ Initial Decision and Dismisses Complaint in Case Against Altria and Juul

On Friday, June 30, 2023, the Federal Trade Commission vacated the Administrative Law Judge’s (ALJ) initial decision  in the administrative litigation challenging an alleged unlawful agreement between Altria Group, Inc. (Altria) and Juul Labs, Inc. (JLI) and dismissed the complaint in the public interest.  

In its order, the Commission also vacated the ALJ’s initial decision because the Commission’s dismissal deprived FTC staff attorneys of the ability they would otherwise have had to obtain review of the decision. In doing so, the Commission clarified several matters of law that arose in the ALJ’s initial decision. Vacating the ALJ’s initial decision means that it may no longer be cited as precedent.  

The complaint in this matter stems from Altria’s December 2018 purchase of a 35 percent stake in JLI in exchange for a $12.8 billion all-cash investment and Altria’s preceding withdrawal of its closed system electronic cigarette products from the market. The FTC’s complaint alleged that, in the deal and in an unwritten agreement leading up to it, the companies unlawfully agreed that Altria would cease competing in e-cigarettes, in violation of the Sherman Act’s Section 1 and the FTC Act’s Section 5. The FTC’s complaint also alleged that the investment was an illegal acquisition in violation of the Clayton Act’s Section 7 and the FTC Act’s Section 5.  An evidentiary hearing took place before the ALJ, who issued the initial decision recommending dismissal of the complaint, and FTC staff attorneys timely appealed.