Juul’s internal playbook opens a rare window into influence in Washington

WASHINGTON — A new trove of internal emails and other documents from the e-cigarette maker Juul reveals the company’s extensive behind-the-scenes efforts to promote its interests in Washington — a rare insight into the otherwise opaque methods corporations use to influence the government.

It’s well documented that Juul spent significant sums on registered lobbyists and political donations back in 2018 and 2019, when the head of the Food and Drug Administration declared youth vaping an epidemic, Congress held two days of hearings investigating Juul’s marketing to kids, and cities, states, and the federal government were threatening to ban the flavored vapes that made Juul so popular in the first place.

The trove of documents, which was released as part of a legal settlement with the state of North Carolina, shows that Juul tried everything from orchestrating untraceable political donations to paying think tanks for favorable research, in an effort to revamp its image and prevent both Congress and the FDA from taking action that could cost the company financially.

The strategies aren’t necessarily surprising themselves, transparency advocates told STAT. But it is rare to see them laid out like this.

“It isn’t often I get to look at this whole pool of influence peddling … being used by one company, even though I know it happens frequently,” said Craig Holman, the government affairs lobbyist at Public Citizen. “It surprises me to see it, but I know it happens.”

Michael Beckel, research director at the advocacy organization Issue One, said the documents affirm “there are companies out there doing the things that advocates have been warning of.”

“These documents just really underscore how many different avenues there are to try to influence public policy debates in Washington, all the different levers of power that special interests try to pull, all the different ways that they are working to ingratiate themselves with lawmakers … and put their thumb on the scale,” Beckel added. “There are many tentacles to an influence operation in Washington.”

In a statement a Juul spokesperson defended the company’s interactions with outside groups as key to its efforts to “contribute to a more science- and evidence-based public discussion about how best to reduce the death and disease caused by smoking and to reduce underage appeal and access to tobacco and nicotine-containing products.”

“We furthermore believe as a matter of general principle it is fundamentally appropriate for companies like ours to participate in the public dialogue and engage with others who are part of that dialogue,” the spokesperson added. “This includes, under certain circumstances, providing those stakeholders with support for their work.”

Some of Juul’s advocacy did benefit public health. The documents show, for example, that a central part of Juul’s strategy to revamp its image centered on aggressively lobbying to raise the age for buying tobacco to 21, which became law in late 2019. It’s estimated that that change alone could prevent more than 200,000 premature deaths.

A rare glimpse into dark donations

Juul’s internal documents provide rare insight into how corporations use so-called dark money groups to funnel large donations to political candidates.

According to an internal spreadsheet entitled “Political Giving Strategy,” Juul considered writing six figure checks from the company’s treasury to several so-called “social welfare organizations” as a means of influencing congressional leaders. Unlike other political donations, corporations aren’t required to disclose their donations to these sorts of organizations, known as 501(c)(4)s.

These nonprofits aren’t supposed to have political support as a primary purpose. But Juul’s internal strategy clearly shows that the company saw its donations to these organizations as conduits for giving to some of Washington’s most powerful lawmakers. The internal spreadsheet describes Majority Forward as a “recipient vehicle” for Senate Majority Leader Chuck Schumer (D-N.Y.), and another group, One Nation, as a vehicle for Senate Minority Leader Mitch McConnell (R-Ky.)

It’s unclear if Juul did donate these sums or only considered the donations. The emails do not include formal receipts for the donations.

There are other ways to make it harder for the public to trace donations. In one example, Juul had a board member target a lawmaker with a donation at the same time it had the company’s CEO do the same. When Juul hosted a fundraising dinner with then-Energy & Commerce Chair Rep. Greg Walden (R-Ore.) at the home of Juul’s CEO at the time, Kevin Burns, Juul coordinated one $20,000 donation from the company’s CEO and another $25,000 from the board member, Riaz Valani, the company’s emails show. Both Burns and Valani donated the cash to Walden the day of the fundraising dinner, according to Federal Election Commission records. While Burns must legally disclose his connections to Juul, Valani instead lists his investment firm.

Juul also gave money the traditional way, with executives donating directly to individual candidates and their political action committees. Those donations are always disclosed to the FEC.

But the documents show Juul CEO Burns was slated to write so many personal checks to politicians in 2019 that he questioned whether the donations were even legal.

Juul lobbyist Chaka Burgess reassured him.

“Thanks to our wonderful [election] laws one person can write as much as they want,” Burgess wrote in March 2019. “Whatever happened to ‘Mr. Smith Goes to Washington?’”

Washington connections typically go much deeper than registered lobbyists

Corporations are required by law to disclose every lobbyist they pay, both inside and outside the company. But the Juul documents show that those registered lobbyists are far from the only influential people companies employ to help them navigate Washington.

Internal budgets reveal that by April 2019, Juul was forking over more than $200,000 per month to “strategic advisors” — former staffers for Presidents Obama and Bush and powerful members of Congress like Schumer who played an integral role in charting Juul’s strategy in Washington. Hiring consultants like these isn’t illegal, as long as those people spend less than 20% of their time on lobbying activities.

Juul hired Mercury, a “high-stakes public strategy firm” that boasts clients like AirBnB and eBay to “provide regular strategy assessments considering political threats, opportunities, and objectives” and to “advise Juul … on meetings with the Executive Branch, Congress and State/Local Leaders.” It’s unclear how much Juul ultimately paid the firm for its services; Mercury’s monthly retainer appears to have ranged from $15,000 to $30,000 per month, according to unsigned contracts and internal company budgets.

Internal emails show that one Mercury official, a former Schumer staffer, was instrumental in crafting a political response to the FDA’s first major crackdown on Juul in September 2018. That official, Erick Mullen, urged Juul to try everything from lobbying congressional appropriators to disempower the FDA to promoting Juul at bull riding and martial arts events.

In one email dated Sept. 12, 2018, Mullen highlighted his past success in killing tobacco regulations. “Target members of the Appropriations Committee with both an inside lobbying game in DC and an outside grasstops game in their districts that include: consumers (see above), convenience store owners, vape shop owners (I did this to defeat the attempted FDA menthol rules in 2011/2012),” Mullen wrote.

Mercury did not respond to requests for comment.

Juul’s army of consultants also appeared to connect the company to people and organizations that may otherwise have been unwilling to meet. Precision Strategies, a firm founded by three top Obama campaign aides, for example, helped set up and attended a meeting between Juul’s CEO and Neera Tanden, the president of the Center for American Progress, the prominent liberal think tank formed by a Clinton Administration alum.

At one point Juul appears to have paid Precision Strategies $100,000 a month, according to a draft contract and emails confirming the company’s willingness to sign said contract. The firm’s responsibilities included creating a “proactive strategy to reach influencers and attract partners to change [the] narrative around Juul” and aiding in the rollout of the company’s plan to combat underage use and its legislative efforts to raise the legal age for buying tobacco to 21. A spokesperson for Precision Strategies said that the firm “terminated work with JUUL when Altria purchased a stake in the company” in late 2018.

Another consultant, Ed Gillespie, helped organize a salon dinner with key Republican officials, including former senator and presidential candidate Rick Santorum. Juul was paying his firm $40,000 per month, according to an internal September 2018 budget. Gillespie served as the chair of the Republican National Committee and as a counselor to President George W. Bush.

Supposedly impartial think tanks can become arms of corporations

Think tanks have a reputation as impartial laboratories of policymaking. But the Juul emails reveal the company pursued partnerships with these organizations with the express purpose of revamping its image in Washington.

“The central pillar of our strategy is to identify and facilitate the creation of a partnership with a top-tier think tank that can produce substantive, data-driven research that can be used to correct the record, shift the public conversation, and even influence the creation of policy,” Mercury wrote in a memo to Juul dated September 2018.

Among the groups targeted, according to the memo, was the Center for American Progress.

In addition to meeting with CAP, Juul also donated $25,000 to the group, according to an internal budget. A spokesperson for CAP told STAT that “Juul was one of several sponsors of an after party at CAP’s 2019 flagship IDEAS Conference — a minor contribution to a major conference.” He said CAP has “since instituted rules against receiving resources from companies that produce products like those made by Juul” and that all corporate donations to the group go toward “general operating costs and are not directed towards any particular area of research.”

The documents also reveal that Juul budgeted for a partnership with the Progressive Policy Institute, a center-left think tank once known for being President Bill Clinton’s “idea mill.”

PPI does not publicly disclose its funders, and the trove does not include a formal funding contract between the parties. However, an internal budget shows that Juul set aside $300,000 for the group in 2019, and that executives were bullish about the two working together.

“Productive meeting with the leadership of the Progressive Policy Institute, which is likely to lead to an important partnership,” one of the company’s executives wrote in an email dated March 15, 2019.

Within five months, PPI was producing research promoting the potential benefits of e-cigarettes. In August 2019 PPI released a white paper claiming that “e-cigarettes offer the most effective means currently available for reducing cigarette smoking.” The paper made no mention of any connection to Juul.

Lindsay Lewis, executive director of PPI, said in a statement that the group has studied e-cigarettes in an effort to help reduce smoking rates, and that the group has had “no engagement with Juul since 2018.” The organization declined to answer STAT’s questions on how much money the group has accepted from Juul and whether it had any editorial control over its reports.

The documents also show that Juul paid the conservative think tank and advocacy group FreedomWorks to produce a five- to ten-page policy paper “targeted at briefing FreedomWorks activists on harm reduction policy,” according to a signed funding proposal.

Even the oddest of connections can be leveraged for political gain

Corporations often dole out money to organizations that seem to have no real connection to their mission, but Juul’s internal documents reveal it sought to leverage even disparate connections to advance its political goals.

Internal documents show, for example, that Juul was so interested in courting firefighter groups, that it put a former head of lobbying for the international firefighters labor union on retainer for $20,000 a month. Juul saw firefighters as a potential ally because combustible cigarettes are often tied to house fires, but it also saw an opportunity to use local firefighters’ positive image and political clout to defeat policies that hurt its bottom line.

One internal email, for example, showed Juul was hopeful Sacramento firefighters would help defeat the city’s proposed ban on flavored vapes. “They appeared open to potentially supporting our alternative proposal for Sacramento and wanted to keep a dialogue going moving forward,” a Juul official wrote in an internal email dated November 2018.

There’s an industry for drumming up comments on dockets

There is perhaps nothing more bureaucratic in Washington policymaking than a regulatory comment period. The federal government opens one for seemingly every single thing it does. The comments go unnoticed by 99% of Americans, and there’s even debate among scholars over whether comments have an impact on the regulators to whom they’re addressed.

But internal Juul emails highlight a cottage industry in Washington that charges corporations to generate these comments.

When the FDA opened a docket in 2018 on the public health impact of flavored tobacco products, it was flooded with comments calling for a ban on flavors, which were then a key part of Juul’s business. The sudden public backlash prompted one consultant to pitch Juul on a counterattack — one that would use a dark money group associated with former Libertarian congressman Bob Barr and enlisted the support of prominent Christian conservative Rebecca Hagelin. It would cost the company $1.5 million.

The consultant, John Hilinski, promised that the campaigns would generate Juul between 350,000 and 550,000 comments. In addition to the public support, the consultant added that Barr and Hagelin would be “doing daily media appearances and writing columns defending the industry and taking any heat for their stance that ‘harms kids,’” all with no fingerprints back to the company.

“Again, Juul will never be mentioned as a player in these campaigns, but will have strong advocates in their support that represents the segments of Americans that regulators weigh more heavily than others,” Hilinski wrote.

It’s unclear if Juul ever finalized the agreement with Hilinski, who has also been connected to an effort to spam the Federal Communications Commission with fake comments. However, it does appear that at least two Juul executives were in favor of launching the effort as a counter attack against comments being drummed up by public health groups. “I hate how these political debates are fought but we may need to take a page from their playbook,” wrote Juul’s vice president of global commercial marketing to the company’s CEO in June 2018.

Barr did write an op-ed later that month publicly slamming the FDA for its regulation of vaping. He did not respond to STAT’s request for comment. Hilinski and Hagelin could not be reached for comment.

The consultant wasn’t the only one pitching Juul on the ability to generate comments. The conservative advocacy group FreedomWorks also included that service in a larger funding proposal that the company accepted in October 2018.

“If a regulatory comment period opens, activists will use the FreedomWorks Regulatory web portal to submit public comments,” the proposal states. That specific service, dubbed “Expert and Activist Engagement” cost Juul $15,000, according to the proposal.

STAT’s coverage of the commercial determinants of health is supported by a grant from Bloomberg Philanthropies. Our financial supporters are not involved in any decisions about our journalism.