Juul Labs Inc. is beginning talks regarding funding for a potential chapter 11 bankruptcy, Bloomberg News reported. The e-cigarette manufacturer has engaged in informal talks regarding debtor-in-possession financing and formal discussions with potential lenders are expected to progress in the coming days. Juul hired bankruptcy advisers Kirkland & Ellis and Alvarez & Marsal in June after the FDA banned Juul products on U.S. shelves, citing a lack of evidence demonstrating their overall safety. The company has been mulling a possible bankruptcy filing since then, along with pursuing various financing options, as previously reported by Bloomberg. The company won a court order temporarily blocking the FDA decision, and the agency separately stayed its ban, allowing the company to continue selling products. Juul has also faced hundreds of millions of dollars in damages from a barrage of lawsuits alleging it targeted minors. It has agreed to settle certain of those claims for more than $500 million, including through an agreement in principle with 33 states to resolve a two-year bipartisan probe into its marketing and sales practices.
