A shadowy e-cigarette company that has reaped millions of dollars by exploiting a loophole to sell kid-friendly, flavored nicotine products says it is suspending sales in the U.S following revelations about its owners.
Puff Bar, a California-based marketer of disposable e-cigarettes, announced the sales suspension Monday on its website. In a phone call with FairWarning, the company's Chief Financial Officer Patrick Beltran confirmed that U.S. sales were being halted until further notice, but said that international sales would continue for the time being. Beltran would not give a reason for the move. Despite the announcement, as of late Monday the company website still listed other outlets that sell Puff Bar products.
For months, Puff Bar had cultivated a sense of mystery about its ownership and operations. But as FairWarning reported on July 9, a new document filed with the California Secretary of State named Beltran and Nick Minas, both in their twenties, as CFO and CEO, respectively.
The document was filed shortly after FairWarning began an investigation of the company, which was originally registered to a house owned by Minas' mother in the North Hollywood area of Los Angeles. FairWarning's story documented Minas' and Beltran's history of bending rules on e-commerce websites to sell e-cigarette products.
Even with the disclosure, it's uncertain who really is in control of Puff Bar, which appears to be connected with other companies in the U.S. and China. In an interview, Minas and Beltran said that despite their titles, their job was running the Puff Bar website. They refused to say who hired them, and claimed not to know anything about another company that owns trademarks for some of the Puff Bar products.
Beginning in 2019, Puff Bar rapidly gained popularity with its wide variety of fruity flavors and sleek design. The company got a giant boost in January, when the Food and Drug Administration banned most flavored e-cigarettes but carved out an exemption for disposable vape devices. Puff Bar, along with a handful of other brands, quickly capitalized. By April, the company was reportedly making millions of dollars in sales each week.
Public health advocates, upset by the regulatory loophole, have asked lawmakers to take action against Puff Bar and other disposable e-cigarette makers. In June, Rep. Raja Krishnamoorthi, an Illinois Democrat, demanded that the FDA ban sales of Puff Bar products because the company has allegedly targeted children.
Puff Bar is currently the target of at least two lawsuits. On July 1, the Boston-based Public Health Advocacy Institute sued Puff Bar and its distributor, Cool Clouds Distribution Inc., for allegedly promoting and selling e-cigarettes to children in Massachusetts. On the same day, a Florida law firm filed a class action against Cool Clouds in New Jersey. The complaint alleged that a 17-year-old became addicted to nicotine by using Puff Bar products. A few days after FairWarning's story was published, the New Jersey lawsuit was amended to add Puff Bar, Minas and Beltran as individual defendants. Beltran said he hadn't seen the latest lawsuit against his company.
While the Puff Bar website is suspending U.S. sales, Puff Bar products are still for sale on various e-commerce websites. One of those is eliquidstop.com, a site owned by Minas and Beltran. On Reddit, a user who claims to represent the Puff Bar company has directed confused customers to make purchases at eliquidstop.
Mark Gottlieb, executive director of the Public Health Advocacy Institute, said he was pleased to learn of the sales suspension, but worried that "those same highly addictive products will soon be available under another brand name and the public health community will be forced into a game of Whack-A-Mole. Ideally, the FDA's loophole for disposable flavored e-cigarettes should be closed and closed now, before another disposable brand gains the traction that Puff Bar managed to do in less six months."
Minas and Beltran appear to have done well for themselves in recent months. According to public records, they purchased a home in Los Angeles in early June, and took out a nearly $927,000 mortgage on the property.