City Attorney secures $1 million settlement from online tobacco retailer

SAN FRANCISCO, CA (January 8, 2026) — City Attorney David Chiu announced today that his office secured a $1 million settlement that requires online tobacco retailer, Lucy Goods, Inc., to stop shipping illegal tobacco products into San Francisco. The settlement stems from a 2024 lawsuit the City brought alleging that several online tobacco retailers flouted San Francisco’s flavored tobacco bans by unlawfully selling flavored nicotine pouches, commonly referred to as “Zyns,” to San Francisco consumers.

In October 2025, the City Attorney reached a stipulated judgment and injunction with the other Defendants in the lawsuit. The lawsuit successfully enforced San Francisco’s flavored tobacco ban and yielded nearly $4 million total in penalties and fees.

“The popularity of flavored nicotine pouches has skyrocketed, and we cannot risk hooking a new generation of young people on tobacco products,” said City Attorney Chiu. “Due to the alarming health risks, San Francisco banned all flavored tobacco products, including flavored Zyns. Online tobacco retailers are not above our laws and cannot ship banned products into our city. We hope this sends a clear message that selling these products will not be tolerated.”

“Evidence shows flavored tobacco pouches pose a serious threat to public health, particularly among young people, as they can impact healthy development and lead to long-term health consequences,” said San Francisco Health Officer Dr. Susan Philip. “We appreciate the City Attorney’s Office for its ongoing commitment and partnership in upholding our laws to protect the health and well-being of our communities.”

“This settlement sends a clear message that San Francisco will enforce its flavored tobacco ban and hold corporations accountable when they try to undermine our public health laws,” said Supervisor Shamann Walton. “Flavored nicotine products are designed to attract young people, and we cannot allow online retailers to bypass local protections and put another generation at risk. This action reinforces our commitment to protecting youth, supporting families, and prioritizing community health over corporate profits. Thank you City Attorney Chiu and your team for enforcing this.”

Background
The proliferation of flavored tobacco products has threatened decades of progress in reducing youth tobacco use. Tobacco products are much more attractive to young people when they are flavored. The 2023 California Youth Tobacco Survey found that most high school survey respondents who use tobacco reported using flavored tobacco products and that “nicotine pouches” are the second most common form of tobacco use among California 8th graders.

Due to the alarming public health risks of flavored tobacco products, Supervisor Shamann Walton, former City Attorney Dennis Herrera, and former Supervisor Malia Cohen led the successful effort to enact laws prohibiting the sale or distribution of flavored tobacco products to any person in San Francisco.

Nicotine pouches are commonly referred to as “zyns” or “nics,” with the ZYN brand dominating the U.S. market for flavored nicotine pouches. Nicotine pouches are small water-soluble packets containing nicotine powder or salts that users place between the gum and lip, allowing the nicotine to be absorbed into the bloodstream. The pouches, which are typically packaged in small round plastic canisters, are sold in a variety of fruity, minty, and other flavors.

Nicotine pouches are cheaper than cigarettes or vapes, and a user of nicotine pouches absorbs twice as much nicotine versus a cigarette smoker. Nicotine pouches are particularly appealing to youth given the low cost and attractive flavors, and recent studies have found that more children are trying and using nicotine pouches.

The consequences of hooking a new generation on tobacco and nicotine products are dire. Nicotine exposure during adolescence can harm the developing brain and adversely impact learning, memory, and attention. Nicotine is a highly toxic substance, especially in concentrated forms found in nicotine pouches. Ingesting even a small amount can lead to nicotine poisoning in children.

In September 2024, City Attorney Chiu filed a lawsuit against Lucy Goods, Inc., Rogue Holdings LLC, Swisher International, Inc., and Northerner Scandinavia, Inc. for unlawfully selling a variety of flavored nicotine pouches directly to San Francisco consumers via their websites. The lawsuit alleged violations of San Francisco’s ban on flavored tobacco products as well as violations of California’s Unfair Competition Law.

The stipulated judgment and injunction with Lucy Goods Inc., entered by the San Francisco Superior Court on January 6, 2026, requires the company to pay San Francisco $1 million in civil penalties and attorneys’ fees. The judgment also requires them to prohibit the use of San Francisco addressees in shipping or billing address fields, and post clear language on their website stating that flavored tobacco products may not be sold in San Francisco.

The City Attorney previously reached stipulated judgments with the other Defendants requiring Rogue Holdings LLC, Swisher International, Inc., and Northerner Scandinavia, Inc. to pay San Francisco nearly $3 million.

City Attorney’s Office employees Rhonda Andrew, Sara Eisenberg, Miguel Gradilla, Nancy Harris, Christine Hoang, Ronald Lee, Chris Manitsoudis, and Yvonne Meré worked on this matter to protect public health and hold these online tobacco retailers accountable.

The case is People of the State of California and People of the City and County of San Francisco v. Rogue Holdings LLC., et al., San Francisco Superior Court, No. CGC-24-617804. View the stipulated judgment and injunction.