Online discount cigarettes
"We are law-abiding businesses, and we believe we have been operating within the law, even though we believe the law is unconstitutional and unfair," said Ali Davoudi, president of the Online Tobacco Retailers Association.The group, along with a Seneca Indian retailer and two disabled smokers, are plaintiffs in a lawsuit claiming the ban is discriminatory.Law enforcement officers were on alert for potential protests on discount cigarettes online the Seneca Indian Nation's two western New York reservations, the site of past, sometimes violent, clashes over taxation issues.More than half of the approximately 200 New York-based Web sites offering cut-rate cigarettes for sale are run by Indian businessmen.In April 1997, demonstrators burned tires to close roads and skirmished with state troopers to protest the state's attempt to collect taxes on reservation tobacco and discount cigarettes online gasoline sales. The Pataki administration later quietly abandoned the tax collection attempt.
"We would far rather have this settled in the courts," said Seneca Larry Ballagh, owner of Traveling Smoke. But he and others did not rule out other means of expressing their opposition."We are a nation being attacked by another nation," he said, "and like all nations being attacked, we will respond accordingly."Indian tribes argue they are sovereign nations and immune from state tax laws.State Police Lt. Glenn Miner said there had been no incidents on the reservations as of Wednesday afternoon.The 2000 legislation _ which has never been enforced because of legal challenges _ prohibits private trucking companies from delivering Internet and mail-order shipments of cigarettes to consumers. The law does not prevent vendors from discount cigarettes online using the U.S. Postal Service for cigarette deliveries, a loophole some businesses were taking advantage of, Davoudi said.Tom Bergin, spokesman for the state Taxation and Finance Department, said the first day of enforcement was uneventful.
A New York state law that sought to prohibit the direct sale of cigarettes through the Internet, as well as by mail order and via telephones, was declared unconstitutional by a federal discount cigarettes online judge in Manhattan. In a 79-page ruling, U.S. District Court Judge Loretta Preska wrote that the law violates the commerce clause of the U.S. Constitution, which limits the powers of states to restrict interstate trade. While the state''s interest in protecting the health of residents is "indeed commendable," Preska said, that can''t be done in violation of discount cigarettes online constitutional guarantees to companies.
The law, signed last August by New York Gov. George Pataki, banned direct
sales of cigarettes over the Internet and the two other mediums in an
attempt to prevent minors from making illegal purchases. The measure
also sought to halt untaxed sales of cigarettes in the state via mail
order and other means. But Louisville, Ky.-based cigarette maker Brown
& Williamson Tobacco filed a lawsuit challenging the direct-sales
ban discount cigarettes online last October, arguing
that it unfairly limited the ways companies could do business in New
York. A month later, Preska issued a temporary restraining order against
the law just before it was due to take effect.
Brown & Williamson spokesman Mark Smith on Friday called the ruling
"a caution to the states" in how they try to legislate online
sales and business. Preska "made clear that states have many tools
at their disposal to protect their interests without banning direct
sales," Smith said, adding that state officials "ought not
use a meat ax when discount cigarettes online a scalpel
will do." Marc Violette, a spokesman for the New York state attorney
general''s office, which defended the law, said that it''s disappointed
by Preska''s ruling and is considering options for an appeal. "We
view the issue of Internet sales of tobacco as being an important health
issue in New York, particularly when it allows [minors] access when
using the Internet," Violette said. Brown & Williamson, the
third-largest cigarette maker in the U.S., set up a new division called
BWT Direct last year to sell some of its harder-to-find cigarette brands
directly to smokers. The direct-marketing strategy is aimed at making
the brands more visible at a time when retailers have finite amounts
of shelf space for products such as cigarettes.The hard-to-find brands
currently account for about 3.5 percent of the company''s discount
cigarettes online annual sales. Brown & Williamson has
said BWT Direct will collect all taxes on direct sales of the cigarettes
and forward the money to the federal government and to state revenue
departments, as required by existing laws.