Oklahoma AG sues Indian smoke shops

Chris Rizo Feb. 10, 2009, 3:00pm

Drew Edmondson (D)

TULSA, Okla. (Legal Newsline)-Oklahoma Attorney General Drew Edmondson has filed lawsuits against a handful of Native American smoke shops and tribal officials.

The Democratic attorney general and possible gubernatorial candidate filed the lawsuits against 15 defendants, who either own or operate smoke shops. Edmonson, as the state's attorney, filed the lawsuit on behalf of the Oklahoma Tax Commission.

The Creek Nation smoke shops and tribal leaders are accused of conspiring to violate state and federal laws on cigarette sales. Specifically, the defendants are accused of violating the Federal Contraband Cigarette Trafficking Act, the State Complementary Act and the State Cigarette Tax Act.

The lawsuit alleges that between February 2007 and May 2008, Creek Nation Tobacco Wholesale purchased or had delivered more than 5.3 million packs of unstamped cigarettes to its headquarters in Okmulgee, Okla.

Low-tax cigarettes are meant to be sold along the Oklahoma border by smoke shops in competition with lower tax rates in neighboring states. The low-tax stamp, created about four years ago, was part of a tobacco compact with several Indian tribes in Oklahoma. But the Creek Nation's compact with the state expired and has not been renewed.

The Creek Nation for the last four years has refused to sign a new compact with the state because the tribe contends that the agreement does not protect the historic tax advantage the tribe has had over nontribal retailers.

From Legal Newsline: Reach staff reporter Chris Rizo at chrisrizo@legalnewsline.com.

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