PORTLAND, Ore. - The Oregon Court of Appeals upheld a ruling that gave states the authority over online cigarette sales that originate from an Indian reservation located in another state, the Associated Press reports.

Seneca Nation member Scott Maybee had said that Oregon law was not relevant because his business was located on tribe land in New York. Maybee argued that only federal laws could apply to businesses on reservations.

However, the court of appeals decided that Oregon law had nothing to do with his business operations on the reservation, but that it could be applied to his business products sold in Oregon.

Presiding Judge David Schuman wrote in his opinion that "state courts may exercise jurisdiction in civil cases involving Native Americans and relating to conduct that extends beyond the reservation's boundaries."

The case revolved around cigarette brands not part of the 1998 settlement between tobacco companies and 46 states that made cigarette makers pay states to assist in recovery of health care costs relating to smoking. Oregon made non-participating manufacturers to place funds in escrow to ensure money would be available for any decisions in the future that the state may win against those companies.

However, in 2003, the Oregon legislature limited sales of nonparticipating brands to avoid undermining the master settlement agreement with the large tobacco manufacturers.

The court ruled that Maybee was selling cigarettes in Oregon that were not on the attorney general??s list of brands meeting the mandatory state certification. The state AG sued Maybee over tax evasion relating to cigarettes.

The appeals court did not address the tax evasion issue, but the former AG who had filed the suit said in 2006, Maybee had been operator of three of the top eight online cigarette sites with the biggest number of sales in Oregon.