SALAMANCA, N.Y. - Federal District Judge Richard Arcara temporarily ordered a new law that disallows cigarettes to be shipped via the mail to be placed on hold, the Associated Press reports.
A Seneca Indian Nation tobacco business owner asked for the restraining order to stop the Prevent All Cigarette Trafficking Act (PACT Act) to take effect yesterday. A July 7 hearing has been scheduled to hear the case.
"We are very disappointed in the ruling and reviewing all possibilities for a legal response. NACS was a strong proponent for passage of the PACT Act and worked for years to obtain its enactment," said Lyle Beckwith, NACS senior vice president of government relations. "We will not stop fighting."
The Senecas contend that the act will harm its multi-million dollar tobacco industry and cut 3,000 jobs. The tribe estimates that member businesses sell four out of each five cigarette packs via mail order. "It??s a major impact, a major obstacle we??re going to have to find a way to overcome," said J.C. Seneca, a tribe counselor.
Tobacco companies praised the act for helping to stop customers from not paying state taxes, from which Native American businesses are exempt. But Indians see the new law as against tribal sovereignty and a way for tobacco companies to gobble up lost market share.
Cigarette mail orders accounted for $30 million to $40 million in annual revenue for the U.S. Postal Service, said spokeswoman Karen Mazurkiewicz.
Other delivery companies, including DHL, FedEx and UPS, do not ship cigarettes under arrangements with state attorneys general designed to keep tobacco out of the hands of minors.
In other tobacco news, the U.S. Supreme Court decided not to look at a ruling that said tobacco companies broke racketeering laws. The court refused to hear appeals by the government and the tobacco industry, which wanted to have lower-court decisions reversed. The government filed an appeal against cigarette manufacturers trying to collect up to $280 billion from past tobacco profits and an additional $14 billion for a national anti-smoking campaign.