United States District Court, E.D. New York
For the Plaintiff: Christopher K. Leung, Dana H. Biberman, Assistant Attorneys General, Eric T. Schneiderman, Attorney General of the State of New York, New York, NY.
For Mountain Tobacco Company d/b/a King Mountain Tobacco Company, Inc., Defendant: Kelli J. Keegan, Esq., Randolph Barnhouse, Esq., Of Counsel, Johnson Barnhouse & Keegan LLP, Los Ranchos De Albuq, NM.
For Mountain Tobacco Company d/b/a King Mountain Tobacco Company, Inc., Defendant: Nelson A. Boxer, Esq., Philip N. Pilmar, Esq., Jill Caroline Barnhart, Esq., Of Counsel, Petrillo Klein & Boxer LLP, New York, NY.
For Delbert Wheeler, Sr., Defendant: David N. Yaffe, Esq., Andrew K. Martingale, Esq., Of Counsel, Hamburger, Maxson, Yaffe & McNally LLP, Melville, NY.
DECISION AND ORDER
ARTHUR D. SPATT, United States District Judge.
On December 21, 2012, the Plaintiff State of New York (the " State" ) filed this complaint against the Defendant Mountain Tobacco Company, d/b/a/ King Mountain Tobacco Company Inc. (" King Mountain" ); Mountain Tobacco Distributing Company Inc. (" Mountain Tobacco Distributing" ); and Delbert Wheeler, Sr. (" Wheeler" ), alleging violations of the Contraband Cigarette Trafficking Act, 18 U.S.C. § § 2341-2346 (" the CCTA" ), the Prevent All Cigarette Trafficking Act, 15 U.S.C. § § 375-378 (" the PACT Act" ), and New York State tax and executive laws concerning the tax stamping and sale of cigarettes within the state. On February 12, 2013, the State filed an amended complaint.
The following factual allegations are drawn from the amended complaint. The State is a sovereign entity that brings this action on behalf of its citizens and residents to protect the public health, safety, and welfare, and to enforce federal and state law for those purposes.
King Mountain is a corporation formed under the laws of the Yakama Nation of Indians. King Mountain is engaged in the business of manufacturing, selling, transferring, transporting, and shipping its cigarettes for profit. King Mountain advertises and offers its cigarettes for sale, transfer, transport, and shipment throughout the United States, including New York. Although King Mountain is not owned or operated by the Yakama Nation Tribe, King Mountain is located within the Yakama Indian Reservation. King Mountain's principal place of business and cigarette-manufacturing factory is located at 2000 Fort Simcoe Rd., White Swan, Washington. Its warehouse and distribution facility is located at 2000 Signal Peak Road, White Swan, Washington. Its registered office is located at Box 669, White Swan, Washington. Wheeler, an individual, is a resident of Washington State and is the
President, co-founder, and 50% co-owner of King Mountain.
King Mountain manufactures the King Mountain brand of cigarettes on the Yakama Reservation in the State of Washington. It then sells, transfers, or assigns the cigarettes to retailers and/or wholesalers in New York State. According to the State, King Mountain has sold and shipped, and continues to sell and ship, large quantities of unstamped, untaxed, and unreported cigarettes into Indian reservations located in New York State in violation of N.Y. Tax Law § 470, et seq.
Although the amended complaint asserts five claims for relief against the " defendants," the State has, through the declaration of Assistant Attorney General Christopher K. Leung dated June 16, 2014 (Docket No. 99-2), represented that, in fact, only two claims -- under the CCTA and PACT Act -- are asserted against Wheeler.
On May 9, 2013, the State voluntarily dismissed the action against Mountain Tobacco Distributing pursuant to Federal Rule of Civil Procedure (" ...