taxation

NYTs Editorial on NYC Suit Against Long Island Smokeshops

Matthew L.M. Fletcher

From the NYTs:

Mayor Michael Bloomberg, long a foe of smoking, has taken his opposition to a new territory — the American Indian shops on Long Island that sell cigarettes to non-Indians. By filing a series of federal lawsuits, the mayor is trying to force Gov. David Paterson to collect sales taxes on those cigarettes.

It’s not a welcome subject in New York politics. Former Gov. George Pataki tried collecting cigarette and gas taxes from Indian shops 11 years ago, but he backed away soon after protesters, burning automobile tires, closed Interstate 81 for more than 90 minutes.

States and cities cannot impose taxes on American Indians who buy cigarettes for personal use on sovereign Indian land. But non-Indians are not entitled to a similar break. Mr. Bloomberg has filed suit accusing some cigarette shops on Indian land of selling cigarettes in bulk to bootleggers who then resell them off tribal land. That is illegal in New York State; Mr. Bloomberg is trying to compel Mr. Paterson to enforce the law.

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No Divided Argument in Carcieri v. Kempthorne

Matthew L.M. Fletcher

The Supreme Court released its other orders from last Monday’s long conference.

The motion of petitioners Donald L. Carcieri, Governor of Rhode Island, and the State of Rhode Island for divided argument is denied. The motion of petitioner Town of Charlestown for divided argument is denied. The motion of Narragansett Indian Tribe for leave to participate in oral argument as amicus curiae and for divided argument is denied.

So I assume the State will let Ted Olson on behalf of the governor argue the case against Ed Kneedler on the government’s side.

Here are the cert denials:

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Baylake Bank v. TCGC & Village of Hobart — Covenant Against Tribal Ownership of Land

Matthew L.M. Fletcher5 Comments

In a very interesting, even disturbing, development, the Village of Hobart, which has taken lands of the Oneida Indian Nation of Wisconsin through the power of eminent domain (Oneida v. Hobart), has now begun to use restrictive convenants running with the land to thwart the Nation. Here is the district court opinion upholding the restriction (from the same judge who found that the Village had the power of eminent domain against the tribe).

In this case, the Village sold a golf course to TCGC, which later went bankrupt. During bankruptcy, the village asserted its rights under a restrictive covenant that ran with the land. The covenant, added to the property when the Village sold it, prevents any owner (especially a sovereign nation like Oneida) from taking the land off the property rolls. It is clear from the opinion that the Village of Hobart did this expressly to deny the Oneida Indian Nation the right to seek a fee-to-trust acquisition by the Secretary under 25 U.S.C. 465.

We suggest that Shelley v. Kraemer and/or the 14th Amendment precludes such covenants, but it is a close question.

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City of New York v. Golden Feather et al. Complaint

Matthew L.M. Fletcher1 Comment

Here is the complaint filed this week in the City of New York’s attempt to extract taxes from Poospatuck Indian Country.

nyc-v-golden-feather-complaint

Thanks to T.

NYTs: New York Complains about Tribal Smokeshops

Matthew L.M. Fletcher

From the NYTs:

He emerged from the No. 2 subway at 125th Street wearing a bright orange shirt and aviator sunglasses, with a small backpack concealing his stock in trade — tax-free Newport cigarettes.

Like a Yankee Stadium hawker, but in voice closer to a stage whisper, he kept repeating his pitch: “Newports. Loosies. Shorts. Longs.”

His name is Paco, but on the streets of Harlem he is known simply as a “$5 man,” the nickname for a highly visible network of peddlers who sell bootleg cigarettes. His illegal traffic in Newports — $5 a pack or a single “loosie” cigarette for 50 cents — can bring him $100 or more a day.

Paco will not reveal his last name or the source of his Newports, the menthol brand widely popular in urban communities. But legal authorities say the trail of the $5 men leads to American Indian reservations in New York State, a path they contend is smoothed by the tacit cooperation of some cigarette makers and distributors.

NYTs: Poospatuck Smokeshops Sued by NYC

Matthew L.M. Fletcher1 Comment

From the NYTs:

Plunging headfirst into a delicate issue that has long bedeviled New York State and Long Island’s Indian tribes, Mayor Michael R. Bloomberg criticized Gov. David A. Paterson on Monday for not enforcing cigarette tax laws, which the mayor estimated had deprived the city of up to $195 million a year in revenue.

Residents of Indian reservations — like the 50-acre Poospatuck reservation in Mastic — are entitled to buy cigarettes tax free for their own use.

But in a federal lawsuit filed on Monday, the Bloomberg administration accused eight stores on the reservation in Suffolk County of breaking state and federal law by selling cigarettes in bulk to bootleggers. The bootleggers, the lawsuit said, then shipped the cigarettes into the city.

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Tribal Law Cannot Preempt Federal Criminal Laws in Smokeshop Case

Matthew L.M. Fletcher

The Ninth Circuit held in an unpublished opinion, United States v. Mahoney-Meyer (here), that compliance with tribal law cannot excuse a violation of federal cigarette trafficking laws.

First Circuit Affirms Jury Verdict Against Narragansett Members over Smokeshop Injuries

Matthew L.M. Fletcher

The First Circuit affirmed the jury verdict, and the trial judge’s instructions to it, against the seven members of the Narragansett who were injured by Rhode Island police officers during the notorious smokeshop raid several years ago.

thomas-v-rhode-island-ca1-opinion

Mashantucket Pequot Not Required to Disclose Financials to Conn. Town

Matthew L.M. Fletcher

In an ongoing case where the Mashantucket Pequot Nation is seeking relief from local taxation of slot machines leased by the tribe from non-Indians, the district court rejected the Town of Ledyard’s motion to compel discovery of the Nation’s entire financial records.

dct-order-on-motion-to-compel

SCOTUSBlog’s Petitions to Watch for the Long Conference

Matthew L.M. Fletcher1 Comment

Here is the list of the petitions to watch according to SCOTUSBlog for the long conference. It includes four Indian law cases, Kickapoo v. Texas, Hawaii v. Office of Hawaiian Affairs, US v. Navajo Nation, and Kemp v. Osage Nation.

We agree (see here).