NEW YORK ? Island Smokes, which operates two locations in New York City, will close Feb. 1 in order to resolve a lawsuit brought forth by the city in November, the Associated Press reports. The company determined it would be too costly to fight the lawsuit.
?It really was a business decision. It's the old adage that you can't fight City Hall,? said Jonathan Behrins, an attorney representing Island Smokes. ?From a lawyer's perspective, it was a very winnable case, and something I would have loved to take on. But fighting it alone against an army of lawyers and unlimited funds?the prospects were not that good.?
The case highlights the tension between local and state governments and the roll your own shops, which have sprung up recently across the United States in response to higher cigarette taxes, according to the news source. The shops sold customers loose pipe tobacco, taxed at a much lower rate than cigarettes, and offered a machine on premise for customers to make (i.e., roll) their own cigarettes.
New York City filed a lawsuit last month that alleged the shops were engaging in tax evasion by not affixing the state cigarette tax stamp on completed cigarette packs. ?The success of this lawsuit should serve as a reminder to others thinking of ?gimmicks? to skirt New York City's tough cigarette laws that the City will enforce those laws vigorously,? said Michael Cardozo, the city?s head attorney.
City officials have also sent letters to other roll your own retailers asking them to shut down or be faced with legal action. New Hampshire, West Virginia and Wisconsin are also involved in legal battles over roll your own shops.
Read more about roll your own cigarette machines appearing in retail locations in the upcoming January issue of NACS Magazine.
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