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Tobacco Ban Overturned

In a blow to convenience store retailers throughout the state, a federal judge has struck down a New York ban on mail-order, Internet and telephone cigarette sales intended to prevent smoking by youths, saying the law violated interstate commerce provisions of the U.S. Constitution.

In a 77-page ruling, U.S. District Court Judge Loretta Preska said the practical effect of the law "is to discriminate against interstate commerce by effectively eliminating all competition from interstate merchants for the retail sales of cigarettes."

The law, enacted last August, would have made it a crime to ship or transport cigarettes sold by mail order, telephone or the Internet to consumers in New York state, the Associated Press reported.

According to the order, the law was enacted after New York increased taxes from 56 cents per pack to a national high of $1.11 and retailers complained to Gov. George Pataki about unfair competition from those selling untaxed cigarettes, including Internet, mail order and telephone sales.

Citing a Supreme Court finding, Preska said that "even recognizing the state's legitimate goals in reducing smoking among adults and minors, it cannot seek to achieve these otherwise legitimate goals by the illegitimate means of isolating the state from the national economy."

Louisville, Ky.-based Brown & Williamson Tobacco Corp., the nation's third-largest manufacturer of cigarettes with brands such as KOOL, Lucky Strike and Pall Mall, formed a subsidiary company, BWT Direct LLC, last year to sell some of its less-widely distributed brands directly to adult consumers via the Internet. Under that program, the tobacco company ensures that all applicable excise taxes are paid and that rigorous procedures to prevent minors from obtaining the cigarettes are in place.

In her ruling, Judge Preska said the "adoption of age-verification procedures similar to those employed by plaintiff BWT Direct would be effective in reducing minors' access to cigarettes through direct sales channels."

New York officials could not say immediately whether the state would appeal the ruling. "We're still reviewing the decision, but we are disappointed that the court has struck down a law intended to save lives by keeping children from smoking," said Pataki spokesman Joe Conway.
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