AG Bruning sues tobacco company

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BY KEVIN ABOUREZK / Lincoln Journal Star

Nebraska Attorney General Jon Bruning’s office filed a lawsuit last week in Lancaster County District Court against a tobacco company owned by an Oklahoma tribe.

The suit alleges the Seneca-Cayuga Tribe failed to make payments to Nebraska for money the tribe was required by state law to pay for cigarettes it sold here.

The tribe’s Seneca-Cayuga Tribal Tobacco Corp. sold 3,620,400 cigarettes to customers in Nebraska in 2003, mainly through its Skydancer and Silverton brands, according the suit.

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Attorney General Jon Bruning

Attorney General Jon Bruning

As a result of those sales, the tribe was required to pay $70,580 into an escrow account for the state of Nebraska’s benefit.

The tribe’s tobacco company is considered by the state of Nebraska to be a non-participating tobacco manufacturer. That means the company has declined to participate in the state’s tobacco Master Settlement Agreement.

The agreement requires tobacco manufacturers who sign it to make annual payments to Nebraska as the result of a 1998 court settlement with major U.S. tobacco companies.

Companies that decline to sign the agreement are required by Nebraska statute to deposit funds annually into an escrow account for the state’s benefit.

According to the lawsuit, the Seneca-Cayuga tobacco company failed to pay the money it owed for its 2003 cigarette sales by the April 15, 2004, deadline. The tribe then entered into an agreement with the state to pay civil penalties, as well as the $70,580 it owed in installments.

The tribe made two of the installment payments and paid the civil penalties but failed to pay the rest of the amount it owed the state, which amounted to nearly $53,000, according to the suit.

The lawsuit seeks to force the tribe to pay the money it still owes the state, as well as civil penalties of nearly $159,000, or about 300 percent of the back amount the tribe allegedly owes.

Seneca-Cayuga Chief Paul Spicer declined to comment on the lawsuit.

“It’s really none of your business,” he said this week. “We don’t need to defend ourselves.”

Bruning’s spokeswoman, Leah Bucco-White, said the action taken by Bruning’s office is not unusual.

“The Attorney General’s Office routinely files against those non-participating manufacturers who don’t comply with the escrow statute,” she said.

The non-participating tobacco companies the Attorney General’s Office has sued include American Virginia, CigTec Tobacco Co., Ridgeway Brands Manufacturing, Tabacalera Nazionale, Atlanta US Brands, China National Tobacco Co. and Gulf Conversion Co.

Reach Kevin Abourezk at 473-7225 or kabourezk@journalstar.com.