Oklahoma Smokers

The office of Oklahoma Attorney General Drew Edmondson has sued a Canadian tobacco manufacture, Grand River Enterprises Six Nations Ltd. on a claim that the company failed to properly fund the required extortion account. The company manufactures Opal and Seneca cigarettes and was not a party to Edmondson’s deal with ‘big tobacco’ back in 1998.

Oklahoma enacted a “nonparticipating manufacturer” law in 1999 requiring tobacco companies who chose not to join the 1998 Master Settlement Agreement or which did not exist at that time to pay into an extortion fund. Manufacturers who sell tobacco in Oklahoma are subject to the statute.

Recently the Seneca-Cayuga Tribes sued Edmondson in federal court in Tulsa on a claim that  the tribe is soverign and therefore not subject to economic deals the state of Oklahoma cuts with anyone, especially deals to protect the interests of large tobacco companies by forcing smaller companies out of business.

Grand River Enterprises Six Nations Ltd. is one of three small tobacco companies that have sued the Attorney Generals of the various states involved in this scam. You can read more about that case which appears destined to the US Supreme Court by Clicking Here.

The Seneca-Cayuga Tribes sued Oklahoma Attorney General Drew Edmondson on Monday in federal court in Tulsa. The tribe contends that its tribal tobacco corporation is on the brink of collapse with the loss of 74 tribal jobs at the tribe’s facility near Grove, OK.

At issue is an escrow account into which the state of Oklahoma has forced to tribe to contribute $10 million thus far. The state maintains that since the tribe was not party to Oklahoma’s ‘deal’ with big tobacco companies back in 1998 it must pay into the escrow fund.

As part of the deal with ‘big tobacco’ the Attorney General promised the major tobacco companies to force small tobacco manufactures to pay into an escrow account supposedly an amount equal to what the small companies would have paid in kickbacks to the state, were they party to the deal with ‘big tobacco’.

The Seneca-Cayuga Tribe maintains that it is soverign and therefore not subject to economic deals the state of Oklahoma cuts with anyone, especially deals Oklahoma makes to protect the interests of large tobacco companies.

The Seneca-Cayugas allege that states knowingly or unwittingly agreed to help manipulate the tobacco market to protect big tobacco’s bottom line and overburden small tobacco manufacturers to the point of extinction.

The tribe is asking the federal court for a temporary, preliminary and permanent injunction barring the defendant Oklahoma Attorney General Edmondson from prohibiting the sale of the tribal corporation’s products within Oklahoma. The tribe is also seeking the return of the $10 million dollars it has paid into the escrow account.

More on this interesting case as it develops…