Business | Law

9th Circuit rejects treaty claims of Indian tobacco manufacturer






A tobacco manufacturer based on the Yakama Nation in Washington must comply with state law, the 9th Circuit Court of Appeals ruled today.

The King Mountain Tobacco Company argued that its on-reservation activities are protected by the Yakama Treaty of 1855. The state, however, wanted the firm to pay into an escrow fund set up as a result of the Tobacco Master Settlement Agreement of 1998.

King Mountain was not a party to the settlement. But the 9th Circuit determined that the company must comply with state law because the activity at issue -- namely, the sale of tobacco -- occurs off the reservation.

"Washington’s escrow statute is a nondiscriminatory law that applies to off-reservation activity," the court wrote.

In a case from 2007 and another from 1998, the 9th Circuit ruled that the treaty guarantees the right of tribal members to bring their goods to the open market without state interference. The court said King Mountain failed to show how the same situation applied to tobacco manufacturing.

Turtle Talk has posted documents from the lower court case, King Mt. Tobacco Co. v. McKenna. Oral arguments can be found on the Indianz.Com SoundCloud.

Get the Story:
Tribe's Treaty Doesn't End Its State Obligations (Courthouse News Service 9/26)

9th Circuit Decision:
King Mt. Tobacco Co. v. McKenna (September 26, 2014)

Related Stories:
BSPR: Tobacco firm on Yakama Nation fights federal government (09/08)
Judge tells tobacco firm on Yakama Nation to pay $58M in taxes (9/5)
9th Circuit hears case over Yakama Nation tobacco manufacturer (8/29)
Judge subjects Yakama Nation business to tobacco settlement (4/9)