Cigarettes sold by a tribally licensed retailer and pursuant to a state-tribe cigarette agreement are not contraband for purposes of the federal Contraband Cigarette Trafficking Act (CCTA) – even if they are contraband under state law. United States v. Wilbur, 10-30185, 2012 WL 1139078 (9th Cir. Apr. 6, 2012). The Ninth Circuit ruled last week in Wilbur that even if cigarettes are transported in violation of state law, the CCTA only makes cigarettes “contraband” in this context if they “bear no evidence of the payment of applicable State or local cigarette taxes in the State or locality where such cigarettes are found.” 18 U.S.C. § 2341(2). The cigarettes at issue during one period of the Wilbur case were unstamped. But the defendants qualified as an Indian retailer under Washington state law, came partially within the constraints of a tribal tobacco tax compact, and therefore were not subject to state taxes – even though they were allegedly illegal under state cigarette transportation laws and were out of compliance with some tribal regulations.
At its core, for the period in which convictions were overturned, the decision implicitly recognized the legitimacy of tribal tobacco regulation. This could, by analogy or otherwise, undercut the interpretation of the PACT Act by federal agencies that suggests tribal tobacco entities must be licensed by the state to be considered “lawfully operating” under that federal law.
The Wilbur defendants’ convictions were upheld for other periods of the alleged conspiracy. And of more concern is the appearance of state officers acting in federal clothing. As the opinion observed, “a Lieutenant with the Washington State Liquor Control Board who was deputized as a Special Deputy U.S. Marshall, led the search” of the defendants’ retail facility. Although tribal law enforcement also participated in the raids, it is nonetheless noteworthy that reliance by federal statute on state law predicates is problematic in the face of “the right of reservation Indians to make their own laws and be ruled by them.” Williams v. Lee, 358 U.S. 217, 220 (1959).
The apparent ability for state officers to don federal clothing and enforce the state-federal hybrid criminal frameworks on reservations is an even more profound threat to that right. As explicitly contemplated by the Tribal Law and Order Act, if federally deputized non-federal officers are enforcing laws on the Reservation, it should be federally deputized tribal officers doing so. This concern is of course nothing new, as Indian Country braces for and resists the STOP Act, which would essentially import state and big-tobacco interests into Reservation economies under color of federal law. Wolves in sheep’s clothing; Trojan horse; pick your cliché.
Besides the clarity provided by Wilbur, and its limitation on the reach of the CCTA, in the end, a state was still able to enforce its laws on the Reservation, against Reservation Indians.
Anthony Broadman is a partner at Galanda Broadman PLLC. He can be reached at 206.321.2672, anthony@galandabroadman.com, or via www.galandabroadman.com.
