Judge Katherine Forrest
BB’s Corner Inc. and Nitecap Entertainment Corp. operate stores where customers buy loose tobacco and cigarette tubes with affixed filters, and are provided access to—and at times assistance with—”roll your own” machines. No packaging from either establishment had New York state or city tax stamps affixed. A lawsuit by the state and city under the Contraband Cigarette Trafficking Act (CCTA), New York’s Cigarette Marketing Standards Act (CMSA) and Tax Law asserted, principally, that BB’s Corner and Nitecap failed to pay certain excise taxes due. Rejecting claims that they were not selling “cigarettes” as statutorily defined, the court, noting the showings required by City of New York v. Golden Feather Smoke Shop—a nearly identical case—enjoined the cigarette-related operations. Discussing the CCTA and CMSA, the court rejected defendants’ argument that they sell loose tobacco to which a different taxation scheme applies. Thus plaintiffs showed likely success on the merits of their claims—under both laws—that defendants violated the applicable taxation scheme by selling “deeply discounted” cigarettes lacking appropriate tax stamps.