Cayuga Indian Nation’s Land Into Trust Application
Read the application submitted to the Bureau of Indian Affairs.
Tobacco Tax Legislation
In November 2008, Seneca and Cayuga County sheriffs deputies raided two Cayuga Indian Nation convenient stores in Union Springs and Seneca Falls and confiscated more than 17,000 cartons of cigarettes. Officials said the stores violated state law by selling cigarettes without collecting required state taxes.
Thereafter, the Cayuga Indian Nation (the “Nation”) sued the District Attorneys and Sheriffs of Seneca and Cayuga Counties, arguing in state supreme court that the raid was illegal and violated the Nation’s sovereignty. The Counties argued the raid was legal and that the stores are not located within sovereign territory. On December 9, 2008, the Court ruled in favor of Seneca and Cayuga Counties and denied a request of the Nation for an injunction barring the Counties from enforcing state tax laws regulating the sales of cigarettes.
On December 10, 2008, the Nation filed an on appeal from the previous day’s Court ruling and filed papers seeking a temporary restraining order and a preliminary injunction enjoining the Counties from prosecuting the Nation under the Tax Law pending a determination of the appeal. On December 10 and 11, 2008, Cayuga County and Seneca County respectively handed up sealed indictments related to the Nation’s sale of untaxed cigarettes.
On December 15, 2008, Governor David Paterson signed into law legislation sponsored by State Senator Michael F. Nozzolio and State Assemblyman William Magee which enforces the collection of taxes on cigarettes sold at Native American-owned stores. Senate bill 8146 provides an alternative means to collect the sales tax by requiring wholesalers to pre-pay the tax. This pre-payment ensures sales taxes on goods would already be collected by the time they were delivered to the Native American retailers. Supports say the taxes collected would generate $400 million a year in state revenues.
On January 21, 2009, the Appellate Division Fourth Department preliminarily enjoined the Counties from any further criminal prosecution pending the determination of the Nation’s appeal. On January 30, 2009, the Nation, having re-stocked its inventory of untaxed cigarettes, by its own admission, began selling those cigarettes. On the same day, the Counties moved for an order holding the Nation in contempt of the Court’s December 9, 2008 Order.
On February 13, 2009, Judge Kenneth R. Fisher heard oral arguments on the Counties’ motion for contempt. Five days later, Judge Fisher issued two Orders. The first Order denied the Nation’s motion seeking the return of the seized property and the second Order declared that the Nation may not, consistent with Tax Law § 471, sell untaxed cigarettes to non-Native American consumers on the two parcels in question. On February 19th, the Nation appealed the latter Order and moved to stay its enforcement pending the outcome of that appeal.
On July 10, 2009, the Appellate Division, Fourth Department, overturned Justice Fisher’s December 9th ruling and granted judgment in the Nation’s favor. This Court also held that the Nation could collaterally attack a criminal proceeding with a declaratory judgment action. The Appellate Division’s five-judge panel ruled in a 4-1 vote that the Cayuga Indian Nation can sell cigarettes tax-free at their Seneca Falls and Union Springs stores.
In casting the dissenting vote, Hon. Erin M. Peradotto agreed with the Counties that the obligation of Tax Law § 471 applies to reservation sales to non-Native Americans and non-member Native Americans and that reservation retailers who disobey that obligation risk criminal prosecution. In her dissent, Justice Peradotto argued that the majority’s decision was not supported by the legislative history of Tax Law § 471 and that it conflicted with precedent established by the United States Supreme Court, by the New York Court of Appeals, and by other courts in New York, including a prior decision of the Fourth Department.
On August 19, 2009, the Counties submitted a motion for leave to appeal to the Court of Appeals, New York state’s highest court. The Counties argued that the leave to appeal is necessary given the unsettled issues of law involved. The Counties further argued that the Appellate Division’s holding conflicts with those of other state and federal courts with respect to the proper interpretation of the Tax Law and, therefore, creates a pressing need for review by the Court of Appeals. The Counties also raised issues of great public importance that should be reviewed by the Court of Appeals. They referenced their memorandum of law in which municipalities throughout the state are currently struggling with significant losses in revenue directly resulting from the tax-free sale of cigarettes to non-Native Americans in plain violation of the explicit provisions of the Tax Law. The Counties noted current litigation in New York City (see reference to this case below) regarding lost potential revenue to state and local governments resulting from the sales of cigarettes by Native Americans to non-Native Americans. In addition to the tax revenue concerns, the Counties argued that their case involves fundamental issues of prosecutorial governance and independence.
On October 2, 2009, the Appellate Division, Fourth Department granted the Counties’ motion, thereby permitting Seneca and Cayuga Counties to appeal to the Court of Appeals.
As further proof that this is indeed a statewide issue, these very same issues are currently being litigated not only in Cayuga County and Seneca County, but in New York City as well.
The City of New York is pursuing similar cigarette tax litigation against eastern Long Island Indians selling untaxed cigarettes to non-Native Americans (City of New York v. Golden Feather Smoke Shop). The federal district court held that the sales of massive quantities of nontaxed cigarettes to bootleggers who then resell them to non-Native Americans throughout the metropolitan area, violates the New York Tax Law. The Court enjoined further sales of untaxed cigarettes. The Long Island Indians appealed to the federal appeals court in New York City and asked to stay the injunction pending the appeal. On October 15, 2009, the federal appeals court denied the stay. This means the injunction prohibiting the untaxed sales to non-Native Americans remains in place while the appeals proceed. The federal court now has the opportunity to certify questions to the New York State Court of Appeals on the application of the Tax Law § 471 and § 471-e. If the federal appellate court does so, this raises the possibility that the New York Court of Appeals could simultaneously have before it two different cases whose central issues involve the applicability of Tax Law § 471 (and Tax Law § 471-e) to the sale of cigarettes by Native Americans to non-Native Americans.
November 30, 2009. Court of Appeals Brief filed on behalf of Cayuga and Seneca Counties.
On March 5, 2010, the United States Court of Appeals for the Tenth Circuit ruled in favor of the Oklahoma Tax Commission by rejecting the Osage Indian Nation’s claim that its reservation still exists. The decision contains language that should prove helpful in defending against the Cayuga Nation’s land to trust application, as well as the pending cigarette tax litigation cases. Read More
On March 10th 2010, a public comment was made on the Proposed NYS Regulations to Limit the Sale of Untaxed Cigarettes – New Yorkers have the opportunity to make their voices heard to Albany during the 45 day public comment period on new regulations proposed to limit the supply of “unstamped and untaxed” cigarettes sold by Native American retailers to non-Native Americans. Read More
On March 25, 2010, Seneca and Cayuga Counties presented arguments in the cigarette litigation case before the New York State Court of Appeals at a special session the court held in Syracuse. A video of the proceeding, available via the court’s Oral Argument Archive, can be accessed here: No. 74 – Cayuga Indian Nation of New York v Gould.
On Monday, October 4, 2010, it was reported that the United States Supreme Court will not review the cigarette tax dispute involving Cayuga and Seneca counties and the Cayuga Indian Nation.
Related Cigarette Tax Cases
The New York Association of Convenience Stores has filed amici briefs in the Seneca Nation and Oneida Nation lawsuits against New York’s latest attempt to collect taxes on the sale of tobacco products to non-Indians. A brief was also filed on behalf of the Association in the Seneca Nation’s lawsuit challenging the constitutionality of the PACT Act, which prevents the mail order of cigarettes.
Seneca Nation v. Paterson. Memorandum of Law of Amici Curiae: New York Association of Convenience Stores, Wilson Farms, Inc., and NOCO Energy Corp. in support of defendants’ opposition to plaintiff’s motion for temporary restraining order or preliminary injunction.
Seneca Nation and Cayuga Nation v. Paterson. Post-Hearing Supplemental Memorandum of Law of Amici Curiae: New York Association of Convenience Stores, Wilson Farms, Inc., and NOCO Energy Corp. in support of defendants’ opposition to plaintiff’s motion for preliminary injunction.
Oneida Nation v. Paterson. Memordandum of Law of Amicus Curiae: New York Association of Convenience Stores in support of defendants’ opposition to plaintiff’s motion for preliminary injunction.
Red Earth LLC v. United States of America, et. al. Brief of Amici Curiae: National Association of Convenience Stores and New York Association of Convenience Stores in opposition to motions for preliminary injunctive relief.
The Legal History
Read about the history of the land claim disputes to understand how we arrived at where we are today with the Cayuga Indian Nation’s land into trust application.
Read the four key court decisions involving the land claim disputes brought by the Cayuga and Oneida Indian Nations.
Amicus Brief in Support of Madison County
Read the brief filed on August 12, 2010 for Cayuga County and Seneca County as amici curiae in support of Madison County, which addresses whether the ancient Oneida reservation in New York was disestablished or diminished – the second question presented for review in Madison and Oneida Counties’ petition for a writ of certiorari. On October 12, 2010, the United States Supreme Court agreed to hear this case.
Rhode Island Decision
Read local newspaper summaries of the United States Supreme Court’s ruling in favor of Rhode Island regarding a Narragansett Indian Tribe land into trust issue.
On March 5, 2010, the United States Court of Appeals for the Tenth Circuit ruled in favor of the Oklahoma Tax Commission by rejecting the Osage Indian Nation’s claim that its reservation still exists.
Read what other authorities have stated about the impacts of placing Indian lands into trust.
Oneida Indian Nation’s Land Into Trust Application
Read the application submitted to and granted by the Bureau of Indian Affairs and how it relates to the Cayuga Indian Nation’s application. Also, we have a provided a brief summary here of the status of the re-opening of the Cayuga and Oneida Indian Nation land claim lawsuits.