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Dirt Cheap sues state over cigarette provision

November 19, 2001
By: Steve Ahern
State Capital Bureau

Missouri Based D,C., Inc. conducting business as Dirt Cheap Cigarettes and Beer, has refused to back down from a lawsuit which they filed against the state on Friday according to Dirt Cheap President Fred Teutenberg.

"It's unfortunate we have to do this," Teutenberg said.

The suit challenges legislation passed earlier this year by Missouri lawmakers on the grounds that provisions violate the Missouri Constitution and federal interstate commerce laws.

According to Teutenberg, the sections of the bill prohibiting the sale and distribution of American brand cigarettes that are manufactured overseas and legally imported into the United States are unconstitutional.

Rep. Thomas Hoppe, D-Kansas City, who sponsored the legislation said that he doubts that Dirt Cheap will be successful because of state government's stance on the sale of cigarettes throughout the Missouri.

"The state has a position that any cigarettes sold in Missouri should contribute to the tobacco trust fund. No one should be exempted from paying this tax," Hoppe said.

Teutenberg said that taxes are paid to the tobacco trust funds by both the manufacturers of the overseas cigarettes and the importers. However, Hoppe contends that he never received the account information from Teutenberg or the manufacturers and does not know whether whether the account, if it exists, adheres to the guidelines of the tobacco trust fund.

"Mr. Teutenberg did not supply us with the account number of the account into which Master Trust Fund payments are allegedly made," Hoppe said. "This leads me to supsect that either the account does not follow the tobacco trust fund guidelines or that there are no deposits being made." Teutenberg said that payments are made to the trust fund before he receives the cigarettes from overseas.

Teutenberg said he believes that the law enables the big tobacco manufacturers to further monopolize the sale of cigrettes and stymie the growth of low price cigarettes, making it unconstitutional.

Hoppe argued that Teutenberg's company should not be permitted to enjoy an unfair advantage over other retailers whose cigarette manufacturers that are contributing to the tobacco settlement.

"Dirt Cheap is the only retailer that has filed a lawsuit. If he says the bill is unconstitutional, then I say he doesn't go by the same rules and guidelines and has an advanatage over other retailers. We'll just have to agree to disagree and let the courts decide," Hoppe said.