Nearly six years after state Liquor Control Board agents raided an Indian smoke shop in Puyallup, relatives of the shop’s owner are still fighting to get 376,852 packs of cigarettes back.
The owner of the store, a Quinault Indian named Edward Comenout, has died, but his family says that taxes never were owed and that the cigarettes were seized illegally.
Indian Country Store on River Road sits on land that’s in federal trust status and not part of any reservation, and therefore it’s not subject to state jurisdiction, the family asserts.
“It’s a little postage stamp that’s controlled by federal law,” Robert Kovacevich, the Comenouts’ lawyer, said Thursday. “It’s a half-acre that’s essentially a tax-free zone.”
In 2011, the Washington State Supreme Court rejected that argument when ruling on the criminal case brought against Comenout concerning the untaxed cigarettes.
Last month, the Liquor Control Board rejected it too. In an April 29 decision, the board refused the Comenouts’ request that the cigarettes be returned.
Even so, on Wednesday, the Comenouts appealed the board’s decision in Pierce County Superior Court. A hearing has been set for Nov. 14 in Judge Susan Serko’s court.
The appeal asks that the cigarettes be returned, but that’s not what the family ultimately wants, Kovacevich said. After being in storage for six years, the cigarettes are worthless.
Kovacevich says the state has an obligation to make his clients whole by reimbursing them for the value of the cigarettes six years ago, which he says was more than $1 million.
Had the cigarettes had been sold in nontribal stores, the Liquor Control Board says they would have produced more than $750,000 in taxes for the state.
Attorneys for the state say that because of cigarette tax compacts signed with most Washington tribes — including the Quinaults — Comenout was obligated to play by those rules because he was a tribal member.
Under the Quinault compact, taxes must be charged on cigarette sales to nontribal members, but the tribe keeps the money, to use for “essential government services,” such as libraries, schools or health care.
Liquor Board investigators estimated that the Indian Country Store brought in about $1 million a year by selling untaxed cigarettes.
The Quinault Tribal Police participated in the 2008 raid on the store, and it has filed a separate suit against the Comenouts in federal court, contending they owe cigarette taxes to the tribe.
The Puyallup Tribe joined the dispute over the raid, saying it has a right to some part of proceeds of the seized cigarettes because sales at Indian Country Store cut into sales at properly licensed outlets on its reservation.
Pierce County prosecutors dismissed criminal charges of first-degree theft against Comenout after his death from esophageal cancer in 2010. Criminal charges against his son Robert Comenout Sr. and his nephew Robert Comenout Jr. also were dismissed, for misplaced evidence and insufficient evidence.
Rob Carson: 253-597-8693