Philip Morris Sues N.Y., N.J. Retailers

Source from:  Richmond (VA) Times-Dispatch 11/23/2009

As part of a campaign against counterfeit cigarettes, Philip Morris USA is suing 10 retailers in New York and New Jersey alleging they've been selling fake Marlboros. The Henrico County-based cigarette-maker has monitored retail markets for years to keep fake versions of its brands off store shelves. This year, Philip Morris has sued 27 stores in New York and New Jersey, which are hotspots for the fakes because of high state taxes, a huge port through which the contraband is easily shipped, and criminal organizations that wholesale the counterfeits. For Philip Morris, the stakes are simple. In addition to the lost sales, the company doesn't want smokers buying a pack of Marlboros and thinking they don't taste the same, said company spokesman David Sutton. But nonsmokers have a stake in the matter, too, said Joe Murillo, a vice president and associate general counsel at Altria Client Services, the Altria Group entity that provides support services for Philip Morris. "The sale of untaxed cigarettes harms legitimate wholesale and retail businesses and costs New York and New Jersey needed tax revenues that could be used to support essential public services," he said. New York state collects about $1.3 billion a year from its $2.75-a-pack levy, budget documents show. New Jersey takes in about $250 million annually through a $2.70 per-pack tax. Murillo said New York could collect hundreds of millions of dollars by tightening up on tax-free sales on American Indian reservations, a move the legislature is considering, and by cracking down on fakes in the New York City area. Enditem