Minnesota Session Laws - 2000, Regular Session

                            CHAPTER 496-S.F.No. 2693 
                  An act relating to tobacco; regulating sales of 
                  certain cigarettes; prohibiting sales of certain 
                  cigarettes; defining contraband; providing a private 
                  cause of action; amending Minnesota Statutes 1998, 
                  section 297F.21, subdivision 1, as amended by Laws 
                  2000, chapter 490, article 10, section 20; proposing 
                  coding for new law in Minnesota Statutes, chapter 325D.
        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
           Section 1.  Minnesota Statutes 1998, section 297F.21, 
        subdivision 1, as amended by Laws 2000, chapter 490, article 10, 
        section 20, is amended to read: 
           Subdivision 1.  [CONTRABAND DEFINED.] The following are 
        declared to be contraband and therefore subject to civil and 
        criminal penalties under this chapter: 
           (a) Cigarette packages which do not have stamps affixed to 
        them as provided in this chapter, including but not limited to 
        (i) packages with illegible stamps and packages with stamps that 
        are not complete or whole even if the stamps are legible, and 
        (ii) all devices for the vending of cigarettes in which packages 
        as defined in item (i) are found, including all contents 
        contained within the devices. 
           (b) A device for the vending of cigarettes and all packages 
        of cigarettes, where the device does not afford at least partial 
        visibility of contents.  Where any package exposed to view does 
        not carry the stamp required by this chapter, it shall be 
        presumed that all packages contained in the device are unstamped 
        and contraband. 
           (c) A device for the vending of cigarettes to which the 
        commissioner or authorized agents have been denied access for 
        the inspection of contents.  In lieu of seizure, the 
        commissioner or an agent may seal the device to prevent its use 
        until inspection of contents is permitted. 
           (d) A device for the vending of cigarettes which does not 
        carry the name and address of the owner, plainly marked and 
        visible from the front of the machine. 
           (e) A device including, but not limited to, motor vehicles, 
        trailers, snowmobiles, airplanes, and boats used with the 
        knowledge of the owner or of a person operating with the consent 
        of the owner for the storage or transportation of more than 
        5,000 cigarettes which are contraband under this subdivision.  
        When cigarettes are being transported in the course of 
        interstate commerce, or are in movement from either a public 
        warehouse to a distributor upon orders from a manufacturer or 
        distributor, or from one distributor to another, the cigarettes 
        are not contraband, notwithstanding the provisions of clause (a).
           (f) Cigarette packages or tobacco products obtained from an 
        unlicensed seller. 
           (g) Cigarette packages offered for sale or held as 
        inventory in violation of section 297F.20, subdivision 7. 
           (h) Tobacco products on which the tax has not been paid by 
        a licensed distributor. 
           (i) Any cigarette packages or tobacco products offered for 
        sale or held as inventory for which there is not an invoice from 
        a licensed seller as required under section 297F.13, subdivision 
        4.  
           (j) Cigarette packages which have been imported into the 
        United States in violation of United States Code, title 26, 
        section 5754.  All cigarettes held in violation of that section 
        shall be presumed to have entered the United States after 
        December 31, 1999, in the absence of proof to the contrary. 
           Sec. 2.  [325D.421] [UNLAWFUL CIGARETTE TRADE PRACTICES.] 
           Subdivision 1.  [PROHIBITIONS.] (a) It is unlawful for any 
        person to sell or distribute in this state; to acquire, hold, 
        own, possess, or transport, for sale or distribution in this 
        state; or to import, or cause to be imported, into this state 
        for sale or distribution in this state, any cigarettes: 
           (1) the package of which: 
           (i) bears any statement, label, stamp, sticker, or notice 
        indicating that the manufacturer did not intend the cigarettes 
        to be sold, distributed, or used in the United States, 
        including, but not limited to, labels stating "For Export Only," 
        "U.S. Tax-Exempt," "For Use Outside U.S.," or similar wording; 
        or 
           (ii) does not comply with all requirements imposed by or 
        pursuant to federal law regarding warnings and other information 
        on packages of cigarettes manufactured, packaged, or imported 
        for sale, distribution, or use in the United States, including, 
        but not limited to, the precise warning labels specified in the 
        federal Cigarette Labeling and Advertising Act, United States 
        Code, title 15, section 1333; 
           (2) imported into the United States in violation of United 
        States Code, title 26, section 5754, or any other federal law or 
        regulation; or 
           (3) for which there has not been submitted to the secretary 
        of the United States Department of Health and Human Services the 
        list or lists of the ingredients added to tobacco in the 
        manufacture of the cigarettes required by the federal Cigarette 
        Labeling and Advertising Act, United States Code, title 15, 
        section 1335a. 
           (b) It is unlawful for any person to alter the package of 
        any cigarettes, prior to sale or distribution to the ultimate 
        consumer, so as to remove, conceal, or obscure: 
           (1) any statement, label, stamp, sticker, or notice 
        described in paragraph (a), clause (1), item (i); or 
           (2) any health warning that is not specified in, or does 
        not conform with the requirements of the federal Cigarette 
        Labeling and Advertising Act, United States Code, title 15, 
        section 1333. 
           (c) If cigarettes are sold or distributed under any trade 
        name, trade dress, or trademark that is the same as, or is 
        confusingly similar to, any trade name, trade dress, or 
        trademark used for other cigarettes previously sold or 
        distributed, it is unlawful for a wholesaler, as defined in 
        section 325D.32, subdivision 4, or a retailer, as defined in 
        section 325D.32, subdivision 5, to sell the cigarettes at a 
        price lower than the minimum price presently permitted under 
        sections 325D.30 to 325D.42 for the cigarettes which were 
        previously sold or distributed in this state.  For purposes of 
        this subdivision, "previously sold or distributed" means 
        cigarettes using a trade name, trade dress, or trademark that 
        were sold or distributed in this state before January 1, 1998.  
        No provision of sections 325D.30 to 325D.42 authorizes or 
        permits sales of cigarettes, subject to this paragraph, at 
        prices lower than the minimum prices under this paragraph.  The 
        commissioner of revenue is not responsible for enforcing this 
        paragraph.  None of the enforcement mechanisms or remedies under 
        sections 325D.30 to 325D.42 apply to violations of this 
        paragraph. 
           Subd. 2.  [PRIVATE CAUSE OF ACTION.] (a) In addition to any 
        other private remedy provided by law, any person that sustains 
        economic damages or commercial injury as a result of any 
        violation of subdivision 1 may bring an action for appropriate 
        injunctive or other equitable relief, actual damages, if any, 
        sustained by reason of the violation, and, as determined by the 
        court, interest on the damages from the date of the complaint, 
        taxable costs, and reasonable attorney fees.  
           (b) If the trier of fact finds that the violation is 
        egregious, it may increase the recovery to an amount not in 
        excess of three times the actual damages sustained by reason of 
        the violation.  The trier of fact may, in addition, award 
        exemplary damages for violations of subdivision 1, paragraph 
        (c), equal to the difference between the permitted legal price 
        and the actual price for the sales. 
           Subd. 3.  [APPLICABILITY.] This section does not apply to 
        cigarettes imported or reimported into the United States for 
        personal use and cigarettes sold or intended to be sold as 
        duty-free merchandise by a duty-free sales enterprise in 
        accordance with the provisions of United States Code, title 19, 
        section 1555(b), and any implementing regulations; unless the 
        cigarettes are brought back into the customs territory for 
        resale within the customs territory. 
           Subd. 4.  [VIOLATION.] A violation of this section is a 
        misdemeanor. 
           Sec. 3.  [EFFECTIVE DATE.] 
           This act is effective July 1, 2000. 
           Presented to the governor May 19, 2000 
           Signed by the governor May 30, 2000, 2:15 p.m.