RYO Machine Rule Stands

A judge has struck down a request for a temporary restraining order against the U.S. Treasury’s Alcohol Tobacco Tax and Trade Bureau’s (TTB) ruling that regulates the commercial size cigarette-making machines being used in retail stores, the National Association of Tobacco Outlets (NATO) reported.

The TTB previously ruled that a retailer who provides a commercial cigarette-making machine at its premises is a tobacco product manufacturer and must: (1) qualify for and obtain a federal permit from the TTB to operate as a cigarette manufacturer under federal law, (2) obtain a bond and comply with federal recordkeeping, reporting and inventory requirements, and (3) pay the federal cigarette excise tax on cigarettes produced.

On Oct. 28, 2010, Plaintiffs RYO Machine Rental LLC, Tobacco Outlet Express LLC, and Tightwad Tobacco LLC filed a federal lawsuit against the TTB, challenging the ruling.

A hearing for a temporary restraining order against the TTB ruling was held and a federal judge issued a decision on Oct. 29, 2010 denying the request. Next, a hearing on this case is scheduled for Nov. 12, 2010 to determine if a preliminary injunction will be issued against the TTB ruling. At this hearing, additional testimony will be presented by the plaintiffs and the TTB.

 

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