6th Cir (Tobacco Settlement): Tritent Intl Corp v. Comwlth of KY (ED KY 10/30/2006)

Tritent Intl Corp v. Comwlth of KY
Eastern District of Kentucky at Frankfort
Tobacco Settlement

06a0400p.06 – 10/30/2006

RONALD LEE GILMAN, Circuit Judge. Plaintiffs Cibahia Tabacos Especias Ltda. (a Brazilian cigarette manufacturer), Tritent International Corp. (an importer of Cibahia’s cigarettes), and DWI, LLC (a Kentucky wholesaler of those cigarettes) (collectively, Tritent), filed suit against the Commonwealth of Kentucky, arguing that two Kentucky statutes have effectively prohibited Tritent from doing business in the state. The statutes were enacted to effectuate and enforce the provisions of the Master Settlement Agreement (MSA), a voluntary agreement that has been entered into by 46 states (the settling states) and most tobacco companies. Tritent alleges that because it is not a party to the MSA, it has been adversely affected by anticompetitive behavior that has occurred as a result of the Kentucky legislation.

In its lawsuit against the state, Tritent alleged that the Kentucky statutes are preempted by the Sherman Act, 15 U.S.C. § 1, both because the state statutes mandate or authorize unlawful anticompetitive behavior and because they constitute a hybrid restraint on trade. The district court granted Kentucky’s motion to dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. Tritent timely appealed. For the reasons set forth below, we AFFIRM the judgment of the district court.

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