October 25, 2014

Feds abandon appeal in Kan. tobacco tax case

WICHITA, Kan. (AP) – The federal government is dropping its case against a Kansas tobacco wholesaler and several others accused of trying to avoid paying $25 million in cigarette taxes to Indian tribes and the state of Oklahoma.

A judge in Wichita had dismissed the indictment in December. Last week, the 10th U.S. Court of Appeals granted the Justice Department's request to drop its appeal of that ruling.

U.S. District Judge Monti Belot had tossed out the 2008 indictment as unconstitutionally vague. Belot said the case was based on the government's opinion and not on any federal, Kansas or Oklahoma statute.

The 43-count indictment named eight people including Gary Hall, president and owner of Galena-based Sunflower Supply Co. Also named were Discount Tobacco Warehouse Inc., of Joplin, Mo., and Rebel Industries Inc., of Galena.

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