Wisconsin Judge Stops Crackdown on RYO Shops

Restraining order delays permitting, other actions until Nov. 23 hearing

Published in CSP Daily News

MADISON, Wis. -- A Dane County judge on Friday restored for now the ability of roll-your-own (RYO) tobacco shops, which have faced a crackdown by state officials, to operate in Wisconsin, reported the Milwaukee Journal Sentinel.

Circuit Court Judge Juan B. Colas issued a temporary restraining order preventing the state from taking steps such as requiring the shops to obtain tobacco manufacturing and distributor permits and paying manufacturers taxes. The restraining order was sought by several businesses involved in the roll-your-own industry, the report said.

A November 23 court hearing is scheduled on whether to continue the order, Stephanie Marquis, a spokesperson for the state Department of Revenue, told the newspaper.

"We are disappointed with the court's decision, but we remain dedicated to enforcing our tobacco laws and regulations fairly and equitably," she said in a statement obtained by the Journal Sentinel.

RYO tobacco stores sell customers loose tobacco and cigarette papers that the customers load into large rolling machines on the premises. The cigarettes are sold at about half the price of premium brands because the retailers charge the tax on pipe tobacco, rather than the much higher tax on standard cigarettes.

But Department of Revenue agents have been visiting the shops, shutting down the machines and telling the owners they need the permits to operate. Some of the shops shut down as a result.

The case seeking the restraining order was brought by three companies, said the report: RYO Machines, an Ohio maker of the roll-your-own machines, WISUP, a distribution company with operations in Wisconsin, and RW Petersen, which operates a Wausau store.

"This is good news for the RYO community," Kent Krueger, the owner of the Ciggy Shack in Menomonee Falls, told the paper. Krueger was not a party in the case.

The state estimates there are 50 to 100 RYO machines in the state, said the report.