Lorillard Tobacco Co. v. Roth

A New York State “minimum price” law prohibits cigarettes from being sold below cost if the intent is to harm competition or avoid taxes. The state agency that enforces the law issued a memo saying that certain price promotions – specifically “master-type” and “buy-down” promotions – violate the law. In these types of promotions, a retailer charges a lower price for cigarettes and is later reimbursed by the manufacturer or wholesaler at the end of the promotion period. A tobacco company and retailer challenged the agency’s interpretation of the law, arguing that these types of promotions are not illegal under the law. The court ruled that the agency’s interpretation is consistent with the law, because the law intended to prohibit promotions that create price differentiation among retailers. However, the court noted that it was not deciding whether a specific sale under a master-type or buy-down promotion violated the law, only that such types of promotions were intended to be covered by the law.


Lorillard Tobacco Co. v. Roth, 786 N.E.2d 7 (2003).

  • United States
  • Feb 13, 2003
  • Court of Appeals of New York



  • ATN Marts, Inc., d/b/a K & K Food Mart
  • Lorillard Tobacco Co.


  • Arthur J. Roth, Commissioner of Taxation and Finance
  • New York State Department of Taxation and Finance

Legislation Cited

New York Cigarette Marketing Standards Act

Related Documents

Type of Litigation

Tobacco Control Topics

Substantive Issues

Type of Tobacco Product