State Attorney General Darrell McGraw has filed a civil suit against a Brazilian tobacco company, claiming it has not paid more than US$ 2 million in state taxes.

In a lawsuit filed 2 March in Kanawha Circuit Court, McGraw says Sudamax Industria E Commercio De Cigarros, a tobacco company based in Sao Paulo, has not paid escrow requirements to the state. Sudamax produced the Berkley brand of cigarettes.
Tobacco manufacturers must meet certain obligations under West Virginia Code to be able to sell their product in the state. One way involves entering into a master settlement agreement, which Sudamax did not. If the company does not enter into that agreement, they must pay into a qualified escrow fund, in an amount equal to US$ 0.0167539 per pack of cigarettes sold in the state, which is adjustable with inflation.
The suit says Sudamax did not place any money in an escrow account from 1 January 2004 to 23 June 2005. More than 36 million packs of Berkley cigarettes were sold in 2004 and 6.74 million were sold between 1 January and 23 June 2005," the suit says. "After 23 June, Berkley brand cigarettes were removed from the Directory of Cigarette Brands Approved for Stamping and Sale in West Virginia for Nonparticipating Manufacturers."
According to the civil suit filed by McGraw, Sudamax was required to pay US$ 736,594 in escrow on or before 15 April 2005 and US$ 140,331 on or before 15 April 2006, but no funds were put in escrow. (pi)