JUDGE OVERTURNS ILLICIT-DRUGS TAX

Officials Will Continue To Collect Fine; Defense Attorneys Call State 'Cavalier

A Tennessee judge has ruled that a state law requiring drug dealers
to pay taxes on their cocaine, marijuana and other illicit drugs is
unconstitutional.

The ruling by Davidson County Chancellor Richard Dinkins bars the
state from collecting $1.1 million from Jeremy Robbins, an East
Tennessee man who was arrested on federal drug conspiracy charges and
ordered to pay taxes on marijuana he is accused of illegally possessing.

But it could potentially cost the state much more if the decision is
upheld by higher courts and interpreted as applying to the entire state.

Last night, state officials said they would continue to enforce the
tax, which has brought more than $2.7 million into state coffers
since it went into effect in January 2005.

"They're just turning a blind eye and a deaf ear to the opinion,"
said James A. H. Bell, one of the Knoxville lawyers who brought the
case on behalf of Robbins. He described the state's attitude as "cavalier."

The chancellor's decision, handed down Monday, applies only to
Robbins and, in any case, the state plans to appeal, said Sharon
Curtis-Flair, spokeswoman for the state attorney general's office.

"It's just this one client," she said.

The drug tax requires dealers to purchase tax stamps, similar to
those on cigarettes and alcohol.

Because tax information is confidential, officials with the state
Department of Revenue cannot turn the information over to police. If
the dealer is later arrested with drugs and has not paid the tax, he
will be assessed the back taxes and penalties.

Since 2005, state Department of Revenue officials have assessed $51
million in drug taxes owed, with the vast majority of the money going
uncollected.

Very few people have actually bought the stamps. During the law's
first year, taxpayers spent $1,492 in stamps for illegal drugs.

"As you can imagine, very few people are coming forth voluntarily,"
said Department of Revenue spokeswoman Emily Richard.

In issuing his decision, Dinkins, the chancellor, ruled that buying
the stamps violated a person's right to avoid self-incrimination. He
noted that law enforcement could use the purchase of stamps against
people if they obtained the information independently from the
Department of Revenue.

"The court concludes that the manner in which the tax is assessed
deprives taxpayers of due process and, to that extent, the statute is
unconstitutional on its face," the chancellor wrote.

He also found that levying the tax and charging someone with a crime
was equivalent to double jeopardy because it punished the dealer
twice for the same crime.

"(The) statute violates the double jeopardy provisions of the Fifth
and Fourteenth Amendments to the United States Constitution and ...
the Tennessee Constitution to the extent it may be employed against a
dealer otherwise subject to state prosecution relating to the
unauthorized substances subject to the tax proceeding."

The tax has been applauded by law enforcement officials but fiercely
attacked by criminal defense attorneys. Bell and Richard Holcomb, an
attorney who also worked on the Robbins case,argued that state tax
officials are targeting citizens who have only been accused of crimes
and not yet convicted.

In some cases, the suspects had property seized by the state and have
been forced to pay thousands of dollars in taxes.

Defense attorneys also have cited cases in which people have been
ordered to pay the tax even after a judge or jury finds them not
guilty of the drug crime.

In criminal cases, the burden of proof is on the state to show
someone is guilty beyond a reasonable doubt. But for purposes of
collecting taxes, the state uses the lower standard used in civil
cases, which requires that a "preponderance of evidence" shows a
person is guilty.

In making his ruling, Dinkins said the tax robs residents of their
due process by forcing them to put up money at the outset of a case
to avoid having their assets seized. He also faulted the fact that
the burden is on the person to prove the tax is not owed.

Three-quarters of the money collected under the drug tax go back to
the law enforcement agencies that made the drug busts. The other 25
percent goes to the state's general fund.

"Obviously, it's raised some money and I think it's done some good
things," Davidson County District Attorney General Torry Johnson
said. He declined to comment directly on Dinkins' decision.

Tennessee is one of at least 23 states that requires drug dealers to
purchase tax stamps. The law was patterned after similar legislation
in North Carolina, which, thus far has withstood legal challenges.