AUBURN, NY - New York??s top court upheld a ruling earlier this week, deciding that the Cayuga Indian Nation did not have to pay taxes on its cigarette sales. As such, an attorney for the Cayugas said that the tribe now intends to sue Cayuga and Seneca counties for roughly $500,000 for seizing the tribe??s cigarettes in a 2008 tax raid, Syracuse.com reports.

Subsequent to the raid, the counties had retained the cigarettes as evidence in their now dismissed tax-evasion case against the Cayugas, but the smokes are spoiled, said Daniel French, attorney for the Cayugas.

"They??re done, they??re past the spoilage date...Of course, all of this was completely avoidable,???? French added.

Last year, the Cayugas offered to drop their impending lawsuit and pay both counties?? legal expenses if the counties returned the cigarettes to the tribe.

However, the counties rejected the offer and pursued an appeal of a lower state court ruling that allowed the Cayugas to continue selling tax-free cigarettes.

New York??s Court of Appeals ruling said that the Cayugas do not have to pay state sales tax on the cigarettes because its two stores are located on qualified reservation land under state taxation law.

County leaders said they were disappointed with the decision and that it reinforces an unfair competitive advantage for the tribe??s cigarette sales.