The Manitoba government has won a temporary court injunction to close down a First Nations smoke shop that has been selling cigarettes illegally since November.

The province wants to shut down the Dakota Chundee Smoke Shop in southwestern Manitoba, as it does not have a licence to sell cigarettes.

People gathered Wednesday morning at The Forks, prior to the start of the march. (John Redekop/CBC)

In a decision handed down Wednesday afternoon, Court of Queen's Bench Justice Brenda Keyser said she will grant an interim injunction, as long as the province files an "undertaking of damages" before it tries to shut down the smoke shop.

The province would acknowledge in the undertaking that if it loses its bid for a permanent court injunction, the shop owners can seek damages that they may have incurred from the interim injunction.

However, the smoke shop owners would have to prove they did incur damages as a result of the interim ruling, Keyser told the court.

Horseback rally downtown

Earlier on Wednesday, operators of the Dakota Chundee Smoke Shop and their supporters sang and drummed as they proceeded — some on horseback — through downtown Winnipeg to the courthouse.

About 75 people participated in the march.

Owned by leaders from the Dakota Plains and Canupawakpa First Nations, the Dakota Chundee Smoke Shop has been raided several times since it opened in Nov. 9 on off-reserve land 80 kilometres southwest of Brandon, Man.

The store sells untaxed cigarettes, which come from Mohawk distributors in Quebec, for less than half the regular price in Manitoba.

The First Nations opened the shop not just to generate revenue for their members but to draw attention to the Canupawakpa First Nation's court battle with the federal government over treaty status.

Should operate with own laws, chief says

The First Nation is not part of any modern-day treaties, meaning the smoke shop is not located on reserve land, where it would fall under federal jurisdiction.

Canupawakpa Chief Franklin Brown said the Dakota people should be able to operate with their own laws.

"We ask the province to produce legal documentation that Dakotas agreed to be under provincial jurisdiction," he said Wednesday morning.

"It's been eight months now. They haven't produced legal documentation."

The store's owners face charges under the Tobacco Tax Act and the Tax Administration and Miscellaneous Taxes Act, but those charges have yet to be heard in court.

Lawyers for the province told reporters outside the courthouse that once the temporary injunction is granted, the Dakota Chundee store technically does not have to close, but it does have to stop the illegal actions — that is, the sale of cigarettes.

Finance minister pleased

In a statement, Finance Minister Stan Struthers said the province is pleased with Wednesday's ruling.

"This is an important decision upholding the rule of law," Struthers said.

"The decision to pursue an injunction through the courts was made as the defendants continued to contravene the law by selling illegal tobacco, despite seizures of the product and charges being laid against eight different individuals."

Struthers said the province will look at taking further action if the smoke shop owners disregard the court injunction.

Brown said regardless of the outcome from court, the Dakota Chundee Smoke Shop will open as usual on Thursday.

"It's creating employment so the province doesn't have to worry about feeding us; we don't have to be a burden to them," he said.