If the companies do not take up the challenge, the government might go ahead and ban them, spokeswoman Catherine Lappe said. "It's misleading people into thinking that they're actually a safer cigarette when in fact they're not."

Lappe noted that the moves against light and mild cigarettes were part of an international framework on tobacco control being negotiated in Geneva. On May 15 the European Union passed legislation that will prevent descriptions of "light" and "mild" for tobacco beginning in September 2003.

Canada's largest tobacco company, Imperial Tobacco, has already halted plans to launch two new light cigarette brands Rock's challenge. Imperial was set to introduce the brands within months.

"Made-in-France is a valuable brand in many countries," said Pozin. "And if the cigar is very good, the consumer won't mind that it was not made in Cuba or the Dominican Republic."

A former exporter of French wines and spirits to Caribbean countries, Pozin was inspired by his travels to produce his own cigar brand in his native land.

"Much of the quality of a good cigar comes from the art of assembling the finest tobacco leaves," Pozin said. "We in France are assembling specialists, in our wine and Champagne production, for example."

Pozin, the first to launch a tobacco business in France since the formerly state-owned Seita lost its monopoly in the field in 1997, raised a million dollars from private investors in his native Drome region to get started.

He recruited three Dominican nationals with cigar-factory experience to oversee production and 13 workers from the Drome, who were trained for six months in the art of rolling cigars at the newly created Manufacture Francaise de Cigares.

The team started work last November, and orders for 300,000 Edito cigars have already arrived from tobacco outlets in France, the United States, Japan, and Singapore, says Pozin.

The tobaccos used to make Edito cigars are currently imported from various Caribbean countries, but Pozin intends to start growing his own locally in hothouses to avoid using pesticides.

"The idea is to create a luxury brand, with high-quality, natural and perfectly made cigars to one day rival Davidoff," Pozin said in an ambitious challenge to the legendary brand founded more than 80 years ago by Zino Davidoff.

In an innovative move inspired by practices in the wine business, Pozin's company labels all its boxes with the origin of the tobacco leaves used to make the cigars and the year of production.

"That's so consumers can trace the origins of their cigars," Pozin said, adding that certain years might come to be regarded as particularly good, as is the case with wines.

Net sales include sales from merchandise, shipping and handling charges, and mailing list rental. Included in total net sales is the retail store revenue, which decreased to $64,838 in 2000, compared with $115,484 in 1999.

Total cost of sales increased 342% from 1999 reflecting the overall increased sales of the company. Merchandise costs increased from 43.0% of net sales in 1999 to 47.2% in 2000. The company attributes this increase to generally higher merchandise cost percentages at P&K, which sells tobacco, cigars, pipes, and related smoking products in wholesale distribution.

The justices also ruled that the ad restrictions on cigars and smokeless tobacco amounted a ban on advertising of a legal product to legal users.

The only state regulations to survive involved retail outlet sales practices, which bar self-service displays for tobacco products and require that the products be put in a spot accessible only by the sales staff. For Massachusetts tobacco shops, this may mean an end to walk-in humidors and any customer handling of cigars. One possible avenue for smoke shops there is to adopt strict, adult-only standards, not admitting minors onto the premises, or at least into humidors.

The decision was extremely complicated, noted Justice Sandra Day O'Connor in delivering the court's opinion. While the ruling came in answer to an industry appeal of the Massachusetts ban, it also now calls into question existing restrictions on tobacco ads in other juridictions, including New York and Chicago.

O'Connor said states and local cities have other ways of regulating conduct to make sure minors do not obtain cigarettes. She noted that it is illegal in Massachusetts to sell tobacco products to anyone under 18.