I am not an attorney in Washington (I practice in NY), but this situation sounds disgraceful. You do have the right to report this action to local police, the local child-welfare department, and/or the Department of Alcohol, Firearms and Tobacco. It is a crime to provide children with cigarrettes. In the United States, it is illegal (as far as I know in every state) to purchase/give children cigarettes if they are under the age of 18. You have rights. Only you can decide how far you want to go. Your actions might help the situation. Whatever you decide, think it through before you do anything. I wouldn't want to see you have a problem with seeing your granddaughter, but I also cannot stand the thought of her being hurt. You should seek an attorney in Washington for more detailed information. Good luck.
THIS RESPONSE DOES NOT IMPLY OR CREATE AN ATTORNEY-CLIENT RELATIONSHIP. NO ATTORNEY-CLIENT RELATIONSHIP IS IMPLIED OR CREATED BY RESPONDING OR FAILING TO RESPOND TO THIS RESPONSE. THIS RESPONSE DOES NOT PROVIDE LEGAL ADVICE. FOR LEGAL ADVICE, YOU SHOULD CONSULT AN ATTORNEY.
RCW 26.28.080 (Selling or giving tobacco to minor — Belief of representative capacity, no defense — Penalty) provides:
Every person who sells or gives, or permits to be sold or given to any person under the age of eighteen years any cigar, cigarette, cigarette paper or wrapper, or tobacco in any form is guilty of a gross misdemeanor.
It shall be no defense to a prosecution for a violation of this section that the person acted, or was believed by the defendant to act, as agent or representative of another.
RCW 70.155.080 (Purchasing, possessing by persons under eighteen — Civil infraction — Jurisdiction) provides:
(1) A person under the age of eighteen who purchases or attempts to purchase, possesses, or obtains or attempts to obtain cigarettes or tobacco products commits a class 3 civil infraction under chapter 7.80 RCW and is subject to a fine as set out in chapter 7.80 RCW or participation in up to four hours of community restitution, or both. The court may also require participation in a smoking cessation program. This provision does not apply if a person under the age of eighteen, with parental authorization, is participating in a controlled purchase as part of a liquor control board, law enforcement, or local health department activity.
In WA, a gross misdemeanor is punishable by up to a year in jail, $5000 fines, or both.
Are you willing to see your daughter, son in law, or both in jail?
The prosecutor may also throw in some charges involving abuse of a minor. If the parents are not US citizens, that may be an immigration problem for them.
Perhaps they are not aware that they risk being in jail. Perhaps they will stop once you point out the law.