Unless you are willing to escalate the issue and deal with all the hassles associated with such action, of which there will be plenty, yes they can. Like someone else said, what are you going to do about it? I gaurantee you arguing with a NYC cop about such a thing in public is only going to end up in a physical confrontation with you likely to get your head knuckled. You think zero tolerance is just at public schools, try taking your knife back from a uniformed cop at a subway stop in Manhattan. I gaurantee you a bad day then.

I don't like it anymore than the next guy, and I've already had my run in with them over my little SAK classic. Believe me, it is worth it just to let him have his way and walk down to the luggage store and pick up another for $20. Once he's made up his mind, you are not going to change it, but you might give him a good reason to take out his stress and frustration.

The principle ideal is a sound. Our rights ought not be infringed, but the reality is it just isn't worth the effort. It is the way things work now, and it is not going to accomodate our rights that way any more.

Don't use it unless you really need to, and be prepared to give it up to The Man unless things go all heck and it's every man for himself then.
The ultimate result of shielding men from the effects of folly is to fill the world with fools.
-- Herbert Spencer, English Philosopher (1820-1903)