U.S. Appeals Courts Split Over Graphic Cigarette Labels

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Two federal appellate courts are now split over whether the government can force the tobacco industry to place graphic warning labels on cigarette packages. The division between the two circuits, which disagree on the level of scrutiny this regulation of commercial speech must meet, raises expectations that the matter will go before the U.S. Supreme Court.

The controversy centers on the 2009 Family Smoking Prevention and Tobacco Control Act, which gives the Food and Drug Administration (FDA) authority to regulate tobacco products and directed the agency to require the new labels. The FDA rule created nine new labels that included textual warnings as well as images that were to cover the top half of the front and back of cigarette packages.

The warnings include color graphic images of, among other things, a dead man's body with staples lining his chest, decaying teeth, and a man breathing through a hole in his neck.

In the most recent ruling, dated Aug. 24, 2012, a divided panel of the U.S. Court of Appeals for the District of Columbia Circuit held that the FDA labels violate tobacco companies’ First Amendment rights. R.J. Reynolds Tobacco Co. v. Food & Drug Administration. In doing so, it upheld a decision by Judge Richard Leon of the U.S. District Court for the District of Columbia, who found that the regulations failed to satisfy a strict-scrutiny analysis.

In writing for the D.C. Circuit’s majority, Judge Janice Rogers Brown, joined by Senior Circuit Judge A. Raymond Randolph, said the FDA labels failed to satisfy Central Hudson Gas & Electric Corp. v. Public Service Commission criteria for restrictions on commercial speech. Under that intermediate standard, the government must assert a substantial interest justifying a commercial-speech regulation and also establish that the regulation directly advances its goal and is no more extensive than necessary.

The D.C. Circuit rejected application of the less rigorous standard provided in Zauderer v. Office of Disciplinary Counsel, finding that the labels are not purely factual and uncontroversial statements designed to correct deceptive advertisements. “In fact, many of the images do not convey any warning information at all, much less make an ‘accurate statement’ about cigarettes,” according to the opinion. It said, for example, that there is no information about the health effects of smoking contained in the images of a woman crying, a small child, and the man wearing a T-shirt emblazoned with the words “I QUIT.”

And the “1-800-QUIT-NOW” number, when presented without any explanation about the services provided on the hotline, hardly sounds like an unbiased source of information. These inflammatory images and the provocatively-named hotline cannot rationally be viewed as pure attempts to convey information to consumers. They are unabashed attempts to evoke emotion (and perhaps embarrassment) and browbeat consumers into quitting.

Applying the Central Hudson test, the D.C. Circuit held that the FDA failed to meet its burden of proving that the labels would accomplish its asserted aim of reducing smoking rates. “FDA has not provided a shred of evidence . . . showing that the graphic warnings will ‘directly advance’ its interest.”

Circuit Judge Judith W. Rogers dissented, saying the panel should have applied the more lenient Zauderer standard due to the tobacco industry’s long-term efforts aimed at hiding the health risks of smoking and the government’s interest in “effectively conveying information about the negative health consequences of smoking to consumers.”

“Because the warning labels present factually accurate information and address misleading commercial speech, as defined in Supreme Court precedent, Zauderer scrutiny applies, and the government need show only that the warning label requirement is reasonably related to its stated and substantial interest in effectively conveying this information to consumers,” Rogers wrote in dissent. Rogers agreed, however, that the Central Hudson test applied to the mandatory inclusion of the 1-800-QUIT-NOW hotline on each label and that this requirement was unconstitutional.

On October 9, 2012, the FDA asked for a rehearing by the full court, arguing that the panel’s 2–1 decision was wrong and conflicts with an earlier U.S. Sixth Circuit Court of Appeals opinion upholding the federal government’s right to require the warnings. Discount Tobacco City & Lottery v. United States. In Discount Tobacco City, the Sixth Circuit rejected Big Tobacco’s facial challenge to the law and ruled that the key requirement calling for color graphics is constitutional under the Zauderer standard.

(The First Amendment & Media Litigation Committee News and Development item “Appeals Panel Upholds Graphic Cigarette Labels” discusses earlier rulings and “Tobacco Suit Challenges Graphic Warning Mandate” provides an analysis of the issues.)

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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