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Judge Finds Tobacco Companies Likely to Prevail in Graphic Labels Case

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U.S. District Judge Richard Leon gave cigarette manufacturers contesting the Food and Drug Administration’s new graphic warning labels a win Monday morning, finding that they were likely to succeed and granting their request for a preliminary injunction to delay enforcement.

Leon hasn’t ruled on a pending motion for summary judgment, but said in a Nov. 7 opinion that the companies had “demonstrated a substantial likelihood that they will prevail on the merits of their position.”

The labels in question include color images that are meant to show the consequences of smoking – diseased lungs, for instance. The manufacturers challenged the new regulations on the grounds that the labels violate their First Amendment rights by requiring them to advocate against the purchase of their own product on labels that take up half of the cigarette package.

Floyd Abrams of New York’s Cahill, Gordon & Reindel said the ruling “is a vindication of the First Amendment principle that the government may not compel speech.”

“In some circumstances, the government may require warnings to be placed on products, as is true of tobacco products, but what it may not do is to try to require those people who produce and sell lawful products to urge prospective customers not to purchase those products,” Abrams said.

A spokeswoman for the agency declined to comment.

Although the new regulations requiring companies to print the graphic labels isn’t set to go into effect until September 2012, the tobacco companies argued that they would have to spend millions of dollars and thousands of employee hours in advance to design and produce the labels.

Leon heard oral arguments on Sept. 21. Abrams and Jones Day partner Noel Francisco, who could not immediately be reached for comment on Monday, argued on behalf of the tobacco companies. The injunction will delay enforcement for 15 months after the court issues a final ruling in the case.

Under the Family Smoking Prevention and Tobacco Control Act of 2009, the FDA created nine new written warnings that feature graphic color pictures, including a side-by-side comparison of diseased and non-diseased lungs, a man with a hole in his throat and a body on an autopsy table.

When it comes to commercial businesses, the government can compel speech as long as it is “purely factual and uncontroversial,” Leon wrote. But even then, he added, those disclosures can violate the First Amendment if they are “unjustified or unduly burdensome.”

In this case, Leon found, the proposed graphic labels aren’t purely fact – some are cartoons and some appear to be digitally altered or enhanced. He added that all of them are “unquestionably designed to evoke emotion,” or at least that was a standard the agency used to consider which images to use.

“Thus, while the line between the constitutionally permissible dissemination of factual information and the impermissible expropriation of a company’s advertising space for Government advocacy can be frustratingly blurry, here…the line seems quite clear,” he wrote.

Leon wrote that he agreed that the companies would be harmed if the enforcement date wasn’t pushed back. Aside from the estimated $20 million they would have to spend, he wrote, the more convincing issue is that they wouldn’t be able to get that money back even if they won.

The plaintiffs are five of the largest cigarette manufacturers in the United States – R.J. Reynolds Tobacco Co., Lorillard Inc., Commonwealth Brands, Inc., Liggett Group LLC, and Santa Fe Natural Tobacco Company Inc.

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