Update: Court Issues Preliminary Injunction Blocking FDA’s Graphic Smoking Warning Labels From Going Into Effect

Nov 14, 2011   
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On November 7, 2011, Judge Richard Leon of the United States District Court for the District of Columbia granted a preliminary injunction on behalf of five tobacco companies challenging the implementation of the FDAs new graphic cigarette warning labels. As a result of the injunction, the FDAs new cigarette labeling requirements, which were scheduled to take effect in September 2012, are now blocked from taking effect until fifteen months after resolution of the plaintiffs claims on the merits. A copy of the Courts opinion can be read here.

As we previously reported, on June 21, 2011, pursuant to the authority granted to it by the Family Smoking Prevention and Tobacco Control Act to regulate tobacco, the FDA released nine new graphic warning labels that were required to appear on every pack of cigarettes sold in the US and in every cigarette advertisement starting no later than September 2012. In response to the FDAs new rule, five tobacco companies (R.J. Reynolds Tobacco Company, Lorillard Tobacco Company, Commonwealth Brands, Inc., Liggett Group LLC, and Santa Fe Natural Tobacco Company, Inc.) filed a complaint in the United States District Court for the District of Columbia alleging that the FDAs new cigarette labeling rules violated the First Amendment and the Administrative Procedure Act.

The five companies also sought an injunction to prohibit the rules from going into effect until fifteen months after a final decision has been rendered on the merits of their case. More background information involving this case can be read in our prior report here. In order for a court to grant a preliminary injunction, it must determine the following: 1) whether there is a substantial likelihood of success on the merits for the moving party; 2) whether the movant will suffer irreparable harm if the injunction is not granted; 3) whether the injunction will substantially injure other interested parties; and 4) whether the public interest would be furthered by the injunction. See Mova Pharm. Corp. v. Shalala, 140 F.3d 1060, 1066 (D.C. Cir. 1998). However, “the party seeking a preliminary injunction need not prevail on each factor.” R.J. Reynolds Tobacco Company, Inc. v. U.S. Food and Drug Administration, 11-1482, at 9 (November 7, 2011 D.D.C.). Rather, the court “appl[ies] the factors on a sliding scale.” Id. As a result, “if the arguments for one factor are particularly strong, an injunction may issue even if the arguments in the other areas are rather weak.” Id.

More specifically, the tobacco companies alleged that the requirement to place graphic images on its labels unconstitutionally compels speech. Generally speaking, compelled speech is presumptively unconstitutional and will only be upheld if it passes “strict scrutiny,” i.e.: 1) the government has a compelling interest it seeks to protect; and 2) the regulation is narrowly tailored to achieve that interest. However, as explained by the Court, narrow exceptions apply in the area of commercial speech. The government may require disclosure of only “purely factual and uncontroversial information” to protect consumers from “confusion or deception,” unless such a disclosure is “unjustified or unduly burdensome.” A lower level of scrutiny applies in cases where government- compelled speech meets this narrow exception.

In this case, the Court determined that the FDAs rule did meet the narrow exception for compelled commercial speech for several reasons. First, the Court found that the images could not be considered purely factual because must were either digitally enhanced or manipulated to depict the negative consequences of smoking. Second, the Court found that the FDAs argument that the images chosen by the rule were uncontroversial and purely factual was undermined by the fact that the FDAs selected graphic images were designed to evoke viewers emotions. Finally, the Court found that when the graphic images were combined with the textual warnings and the mandatory display of the 1-800-QUIT-NOW smoking cessation hotline, the goal was to induce the viewer to quit or never start smoking. Thus, the Court found that the FDAs labels were neither purely factual nor uncontroversial. Therefore, strict scrutiny and not a lower, more-deferential level of scrutiny applied.

In evaluating whether the FDAs labeling rule passed constitutional muster, the Court found that regardless of whether the governments interest in providing information to consumers is compelling, the FDAs rule is not narrowly tailored to achieve such a purpose. The Court noted that the size and display requirements of the rule — the top 50% of the front and back panels of all cigarette packages and the top 20% of printed advertising — is not narrowly designed to achieve an informative purpose. Rather, the Court found that such dimensions promote a government sponsored anti-smoking message. Additionally, the Court found that the graphic warnings when combined with the textual messages and the 1-800 number result in the FDA “conscript[ing] tobacco manufacturers into an anti-smoking brigade.” Thus, the Court found that the tobacco manufacturers have a substantial likelihood of success on the merits because the FDAs labeling requirements are likely to be found violative of the First Amendment.

The Court also found that the plaintiffs satisfied the other prongs necessary to be granted a preliminary injunction. The Court found that because of the plaintiffs likelihood of success on the merits and the fact that litigation would likely continue well beyond the September 2012 effective date, the plaintiffs would suffer irreparable harm if an injunction was not issued. Additionally, the Court found that injunctive relief would not harm any interested third parties because, based on the record, Congress did not demonstrate that such rules were urgent. In so finding, the Court noted that the Tobacco Act established a mutli-stage timeline in which the FDA was given two years to promulgate a Final Rule and a 15 month implementation period before the Final Rule took effect. Therefore, the Court found no prejudice to other third parties. Finally, the Court found that the “public interest will be served by ensuring that plaintiffs First Amendment rights are not infringed before the constitutionality of the regulation has been definitively determined.” As such, the Court granted the tobacco companies injunction.

Although the preliminary injunction is effective as of the Courts order, the government does have the ability to file an interlocutory appeal challenging the Courts decision. If the government does appeal and is successful, then the District Courts preliminary injunction will be vacated. A similar situation arose in Sherley v. Sebelius, a case involving a challenge to federal funding for stem cell research. In that case, the plaintiffs were granted a preliminary injunction to prevent the NIH funding guidelines from taking effect. However, as we previously reported, the D.C. Circuit vacated the preliminary injunction on appeal and remanded the case to the district court for resolution on its merits.

The practical effect of a successful government appeal would be that, although tobacco companies would still be able to challenge the FDAs rule on the merits, the companies would still have to comply with the FDAs new labeling requirements starting September 2012.

Fuerst Ittleman will continue to monitor the progress of this lawsuit and the FDAs regulation of tobacco products and advertising. For more information, please contact us at contact@fidjlaw.com.