Wednesday, July 11, 2012

Second Circuit Strikes NYC Tobacco Warning Signs

A three-judge panel of the Second Circuit ruled this week in 94th St. Grocery Corp. v. New York City Board of Health that the Federal Cigarette Labelling and Advertising Act preempted New York City's requirements that retailers who sell cigarettes post warning signs near cash registers and cigarette displays.  

The ruling voids New York's requirements, but at the same time goes to lengths to remind us that other municipal efforts to regulate cigarette sales and to educate the public about the dangers of tobacco use (through public education campaigns) are unaffected by the case.

The case involved challenges to two signage requirements in the New York health code.  The first one required "persons who engage in face-to-face" tobacco sales to post a "small sign" near the cash register with pictures depicting the dangers of tobaccco use.  The second one required those persons to post a "large sign" near each tobacco display, also with pictures depicting the dangers of tobacco use.  The provisions applied to retailers; nothing at issue in the case applied directly to cigarette manufacturers.

Retailers and tobacco manufacturers sued, arguing that the federal Act preempted the signage requirements.  The preemption clause says that a state or locality may not impose any "requirement or prohibition based on smoking and health . . . with respect to the advertising or promotion of . . . cigarettes."  15 U.S.C. Sec. 1334(b).  The case thus turned on the meaning of the phrase "with respect to promotion."

The court ruled that both City signage requirements were "with respect to promotion."  The court said that the second one--the one requiring a sign by a cigarette display--directly affected promotion, because "a display is a form of publicity that can further the sale of merchandise," and the graphic sign "treads on" it.  The court said that the first one--the one requiring a sign by the cash register--was a closer call, but still indirectly affected promotion.  The court said that most New York retailers kept cigarettes behind the cash register counter (pursuant to New York law), and the cash register sign therefore had the same effect that the display sign had--a treading-on of the sales display.

The case comes closely on the heels of a Sixth Circuit ruling this spring rejecting a facial free speech challenge to the new federal warning requirements for cigarette packaging in the federal Family Smoking Prevention and Tobacco Control Act.  That case, in turn, came on the heels of an earlier ruling from the D.C. District that FDA's labels, promulgated under the Family Smoking Prevention and Tobacco Control Act, did violate free speech.  


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