Appeals Court Strikes Down NYC's POS Cigarette Ad Measure

RICHMOND, Va. -- A New York City resolution requiring retailers who sell cigarettes to display graphic health warnings has been dealt a second legal blow.

Today, the U.S. Court of Appeals for the Second Circuit upheld a 2010 district decision striking down the resolution, finding that such mandates were preempted by federal law.

"We are pleased that the Second Circuit reaffirmed that federal law bars state and local governments from regulating the content of cigarette advertising and promotion," said Murray Garnick, Altria Client Services senior vice president and associate general counsel, speaking on behalf of Philip Morris USA (PM USA). "This suit has always been about who has the authority to regulate the content of cigarette warnings. That is a power reserved to the federal government without interference or additional efforts by state and local authorities."

In its decision, the appellate court concluded that "requirements or prohibitions directly affecting the content of the manufacturers' promotional message to consumers are preempted." Though the city had argued that the resolution was not a requirement with respect to promotion of cigarettes but rather the sale, the court found that with the resolution "the city ignores the practical effect the resolution has on the manufacturer's promotional activity at the retail location," according to the decision.

"Specifically, requiring a warning sign in close proximity to a cigarette display has practically the same effect as requiring a warning on the display itself," it added.

In September 2009, the New York City Board of Health approved a code change that required the display of smoking cessation signs where tobacco products are sold. In June 2010, several plaintiffs filed suit challenging the measure. PM USA, R.J. Reynolds and Lorillard Inc. were among the plaintiffs in the case and were joined by individual retailers and the New York Association of Convenience Stores (NYACS).