On Friday, August 24, 2012, the D.C. Circuit upheld an earlier ruling by the D.C. District Court invalidating an FDA rule that would have required one of nine images to be displayed on every cigarette package. The court held that the rule violated the First Amendment because the government failed to demonstrate that the regulation would directly advance the stated goal of reducing smoking rates.

The Family Smoking Prevention and Tobacco Control Act (“the Act”) directs FDA to “issue regulations that require color graphics depicting the negative health consequences of smoking to accompany the [textual] labeling statements” specifically provided for under the Act. Pursuant to this authority, FDA promulgated a final rule in June 2011 with a set of nine images, which it justified based on the “strong worldwide consensus” in favor of graphic warnings compared to text-only warnings. While the decision technically only invalidates FDA’s implementation of the statutory requirement, it also raises questions as to the constitutionality of the statutory requirement itself.

The court began by emphasizing that the First Amendment protects “[b]oth the right to speak and the right to refrain from speaking” as “complementary components.” According to the court, the graphic images at issue here functioned less as warnings and more as admonitions not to buy or use cigarettes. Determining what level of scrutiny to apply, the court held that the rational basis review applied to “purely factual and uncontroversial” disclosure requirements was inappropriate here for two independent reasons. Applying Zauderer v. Office of Disciplinary Counsel, 471 U.S. 626 (1985), and its progeny, the court explained that rational basis review had never been applied to disclosure requirements that weren’t designed to correct misleading commercial speech. Because the Act also bans inherently misleading speech by prohibiting “light,” “mild,” “low” or other descriptive claims on cigarette packages, the graphic labels could not be characterized as designed to remedy a “potentially real danger that an advertisement will mislead consumers” and therefore Zauderer was inapplicable.

Additionally, the Zauderer standard was inappropriate because the graphic warnings were not the type of “purely factual and uncontroversial information” that should be subject to rational basis review. The court reasoned that the “inflammatory images . . . cannot rationally be viewed as pure attempts to convey information to consumers,” and instead were “unabashed attempts to evoke emotion (and perhaps embarrassment) and browbeat consumers into quitting.” Zauderer, according to the court, has never been applied to allow a more lenient standard for compelled speech that was not designed to impart factual and uncontroversial information.

While ultimately upholding the district court decision, the D.C. Circuit departed from the lower court’s rationale by applying intermediate, rather than strict, scrutiny to the FDA rule. Acknowledging “contrary views of other circuits,” the court held that the intermediate standard set forth in Central Hudson was appropriate because the FDA rule involved a compelled commercial disclosure. Despite stating that it was applying intermediate scrutiny, the court cited an earlier D.C. Circuit decision noting that the Supreme Court’s bottom line has been that the “government must affirmatively demonstrate its means are narrowly tailored to achieve a substantial government goal” – language generally reserved for analysis under strict scrutiny.

Regardless of whether the standard is described as intermediate or strict, the government was required to show that the regulation “directly advanced the governmental interest asserted” in order to justify it under Central Hudson. The court found that FDA’s cited evidence constituted “mere speculation” because FDA in essence conceded that the agency lacked evidence showing that the graphic warnings were likely to reduce smoking rates. FDA had relied on two studies suggesting that the graphic images may have some impact on how people view smoking, but not directly addressing whether the images would actually reduce smoking rates to a material degree.

The decision suggests that the government must provide actual data demonstrating its stated interest will be directly advanced “prior to imposing a burden on commercial speech.” The decision in its entirety can be accessed here.