Last Wednesday, the D.C. Court of Appeals declined to grant an en banc (full panel) review of the Court panel's graphic cigarette warning decision, in which the Court overturned the FDA's graphic warnings on the grounds that the law violates the tobacco companies' First Amendment free speech protections. The FDA will likely appeal this ruling to the Supreme Court.
The Rest of the Story
I think it is quite likely that the Supreme Court will hear this case. Because the warning labels are not purely factual and non-controversial but are designed specifically to create an emotional reaction that is intended to encourage smokers to quit, I believe that the Court will apply intermediate level scrutiny, meaning that it will analyze the constitutionality of the rule under Central Hudson. The key issue will then be whether or not the government has demonstrated that the proposed regulation will substantially advance the government's interest in promoting smoking cessation. This is the critical 3rd prong set out by Central Hudson.
Unfortunately for the government, the FDA's own Regulatory Impact Analysis concludes that there was no statistically significant effect of Canada's graphic cigarette warnings on smoking rates.
The Regulatory Impact Analysis concludes that the predicted effect of the graphic warning
labels is not statistically different from zero: "FDA has had access to
very small data sets, so our effectiveness estimates are in general not
statistically distinguishable from zero; we therefore cannot reject, in a
statistical sense, the possibility that the rule will not change the
U.S. smoking rate. Therefore, the appropriate lower
bound on benefits is zero." (Federal Register 76 at 36776)
It doesn't seem to me that this is the kind of scientific evidence that is going to convince the United States Supreme Court that the proposed regulation will substantially advance the government's interest in lowering adult smoking rates.