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The FDA proposed legislation in late 2010 to require graphic warning labels on cigarette packaging. The body approved nine warnings which included graphic images. The rule would have mandated 50% of the packaging to be covered by the warning. It would also require 20% of all cigarette advertising to be health warnings.
Four companies filed suit against the federal government. They contended the new requirements violated their right to free speech, would be cost prohibitive, and would discourage use of their product.
Mohejerian.com reports the government lost the fight. In march of this year, a federal apellate court upheld a lower court ruling rejecting the proposed legislation on 1st amendment grounds.
It's unclear at this time what further action, if any, the FDA will take on the issue.