CHIN, Circuit Judge:
In 2009, the Board of Health of the City of New York adopted a resolution requiring all tobacco retailers to display signs bearing graphic images showing certain adverse health effects of smoking. The City did so as part of its continuing campaign to discourage cigarette use by educating New Yorkers about the dangers of smoking. The district court held below that the resolution is null and void because it is preempted by federal labeling laws. We agree, and therefore affirm.
In 1965, Congress enacted the Federal Cigarette Labeling and Advertising Act (the "Labeling Act").
15 U.S.C. § 1331. The Labeling Act thus seeks to strike a balance between informing the public about the dangers of cigarette
The Labeling Act prescribes the content and format of warnings that must appear on cigarette packages and in cigarette advertisements. Id. § 1333. Specifically, all cigarette packages and advertisements must contain the phrase "Surgeon General's Warning" followed by one of the following four cautions:
Id. § 1333(a)(1).
Congress also included a preemption provision in the Labeling Act, limiting the extent to which states may regulate the labeling, advertising, and promotion of cigarettes. Id. § 1334. First, the preemption provision prohibits states from requiring any additional "statement relating to smoking and health, other than the statement required by [§ 1333(a),] on any cigarette package." Id. § 1334(a). Second, it provides that "[n]o requirement or prohibition based on smoking and health shall be imposed under State law with respect to
Finally, subsection (c) states:
Id. § 1334(c).
On September 22, 2009, the Board of Health (the "Board")
N.Y.C. Health Code, § 181.19 (the "Resolution"), invalidated by 23-34 94th St. Grocery Corp. v. N.Y.C. Bd. of Health, 757 F.Supp.2d 407 (S.D.N.Y.2010).
The Department produced three signs, any one of which retailers could display to comply with the Resolution. One shows an x-ray image of a cancerous lung over the warning "Smoking Causes Lung Cancer." Another depicts a photograph of a decaying, extracted tooth over the warning "Smoking Causes Tooth Decay." The third is an MRI of a brain with damaged tissue resulting from a stroke, and states, "Smoking Causes Stroke." Each sign also reads, "Quit Smoking Today. Call 311 or 1-866-NYQUITS." Commissioner Farley declares that each image is "true and medically accurate." (Farley Decl. at 10).
The City passed the Resolution to "promote further reductions in smoking prevalence in New York City." (Notice of Adoption at 2). The City attributed the
Specifically, the City observed that cigarette advertising was particularly "prominent" in retail locations, but the "retail environment lack[ed] information about tobacco health risks." (N.Y.C. Dep't of Health and Mental Hygiene, Proposal to Require Health Warnings and Smoking Cessation Information Where Tobacco is Sold (the "Proposal") at 3 (June 24, 2009)). It also noted research indicating that "pictorial warnings" were "more effective and engaging than text-only warnings," especially among youths. (Notice of Adoption at 3). The City concluded that requiring graphic images at retail locations would "[c]ounteract tobacco advertising" and "further de-normalize smoking." (Proposal at 9; Notice of Adoption at 4).
On June 2, 2010, plaintiffs-appellees — two cigarette retailers, two trade associations, and three of the nation's largest cigarette manufacturers — initiated the action below against the Board, the Department of Health, the Department of Consumer Affairs, and their respective commissioners, seeking a declaration that the Resolution was preempted by federal labeling laws and violated their First Amendment rights. On June 25, 2010, plaintiffs moved to enjoin preliminarily the enforcement of the Resolution. On June 28, 2010, the parties stipulated that enforcement of the resolution would be stayed until the earlier of (a) fourteen days after the district court's ruling on the preliminary injunction or (b) January 1, 2011. Defendants moved for summary judgment on August 13, 2010.
On December 29, 2010, the district court granted summary judgment for the plaintiffs, declaring Article 181.19 null and void on the ground that it was preempted by federal labeling laws.
"We review de novo a district court's application of preemption principles." N.Y. SMSA Ltd. P'ship v. Town of Clarkstown, 612 F.3d 97, 103 (2d Cir.2010) (per curiam); see Goodspeed Airport LLC v. E. Haddam Inland Wetlands & Watercourses Comm'n, 634 F.3d 206, 209 n. 3 (2d Cir.2011); Pac. Capital Bank, N.A. v. Connecticut, 542 F.3d 341, 351 (2d Cir.2008) ("A district court's determination as to preemption is a conclusion of law, which we review de novo.").
To determine whether a state or local law is preempted by federal law, we look to Congress's intent. Cipollone v. Liggett Grp., Inc., 505 U.S. 504, 516, 112 S.Ct. 2608, 120 L.Ed.2d 407 (1992) (congressional intent is "the ultimate touchstone"
The existence of an express preemption clause, however, "does not immediately end the inquiry because the question of the substance and scope of Congress'[s] displacement of state law still remains." Altria Grp., Inc. v. Good, 555 U.S. 70, 76, 129 S.Ct. 538, 172 L.Ed.2d 398 (2008). Accordingly, courts may look to the statute as a whole to determine the extent to which "Congress intended federal law to occupy the legislative field." Id.; accord In re WTC Disaster Site, 414 F.3d 352, 372 (2d Cir. 2005) ("If the text of the statute is ambiguous... as to the extent of an intended preemption, the meaning of the statute may be gleaned from its context and from the statutory scheme as a whole, or by resort to the normal canons of construction and legislative history."); see also Reilly, 533 U.S. at 541, 121 S.Ct. 2404 ("State action may be foreclosed... by implication from the depth and breadth of a congressional scheme that occupies the legislative field...."); Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 100, 103 S.Ct. 2890, 77 L.Ed.2d 490 (1983) (considering "the plain language..., the structure of the Act, and its legislative history").
"We assume that a federal statute has not supplanted state law unless Congress has made such an intention clear and manifest." Bates v. Dow Agrosciences LLC, 544 U.S. 431, 449, 125 S.Ct. 1788, 161 L.Ed.2d 687 (2005) (internal quotation marks omitted); accord N.Y. State Restaurant Ass'n v. N.Y.C. Bd. of Health, 556 F.3d 114, 123 (2d Cir.2009) ("[W]here the text of a preemption clause is ambiguous or open to more than one plausible reading, courts have a duty to accept the reading that disfavors preemption.") (internal quotation marks omitted).
The labeling requirement and preemption provision of the Labeling Act express Congress's determination that "the prescribed federal warnings are both necessary and sufficient to achieve its purpose of informing the public of the health consequences of smoking." Altria, 555 U.S. at 79, 129 S.Ct. 538. Accordingly, states may not require that additional warnings be displayed by the manufacturer. See id. "[B]oth of the Act's purposes are furthered by prohibiting States from supplementing the federally prescribed warning...." Id.
In Vango Media, Inc. v. City of New York, this Court invalidated one such effort to supplement federal warnings. 34 F.3d 68 (2d Cir.1994). There, a City ordinance required that one public health message pertaining to the dangers of smoking be displayed for every four tobacco advertisements displayed on top of taxi cabs. Id. at 70. We held that this was a requirement "with respect to" advertising, and therefore preempted by the Labeling Act. Id. at 73-75. Although the ordinance did
We conclude that the Resolution is preempted by the Labeling Act because it is a requirement "with respect to the advertising or promotion" of cigarettes, under § 1334(b). We recognize our duty to assume that a local regulation is not preempted "unless Congress has made such an intention clear and manifest." Bates, 544 U.S. at 449, 125 S.Ct. 1788. We find, however, that Congress has clearly manifested its intent to preempt the Resolution through (1) the language of the preemption provision and (2) the overall statutory scheme.
The Labeling Act prohibits states from imposing any "requirement or prohibition based on smoking and health ... with respect to the advertising or promotion of... cigarettes." 15 U.S.C. § 1334(b). The parties agree that the Resolution is a "requirement or prohibition based on smoking and health." (Appellants' Br. at 26; Appellees' Br. at 20). They dispute, however, whether the Resolution is "with respect to the advertising or promotion of" cigarettes. Plaintiffs argue that it is a requirement with respect to promotion; defendants argue that it is only a requirement with respect to sale. (Appellees' Br. at 20-21; Appellants' Br. at 24-25). We agree with plaintiffs that the Resolution is a requirement with respect to the promotion of cigarettes.
First, we discuss the meaning of the word "promotion" and the types of activities that constitute promotion. Second, we discuss why the requirements of the Resolution affect promotion in a way that causes them to fall within section 1334(b)'s preemptive scope.
The word "promotion" is not defined in the Labeling Act. Hence, we look to the word's plain meaning. Specifically, we consider the "the ordinary, common-sense meaning of the word[]." United States v. Dauray, 215 F.3d 257, 260 (2d Cir.2000); see Harris v. Sullivan, 968 F.2d 263, 265 (2d Cir.1992) ("A fundamental canon of statutory construction is that, unless otherwise defined, words will be interpreted as taking their ordinary, contemporary, common meaning.") (internal quotation marks omitted).
Merriam-Webster defines "promotion" as "the act of furthering the growth or development of something; especially: the furtherance of the acceptance and sale of merchandise through advertising, publicity, or discounting." Merriam Webster's Collegiate Dictionary 931 (10th ed.2000). A broad array of activities may fall under this umbrella. See U.S. Dep't of Health & Human Servs., Preventing Tobacco Use Among Young People: A Report of the Surgeon General 159-60 (1994). Distribution of coupons and free samples, for example, would obviously be classified as promotional activity as they further the sale of merchandise. Promotional activity may also include the "place[ment] and display [of] products in ways that will maximize the opportunity for purchase." Id. Indeed, many companies pay additional fees to have their product displayed in a desirable location at a retail outlet. See generally Benjamin Klein & Joshua D. Wright, The Economics of Slotting Contracts, 50
The Resolution requires that every tobacco retailer place signage either (1) next to the register or (2) next to each tobacco product display. Option (2) directly affects the promotion of cigarettes. By its terms, it affects the display of cigarettes, which is a type of promotion. Specifically, a display is a form of publicity that can further the sale of merchandise. It is an opportunity for the manufacturer to present the consumer with its trade dress, product pricing, and any deals — or sales — that the manufacturer may be offering. Placing a graphic warning adjacent to a product display necessarily affects — or "treads on," Vango Media, 34 F.3d at 74 — the content of the image projected and the message conveyed to the consumer by that display.
Whether option (1) affects promotion is a closer call, as it does not explicitly reference the display of tobacco products. Indirectly, however, it is likely to affect product display, and therefore, product promotion. New York law requires retailers to place cigarettes either "behind a counter ... accessible only to [store] personnel" or "in a locked container." See N.Y. Pub. Health Law § 1399-cc(7) (McKinney 2012). As a result, the vast majority of retailers choose to place cigarettes behind the counter, where the registers are located, prominently displayed in plain view but accessible only to store personnel. In such circumstances, placing signage at the register is practically the same as placing it at the point of display. Furthermore, the Resolution may very well prompt retailers to choose not to place cigarettes near the register — a decision that would affect promotion.
The City's primary argument is that the Resolution is a not a requirement with respect to the promotion of cigarettes, but rather, a requirement with respect to the sale of cigarettes. Specifically, it argues that it is not regulating or restricting a manufacturer's ability to advertise or promote; it is simply requiring any establishment that sells cigarettes to post warning signs, regardless of whether any advertising or promotion occurs at the particular retail establishment. (Appellants' Br. at 24).
While it is true that the Resolution only explicitly requires action on the part of the seller, not the manufacturer, the City ignores the practical effect the Resolution has on the manufacturer's promotional activity at the retail location. 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, thereby directly affecting the content of the promotional message conveyed to consumers at the point of display. Indeed, by the City's own admission, one
To be clear, we do not hold that every state or local regulation affecting promotion violates the Labeling Act's preemption clause. Section 1334(c) provides a safe harbor for laws regulating the time, place, or manner of promotional activity.
To the extent the language of the preemption provision itself is or may be ambiguous, our conclusion is supported by the overall statutory scheme.
The Labeling Act seeks to strike a balance between two competing interests: (1) ensuring that Americans are adequately warned about the health consequences of smoking; and (2) protecting free commerce. See 15 U.S.C. § 1331. The Resolution affects this balance by seeking to advance the first interest at the expense of the second. The requirement that retailers post graphic images might serve to further educate consumers, but it does so by imposing a direct burden on cigarette retailers.
The Resolution was born of the assumption that the federally mandated warnings
The City's desire to tilt the balance more in favor of educating consumers is understandable. Indeed, the City may seek to tilt the balance further by imposing time, place, or manner restrictions, and by launching its own anti-smoking campaigns. But what the City cannot do is seek to affect the balance by requiring a manufacturer or retailer to display supplemental content at the point of purchase. Specifically, it cannot require retailers to post warning signs adjacent to cigarette displays, because doing so would affect the content of the retailers and manufacturers' promotional efforts. The legislative scheme contemplates that Congress, and only Congress, will amend the content of warnings required of manufacturers to educate consumers, see S.Rep. No. 98-177, at 6-7; FSPTCA § 201(a), without interference or supplementary efforts by state or local authorities.
Allowing state or local authorities to mandate supplementary warnings on or near cigarette displays risks the creation of "diverse, nonuniform, and confusing" regulations. See 15 U.S.C. 1331(2)(B). Indeed, there is a risk of such nonuniform regulation here. Congress has directed the FDA to prescribe graphic warnings for cigarette packages. FSPTCA § 201(a) ("the Secretary shall issue regulations that require color graphics depicting the negative health consequences of smoking"). While new FDA regulations have not yet gone into effect, Congress intends for some form of graphic image to appear on packages in the near future.
To be sure, we do not hold that supplementary warnings are, in and of themselves, preempted by the Labeling Act. We hold only that requiring retailers to post graphic supplementary warnings adjacent to cigarette displays is preempted. Of course, states and localities remain free to impose time, place, and manner restrictions on the advertising and promotion of cigarettes, and to engage in anti-smoking campaigns using their own resources. Our holding today should not be read to curtail in any way state and locally funded efforts to further educate consumers and counter cigarette advertising and promotion.
For the foregoing reasons, we hold that the Resolution, Article 181.19 of the New
The FSPTCA, which Congress passed in 2009, prescribed a new set of textual warnings (with an emphasis on the potentially fatal effect smoking can have) and directed the FDA to issue regulations requiring graphic labels to appear on all cigarette packaging. See FSPTCA § 201(a), 123 Stat. at 1842-45.
The new labeling requirements have not yet gone into effect, however, because a district court recently declared that the FDA's proposed regulations violated the First Amendment. See R.J. Reynolds Tobacco Co. v. U.S.F.D.A., No. 11-1482, 845 F.Supp.2d 266, 2012 WL 653828 (D.D.C. Feb. 29, 2012). Specifically, the court held that the proposed regulations were not "narrowly tailored to achieve a compelling government interest." Id. at 274, 2012 WL 653828, at *6. It suggested that the FDA could make the regulations less restrictive by, inter alia, reducing the size of the graphic image or selecting images "that conveyed only purely factual and uncontroversial information rather than gruesome images designed to disgust the consumer." Id. at 276, 2012 WL 653828, at *7.
The Sixth Circuit has recently addressed the constitutionality of the FSPTCA itself. It held that the FSPTCA's "requirement that tobacco packaging and advertising ... include[] color graphic and non-graphic warning labels satisfies the requirements of the First Amendment." Discount Tobacco City & Lottery, Inc. v. United States, 674 F.3d 509, 531 (6th Cir. 2012). While the Sixth Circuit upheld the constitutionality of the statute's graphic-image requirement generally, it did not opine on the constitutionality of the FDA's proposed regulations, as that issue was not before it on appeal. Id. at 568-69 & n. 17 (distinguishing its holding from that of the D.C. district court).
The City also points out (essentially in passing) that the Resolution applies to all tobacco products, whereas the Labeling Act only applies to cigarettes. (Appellant Br. at 12). The City thus implies that the Resolution should survive at least to the extent it applies to non-cigarette tobacco products. We reject that argument. First, it is not clear how any part of the Resolution could be severed such that it would apply only to non-cigarette tobacco products. Second, this argument was not sufficiently preserved in the district court or on appeal, and is therefore waived. See Cuoco v. Moritsugu, 222 F.3d 99, 112 n. 4 (2d Cir.2000) ("single, conclusory, one-sentence argument is insufficient to preserve any issue for appellate review"); United States v. Braunig, 553 F.2d 777, 780 (2d Cir. 1977) (where party has had ample opportunity to make an argument to the trial court, but has failed to do so, "waiver will bar raising the issue on appeal").
The Resolution, however, is not "aimed at the location of the display." In other words, it does not limit the places in which manufacturers or retailers may display cigarettes. Rather, it requires that a sign be placed at the register or wherever cigarettes are displayed at the retail location. Therefore, the Resolution is not a "place" restriction within the meaning of 1334(c).