March 19 (Reuters) - A U.S. law requiring large graphic health warnings on cigarette packaging and advertising does not violate the free speech rights of tobacco companies, a federal appeals court ruled on Monday.

Cigarette makers had sued to stop the U.S. Food and Drug Administration's new labeling and advertising requirements on grounds the rules violated their First Amendment right to communicate with adult tobacco consumers.

But the Cincinnati-based U.S. Court of Appeals for the 6th Circuit upheld the bulk of the FDA's new regulatory framework, including the requirement that tobacco companies include large warning images on cigarette packs.

The decision comes on the heels of a Washington, D.C., judge's ruling in a different, but related, case that rejected the FDA requirements and seems to set up a clash over the constitutionality of the FDA rules.

Floyd Abrams, a lawyer for Lorillard, noted the difference in tone in the two rulings and said the 6th Circuit case, the Washington case, or both, would likely end up in the U.S. Supreme Court.

The difference in the two cases is that the FDA had not introduced the specific images when the companies filed the 6th Circuit suit. While the Washington suit focused on the images, the appeals court addressed the larger issue of the FDA's regulatory power.

"There can be no doubt that the government has a significant interest in preventing juvenile smoking and in warning the general public about the harms associated with the use of tobacco products," Judge Eric Clay wrote for the three-judge 6th Circuit panel.

Congress passed the law in 2009 and ordered the FDA to adopt specific warning-label regulations. The labels must be in color, must cover the top 50 percent of a cigarette pack's front and back panels, and must cover the top 20 percent of print advertisements.

After tobacco companies, including R.J. Reynolds Tobacco Co and Lorillard Inc's Lorillard Tobacco Co, sued to block the law, the FDA unveiled nine images to go on cigarette packs, including graphic pictures of dead bodies, diseased lungs and rotting teeth. The companies accused the government of forcing them to disseminate an anti-smoking message in order to stigmatize and embarrass already-informed consumers.

The appeals court panel's two-judge majority disagreed with the companies on the label requirement, finding that the fact that the specific images might trigger disgust does not make the requirement unconstitutional. The majority did note that it was only addressing the constitutionality of the statute on its face, and not the specific images that the FDA introduced after the suit was filed.

DISSENT ON IMAGES

Judge Clay, who wrote the main opinion upholding most of the FDA regulations, dissented, however, on the graphic label ruling. He called the rule "simply unprecedented." While the government can require a product manufacturer to provide truthful information, "it is less clearly permissible for the government to simply frighten consumers or to otherwise attempt to flagrantly manipulate the emotions of consumers as it seeks to do here," Clay wrote.

On Feb. 29, D.C. district judge Richard Leon ruled that the FDA's images violated the tobacco companies' free-speech rights. He found that the warning labels were too big and that the government has numerous other tools at its disposal to deter smoking, such as raising cigarette taxes or including simple factual information on the labels rather than gruesome images.

The Obama administration appealed that ruling to the U.S. Court of Appeals for the District of Columbia Circuit on March 5.

Lorillard lawyer Abrams says Monday's appeals court decision does not necessarily conflict with the Leon's decision.

"The court made clear it was focusing on the statute as written, as opposed to the implementation of it," Abrams said.

The Department of Justice did not immediately provide comment.

The 6th Circuit also upheld other FDA regulations, including restrictions on the marketing of "light" cigarettes, on the distribution of free tobacco samples, and event sponsorship. The court struck down a rule barring the use of color and graphics in tobacco advertising.

"We are pleased the 6th Circuit Court of Appeal upheld the continued use of colors and imagery in our advertisements," said R.J. Reynolds spokesman Bryan Hatchell.

The case is Discount Tobacco City & Lottery Inc et al v. USA et al, U.S. Court of Appeals for the 6th Circuit, no. 10-5235.

For the tobacco companies: Noel Francisco of Jones Day.

For the government: Mark Stern of the U.S. Justice Department.

(Reporting by Terry Baynes)

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