By Tripp Mickle 

The biggest U.S. tobacco companies on Tuesday dropped a federal lawsuit against the Food and Drug Administration after challenging the agency's recent effort to assert authority over labels on tobacco products.

Tobacco subsidiaries of Altria Group Inc., Reynolds American Inc. and Lorillard Inc. said in a court filing they were dropping the suit because the FDA announced last week that it will review a policy that would have required companies secure federal approval for tobacco products if they made such packaging changes as switching a background color from green to red, altering a logo or adding such words as "premium tobacco."

The FDA said it won't enforce the policy until it decides to either revise or preserve it.

In April, the tobacco companies filed a lawsuit against the FDA challenging the policy in U.S. District Court in Washington, D.C. The cigarette makers claimed the 2009 Tobacco Control Act, which gave the FDA authority to regulate tobacco, restricted the FDA from preapproving tobacco labels of Marlboro, Camel and Newport cigarettes. As a result, the manufacturers said, they should be able to change the color or look of tobacco packaging as they wish.

The companies argued the FDA's policy harmed them by "restricting [their] ability to modify their product labels without FDA preauthorization and by chilling and restricting" free speech.

The lawsuit didn't challenge the surgeon general's warning labels, which are required by law and warn about the health risks of smoking.

The companies called on the FDA to go through a "notice-and-comment rule making" process before issuing new rules. During the evaluation of the policy, the FDA will be reviewing comments from tobacco companies and others, a spokesman said.

Write to Tripp Mickle at Tripp.Mickle@wsj.com

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