Tobacco giants, govt battle in court over plain packaging

The federal government and four tobacco giants will face off in the nation's highest court on Tuesday over Labor's world-first legislation requiring all cigarettes to be sold in plain packages.

The three-day hearing will come before the seven justices of the full court.

British American Tobacco (BAT), Philip Morris, Imperial Tobacco Australia and Japan Tobacco International claim the government's legislation, which passed parliament in November, is unconstitutional.

They argue the Commonwealth is acquiring their property - in the form of brand names and logos - without just compensation.

Roxon says the government had received careful advice that it would withstand legal challenges.

"We're very confident," she told ABC Radio on Tuesday, adding the government knew that tobacco companies were very litigious.

"From the government's perspective, it's about strongly defending an important policy decision that we've made in the health area that we think can save Australian lives."

Roxon said defending the High Court challenge made economic sense.

"We currently spend a lot of the health budget treating people with cancers and other tobacco related illnesses.

Big tobacco is throwing everything at the legal challenge because it is worried other countries could follow Australia's lead if the government wins the day.

BAT says the stoush will operate as a "test case" on the validity of plain packaging legislation.

The commonwealth argues that even if big tobacco could prove the government was acquiring their property rights the manufacturers still wouldn't win in court.

That's because the purpose of the plain packaging legislation - namely to improve public health - is within the scope of the commonwealth's legislative power under the constitution's commerce, trade and external affairs powers.

The Queensland, ACT and the Northern Territory attorneys-general are all intervening in the High Court case along with the Cancer Council of Australia.

Labor's laws will force all cigarettes to be sold in drab olive-brown packs from December 2012.