Altria whose stable of brands also includes Benson and Hedges contends that a section of a federal law that deals with cigarette labeling and advertising trumps anti-tobacco legislation implemented at the state level.
If the highest court in the United States rules against Altria whose Philip Morris unit is best known for Marlboro cigarettes tobacco manufacturers could find themselves being forced to pay out staggering legal settlements to ex-smokers.
Three residents of the northeast state of Maine who puffed on Marlboro Lights and Cambridge Lights for 15 years want to use a state law to sue for allegedly deceiving smokers into thinking that light cigarettes are healthier cigarettes.
"You have misled everyone who have bought these cigarettes for a long time," Samuel Alito, one of the nine Supreme Court justices, told Douglas Hallward-Driemeier, an attorney for the FTC.
Lawyers for the plaintiffs were meanwhile peppered with questions from the bench as to why their case focused on public deception, rather than on the relationship between smoking and health.
Light cigarettes offer lower levels of tar and nicotine, but health experts say they do not eliminate the dangers posed by smoking.
At the heart of the case is the possibility that cigarette manufacturers used every trick in the marketing book to pitch their products.
That law was adopted in 1966, however, when smoking's impact on health was not as clear as it is today.
Quite apart from the obvious health aspect of the case, the Supreme Court will clarify the legitimacy of such exemption clauses.
A federal court in Maine initially ruled in favor of Altria, before an appeals court overturned its ruling.
In the Supreme Court on Monday, Altria's lawyer Theodore Olson argued that if Congress went through the trouble of drafting an exemption clause, it was certainly with the intention of seeing federal law taking precedent over state law.