* Ban scheduled to go into effect in March * City defends rule as a reasonable anti-obesity measure By Joseph Ax NEW YORK, Jan 23 (Reuters) - The beverage and restaurant industries on Wednesday urged a New York judge to block Mayor Michael Bloomberg's ban on large sugary drinks, calling it an unconstitutional overreach that burdens small businesses and infringes upon personal liberty. The ban, scheduled to go into effect in March, outlaws the sale of sugary drinks larger than 16 ounces from New York City's restaurants and many other eateries in an effort to combat obesity. City officials have said they will not begin imposing $200 fines on offending businesses until June. James Brandt, a lawyer for the American Beverage Association, which represents companies like Coca-Cola, PepsiCo and Dr Pepper Snapple Group, told Manhattan Supreme Court Justice Milton Tingling that the ban, approved last September by the city's health board, represents an illegal end-run around the city council. "What makes this ban patently offensive is that the regulation at issue is promulgated by the Board of Health, a group of civil servants who are not elected by the citizens, who are appointed by the mayor of New York and as a practical matter serve at his discretion," Brandt said. City attorney Mark Muschenheim, however, said the health board has the legal authority to pass regulations to protect the "safety, health and well-being" of the city's residents. The ban is the latest initiative in Bloomberg's years-long quest to use the city's regulatory power to improve public health. During his tenure, the city has outlawed smoking in bars and restaurants; required chain restaurants to post calorie counts; and barred the use of trans fats in food preparation. The city has defended the rule as a reasonable measure to address the growing problem of obesity. "There is an association between sugary drinks and obesity," said Thomas Merrill, a lawyer for the health department. Tingling did not indicate when he will rule, and Brandt said the plaintiffs will soon move separately for an emergency stay. Minority organizations like the NAACP and a New York pro-business group have filed court papers in support of the challenge, expressing concern about the ban's potential impact on small and minority-owned businesses. Several city council members also oppose the regulation. Meanwhile, public health advocacy groups have joined in the city's defense. Brandt told Tingling that the ban favors certain businesses at the expense of others. The regulation only applies to food service businesses under the aegis of the health department, which means convenience and grocery stores will not be affected. Cup and bottle manufacturers have complained that many of their products barely run afoul of the ban. A 500-milliliter glass bottle, for instance, used by certain drink makers, is 16.9 ounces, while "16-ounce" cups are typically a shade larger so that restaurants don't have to fill them to the brim. The ban exempts drinks that contain more than 50 percent milk, which means milkshakes or high-calorie frozen coffee drinks will also be allowed, Brandt said. "You'll be able to go into a 7-Eleven and buy the biggest Big Gulp you want, but you're not able to go to a Sabrett hot dog stand and buy a 20-ounce Coke or Pepsi," Brandt said. But Thomas Merrill, a lawyer for the health department, said the regulation may not be a "silver bullet" but represents a positive step in reducing obesity. "The perfect cannot be the enemy of the good," he said. Brandt also warned that the ban, if allowed, could eventually lead to even more restrictive regulations. "What comes next? Red meat twice a week but no more?" Brandt said. "No jay-walking?" Tingling interrupted him with a smile. "For the record, counsel, jay-walking is illegal," he said, drawing laughs from the gallery. The case is New York Statewide Coalition of Hispanic Chambers of Commerce et al. v. New York Department of Health and Mental Hygiene, New York State Supreme Court, New York County, No. 653584/2012.