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Labels don’t display on top of graphics.
Labels are not placed if they conflict with other labels, features, or graphics in layers which have a feature weight greater than the current label weight. By default, graphics drawn in the data view are placed in the Default annotation group, which has its feature weight set to High.
Make sure that the feature weight is less than the label weight. You can control the feature weight settings from the Conflict Detection Rules dialog.
NOTE:The table entry <Default> is an annotation group that is part of every map document.