88 3390537265 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537265 10361 UNITED STATES DISTRICT COURT FOR TEE DISTRICT OF COLUMBIA UNITED STATES OF AMERICA, Docket No. CA CA99-02496 Plaintiff, v. PHILIP MORRIS USA, et al., Washington, D.C. January 18, 2005 Defendants. VOLUME 50 AFTERNOON SESSION TRANSCRIPT OF BENCH TRIAL PROCEEDINGS BEFORE THE HONORABLE GLADYS XESSLER, UNITED STATES DISTRICT JUDGE APPEARANCES: For the Plaintiff: U.S. DEPARTMENT OF JUSTICE Civil Division Sharon Y. Eubanks, Director 1331 Pennsylvania Avenue, N.W. Suite 1150 Washington, D.C. 20004 202.616.8280 U.S. DEPARTMENT OF JUSTICE Civil Division Stephen D. Brody, Deputy Director 1331 Pennsylvania Avenue, N.W. Suite 1150 Washington, D.C. 20004 202.616.1438 U.S. DEPARTMENT OF JUSTICE Criminal Division Frank Marine, Sr. Litigation Counsel, Organized Crime and Racketeering Section 1301 New York Avenue, N.W. Suite 700, P.O. Box 27598 Washington, D.C. 20530 202.514.0908 Scott 1. Ifellac*, SDR, am Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10362 U.S. DEPARTMENT OF JUSTICE Civil Division Renee Brooker, Asstitant Director, Leo J. Wise, Trial Attorney 1331 Pennsylvania Avenue, N.W. Suite 1150 Washington, D.C. 20004 APPEARANCES: Cont. 202.616.3797 U.S. DEPARTMENT OF JUSTICE Elizabeth Crocker, Trial Attorney, Andrew N. Goldfarb, Trial Attorney, MaryJo Moltzen, Trial Attorney, Tobacco Litigation Team 1331 Pennsylvania Avenue, N.W. Washington, D.C. 20530 202.616.4875 WINSTON & STRAWN Dan K. Webb, Esq. Thomas J. Frederick, Esq. 35 West Wacker Drive Chicago, IL 60601-9703 312.558.5700 For Defendant: Philip Morris USA, Inc. HUNTON & WILLIAMS Patricia M. Schwarzschild, Esq. Riverfront Plaza, East Tower 951 East Byrd Street Richmond, VA 23219 804.788.8728 PAUL, WEISS, RIFKIND, WHARTON 6 GARRISON James Brochin, Esq. Theodore Wells, Esq. 1285 Avenue of the Americas New York, NY 10019 212.373.3000 For Defendant: Lorillard Tobacco Company THOMPSON COBURN J. William Newbold, Esq. William B. Minton, Esq. Richard P. Casetta, Esq. One US Bank Plaza St. Louis, MO 63101 314.552.6000 Scott X. Wallace, JtDR, CRR Official Court nepoztmr Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10363 For Defendant: Brown & Williamson Tobacco Corporation KIRKLAND & ELLIS, LLP David M. Bernick, Esq. Kenneth N. Bass, Esq. Renee Bonigberg, Esq. 200 East Randolph Drive Chicago, IL 60601 312.861.2248 For Defendant: R.J. Reynolds Tobacco Company JONES DAY Jonathan M. Redgrave, Esq. Peter J. Biersteker, Esq. Robert Francis McDermott, Esq. 51 Louisiana Avenue, N.W. Washington, D.C. 20001 202.879.3939 For Defendant: British American Tobacco (Investments), Ltd. CHADBOURNE £ PARKE, LLP David Wallace, Esq. Bruce Sheffler, Esq. 30 Rockefeller Plaza New York, NY 10112 212.408.5498 For Defendant; Liggett Group, Inc. KASOWITZ, BENSON, TORRES £ FRIEDMAN Aaron H. Marks, Esq. Nancy Straub, Esq. 1633 Broadway New York, NY 10019 212.506.1700 For Defendant: Tobacco Institute COVINGTON & BURLING Phillip Dube, Esq. James GooId, Esq. 1201 Pennsylvania Avenue, N.W. Washington, D.C. 20009 For Defendant: The Counsil for Tobacco Research USA, Inc. THOMPSON COBURN J. William Newbold, Esq. William B. Minton, Esq. Richard P. Casetta, Esq. One US Bank Plaza St. Louis, MO 63101 314.552.6000 For Defendant: British American Tobacco Australian Services, Ltd. SHAW PITTMAN, LLP Jack McKay, Esq. Alvin Dunn, Esq. 2300 N Street, N.W. Washington, D.C. 20037 202.663.8355 Scott L. Wallace, Official Coitrt M R , CRN Rtpoxtax Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10364 Court Reporter: Scott L. Wallace, RDR, CRR Official Court Reporter 333 Constitution Avenue, N.W. Room 6814, U.S. Courthouse Washington, D.C. 20001 202.326.0566 Proceedings reported by machine shorthand, transcript produced by computer-aided transcription. Saaht 2. FfalltfC*, KXR, CRR OeO.CXa.1 Court importer Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10365 AFTERNOON SESSION, JANUARY 1 8 , 2005 {1:47 p.m.) THE COURT: All right, Ms. Brooker, redirect, please. MS. BROOKER: Okay. Good afternoon. Renee Brooker, for the record, Your Honor. Your Honor, in honor of our 50-day anniversary here today, the government has no redirect examination of this witness. THE COURT: Well, that is an appropriate celebration, I have to say.. All right, Doctor, you are done. Thank you. You may step down. Now, I don't know if Ms. Keane is here, though. I think I said 2:00. MR. WELLS: She is, Your Honor. THE COURT: Would the government call her at this time? MR. WELLS: Can we have a couple minutes to get prepared? THE COURT: All right. MR. GOLDFARB: (DENISE KEANE, GOVERNMENT'S WITNESS, SWORN) DIRECT EXAMINATION OF DENISE F. KEANE BY MR. GOLDFARB: Q. Good afternoon, Ms. Keane. A. Good afternoon. Q. Andrew Goldfarb for the United States. MR. GOLDFARB: THE COURT: Your Honor, may I approach the witness? Yes, you may. BY MR. GOLDFARB: Scott L. Wallac*. RDR, CHR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10366 Q. I'm handing the witness a document that has been marked the written direct examination of Denise F. Keane, submitted by the United States pursuant to Order 471 as corrected by Denise F. Keane. Do you have the document before you, ma'am? A. I do. Q. Do you recognize the document to be your written direct testimony as corrected by you in this case? A. I do. Q. And do you adopt that testimony as your written direct examination for this case? A. I do, with one possible addition. Q. What is the addition you wish to identify? A. Page 63, line 11. Basically, what I would like to do is make clear that when I indicate that Philip Morris included this, and other Website information, in the mailings sent to smokers on its direct mail database in 1999, I want to qualify that by saying -Q. Well, just so the record is clear, the copy of the written direct examination we received from defendants has 62 pages. THE COURT: Correct. BY MR. GOLDFARB: Q. So you've identified page 63 — A. I'm sorry, I meant to say 62, I apologize. Q. Okay. And what is the line and correction — Scott 1 . Wallace, Official court or addition RER, CRR Sapoxtw Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10367 you want to make? A. If you look at line 11, I would like to add the words "who had requested it" so that the sentence would now read, "Philip Morris included this, and other Website information, in a mailing sent to smokers on its direct mail database who had requested it starting in 1999". Q. And just to clarify, it's smokers who had requested the information from the direct mail database? A. Yes. Q. With that, the addition of that phrase, you adopt the testimony as your written direct examination? A. I do. Q. Okay. MR. GOLDFARB: Now, Your Honor, at the outset, we would like to note that in response to many of the governments' questions, it's our view that the witness added testimony that was nonresponsive to the question posed, and while we don't think it necessarily rises to the level of needing to move to strike the testimony, we do note it for the record and we are cognizant of it, and should defendants, in their cross-examination of this witness, intend — go into matters which are not properly raised by the scope of the direct examination, we will object at that time. THE COURT: Well, I think we'll have to see whether it comes up at all or not. Scott L. tfAllaco, Official Court JU», CPU Bepoctmr Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10368 MR. GOLDFARB: Okay. BY MR. GOLDFARB: Q. Ms. Keane, you were deposed in this action, the United States versus Philip Morris; is that correct? A. I was. Q. And that occurred in October of 2002? A. Correct. Q. And at the outset of your testimony, you were given instructions as to how the deposition would proceed; is that right? A. Correct. Q. And you were instructed that you would be asked questions, and if you didn't understand the questions, you should so indicate to the questioner; is that correct? A. Yes. Q. Okay. And you understood that — you understood that instruction? A. I did. Q. And you also understood that at the close of your deposition you had the opportunity to read and sign your deposition? A. Yes, I do. Q. And make any corrections that you saw that needed to be made? A. Yes. With the caveat that I was focused on, you know, Scott X. mice*, AQR, CRR Official Court Repoitei Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10369 typographical errors and things of that nature. Q. Okay. But you had the opportunity to make any corrections to the testimony, substantive or otherwise; isn't that correct? A. I believe that's technically right. Q. Okay. And you submitted an errata sheet approximately a month after your deposition? A. I did. Q. And you signed that errata sheet? A. I did. Q. In the course of your deposition, Ms. Keane, there was extensive discussion about the issue of the FTC test, correct? A. Yes. Q. And low-yield cigarettes? A. Yes. Q. Light cigarettes? A. Yes. Q. And the issue of brand descriptors? A. Yes. Q. And you testified about a 1996 meeting that you attended with the Federal Trade Commission and counsel for some of the other defendants in this action, right? A. Correct. Q. And you did that as general counsel for Philip Morris? A. Yes. Scott L . vaiiacm, JUW, a w Official Court R*port*r Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10310 1 Q. Okay. And at that meeting, you were asked, were you not, 2 for any information that Philip Morris might have in its files 3 with respect to consumer perception of low-yield cigarettes; is 4 that right? 5 A. 6 meeting, but that was one of the questions that was raised. 7 Q. 8 memorandum by David Remes of Covington & Burling, isn't that 9 correct? There were many things that were discussed at that Okay. And in fact, that meeting was memorialized in a 10 A. Yes, he sent around a memo trying to capture the content 11 of the discussion. 12 Q. And you received that memo? 13 A. I did. 14 Q. And the — 15 Mr. Remes' memo, was it not, this request by the staff for the 16 FTC that you — 11 any information the companies had concerning the issue of 18 consumer perception of low tar, so-called "light" cigarettes; 19 isn't that correct? 20 A. Correct. 21 Q. And you testified in your deposition, and in response to 22 that, and you testified in your direct examination, have you 23 not, that in response to that request by staff of the FTC, 24 Philip Morris did not provide any such information? 25 A. one of the specific things identified in a general request to the companies to provide Correct. Scott L. Wallace, Official Court BQR, CRR Reporter 3390537275 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537275 10371 1 Q. 2 any information relevant to that — 3 request; isn't that right? 4 A. 5 NCI report and the conclusions found therein. 6 Q. 7 Ms. Keane, I'm asking you in response to the 1996 meeting, that 8 occurred in May with the FTC, in response to that meeting, you 9 did not provide any information in response; isn't that correct? And it was your testimony that Philip Morris didn't have That's right. in response to the FTC's In our written submissions we refer to the I'm not asking about your NCI point at this point, 10 A. Correct. 11 Q. And if we can please give Ms. Keane, let me show you 12 copies of your deposition that was taken on -- it's day two, 13 please, Ed — October 2nd, 2002. 14 MR. WELLS: Can I have the page? 15 THE WITNESS: I'm sorry, could you tell me where? 16 BY MR. GOLDFARB: 11 Q. 18 It looks like you may have both pages of your deposition there 19 in front of you. You do, ma'am? 20 A. I have volume 2. 21 Q. Okay. 22 please. Do you have day two of your deposition in front of you? And if I could ask you.to turn to page 414, Are you there, ma'am? 23 24 A. I am. 25 Q. Okay. If we look at the beginning at line 10 on page Scott L. Wallace, Official ADR, CRR Court Kaportar 3390537276 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537276 10372 1 414, you were asked: 2 "Question: Have you ever asked anyone at Philip Morris 3 whether such research has ever been conducted", and the subject 4 matter of that question goes to the subject matter that we've 5 been discussing, consumer perception of "low-yield" and "light" 6 cigarettes; is that correct? 7 A. Correct. 8 Q. Okay. 9 "I kind of go back to what I said before. So having been asked that question you answered, Although I'm not 10 aware of it, I would have assumed during the course of time that 11 it would have come to my attention. 12 truly unaware whether or not that happened. 13 categorically that it hasn't, but I do believe I would have been 14 aware of some context". 15 correct? 16 A. Correct. 11 Q. And then looking at the next question, line 21, the next 18 question was: 19 about whether such testing has occurred and what that testing 20 has been?" 21 Did you give that answer at your deposition, ma'am? 22 A. I did. 23 Q. If I could ask you now, Ms. Keane, please, to turn to 24 page 4 9 of your corrected direct examination. 25 A. Sitting here today, I am I can't say And that was the answer you gave, "And at any point have you requested information And your answer being at line 24, is, "I haven't." I have it. Scott L. Wallace, Official Court JUHJ, CRR Reporter 390537277 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537277 10373 1 Q. 2 Okay. If we could call up 49, lines 1 to 5. You were asked, essentially, the same question in your 3 direct examination in this case. 4 even asked anyone at Philip Morris whether such research had ever 5 been conducted by or for Philip Morris, did you?" 6 proposed answer to that question was: 7 that out and you answered: 8 understanding that we had not conducted such research, and I 9 confirmed that understanding with my staff, including during the The question is: "You never "I did not." You struck "No, that is not correct. 10 period surrounding this meeting." 11 corrected examination, right ma'am? 12 A. Correct. 13 Q. So, by your testimony — 14 please. 15 And the It was my That was your answer in your you can leave that up there, By your testimony, you yourself did not call, for example, 16 the head of the marketing Department of Philip Morris and ask 17 whether there was any such research; isn't that correct? 18 A, What I did was — when I became general counsel — 19 Q. Ma'am, I would like an answer to my question, please, 20 which is, did you — by your answer, isn't it correct that you 21 yourself did not call the head of the Philip Morris Marketing 22 Department and ask whether there was any research that was 23 relevant to consumer perception of brand descriptors, consumer 24 perception of the relative safety of low-yield cigarettes; isn't 25 that correct? Scott L. Wallace, Official KBR, CAR Court Reporter 390537278 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537278 10374 MR. WELLS: 1 2 and say what she did. THE COURT: 3 4 Objection, Your Honor, she was about to answer That wasn't the question, Mr. Wells, the objection's overruled, that's a yes or no answer. THE WITNESS: 5 Could you please repeat it, and I will 6 answer. 7 BY MR. GOLDFARB: 8 Q. 9 yourself, call the head of the Philip Morris Marketing My question is, isn't it true, ma'am, that you did not, 10 Department and ask whether Philip Morris had in its possession 11 any research concerning consumer perception of "low-yield" 12 cigarettes, "light" cigarettes, and their relative safety 13 compared to full flavor products? 14 A. No. Prior to that time, if I could — 15 Q. No, you've answered my question. 16 Thank you. And Ms. Keane, you are familiar that Philip Morris has a 17 filing system where it maintains its documents? 18 A. I am. 19 Q. Have you ever heard of central files? 20 A. I have. 21 Q. And that's maintained by either a librarian or someone 22 who's in charge of maintaining Philip Morris's documents over 23 time? 24 A. 25 filing for many documents. There are varying filing systems, but there is a central Scott x . Wallace, Official Court JHM1, CtOt Reporter 990537279 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537279 10375 1 Q. And is there a librarian who you would contact? 2 A. It varies based on function. 3 Q. Okay. 4 you didn't call any of these people yourself and ask that a 5 search be done to ascertain whether or not Philip Morris had 6 such research in its files? 7 A. 8 had a general understanding, based on specific conversations I 9 have had with company people, as to the nature of research that So, by your answer, Ms. Keane, isn't it true that After the deposition, I did. Prior to the deposition, I 10 we had conducted. 11 Q. So the answer to my question is no? 12 A. Specifically, in response to had I called them up and 13 specifically asked for that immediately before, no. 14 Q. 15 called people up. You had 30 days in which to make any changes 16 to your deposition; isn't that true? 17 A. That was not my understanding. 18 Q. Can you please answer my question? 19 A. Yes. 20 Q. Okay. 21 this part of your deposition at all; isn't that correct? 22 A. That is correct. 23 Q. Thank you. 24 A. As it was not my understanding that that was, in fact, 25 what is contemplated by the errata sheet. Okay. And Ms. Keane, you said after your deposition you You had 30 days and you did not make any change to Scott L . Wallace, Rim, CRR Official court Reporter 3390537280 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537280 10318 1 said she has no personal knowledge. 2 in essence, about his own search. 3 cross-examine him about what he did or what it shows and the 4 witness is not in a position since she has no firsthand 5 knowledge. 6 THE COURT: 7 MR. GOLDFARB: Now he's about to testify, I'm not in a position to Mr. Goldfarb? That's utterly irrelevant to the line of 8 questioning, Your Honor. In fact, what I'm showing is that the 9 documents were readily available throughout the Philip Morris 10 information system in various departments, and the Philip Morris 11 Website indicates where, in the Philip Morris company, copies of 12 these documents were located, and if I can proceed with my 13 examination, I'll slow that the documents were readily available 14 had — THE COURT: 15 But you're the one who found the documents, 16 right? You're the one who found the documents, right? 17 did the search, right? 18 MR. GOLDFARB: 19 THE COURT: I am, but And who — I think there is a real problem with that. I 20 know that has occurred previously in this trial. 21 been objections and that was fine. 22 strategic decision whether to bother objecting to something or 23 not, but in this case Mr. Wells is making the decision to object, 24 and you're asking this witness questions about a document that 25 she's never seen. Scott Z. Hallaae, Official Court There haven't Counsel always make a ADR, CRS Reporter 3390537281 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537281 10379 1 MR. GOLDFARB: 2 of the examination. THE COURT: 3 And, Your Honor, that is part of the point But you can't — you cannot examine her on the 4 basis of the results of a search that you have conducted on the 5 Website. 6 think it's appropriate for me to spell them out, but you are 7 basically asking her questions about your search, and that is 8 objectionable. Now, there are different ways to do that, and I don't MR. GOLDFARB: 9 Okay. I can do it another way, Your Honor. 10 THE COURT: All right. 11 BY MR. GOLDFARB: 12 Q. 13 personally — well, strike that question. So, Ms. Keane you're not aware, because you never Ms. Keane, you're not aware that two copies of this U.S. 14 15 Exhibit 20, 403 are in Philip Morris's central files? 16 A. I wasn't at the time, no. 17 Q. Okay. 18 resided in the files of Hamish Maxwell? 19 A. No. 20 Q. Do you know who Hamish Maxwell is now? 21 A. I do. 22 Q. He was, at one point, the chairman, CEO, of the — what 23 was formerly the Philip Morris Company, correct? 24 A. Correct. 25 Q. So he is the first chairman of what is known as the You're not aware that a copy of this document Scott x . Wallace, Official Court ROR, CPU Raportar 3390537282 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537282 10380 1 Altria Group, correct? 2 A. Yes. THE COURT: 3 Mr. Goldfarb, I just ask you to talk a little 4 more slowly, please for the court reporter. 5 BY MR. GOLDFARB: 6 Q. 7 at Philip Morris USA had a copy of this document in its files, 8 are you? 9 A. No. 10 Q, You're not aware that overseas affiliates of Philip 11 Morris in Brussels had copies of this document in its files, are 12 you? 13 A. I have no idea. 14 Q. And Ms. Keane, another document that was shown to you in 15 your direct examination was U.S. Exhibit 22218, correct? 16 the 1979 Roper survey that was titled A Study of Smokers' Habits 17 and Attitudes With Special Emphasis on Low Tar and Menthol 18 Cigarettes? 19 A. Yes. 20 Q. And you saw a document when it was given to you last week 21 with your proposed examination; is that correct? 22 A. Correct. 23 Q. Okay. 24 Ms. Keane, that this document was found in several places within 25 the Philip Morris organization, are you? So, Ms. Keane, you're not aware that the Legal Department That's And so, Ms. Keane, you weren't aware, were you, goott X. Wallace, Official Court RDH, CRR Reporter 3390537283 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537283 10391 1 A. No. 2 Q. Okay. 3 A. Yes, I do. 4 Q. Are you aware that he had a copy in his files? 5 A. No. 6 Q, Karen Eisen, do you know who Karen Eisen is? 7 A. Yes. 8 Q. She's in the Marketing Department of Philip Morris? 9 A. I don't recall if she was in the Marketing Department, Do you know who Roy Anise is? 10 but she was a Philip Morris employee, Philip Morris USA 11 employee. 12 Q. So you're not aware that she had a copy in her files? 13 A. No. 14 Q. You weren't aware that there were copies of this file in 15 the Marketing Research Department, in the files of the Marketing 16 Research Department, are you? 17 A. No. 18 Q. Carolyn Levy had a copy of this document. 19 Karen Levy i s , d o n ' t 20 A. Yes, I d o . 21 Q. You didn't know she had a copy in her files, did you? 22 A. No, Mr. Goldfarb. 23 Q. Now, Ms. Keane, just one more question about that portion 24 of your testimony. 25 ever been conducted by or for Philip Morris. Do you see that? You know who you? The question asked whether such research had Scott X_ Wallace, « » , CRR Official Court Reporter 3390537284 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537284 10383 1 objectives, sample size, methodology and facilitation style, 2 this study is qualitative not quantitative. 3 projected to populations larger than the one studied. 4 best used for marketing directions and insight." 5 the answer that you added to that testimony, right, ma'am? 6 A. Yes. 7 Q. Now, do you have a copy of U.S. Exhibit 22217 in front of 8 you? 9 A. I now do, yes. 10 Q. In fact, Philip Morris asked that a qualitative research 11 report be done; isn't that correct? 12 A. Yes. That appears to be the case. 13 Q. And if you look — because if you look at the first 14 paragraph, you can see there that it's an interoffice memo in 15 March of 1996 from Sherry Teitelbaum to Jodi Sansone or Sansony 16 and Rebecca Gordon. 17 A. I do. 18 Q. And it's titled Merit Ultima Qualitative Research, Final 19 Report. 20 findings from the qualitative research that was conducted on the 21 lowest category in New Jersey on March 5th through 7th. The 22 objective of this research was to gain an understanding of 23 consumers' perception of the lowest category, as well as the 24 motivations and wants of smokers of Carlton, Now, and Merit 25 Ultima, and potential down switchers to this category. It cannot be It is And that was Do you see that? And the memo goes on to state, "The attached is the Scott L. Wallace, Official Court RDR, CRR Reporter 3390537285 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537285 10382 1 THE COURT: 2 MR. GOLDFARB: 3 What page are you on? I'm sorry, page 49, Your Honor, lines 1 through 5. THE WITNESS: 4 Yes, I see it. 5 BY MR. GOLDFARB: 6 Q. 7 understanding that we had not conducted such research." 8 you're not drawing any distinction there are you, Ms. Keane, 9 between research actually conducted by Philip Morris or research You see that? And your answer states that, "It was my And 10 conducted on Philip Morris's behalf by contractors? 11 A. No, I'm not. 12 Q. Now, Ms. Keane, if I could ask you to turn to page 52 of 13 your corrected direct examination, the question at lines — 14 the portion of your testimony at lines 5 through 17, do you see 15 that, ma'am? 16 A. In the question starting on line 5, yes. 17 Q. Yes. 18 Exhibit 22217; is that right? 19 passage is: 20 lighter cigarettes was because of perceived health concerns, 21 right?" 22 out and replaced it with, "Yes, this is what the passage states. 23 I cannot testify to what it "shows", because I am not a 24 marketing expert, and because the document also states elsewhere 25 under the heading A Qualitative Caveat, "by virtue of or And the question is asked with a quote from U.S. And the question after the quoted "This shows that a main reason smokers chose And the proposed answer was, "Yes", and you struck that S c o t t X. Wallace, Official JtDR, CRR Court Reporter 390537286 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537286 10384 1 Respondents were also asked for their reactions to alternative 2 positioning statements from merit Ultima." 3 A. I do. 4 Q. And the discussion of Merit Ultima, that's a Philip 5 Morris brand, isn't it? 6 A. Correct. 7 Q. And just by — 8 switchers are people who are smoking one FTC tar yield of 9 cigarettes and are considering moving to a lower — Do you see that? to clarify for the Court, potential down a brand with 10 a lower FTC tar yield, that's what you understand that term to 11 mean? 12 A. That's what I believe it means here. 13 o,. Okay. 14 asked at the 1996 meeting for any information that Philip Morris 15 had concerning consumer perceptions of low-yield cigarettes, the 16 FTC didn't draw a distinction between qualitative research and 17 quantitative research, did it? 18 A. No, they didn't. 19 Q. And the conclusions from this qualitative study were what 20 is quoted in the question at this point in your direct 21 testimony; isn't that correct? 22 A. Yes. 23 Q. Okay. 24 well, the conclusion was, "Two main reasons for smoking the 25 lowest brands were taste preferences and perceived health Now, as a primary matter, Ms. Keane, when the FTC And that conclusion was that one of the main Scott I. Wallace, Offioial Court — SDR, CRR Reporter 3390537287 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537287 10377 1 A. No. 2 Q. Well, if you look at the — 3 it says, "Welcome to the Philip Morris document site." 4 see that? 5 A. Yes. 6 Q. Okay. 7 www.PMdocs.com? 8 A. I do. 9 Q. And you see Philip Morris USA right there at the top of if you look at the top there Do you And you understand that to be the — that 10 the page, correct? 11 A. Correct. 12 Q. And then there are some search terms in the search 13 window. 14 A. Correct. 15 Q. Okay. 16 eight — there are eight documents that came up with the search 17 for 197 6, Roper, and "emphasis" which is one of the words in the 18 title of the report, do you see that ma'am? 19 A. Can you show me where it shows you the number? 20 Q. Yes. Do you see that? And then if you look down you see that there are MR. WELLS: Your Honor, I'm going to object to 21 22 Mr. Goldfarb testifying. Ms. Keane has stated she's never done a 23 search, she hasn't indicated any familiarity with this document. 24 I'm not in a position to cross-examine Mr. Goldfarb about what he 25 did. There is something he's done on his own, the witness has Scott X. Wallace, Official Court RISi, CRR Reporter 3390537288 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537288 10376 1 Q. 2 understanding by your answer here that you confirmed that 3 understanding with your staff, including during the period 4 surrounding this meeting, correct? 5 A. Correct. 6 Q. And in your testimony there are a few documents 7 referenced that you indicated you were not aware of them prior 8 to them being proffered to you with your proposed examination, 9 correct? Thank you. Now, just so we're clear, it's your 10 A. Correct. 11 Q. And one of those is U.S. Exhibit 20, 403; is that 12 correct? 13 titled A Study of Smokers' Habits and Attitude With Special 14 Emphasis on Low Tar Cigarettes? 15 A. That is correct. 16 Q. I did just a search on the Philip Morris Website to see 17 where copies of these were, just so I could ascertain. 18 look, this is — can you take that off, please? 19 That's the 1976 Roper Study that concerns — that is If we Do you recognize this to be a search result from the 20 Philip Morris USA document Website? 21 A. No. 22 Q. Have you ever seen the Philip Morris document Website, 23 Ms. Keane? 24 A. I have. 25 Q. Have you ever done a search yourself? Scott L. Wallace, Official Court KDR, CRR Reporter 3390537289 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537289 10385 1 concerns, although many of these smokers seemed to have made the 2 decision to go lighter based on perceived health concerns. 3 Taste seems a major reason to choose or stay within a particular 4 brand". 5 A. Can you show me exactly where you're reading? 6 Q. Yes. 7 It's internal page 5 of the document. 8 A. Yes, I see it. Thank you. 9 Q. Okay. And you say you are not a marketing expert, which Do you see that? It's at the top of — Bates number ending in 8321. 10 is true, correct? 11 A. Correct. 12 Q. And this conclusion was drawn by — if you look at the 13 cover page of this final report, it was a conclusion that was 14 drawn by the Sun Research Corporation, right? 15 A. I assume so. 16 Q. And that is the marketing firm that — or the market 17 research firm that Philip Morris retained to conduct this 18 research? 19 A. I don't see the name here, but I have no reason to — 20 Q. If you look at page — 21 in 8315, it runs up the side of the page there. 22 23 Charles, can you show that, the third page of the document? 24 25 if you look at Bates number ending Do you see that? A. I do, thank you. S c o t t L. Wallace), Official Court JtDR, CRR Reporter 3390537230 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537290 10386 1 Q. 2 the executive summary for this report, and it also states it's 3 the Sun Research Corporation; isn't that right? 4 A. Correct. 5 Q. A n d Sun Research Corporation was retained b y Philip 6 Morris to perform this research precisely because it has some 7 expertise in conducting market research; isn't that right? 8 A. I would assume so. 9 Q. Okay. Okay. And the next page as well, which also discusses A n d so this was a conclusion drawn b y the firm 10 that Philip Morris hired to conduct the study, right? 11 A. Yes. 12 Q. Now, if I could ask you to turn to page 56 of your 13 corrected direct examination, ma'am. 14 lines 7 through 13 — 15 could just go up to the first question. 16 that page is quoting a passage from a U.S. Exhibit 5 — U.S. 27 exhibit, excuse m e , 20539, which is identified on page 55 of 18 your testimony, which w a s the Strategic Issues Task Force 2000 19 memorandum, right, ma'am? 20 A. Yes. 21 Q. Okay. 22 question from lines 1 t o 6 that quotes a portion of the document 23 that in relevant part states that as part of this, the document, 24 the strategic issues task force document, that Philip Morris 25 quote, "would support legislation or voluntary industry And looking at — yes, I'm sorry, just to orient Charles if you T h e first question on A n d at. the top of page 56, you were asked a Scott L. Wallace, Official Court BUR, CSS Reporter 390537231 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537291 10387 1 agreement that would define the use of descriptors within a 2 single market". 3 A. I do. 4 Q. Okay. 5 and 8, is, "Philip Morris has not supported or pursued a 6 voluntary industry agreement to define the use of descriptors 7 like "light" and "low-yield" in the United States, has it?" And 8 then the proposed answer was "no, it has not." That was the 9 proposed answer, right? Do you see that, Ms. Keane? And then the next question, as asked, at lines 7 10 A. Correct. 11 Q. And you struck that and you substituted instead, "Yes, it 12 has. For years there has been an industry practice defining the 13 use of descriptors in the United States. 14 has supported additional steps concerning the use of descriptors 15 like "light" and "low-yield" in the United States." And then, 16 "for example, Philip Morris has petitioned the FTC to establish 17 regulations governing the use of descriptors and supports FDA 18 legislation for this purpose as well." 19 substituted, right? 20 A. Yes, I did. 21 Q. The question didn't ask you anything about additional 22 steps you've taken concerning the use of descriptors like 23 "light" and "low-yield", does it, ma'am? 24 A. I'm sorry? 25 Q. The question doesn't ask you about things you've done — S c o t t L. Wallace, Ottici*! Further, Philip Morris That was the answer you M B , CRR Court Rapoxtax 3390537232 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537292 10388 1 whether or not Philip Morris has done things other than 2 supported or pursued a voluntary industry agreement, does it? 3 A. 4 question in an effort to be — 5 Q. 6 supported or pursued a voluntary industry agreement to define 7 the use of descriptors like "light" and "low-yield" in the 8 United States, has it?" And your answer is, "Yes, it has," and 9 the next sentence describes that there has been an industry I thought that that information was responsive to the But the question was, ma'am, "Philip Morris has not 10 practice defining the use of descriptors in the United States; 11 is that correct? 12 A. Correct. 13 Q. Now, it appears from your answer, Ms. Keane, that you 14 are — 15 practice is a voluntary industry agreement, isn't that right? 16 A. 17 yes. 18 Q. 19 practice — the basis of your saying that Philip Morris has 20 supported or pursued a voluntary industry agreement is that 21 their exists what you term an industry practice; isn't that 22 right? 23 A. 24 a practice that was already in existence. 25 FTC request for information, we indicated that we would that in your answer you're saying that the industry There is a practice that is followed in the industry, Okay. My question is: You are saying that the industry Basically what I was saying was that, in fact, there was Scott L. Wallace, Official Court With regard to the JtDR, CRR Reporter 3390537233 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537293 10399 1 absolutely support steps to formalize that to whatever extent 2 they thought necessary. 3 Q. 4 haven't — but my question is whether there is a voluntary 5 industry agreement in place in the United States that Philip 6 Morris has supported or pursued, and the answer to my question 7 is no; isn't that correct? 8 A. No, Mr. Goldfarb, there is a practice that is in effect. 9 Q. Okay. Okay. Ma'am, I understand what your answer says, but you But it's not an agreement among the different 10 companies, is it, ma'am? 11 A. 12 the FTC, by courts — 13 Q. Ms. Keane — 14 A. — one that's followed by the FTC. 15 Q. Ms. Keane, you're an attorney, correct? 16 A. Correct. 17 Q. Okay. And you know the difference between an 18 agreement — 19 don't you? 20 A. a voluntary agreement and an industry practice, Let me ask — There not a formal agreement. THE COURT: Mr. Goldfarb, you have to let the witness 21 22 It is an understanding, one that has been acknowledged by answer the question. THE WITNESS: There is not a formal written agreement. 23 24 BY MR. GOLDFARB: 25 Q. Okay. And in the United States, Philip Morris has not Scott L. Wallace, Official Court RDR, CPU Reporter 990537234 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537294 10390 pursued a formal written agreement among the tobacco companies, has it? A. It has followed a practice and it has — Q. Ms. Keane, can you answers my question, please? A. I believe that we have, insofar as we have petitioned the ETC, so I see that answer as being a yes. MR. GOLDFARB: Excuse me, Your Honor, if the witness is not being responsive to my question and THE COURT: — Well, then you'll have to follow up with additional questions. MR. GOLDFARB: Okay. BY MR. GOLDFARB: Q. Ms. Keane, you've testified just now, have you not, that there is not, in fact, a voluntary industry agreement among different tobacco companies in the United States; isn't that correct? A. I have testified that there is a practice. Q. And you've indi MR. WELLS: I view it as — Excuse me Your Honor, he has to let her finish. THE COURT: THE WITNESS: You may finish. Go ahead please. I view us has having a practice that we are following that's not a written agreement, if that's the distinction you're drawing, the answer would be we do not have a Scott X. Xallace, Official REB, CRR Court Reporter 3390537235 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537295 10391 1 formal written agreement. 2 BY MR. GOLDFARB: 3 Q. 4 written agreement among the different tobacco companies on this 5 issue, has it? 6 A. Nor it has pursued it with the FTC. 7 Q. Okay. 8 industry practice as an agreement; isn't that right? 9 A. Okay. And Philip Morris has not pursued such a voluntary And you characterize this -- you characterize this I characterize it as a practice. There is no written 10 agreement. 11 Q. 12 "No, it has not", that, in fact, is a correct answer, isn't it 13 Ms. Keane? Okay. Now — okay, so then, the answer you struck out, 14 MR. WELLS: Objection, Your Honor. 15 THE COURT: The objection is sustained. 16 17 The witness did answer the question earlier. MR. GOLDFARB: And, Your Honor, I'm asking her now if she 18 is going — 19 written agreement, whether, in fact, the proposed answer to this 20 question was correct that she struck. 21 22 23 since she has now agreed there is no voluntary THE COURT: All right. But that question may stand and the witness may answer that question. MR. WELLS: I object, Your Honor, because he is now 24 inserted the word "written" into his question. 25 the last 15 minutes they've been talking about her understanding That is — for Scott X. Wallace, RDR, O W Official Court Reporter 3390537236 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537296 10392 1 of an agreement versus a practice. She has conceded that there's 2 no written agreement. 3 agreement. 4 question in the written direct, because that's not what it says. The question does not ask about a written Now he's going back and basically reformulating the 5 THE COURT: Let me hear the question again, Mr. Goldfarb. 6 MR. GOLDFARB: Okay. 7 BY MR. GOLDFARB: 8 Q. 9 supported or pursued a voluntary industry agreement to define Well, the question is, Ms. Keane, Philip Morris has not 10 the use of descriptors like "light" and "low-yield" in the 11 United States, has it? 12 A. 13 that is in my written direct. 14 Q. 15 "voluntary industry agreement", correct? 16 A. Yes. 17 Q. Okay. 18 A. Insofar as we are trying to get information about what 19 regime was followed for "lights" and "low-yield", yes. 20 Q. 21 chances to answer this very question, weren't you? 22 A. 23 questions. 24 Q. Okay. 25 A. Do I have that on the pile you gave me before? I think my answer is more accurate, Mr. Goldfarb, the one Because you equate an "industry practice" with a Now, Ms. Keane, at your deposition you were given three I'd have to go back and have you bring me through the I don't remember how many times. If we can look at page 359 of the testimony. Scott X. Wallace, Official Court RDR, CRR Reporter 3390537237 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537297 10393 1 Q. 2 on the screen, but take your time so you can find it, 3 A. 4 Yes. It's also day two of the deposition. It's also up I find this easier to read, thank you. MR. WELLS: Your Honor, I'm going to object. He's been 5 asking her questions about her corrected written direct, and it's 6 clear they have a difference of opinion how to interpret the 7 meaning of "voluntary agreement". 8 asking her questions about the deposition, and he should only be 9 asking her questions about what occurred in the deposition for He's now gone back and he's 10 purposes of impeachment. 11 he's just going back now and going through the deposition. 12 THE COURT: 13 MR. GOLDFARB: 14 He hasn't established any impeachment, Mr. Goldfarb? Well, I think I'm permitted to use a deposition for impeachment and that's the purpose for -- 15 THE COURT: 16 BY MR. GOLDFARB: 17 Q. 18 nothing binding about this industry practice; isn't that 19 correct? 20 A. 21 in fact, it has been acknowledged, but yes, there's nothing 22 binding. 23 Q. 24 its brand descriptors or its terms, such as low-yield, slow tar, 25 to any cigarette it chooses; isn't that correct? The objection's overruled. You may proceed. Now, in fact, Ms. Keane, there is nothing — there's Urn, no, although, in fact, there have been cases where, Okay. And so it's true that a tobacco company can apply Scott L. Wallace, Official Court JH», CKR Reporter 3390537238 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537298 10394 A. I wouldn't agree with that. 2 Q. Okay. And, in fact, if we look at page — 3 further down at page 56 of your testimony, you indicated at line 4 19, 19 to 23, the — 5 THE COURT: 6 MR. GOLDFARB: 7 THE WITNESS: Okay. a little This is in your direct testimony? This is in your corrected direct testimony. 8 BY MR. GOLDFARB: 9 Q. Do you see it, ma'am? 10 A. I do. 11 Q. At lines 19 to 23, Ms. Keane, the question was asked, "So 12 the United States, Philip Morris and the other tobacco 13 companies, can apply brand descriptors like 'light' to their 14 brands however they choose, right?" 15 "Yes". 16 A. I do. 17 Q. And Ms. Keane, you struck it out and you replied: 18 don't believe this is correct. 19 to apply the "light" descriptor to cigarettes with 7 to 20 14 milligrams of tar and the "ultra-light" descriptor to 21 cigarettes with fewer than 7 milligrams of tar." 22 A. Correct. 23 Q. Now, Philip Morris hasn't — 24 that it applies this industry practice based on particular 25 identified FTC tar yields, does it, ma'am? And the proposed answer was Do you see that? "No, I Industry practice has long been S c o t t L. Wallace, Official Court doesn't say on its Website RDR, CRR Reporter 3390537239 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537299 10395 1 A. I don't believe that that's on the Website. 2 Q. And it's not anywhere else in any communication that 3 Philip Morris has made to consumers that it — 4 industry practice tiers particular brand descriptors to 5 particular FTC tar yields and has identified those tar yields 6 for consumers, has it? 7 A. 8 that effect. 9 Q. that this No, I don't believe there's any communication from us to Okay. Now, there's no — as you have testified, have you 10 not, Ms. Keane, there is no — there's no statute, certainly, 11 that defines the brand descriptor to a particular FTC tar yield? 12 A. I think this would fall under section 5 of the FTC act. 13 Q. So you're saying there is a statute? 14 A. I think there's a general practice against doing anything 15 that could, in fact, be misleading and given the fact that the 16 FTC itself has followed a similar form of designation and has 17 long been followed by the industry, I believe that we will have 18 heard from the FTC if, in fact, we had deviated from this in any 19 significant fashion. 20 Q. 21 followed; isn't that true, Ms. Keane? 22 A. 23 Philip Morris's practices. 24 Q. 25 definitional scheme that you've identified, does it? Now, in fact, the industry practice is not always I can't speak to the industry practice, I can speak to Okay. In fact, Philip Morris doesn't always follow this S c o t t X. Wallace, Official Court RDtt, CRR Reporter 3390537300 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537300 10396 A. It would be my objective to have them follow it, and I'm not. aware of specific examples where we haven't. Q. Okay. Well, you are aware, for example, there are some cigarettes that are in the 7 to 14-milligram range, for example, that don't have any descriptor? A, Um-hmm. That's true. But I interpret this as what we can use as opposed to, you know, the presence of a descriptor versus the absence of a descriptor, Mr. Goldfarb. Q. And just so the record is clear, your answer is industry practice has long been to apply the "light" descriptor to cigarettes with 7 to 14 milligrams of tar? A. Right, exactly. Q. Okay. A. Meaning we would not use that descriptor if something did But you are — not fall within that range. Q. Okay. And there are some brands and some — you're aware that of Philip Morris's brands, there are several different versions of a particular brand? A. Yes, I am. Q. Isn't that true. So, for example, Merit, there are several different types of Merit cigarettes, correct? A. Correct. Q. Same with Virginia Slims? A. Correct. Q. Same with Marlboro? Scott L. Wallace, Official Court RDR, CKR Reporter 3390537301 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537301 10391 1 A. Yes. 2 Q. And for some brands, there are versions of those brands 3 that fall outside the 7 to 14 FTC rating range that do carry the 4 descriptor "light"; isn't that true? 5 A. 6 something does not fall within the 7 to 14-milligram range? 7 Q. 8 Morris brands that apply the "light" descriptor to cigarettes 9 with FTC tar yields that exceed the 7 to 14-milligram range? Is your question are we using "light" as a descriptor if No, my question is, aren't there some versions of Philip 10 A. 11 FTC, my answer would be I'm unaware of our doing that. 12 Q. 13 is provided by the tobacco companies; isn't that right? 14 A. 15 pursuant to tests conducted by the, you know, TITL. 16 Q. 17 to the FTC? 18 A. Yes. 19 Q. Correct? 20 A. Yes. 21 Q. Okay. 22 Subject to the way in which rounding is conducted by the Okay. Well, the information that's published by the FTC It is provided pursuant to test — yes, absolutely, And the tobacco companies then provide that information THE COURT: And so, after that exchange, let me see if I 23 can be clear. Is it your testimony that to your knowledge Philip 24 Morris does not have any of its brands which are not complying 25 with the industry practice, what you call the industry practice Scott L. Wallace, Official Court ADR, CRR Reporter 3390537302 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537302 10398 1 of using the descriptor "light" to apply to 7 to 14 milligrams of 2 tar? THE WITNESS: 3 Correct, Your Honor. There could be brands 4 for which we don't use a descriptor, but if we use a descriptor, 5 it would fall within that range subject to there's a practice in 6 the FTC that you round down. 7 down to 14. You have a 14.5, you round up to 15. That is a 8 general practice. 9 BY MR. GOLDFARB: You could have a 14.4 and you round 10 Q. And just to round this out, Philip Morris has some brands 11 of cigarettes that use a descriptor other than the ones that 12 you've identified here, they use a descriptor "medium" for some 13 brands; isn't that correct? 14 A. Yes. 15 Q. And now, if I could have U.S. exhibit, please, 27347? Do you have that document in front of you, Ms. Keane? 16 17 A. I do. 18 Q. It's also up on the screen. 19 10th 1999 memorandum to Mark Berlind from the law firm of Davis, 20 Polk & Wardwell? 21 A. I see that. 22 Q. And Mark Berlind is an attorney at Philip Morris; is that 23 correct? 24 A. At this point in time, he was an attorney working for me. 25 Q. For you. Because at this time — Scott L. Wallace, Official Court You see this is a September M R , CRR Reporter 3390537303 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537303 10399 A. Wait, no. Q. Well, in September of 1999 you were the senior vice president of Philip Morris, what was then Philip Morris Companies, right? And — A. He was within the group for which I had responsibility. Q. And that was a worldwide regulatory affairs group? A. Yes. Q. Okay. And this memorandum, if you look at the top there is a reference to Jane, "Jane asked me to draft a series of questions that might arise, as well as possible answers relating to low delivery cigarettes and brand descriptors. The following questions relate sort of to the FTC testing and brand descriptors pages." Do you see that? A. I do. Q. And my question is, you understand that to be referring to the FTC testing and brand descriptors pages of the Philip Morris Website; is that correct? A. Correct. Q. Now, the Website, in fact, was launched three days after this memo was written, correct? A. Yes. Q. Okay. And if you turn to page 2 of the document and — as you indicate in your direct examination, Ms. Keane, you had primary responsibility for the creation of some of the smoking and health pages that appeared on the Philip Morris Website when Scott L. Wallace, Official Court RDR, CHR Reporter 3390537304 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537304 10400 it was launched in 1999, correct? A. I was in charge of the process, exactly. Q. If we look at paragraph 3 and down, these are sort of proposed responses to questions that Philip Morris might get about the content of its Website, correct? MR. WELLS: Your Honor, could I object and request the Court to have Mr. Goldfarb ask a foundational question whether or not the witness saw this document at or around the time it was drafted? THE COURT: Mr. Goldfarb. Yes. You need to establish that, We don't know at this point. BY MR. GOLDFARB: Q. Ms. Keane, have you seen this document before? A. I did not see it at the time it was created. Q. Okay. Did you see it subsequent to the time it was created? A. I saw it in conjunction with this litigation. Q. Okay. A. I saw it when it was first identified as an exhibit. Q. And not as an exhibit to your direct examination as an And — okay. When did you first see the document? exhibit in the case, correct? A. As an exhibit to my direct examination. Q. Okay. MR. WELLS: So we're talking about last week; is that right? S c o t t L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10401 THE COURT: When is the date, if you remember, on which 1 2 you first saw the document? THE WITNESS: 3 It would have been in responding to the 4 written direct that I got from the government, so it would have 5 been last week. THE COURT: All right. 6 7 BY MR. GOLDFARB: 8 Q. 9 examination, Mark Berlind, Mark Berlind was also one of the And at this point, as you indicate in your direct 10 people responsible for drafting the content of the Philip Morris 11 smoking and health pages, correct? 12 A. 13 author who transcribed that information for purposes of the task 14 force assignment, correct. 15 Q. 16 Issues Task Force, correct? 17 A. Correct. 18 Q. Also known as the Website Task Force? 19 head that have task force? 20 A. I was. 21 Q. So Mr. Berlind reported to you, ultimately, for the 22 purposes of what he was doing with respect to this work? 23 A. He was responsible for collecting input, and he was the And by "task force" you're referring to the Strategic And you were the With regard to the Website work, yes. 24 THE COURT: And you were not cc'd on this letter? 25 THE WITNESS: No, I was not. S c o t t L. Wallace, Official Court RQft, CRR Reporter 3390537306 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537306 10402 1 There was — what was happening with the Website — 2 THE COURT: Well, there's no question pending. Next 3 question now, Mr. Goldfarb. 4 BY MR. GOLDFARB: 5 Q. 6 highlighted up on the screen, the question that the writer of 7 this memorandum was answering is indicated on bolded at the 8 bottom part of question 3 and the question is: 9 descriptors indicate to a smoker with any precision the relative Now, on the — turning to page 2, the part that's "Do the 10 amounts of tar and nicotine they will inhale from a particular 11 Philip Morris cigarette relative to another Philip Morris 12 brand?" 13 A. I do. 14 Q. And the answer that this — 15 proposed was: 16 smoked the same way, Philip Morris believes that tar and 17 nicotine numbers provide a relative basis for comparison. 18 Philip Morris does not control the labeling of or descriptors 19 applied to brands of other companies, and therefore cannot state 20 with certainty that the terms "light" and "ultra light" would 21 serve as a basis of comparison between a Philip Morris cigarette 22 and a cigarette produced by another manufacturer." 23 that? 24 A. I do. 25 Q. That, in fact, is a true statement, is it not? Do you see that? the writer of this memorandum "If two different Philip Morris cigarettes are Do you see Scott L. Wallace, Rim, CRR Official Court Reporter 390537307 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537307 10403 A. We do not control what other companies do, that is correct. Q. And so, now, getting back to the changes to your testimony at page 56, lines 19 to 23, we were talking about how Philip Morris, in fact, applies its brand descriptors to different brands that it makes and sells, correct? A. Correct. Q. Okay. If I could look at U.S. Exhibit 52977, please. Ms. Keane, have you gotten a copy? A. I do. Q. And you recognize this, do you not, Ms. Keane, to be the Federal Trade Commission report issued in 2000 titled: Tar, Nicotine and Carbon Monoxide of the Smoke of 1,294 Varieties of Domestic Cigarettes For The Year 1998. Do you recognize that? A. I see that. Q. You've seen FTC reports before, haven't you? A. I have. Q. And you recognize this to be one of the standard FTC reports put out periodically? A. I do. Q. If I could turn your attention, please, Ms. Keane, to the second to last page of the document, it's Bates number ending in 1222. A. Okay. Q. And it's internal page 32 of the document. Now, if you Scott i . Wallace, PER, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10404 could call up the Virginia Slims, please. Ms. Keane, these are the FTC yields provided to the FTC by Philip Morris for Virginia slim cigarettes, correct? A. Correct. Q. Okay. And if I could direct your attention to the last — we could say the last two or -- I'm sorry, if you look at the last four that are listed there for Virginia Slims. A. I see them. Q. Do you see that? Virginia Slims — screen there — Do you see there that there's a the second from the bottom that's on the the Virginia Slims Light cigarette there is listed as 15 milligrams of tar. Do you see that? A. I do. Q. And you see also, then, that there's a — the one right above it, the full flavor Virginia Slims is listed also at 15 milligrams of tar. Do you see that? A. I do. Q. So that, at least, is one instance where Philip Morris is not following the industry practice, right, ma'am? A. Urn, could I try to explain this example? Q. Well, first I'd like to confirm, ma'am, that according to the FTC report in the year 2000, that there are Virginia Slims Light cigarettes and Virginia Slims full flavor cigarettes listed at 15 milligrams of tar. Can you confirm that? A. That's what this report says. Scott X. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10405 Q. Thank you. Okay. A. May I put it in some context for you? Q. There's no question pending, ma'am. Now, if you could also turn back to page 17, internal page 17 of this document. A. Which document? Q. The same FTC report, Bates number ending in 1207. If you call up the Marlboros at the bottom of the page, please. Okay. These are the FTC ratings for Marlboro for 2000. Do you see that, Ms. Keane? A. I do. Q. Okay. And if you look at the bottom, the bottom two listings for Marlboro are Marlboro Mediums, and you said that's a descriptor that Philip Morris uses on its brands, right? A. Yes. Q. And there you have two listings of Marlboro Mediums, and both of those are listed at 11 milligrams of tar, right? A. That's right. Q. Okay. And then if you go up — A. That's because we treat "mediums" as the same as a "light" descriptor tar range. Q. So "mediums" and "light" mean the same thing to Philip Morris? A. Yes. Q. Has Philip Morris told consumers that "medium" and Scott L. Wallace, Official Court SDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10406 "light" are covered by the same tar range? A. What we do is we communicate the tar numbers on advertising, we do not, as I said before, have specific communications with regard to the numbers that correspond to the tar ranges. Q. Okay. A. To the descriptors, excuse me. Q. But the numbers are not on the pack, right, ma'am? A. No. Q. So if someone buying a copy of Marlboro Mediums and Marlboro Lights wouldn't know that they could be the same cigarette; isn't that right? A. Well, they're not the same cigarette. If they wanted to know the tar number, they could look at the point of sale material at retail. Because to the — when we have an advertising at retail, in fact, the tar number would be found. Q. Okay. But it's not on the packs, right? A. No. Q. Okay. And there's no communication anywhere where Philip Morris has said when we use "medium" as a brand descriptor, we mean the same thing as when we use the — the same FTC tar range as when we use the term "light"; isn't that correct? A. Correct. Q. Okay. And if you go up four or five listings, you see — it's the next one up. It's 11, Charles, of the two — you can S c o t t L. Wallace, Official Court. RCR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10407 see two listings there, that the Marlboro King filter soft pack light is there listed as 11 milligrams of tar; isn't that right, ma"am? A. Yes. Q. And then just the one below the one that is now highlighted in yellow, is another packing of Marlboro Lights that's al30 11 milligrams FTC tar. A. Yes. Q. Okay. Do you see that, ma'am? So, according to the FTC report, based on the information submitted by Philip Morris in the year 2000, Marlboro had at least two packs of Marlboro Mediums that were 11, and two packs of Marlboro Lights that were both 11 milligrams by the FTC test; isn't that right? A. That's right. Q. Okay. A. Are we finished with — Q. You can put that one aside, yes, ma'am. A. Should I be keeping these all separated? If I could have U.S. Exhibit 90108, please. can I put this aside? Are you going to -Q, You may be needing them at some future point, so the pile may, in fact, get high. Do you have it before you. A. I do. Q. U.S. Exhibit 90108. Do you recognize that, Ms. Keane, to be the Federal Trade Commission report equivalent to the one Scott h, Wallace, Official Court ROR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10408 that you just looked at but for the year 1999? A. Correct. Q. And this one is titled: The Federal Trade Commission, Tar Nicotine and Carbon Monoxide of the Smoke of 1252 Varieties of Domestic Cigarettes For The Year 1997, correct? A. Correct. Q. And if you just look quickly, Ms. Keane, at page 4 of this document, toward the bottom of the page, just that first sentence under the source of data in the report, it confirms your earlier testimony, does it not, the first sentence states there, "The FTC obtained the test results published in this report from the five largest cigarette manufacturers in the United States." A. Right, the tests were conducted by TITL pursuant to FTC methodology and we get those numbers and mail them in to the FTC. Q. Okay. And if we could now look at page — turn to page 30 of the report, and do you have that Charles, second to last page? A. Are the numbers what, at the top? Q. Yes. A. Okay. Q. And again, Charles, if you would please call that out. These are the Virginia Slims ratings for — in the 1999 FTC report? Scott L. Wallace, Rrm, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10409 A. That's right. Q. Okay. If we could focus on the bottom six, please, of this Virginia Slims listing. Do you see, again, if you look — if you first, Ms. Keane, take the first top two and the bottom two together that are highlighted in yellow there. You see, first, that looking at the top two that are highlighted, you have Virginia Slims 120-milligram filtered, hard pack, lights, that are both listed at 14 and 15 milligrams of tar, respectively, correct? A. Correct. The FTC, when they break light and full flavor, they break at 15. Our practice is slightly more restrictive than that, so this would be consistent with the FTC designation of what a low tar is. Q. Okay. But this information is provided to — and the headlines for the packings are provided by the company; isn't that correct? A. Correct. Q. When this refers to a Virginia Slims Light, it's a Virginia Slims Lights that Philip Morris terms a Virginia Slims Light cigarette, correct? A. Correct. Q. So, if we look at the top two, as you just said, there are light brands of Virginia Slims at 14 and 15 milligrams of tar? A. Um-hmm. Scott L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10410 Q. Okay. And so, at least for the 15-milligram of tar Virginia Slims, that's outside the industry practice that you identified earlier? A. Consistent with FTC practice, outside of our general practice. Q. Okay. And if we look, now, at the bottom two — A. Which oftentimes is a rounding error because of what I had described before. Q. There is — if you look at the bottom two, these are two full flavor versions of Virginia Slims, 100-milligram filtered soft pack packings, correct? A. Correct. Q. And these are listed at 14 and 15 milligrams of tar respectively, right? A. Correct. Q. So here you have a full flavor brand that is — that according to what you testified, is the industry practice should be in the light range, but it's actually still a full flavor cigarette, right? A. What I had described to you, Mr. Goldfarb, is when we use "light", and I think I tried to indicate that doesn't mean that we will always use a descriptor within that range, but we will not use a descriptor unless it falls within a particular range. Q. Okay, but you just testified that's not true because up above there's a Virginia Slims packing of lights that falls Scott L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10411 1 outside of that range -- 2 A. Which is consist — 3 Q. Excuse me, let me finish my question please. 4 THE COURT: One at a time, everybody. 5 MR. GOLDFARB: Thank you. 6 BY MR. GOLDFARB: 7 Q. 8 that it's not true for the Virginia Slims — 9 Slims packings identified above, because it is a light cigarette My question is, you have just testified, have you not, one of the Virginia 10 as marked by Philip Morris, that it registers at 15 milligrams 11 by the FTC test; isn't that correct? 12 MR. WELLS: Objection, that is not what she testified to. 13 THE COURT: 14 THE WITNESS: Because of the way in which the rounding Well, the witness will answer the question. 15 occurs, all right, this could be a 14.4 and a 14.5, and so the 16 rounding would result in one of these packings going up to a 15. 17 That is still FTC practice. 18 BY MR. GOLDFARB: 19 Q. 20 know whether that's the case or not, right, ma'am? 21 A. I would believe it to be the case. 22 Q. My question is, you don't know it to be the case; isn't 23 that correct? 24 A. I believe it to be a rounding error. 25 Q. My question is -- Okay, but for these packings of cigarettes, you don't S c o t t L. Wallace, Official Court RCK, CRR Reporter 390537316 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537316 10412 A. Yes, I believe it to be a rounding error. Q. Okay, my question, Ms. Keane, is for this cigarette, this 15-milligram light cigarette identified in the 1999 Federal Trade Commission report, you do not know that to be a rounding error, do you? A. I would be very surprised if given our practice and the scrutiny with which we review these numbers and our practices that it was something more substantial than a rounding number because we are very mindful of our practices and also what the FTC practices in this regard. Q. Okay. And the answer to my question is no, you don't know it to be a rounding error? A. No, but I believe it to be. Q. If I could have U.S. Exhibit 27036, please. Do you have the document before you, Ms. Keane? A. I do. Q. Okay. Ms. Keane, do you recognize this to be the 1995 FTC report of tar nicotine carbon monoxide ratings for the smoke of 1,107 varieties of domestic cigarettes? A. Yes, I do. Q. And I would like to ask you to turn, again, to the packings for Virginia Slims, and this is Bates number ending in 1491, internal 32. Are you there, Ms. Keane? A. Yes, I'm following it on the screen. Thank you. Q. Okay. Now, here, Ms. Keane, if you look at the top two S c o t t L. Wallace, Official Court JffiR, CRR Reporter 390537317 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537317 10413 listings for Virginia Slims cigarettes, these are, in fact, cigarettes that are rated — there are two packings of cigarettes that are rated at 6 milligrams of FTC tar, correct? A. Correct. Q. And they don't carry any brand descriptor, do they? A. No, they were called Super Slim. Q. But they don't carry any brand descriptor light, ultra light, medium? A. No. Q. I'm sorry, did you answer? A. No. Q. Okay. And then, if you look five down at the 100-millimeter full flavor soft pack slim brand of Virginia Slims, do you see it's listed at 14 milligrams of tar, correct? A. Correct. Q. Okay. So, at this point we have versions of Virginia Slims without any brand descriptor that are listed at 6 and 14 milligrams of tar respectively, correct? A. Correct. Q. And if we go down to the last two listings for Virginia Slims, we have two versions of Virginia Slims lights, correct? A. Yes. Q. And the second to last listing, the Virginia Slims, is a light slim at 4 milligrams of FTC tar, right? A. Correct. Soott I. Wallace, Official Court WW, CRR Reporter 3390537318 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537318 10414 Q. And you testified the industry practice is when you put a brand descriptor on, if you're going to be under 7 you call it "ultra light", correct? A. Generally that is the practice. Q. And that's not the practice here because it's well under the 7-milligram FTC tar limit that you testified to; isn't that correct? A. We would never do — we would not do the reverse, but this one could, in fact, have been called an "ultra light". Q. But this was called a "light", correct? A. It could have been called an "ultra light". THE COURT: So that in this particular instance, the deviation from industry practice would not have led a consumer to believe that this was a lower tar cigarette than it actually was; is that correct? THE WITNESS: Right. BY MR. GOLDFARB: Q. But this is another instance where the, where the delineation that you have defined in your testimony at page 56 is not being followed by Philip Morris, correct? A. This was a more restrictive practice. We could have called this an "ultra light" but did not, correct. Q. Okay. And the one further down — I'm sorry, the next one down is a 14-milligram light Virginia Slims, correct? A. Yes. Scott X. Wallace, Official Court ROt, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10415 Q. So here -- so those two, you have both a 4-milligram Virginia Slims Light and a 14-milligram Virginia Slims Light, so one of them has 350 times the tar of the other; isn't that correct, three and a half times the tar? A. Three and a half times. Q. Is that correct, ma'am? A. Yes. MR. GOLDFARB: Your Honor, I'm going to change subjects. I can go for another 10 minutes or 15 minutes, or we can take a break now. THE COURT: everybody, All right. Let's take a recess now, 15 minutes, please. (Thereupon, a break was had from 3:04 p.m. until 3:21 p.m.) THE COURT: Mr. Goldfarb, any chance of our completing direct this afternoon? MR. GOLDFARB: No, Your Honor. THE COURT: Okay. Go ahead. BY MR. GOLDFARB: Q. Ms. Keane, if I could direct you to the last page of your testimony. Do you have that corrected direct exam? Do you have it, ma'am? A. Yes, I do. Q. Okay. And the — at this part of your testimony, there's some discussion of the issue of ventilation holes, correct? Scott X. Wallace, Official RD*., CRR Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10416 A. Yes. 2 Q. And you give some prior testimony concerning the onsert 3 that Philip Morris affixed to certain packages of Philip Morris 4 brands of cigarettes in November 2002, correct? 5 A. Right. 2002, '3 and '4. 6 Q. Yes. And then the last question of the examination, at 7 page €2, lines 7 to 15, the question was: 8 website, Philip Morris has never informed smokers of the 9 presence or purpose of ventilation holes, told them where they "Other than the 10 are on a cigarette or instructed smokers how not to block the 11 ventilation holes; isn't that correct"? And the proposed answer is: 12 "That is true." And you 13 struck that answer, correct? 14 A. Yes. 15 Q. And you responded: 16 say:: "Philip Morris included this and other website information 17 in a mailing sent to smokers on its direct mail database in 18 1999. And in November 2002, Philip Morris included this and 19 other website information in a free-standing insert included in 20 30 major newspapers throughout the United States." "No, that is not correct." And you And that's the sentence that I want to ask you about. 21 22 Did I read that correctly, ma'am? 23 A. Yes. 24 Q. Okay. Now, in fact, the insert did not inform smokers of 25 the purpose of ventilation holes, did it? Scott I. Wallace, MR, CRR Official Court Reporter 3990537321 3390537321 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10417 A. It did, in fact, have a reference to ventilation holes. It identified the fact that ventilation holes were a way in which smokers could, in fact, impact the FTC tar numbers. Q. Okay. But the insert did not inform smokers of the purpose of ventilation holes, did it? A. On our website, we tell people the purpose of ventilation holes, which is to dilute the smoke. Q. I understand that, Ms. Keane. I'm sorry. My question is about the insert — A. Right. Q. — that you testified to that was put into newspapers in 2000 — in newspapers in 2002. A. And the insert includes an excerpt from the website that does, in fact, to my knowledge, make reference to ventilation holes. Q. Okay. It makes a reference to ventilation holes, but it doesn't tell smokers what ventilation holes are there for, correct? A. It doesn't give as complete information as is found on the website, but it does, in fact, draw the attention of the reader to the existence of ventilation holes. Q. not" — Okay. So the answer to my question is: the answer to my question is: "No, it does "No, the insert that was included in newspapers did not itself inform smokers of the purpose of ventilation holes," correct? Scott l. Official Wallace, Court JU3R, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10419 MR. WELLS: Your Honor, I object. The problem is he has asked a compound question in the direct testimony, questions: of purpose? Does it inform them of presence? it's multiple Does it inform them Does it instruct them how to use it? And now, because he's asked a compound question, we're having problems because there's no question that, with respect to Ms. Keane's corrected direct, the information that she refers to does refer to the presence of ventilation holes. And the problem is the form of the question. THE COURT: question. It's certainly compound. It's a compound You may break down your questions now to cover each portion of the compound question if you want to cover each one. MR. GOLDFARB: And I apologize, Your Honor. I thought that the question pending was a particular question that was different from the one posed and was not a compound question, but I will rephrase it. BY MR. GOLDFARB: Q. So my question, Ms. Keane, is: Isn't it true that the insert included in 30 major newspapers throughout the United States in November 2002 did not inform smokers of the purpose of ventilation holes? A. Right. We had had many communications. As I remember November 2002, the free-standing insert, it made reference to ventilation holes, but did not go into as complete information as is found on the website. Scott 1. Wallace, SDR, CRR official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10419 I Q. So the answer to my question is "No, it did not inform smokers of the purpose of ventilation holes," correct? A. If I could look at it to refresh my recollection, because there have been numerous — we have had a multitude of communications and I can't remember in that particular one how much detail we go into. Q. Okay. But there's only one time where you've included a free-standing insert in 30 major newspapers, correct? A. But we've had numerous mailings; we've had POS communications. I mean, there have been multiple vehicles through which we've communicated this information. MR. WELLS: Your Honor, the witness has asked if she could have a copy of the actual insert. This would speed up the examination. THE COURT: Do you have it? MR. GOLDFARB: Yes. I'm happy to provide the witness. BY MR. GOLDFARB: Q. It's JD 052969, please. A. Thank you. Q. If we look at the cover page first, Ms. Keane, do you see that this is in fact the insert that was included in newspapers in 2002? A. Thank you. Yes. Q. Okay. And if you look at, I think, page 8 of the — if you look at page 8 of the document, Bates number ending in Scott 1. Wallace, Official Court AOR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10420 5628 — A. "The amount of nicotine inhaled would be higher, for example... the smoker blocks ventilation holes, inhales more deeply or takes puffs" — THE COURT REPORTER: THE WITNESS: I'm sorry? Yeah, I'm just reading it. I'm sorry. It's up there. Q. Just to clarify, Ms. Keane, there was only one time that Philip Morris has put an insert in 30 newspapers around the United States, correct? A. Of this — yes. Q. Okay. A. But as I said, there are many other communications we've had, which is why I appreciate you clarifying or giving me a copy of this to look at. Q. All right. if the — You can look at that page and you can tell me if this page provides information to smokers about the purpose of ventilation holes. A. No. It explains the phenomena of ventilation holes; it explains that in fact it changes the FTC tar delivery. It doesn't explain why we, as manufacturers, use them, which is the information that I referred to earlier, which is found on the website. Q. Okay. A. No. But it's not here, correct? Scott Z. Wallmce, Official RBK, CRR Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10421 1 Q. 2 where on a cigarette the ventilation holes are located; isn't 3 that correct? 4 A. 5 draw people to the website, where more complete information is 6 found. 7 Q. Okay. 8 A. This is not as complete as the website. Okay. And this newspaper insert does not tell smokers No. The website has a diagram, but this was meant to But — MR. WELLS: Could I ask for the government to bring out 9 10 the reference to ventilation holes so the Court can see exactly 11 what's said, because I can't read it. MR. GOLDFARB: 12 13 If you can pull out the ~ if you can pull out that paragraph. 14 Thank you. 15 MR. WELLS: And the underlining is in the exhibit? Is 16 that — 17 BY MR. GOLDFARB: 18 Q. 19 smokers how not to block the ventilation holes, correct? 20 A. 21 meant to give people a closer look at information, but it's not 22 meant to be dispositive of everything that we have up. The 23 website is a far more complete resource. 24 Q. 25 That this insert -- newspaper insert does not instruct smokers The newspaper insert also, Ms. Keane, does not tell I mean, it says in the introduction that this is really Okay. The answer to my question is "No," Ms. Keane? Scott 1. Official Wallace, RDR, CRR Court Reporter 3390537326 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10422 on how not to block the ventilation holes? A. No, it does not. Q. Okay. And you testified, did you not, in your direct exam, Ms. Keane, that in the onsert that Philip Morris included in November of 2002 with certain brands of light cigarettes, it also did not provide — it also did not identify where on a cigarette ventilation holes exist, correct? A. I mean, we couldn't provide all that information on — you're talking about the pack onsert? Q. Yes. A. Yes. We couldn't provide all that information on a pack onsert. It is meant to provide concise information and to identify resources that people can go to for more complete information. Q. Okay. And again, so the answer to my question is "No"? Just so the record is clear, the answer to my question is: "No, the onsert in 2002 that Philip Morris placed in certain brands did not identify the location, the purpose or how not to block the ventilation holes," correct? A. We communicated the impact of ventilation holes and the impact the ventilation holes could have on FTC numbers. It did not identify where they were. Q. Or their purpose, correct? It did not identify the purpose? A. Or our purpose in using ventilation holes. scott x. Wallace, Rt», CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10423 1 Q. And i t didn't instruct smokers how not to block the vent 2 holes, 3 A. No. 4 Q. Now, Ms. Keane, if I could direct your attention to page 5 20 of your corrected written examination. 6 A. Page 20. 7 Q. Are you there? 8 A. I am. 9 Q, This is in the section of your testimony discussing the correct? Thank you. 10 issue of nicotine and addiction and Philip Morris's position on 11 nicotine and addiction, correct? 12 A. Correct. 13 Q. And there's discussion at this point in your testimony of 14 the document that Philip Morris submitted to Senator Hatch in 15 October 1997, referred to generally as "the Hatch Statement"? 16 A. Correct. 17 Q. And that's, for the record, U.S. Exhibit 39734. And as 18 you indicate in your testimony, this — the Hatch Statement was 19 a statement actually submitted by what's now known as Altria, 20 correct? 21 A. Correct. 22 Q. And it was on behalf of Altria and all of its 23 subsidiaries? 24 A. Correct. 25 Q. Okay. And so in this section of testimony, I may refer Scott i . Wallace, RDR, CRR Official Court Reporter 3390537328 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10424 to — discuss Philip Morris, but you understand that by that, it was a submission of Altria? A. I do. Q. Okay. Do you understand that? And I'll use "Philip Morris" to refer to the Philip Morris family of entities generally, okay? A. Okay. Q. On page 19 — I'm sorry — 18 and 19 of your testimony, you quote the sections of the Hatch Statement that deal with addiction, correct? And that begins, for the record, at page 18, line 8 and goes through page 19, line 14? A. Correct. Q. Okay. And then you're asked a series of questions about Philip Morris's statement on addiction in the Hatch Statement, correct? A. Correct. Q. For example, at page 20, lines 11 to 15, you're asked a question: "You're aware that WHO itself discarded that addietion/habituation classification approach in 1964, just months after the Surgeon General's Report was released, right?" A. I see that, yes. Q. And your answer is — you answer: WHO did change its — "Yes, I'm aware that that WHO changed its definition at some point," but you do not recall when or the specifics of the changes, correct? Scott L. Wallace, JUS?, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10425 1 A. Correct. 2 Q. Now, you testified that in fact, as Senior Vice President 3 of Worldwide Regulatory Affairs at Altria, it was your — one of 4 your jobs was to enforce the sort of internal Philip Morris 5 compliance with the Hatch Statement, correct? 6 A. 7 there was a process in place so that the various companies that 8 were bound by it could monitor compliance with it, correct. 9 Q. One of my jobs was to make sure people understood it and And so you had to be able to explain it to people if they 10 asked what it meant? 11 A. I did. 12 Q. And then I'll handle a few of these changes together. At 13 pages 21, lines 5 to 15, you were asked again about revisions 14 made by WHO to its definition of "addiction" and changes that 15 were made in 19- -- and you were asked whether changes were made 16 in 1964 to revise the 1957 classification of addiction, correct? 17 A. Correct. 18 Q. And for those two answers on page 21, you essentially 19 give the same answer: 20 definition of "addiction" at some point in time, but you don't 21 know when or the specifics of the changes, correct? 22 A. 23 You recall that WHO changed its Correct. MR. GOLDFARB: 24 please. 25 BY MR. GOLDFARB: Okay. If I could have U.S. Exhibit 90105, Scott L. Wallace, RBK, CRR Official court Reporter 3390537330 3990537330 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10426 Q. Have you been given a copy? A. I have. Thank you. Q. And if we look at the cover page, we see that this document is titled "The World Health Organization Technical Report Series, Number 273." Do you see that on the front page, Ms. Keane? A. I do. Q. And it is the — titled "The 13Th Report of the WHO Expert Committee on Addiction-Producing Drugs." Do you see that? A. I do. MR. GOLDFARB: And then, Charles, if you will just call out at the bottom of the page. BY MR. GOLDFARB: Q. You see that it is in fact a 1964 publication, correct? A. I see it. Q. If I could ask you to turn to page 9 of the document, Ms. Keane. MR. WELLS: Your Honor, before he proceeds, since this was not one of the exhibits that she was given as part of her direct, could I ask the government to ask a foundation question, whether she's ever seen this document? THE COURT: Is this true? MR. GOLDFARB: This exhibit has — This exhibit is in response to Ms. Keane's change to her testimony that she doesn't know when or the Scott l. Wallace, M», CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10427 specifics of the change to the WHO definition of "addiction." THE COURT: All right. Well, you certainly have to establish some foundation with her. The exhibit itself, by the way, may be in evidence at this point. MR. WELLS: It probably came into evidence through one of the addiction experts. That's what I assume. THE COURT: Or one of the history experts. But in any event — MR. GOLDFARB: I believe it has not, to my knowledge. THE COURT: it's in. But why don't you find out what — she knows about the document before you proceed with questions. MR. GOLDFARB: Okay. BY MR. GOLDFARB: Q. Well, Ms. Keane, you're aware — you indicate that you — on page — at page 20 of your testimony, lines 7 to 10, you confirm that in the Hatch Statement, Altria was referring to a definition of "addiction" used in the 1964 Surgeon General's Report, correct. A. Yes. But the Hatch Statement was forward looking, focused on aligning it with the public health community and the process by which the addiction — the definition may have changed was not the thrust of this document. The thrust of the Hatch communication was to have us align what was then a pronouncement by the Surgeon General and others. So the history of how the definition of "addiction" had Scott L. Wallace, RUR, out Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10428 evolved would not have been something that I would have been focused on. I was focused on the then and the now and the going forward. Q. Okay, We'll get to that. But the question that's pending now is just asking you to confirm that on page 20 of your testimony, lines 7 to 10, you confirmed your awareness that the definition of "addiction" used in the Surgeon General's Report in 1954 and cited by Altria in the Hatch Statement was in fact the 1957 WHO definition, correct? A. Yes. Q. Okay. And you're aware, as you testified, that WHO later changed that definition, correct? A. Yes. Q. And you're unaware of when those changes occurred? A. Exactly. Q. Okay, And so if we could now turn to page — and you have identified for the record what this document is, U.S. Exhibit 90105. If I could ask you to turn to page 9 — A. Having just seen it. Q. I understand that. MR. WELLS: I would ask that he be requested to ask foundational questions. THE COURT: Well, she's indicated she hasn't seen it. I don't know what the questions are about this document. Let's go through the questions and see if she can answer them or not. Scott L, Wallace, RSR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10429 They may be — this is a public document. It may not be very difficult for her to answer the questions. But certainly she can be asked questions about the document. It's an exhibit. And if she doesn't know the answers, then Ms. Keane will say so. MR. GOLDFARB: Okay. BY MR. GOLDFARB: Q. Looking at page 9 of the document, please, do you see the heading at the top under section 4: "Terminology in Regard to Drug Abuse"? A. I do. Q. And in fact, if you look at the first sentence, it refers to — it states — well, the title of this section is: "'Drug Dependence1 to Replace the Terms 'Drug Addiction' and 'Drug Habituation,'" correct? A. Just under heading 4. I see heading 4. Could you please repeat what you just said? Q. Sure. I was just asking — A. I was reading it. Q. Just underneath that heading, it states, quote: "'Drug I'm sorry. Dependence' to Replace the Terms 'Drug Addiction' and 'Drug Habituation,"' correct? A. I see that, yes. Q. And it goes on to say: "The WHO Expert Committee on Addiction-Producing Drugs in 1952 attempted to formulate a Scott X. Wallace, Official Court M » , CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10430 1 definition of 'addiction' applicable to drugs under 2 international control, which it later, 1957, revised." 3 see that? 4 A. I do. 5 Q. Okay. 6 1964 Surgeon General's Report used the 1957 WHO definition of 7 "addiction," correct? 8 A. 9 Q. Do you And as you just testified, you're aware that the Yes. And then it goes — at the beginning of the next 10 paragraph, beginning with "Drug dependence," that sentence 11 states: 12 repeated administration of a drug on a periodic or continuous 13 basis." 14 A. I do. 15 Q. And I'm sorry. 16 above. 27 paragraph that I omitted to read indicates: 18 Committee sought also to differentiate 'addiction' from 19 'habituation' and wrote a definition of the latter which, 20 however, failed in practice to make a clear distinction." 21 you see that? 22 A. 23 "'Drug dependence' is defined as a state arising from Do you see that? I left out one part in the paragraph The sentence after — the second sentence of the "The Expert Do I do. MR. GOLDFARB: Okay. And then, Charles, if you can just 24 drag down a little bit on the document for the next paragraph — 25 there you go. Scott L, Wallace, RDR, CRR Official court Reporter 339053'; Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537335 10431 1 BY MR. GOLDFARB: 2 Q. 3 that: 4 'drug dependence' for the terms 'drug addiction' and 'drug 5 habituation."' 6 A. I do. 7 Q. So this 13th report of the WHO Expert Committee on 8 Addiction-Producing Drugs in 1964 is, in fact, the point at 9 which the WHO changed its definition of 'addiction,' correct? The top sentence as displayed on the screen now indicates "The Expert Committee recommends substitution of the tern Do you see that? 10 MR. WELLS: Objection, Your Honor. 11 MR. GOLDFARB: There's no foundation. Your Honor, the witness has indicated that 12 she's aware of the prior WHO definition; she's aware that the WHO 13 changed its definition. 14 enforcing and providing explanations within the Philip Morris 15 companies as to the understanding of the Hatch Statement, which 16 referred to the WHO definitions of "addiction." And the witness was responsible for 17 THE COURT: The objection's overruled. 18 The witness may answer. 19 THE WITNESS: 20 these definitions. 21 reading three sentences from a report I've never seen. 22 BY MR. GOLDFARB: 23 Q. 24 Committee of the WHO in 1964 recommended substitution of the 25 terms "drug dependence" for the terms "drug addiction" and "drug But it had nothing to do, Mr. Goldfarb, with And I can't answer that question based on But you do see here that this — that here, the Expert Scott L. Wallace, RDR, CRR Official Court Reporter 3390537336 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537336 10432 1 habituation," right? 2 A. 3 before I would feel confident to answer your question 4 specifically, I would, you know, need to look at it. I see that, but this is a multiple page document that, Yes, without a doubt, that's what those sentences said. 5 6 And yes, I do know that the definition was changed. 7 cannot give you, as I said in my written direct, any of the 8 specifics 9 Q. Okay? 10 A. — 11 enforcing Hatch. 12 with the company's commitment. 13 aligning itself with the public health community, not 14 necessarily making sure people understood the nuance over time. 15 Q. 16 changed its definition before the Hatch Statement, correct, in 17 1997? 18 A. Yes. 19 Q. And you knew that it occurred prior to 1994, correct? 20 A. I don't have a — 21 happened. 22 Q. 23 Ms. Keane, when you were enforcing the understanding and had to 24 be able to explain the Hatch Statement to people at Philip 25 Morris — But I — Well — because it was not part of my responsibility in Okay. Okay. The definitional evolution had nothing to do But — It had to do with abiding and well, Ms. Keane, do you know if the WHO I really, truly don't know when it Well, if someone — if someone had asked you, if someone had said, "Where does this definition that Scott X. Wallace, Official Court HER, CRR Reporter 3390537337 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537337 10433 1 we are relying on come from," the only thing that you would 2 have -- the — what you would have relied on is this 1957 WHO 3 definition, correct? 4 A. 5 should matter to you is what, in fact, is being said by the 6 Surgeon General. 7 with. 8 debate on this topic. 9 What is the issue is alignment." What I would have said to them is: "The only thing that And that is in fact what you should be aligned You know, we are trying to do away with any discussion or Who said what, when is not the issue. And that would have been the way in which I tried to 10 11 communicate the company's objective and, in fact, the 12 expectation of employees as it related to compliance with Hatch. 13 Q. 14 Statement, had asked you: "Do we agree with the Surgeon General 15 that smoking is addictive," Philip Morris would have said "No," 16 correct? 17 A. 18 different definition, but from 1997 onward, our position was to 19 speak with a single voice and not in fact to debate the issue. 20 Hatch specifically talks about stepping away from the debate. 21 Q. 22 testimony, affirmed Philip Morris's continuing different public 23 view as to whether smoking was addictive from that of the 24 Surgeon General and other public health authorities, correct? 25 A. But if someone in 1997, after issuance of the Hatch Yes. In 1997, Philip Morris was operating under a Okay. And the Hatch Statement, as you indicate in your I mean, from my perspective, what the Hatch Statement S c o t t X. Wallace, RDR, CRR Official Court Reporter 3390537338 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537338 10434 1 does, it was intended to tell employees that, in fact, the 2 company going forward was walking away from the debate and was 3 going to defer to the judgment of the public health community 4 when it related to certain issues. Without a doubt, the company had used a definition prior 5 6 to that and was at odds with the position of the Surgeon 7 General. 8 Q. 9 definition that Philip Morris was using at that point that is Okay. And my question to you, Ms. Keane, is: The 10 identified in the Hatch Statement, for which you were 11 responsible — 12 that relied on the 1957 WHO definition; isn't that right? 13 A. 14 time? 15 Q. 16 that its views continued to differ with that of public health 17 authorities over the question of whether smoking was addictive, 18 correct? 19 A. 20 which referred to the fact that Philip Morris had used a 21 different definition that typically included intoxication and 22 withdrawal, yes. 23 Q. 24 Statement, Philip Morris indicated that its views as to whether 25 smoking is addictive continued to differ at the point of for which you were responsible, used a definition Could I ask you to bring that question by me one more Yes. In the Hatch Statement, Philip Morris indicated Basically, there was a sentence in the Hatch Statement Okay. My question, Ms. Keane, is: Scott L. Wallace, Official Court In the Hatch RDK, CPR Reporter 3390537339 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537339 10435 issuance of the Hatch Statement with the conclusions of the Surgeon General and other public health authorities, correct? A. Yes. Q. Okay. And that is because, as you just stated, Philip Morris was relying on certain criteria that existed in the 1957 WHO definition of "addiction," correct? A. Yes, it was relying on different criteria, which — including what was found in the WHO, yes. Q. And the WHO in 1957, correct? A. Yes. Q. Okay. And you are aware, are you not, that the Surgeon General — that the WHO in 1964 eliminated intoxication, for example, from its definition of "addiction"? A. I am aware that WHO walked away from the term "addiction." I don't know when that occurred, but I do know that in fact there was a change. Q. Okay. My question was to the criteria of intoxication, that the WHO eliminated that as a required criterion for whether something constitutes an addictive drug? A. You're going now, Mr. Goldfarb, into a level detail for which I'm really not — THE COURT: Mr. Goldfarb. I'm going to sustain the objection, I don't know why you're spending so much time on this issue when we've had so much testimony about it, number one; and number two, I can read the different statements and how Soott X. Wmllmce, Official Court JtCK, CRR Reporter 3390537340 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537340 10436 they're worded and draw my own conclusions. So let's try to move on. MR. GOLDFARB: Okay. BY MR. GOLDFARB: Q. Directing you to page 22 of your corrected direct examination, Ms. Keane, this is another question about the Hatch Statement. And perhaps just to make things clearer for the Court, can I view U.S. Exhibit 39734, please. Do you have it, Ms. Keane? A. I have the first page. Q. You don't have the second page? A. No, I don't. Q. Okay. A. No. Q. At the top of page 22 of your testimony, the question — Is it two-sided, by chance? there's a question that refers to the second paragraph of the Hatch Statement on addiction. It's on page 2, the second paragraph on addiction, please, Charles. Now, the part that I want to focus on are the first two sentences, where the Hatch Statement states: "We acknowledge that our views are at odds with those of the public health community, but in the last analysis, there is little point to a continuing public debate about the definition of a word used Scott Z. Wallace, FDR, CRR Official Court Reporter 3390537341 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537341 10431 1 both colloquially and technically to describe many different 2 kinds of behavior. 3 smoking if they resolve to do so, but we recognize that it can 4 be difficult to quit." We continue to believe that people can quit Did I read that correctly? 5 6 A. Yes. 7 Q. Okay. 8 examination that refers to this statement in the Hatch Statement 9 and it's at page 22, lines 1 through 8. Now, you were asked a question in your direct And the question is: 10 "As indicated in the second paragraph on addiction that you 11 read, one of the basic reasons given in the Hatch Statement for 12 the view that smoking is not addictive was that Altria and 13 Philip Morris, quote, 'continued to believe that people can quit 14 smoking if they resolve to do so,' right?" 15 And the proposed answer was: "Right." And you struck 16 that and answered: 17 previously did not agree that smoking is addictive is because, 18 as stated in the Hatch Statement, the company had, quote, 'not 19 embraced those definitions of addiction which do not include 20 historically accepted and objective criteria such as 21 intoxication and physical withdrawal as important markers .'" 22 23 24 25 "No, My understanding of why Philip Morris Do you see that? A. I do. MR, GOLDFARB: Okay. Can I have U.S. Exhibit 20371. Charles, if you could just call out the top. Scott It. Wallace, RSR, CRR Official Court Reporter 3390537342 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537342 10438 Your Honor, this is 20371. 1 It's already been admitted 2 into evidence. It's probably a document the Court has seen 3 before. 4 BY MR. GOLDFARB: 5 Q. 6 Philip Morris published in 1994, correct? 7 A. Correct. 8 Q. And if you look at the top, it's a message to smokers and 9 nonsmokers and it's titled "Facts You Should Know," correct? This is an issue advertisement or an issue statement that 10 A. Yes. 11 Q. And the next line says: 12 deserve to know facts, not innuendo, about cigarettes," correct? 13 A. Correct. MR. GOLDFARB: 14 "Both smokers and nonsmokers Okay. Now, if we go down to the fourth 15 fact, please. I'll read for the record: This fourth fact stated 16 in this statement published by Philip Morris states: 11 Morris does not believe cigarette smoking is addictive. 18 can and do quit smoking all the time. According to the 1988 19 Surgeon General's Report, there are more than 40 million former 20 smokers in the United States and 90 percent quit on their own 21 without any outside help." 22 BY MR. GOLDFARB: 23 Q. Did I read that correctly. 24 A. Yes. 25 Q. Ms. Keane, isn't the clear message from this public "Philip People Scott L. Wallace, RVR, CRR Official Court Reporter 3990537343 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537343 10439 statement by Philip Morris in 1994 that Philip Morris does not believe cigarette smoking is addictive because people can and do quit smoking all the time? A. I have always viewed those as two separate thoughts. Philip Morris does not believe cigarette smoking is addictive for the reasons that you quoted in the Hatch Statement, because of intoxication and withdrawal, but we do believe — the communication at the time said: "But in fact, people do give up smoking all the time — do quit smoking all the time." So I view them as two separate thoughts, not necessarily the second sentence and third sentence as defining why in fact smoking is not addictive. Q. Okay. And is it your testimony that someone reading -- someone reading this fact and these two statements juxtaposed next to each other would not understand or would not interpret them to be saying that the reason why Philip Morris doesn't believe cigarette smoking is addictive is that people can and do quit smoking all the time? A. I think that our statement there did not go on to give people an explanation as to how we were using the term "addiction" in the context of this ad, so I view it as — when I look at it, I view it as two separate thoughts. Q. Two separate thoughts under the same fact, correct? A. I do, yes. Q. So it's your testimony that people reading this would not Scott L, Wallace, Official Court SDR, CRR Reporter 3390537344 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537344 10440 1 interpret the second sentence to be an explanation for the 2 first? J A. 4 of the communication. 5 interpreted it, I mean, I wouldn't have any specific knowledge 6 of that, but clearly the intent, I think, was to set out that 7 the company did not believe smoking is addictive, you know, 8 underlining that was the company's, you know, analysis that — 9 because it was using a different definition, but at the same I can say that I do not believe that that was the intent In terms of, you know, how people 10 time, it communicated that people can and do quit smoking all 11 the time. 12 Q. Okay. 13 A. And I think the purpose of doing that -- I mean, listen, 14 this is at a different point in time in our history, but I think 15 the purpose of including the second and third sentence in the 16 context of this was to make sure that, even though we were 17 taking a different definition of "addiction," we didn't want 18 people to think that they should not be able to give up smoking 19 if they wanted to. 20 Q. 21 and do quit smoking all the time was relevant, to Philip Morris's 22 stated belief that cigarette smoking is not addictive, right? 23 A. 24 because it was included. 25 think it was necessarily relevant to the definition that the Okay. So certainly the fact — the fact that people can It was clearly, obviously relevant to this communication I'm just making a point that I don't Scott L. Wallace, RDR, CRR Official Court Reporter 3390537345 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537345 10441 1 company was relying upon when it came to the judgment that 2 cigarette smoking was not addictive, when it communicated that 3 back in 1994. 4 Q. 5 Campbell, then the CEO of Philip Morris, also gave testimony 6 before the Waxman House Subcommittee on Health and the 7 Environment in 1994? 8 A. I am aware of that. 9 Q. Okay. And he also made a statement about addiction? 10 A. Yes, he did. 11 Q. Okay. 12 General Counsel for Philip Morris? 13 A. 14 exact title then. That might have been accurate. 15 Q. Okay. Well, Ms. Keane, you're aware that William And you at that point in 1994 were Associate It was before I was General Counsel. I can't remember my Okay. And you recall — 16 Well, let me have U.S. Exhibit 57204, please. 17 Do you have a copy of U.S. 57204? 18 A. Yes. Thank you. 19 Q. This document that's in evidence, you recognize it, do 20 you not, to be a transcript of the House Health and Environment 21 Subcommittee on April 14th, 1994? 22 A. I do. 23 Q. And this is in fact the committee hearing at which 24 Mr. Campbell testified on behalf of Philip Morris, correct? 25 A. Correct. fcott L. Wallace, Official Court JU3R, CRR Reporter 3390537346 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537346 10442 Q. If you turn to page 13 of the document, please, Ms, Keane, it's Bates number ending in 3- — in 3894. A. I have it. Q. Okay. Thank you. The third paragraph down. And do you recognize this, Ms. Keane? You can satisfy yourself, do you recogni2e this to be part of Mr. Campbell's opening statement, or prepared statement as part of his testimony? A. Yes, I believe it is. Q. Okay. That third paragraph indicates in Mr. Campbell's testimony, "Cigarettes contain nicotine because it occurs naturally in tobacco. Nicotine contributes to the taste of cigarettes and the pleasures of smoking. The presence of nicotine, however, does not make cigarettes a drug or smoking addiction. Coffee, Mr. Chairman, contains caffeine and few people seem to enjoy coffee that does not, does that make coffee a drug or coffee drinkers drug addicts? I think not. People can and do quit smoking, according to the 1988 Surgeon General's Report, and there are more than 4 0 million former smokers in the United States, and 90 percent of those who quit did so on their own without any outside help." And then if you go down, Mr. Campbell continues to go on to explain more about why, in Philip Morris's view, smoking is not addictive, correct? A. Yes. Q. Okay. So, isn't the message from the paragraph that I Scott X. Wallace, Official Court ADR, CRR Reporter 390537347 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537347 10443 read into the record, Ms. Keane, that one of the reasons for Philip Morris's view that smoking is not addictive is because people can and do quit smoking? A. I believe the company's view was based on the facts — THE COURT: Ms. Keane, would you keep your voice up please? THE WITNESS: I'm sorry. I believe the company's view was based on the fact that smoking was not addictive under the definition of "addiction" that it was using, and that definition required intoxication and withdrawal. Without a doubt this information has also been communicated in the context of discussing the company's overall perspective on addiction back in 1994. To answer your question as accurately as I can, I believe our definition was the one I described. I do not believe that the fact that people can give up a particular habit is in and of itself an aspect of the definition of addiction. BY MR. GOLDFARB: Q. And in fact, between 1994 and 1997, you made — excuse me, strike the question. Between 1994 when Mr. Campbell made this statement and when Philip Morris made the — issued the public statement in U.S. Exhibit 20371, Philip Morris's position on addiction didn't change, correct? A. Correct. Q. So, at the time of the Hatch statement, this was still Philip Morris's approach to its public statements concerning S c o t t L. Wallace, Official Court REK, CRR Reporter 3390537348 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537348 10444 1 smoking and addiction, correct? 2 A. Philip Morris's approach is as I described. 3 Q. But the same in 1994 as in 1997, correct? 4 A. With the big exception that in 1997 reflected a 5 commitment not to debate the issue, not to debate the definition 6 and to try to, you know, align ourselves with the public health 7 community on this point. 8 Q. 9 defer — Okay. But in fact, Philip Morris didn't agree to strike that question. In the Hatch statement, U.S. 10 Exhibit 39374, the only thing Philip Morris agreed to defer to 11 was the content of the health warnings, right? 12 A. 13 message", I think that's a motivating factor, "a single and 14 consistent health message on the issue of addiction, we will 15 refrain from debating the issue other than is necessary to 16 defend ourselves and our opinions in courts." "According to ensure that there's a single health MR. GOLDFARB: 17 Excuse me just a moment. 18 BY MR. GOLDFARB: 19 Q. 20 your attention to page 38 of — 21 A. I'm sorry, which document? 22 Q. 38 of the corrected written direct testimony, please. 23 The top question on page 38 talks — makes reference to the — 24 in the Hatch statement Philip Morris made reference to the 25 public health community, and the first question on page 38 asks Okay. I apologize for the pause. Now, if I could direct Scott L. Wallace, Official Court RBR, CRR Reporter 3390537349 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537349 10445 you whether certain organizations — whether you would include within the definition of the public health community certain organizations, correct? A. Yes. Q. Okay. And the — the question at line — it lists a number of organizations, and beginning at line 1 of page 38 states: "And you would agree that the public health community referred to in this part of the Hatch statement include such bodies as the Surgeon General, the World Health Organization, the National Institute on Drug Abuse, the Food and Drug Administration and the American Psychiatric Association?" A. Correct. Yes. Q. And the next question asked whether all those agencies and organizations had concluded by 1988, at the latest, that nicotine and cigarette smoke is primarily responsible for smoking being a drug dependent behavior? And you struck "Yes" and answered "I do not know," correct? A. Correct. Q. And just so the record is clear, it is true, is it not, Ms. Keane, that the Surgeon General, the World Health Organization, the National Institute on Drug Abuse and the American Psychiatric Association by 1988 had concluded that nicotine and cigarette smoke was responsible for smoking being a drug dependent behavior? MR. WELLS: Objection, Your Honor. Scott i . Official Wallace, Court She was asked that RDK, CHR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 1044S question, she said I do not know in her corrected. MR. GOLDFARB: Your Honor, I have asked a different question because I realize I wasn't sure whether the basis of the answer of the witness's answer was that the Food and Drug Administration was included in the prior question, and so I'm trying to clarify the witness's testimony which is — THE COURT: All right. THE WITNESS: Objection's overruled. I answered I do not know, because even though definitions had changed, I was unclear as to the date and exactly the position of each of these organizations. BY MR. GOLDFARB: Q. Okay. But you testified earlier in — A. I'm not debating that the definition has changed. I could not answer this question based on my — the knowledge that I had when, in fact, I received this. Q. Okay. And you indicated earlier in your testimony that you had read portions of the 1988 Surgeon General's Report? A. Yes. Q. Okay. A. That I know. Q. You know that you read it or you know by 1988 the Surgeon And — Yes, that I know. General made that conclusion? A. I read that report and I'm familiar with the 1988 Surgeon General's Report. Q. Okay. So if you've read any portion of the Surgeon Scott X. Wallace, ADR, O W Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10447 General's Report I assume you read chapter 1 which is the summary and conclusions, I think it's the introduction summary and conclusions for the report. A. I mean, I assume. I would have to have it right in front of me to know what you're talking about, but, yes, I've generally read the '88 Report. Q. Okay. But you certainly recognize that by 1988 the Surgeon General has — A. Yes. Q. Had reached that conclusion? A. Absolutely. Q. And by 1988 the National Institute of Drug Abuse had reached that conclusion? A. What I tried to do in this answer is truly, you know, not to -MR. WELLS: Can you speak up? THE WITNESS: — quibble with you as to the definition, but just to communicate the fact that I don't know exactly the date by which other organizations came to this conclusion. BY MR. GOLDFARB: Q. Other than the Surgeon General? A. Other than the Surgeon General. Q. Okay. questions. Now, further down at lines 14 to 19, there are two The first question reads. Line 14, the first question is, "Philip Morris never stated publicly that cigarette Scott I . Wallace, RDR, CRR official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10449 smoking was not addictive because it should properly be characterized as a drug dependence, did it?" And you struck the answer "No", and answered that you don't know, correct? A. Correct. Q. But you know of no such instance where it did make such a public statement, correct? A. Correct. Q. And with respect to the next question, "Philip Morris has never told the public that nicotine delivered by cigarette smoke is a drug with "abuse potential" or is capable of causing "dependence" has it?" Again you struck the proposed answer "No", and answered, "I don't know" or "I do not know", correct? A. Correct. Q. And again, you know of no such instance where Philip Morris has made such a public statement, right? A. Correct. Q. And you've been with Philip Morris for 27 years now? A. Yes. Q. Okay. A. Specifically, now, because I just wanted to be absolutely accurate because I don't know what our scientists or anyone else might have done, but the answer is I truly did not know the answer but, in fact, I just, you know, wanted to make sure that I was abundantly accurate. Q. But you know of no such instance where Philip Morris Scott L, Wallace, Official Court RDR, CFR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10449 scientists have publically stated — A. No, I do not. Q. — that smoking cigarettes was not addictive because it should probably be characterized as drug dependence, correct? A. I agree. Q. And so your answer is with respect to anyone in the Philip Morris family of companies, you're not aware of anyone who has made such a public statement, correct? A. I would not know. Q. Okay. I do not know. Now, toward the bottom of that page and on the bottom of page 39 and on to — I'm sorry, the bottom of page 38 on to page 39 is two questions which talk about the Philip Morris Website statements on addiction, correct? A. Yes. Q. And the question at the bottom of page 38 talks about the — as Philip Morris initially stated, its position or its initial — strike the question. The first one, the first question at line 20 on page 38 states: "Looking at U.S. Exhibit 45673, which includes the Philip Morris position on addiction as stated on its Website from October 13, 1999 to October 10, 2000, the addiction statement read cigarette smoking is addictive as that term is most commonly used today" and that was the question posed there? A. Yes. Q. And let's pull up, please, U.S. Exhibit 45673. And Scott L. Wallace, Official Court JUJP, CRtt Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10450 Ms. Keane, have you been given a copy? A. I have, thank you. Q. And Charles, it's about two-thirds down the page where it says "cigarette smoking and addiction" about two-thirds down toward the bottom. And Ms. Keane, you recognize this to be the Philip Morris statement on addiction as it appeared on Philip Morris's Website from October 13, 1999 to October 10th, 2000? A. I do. Q. Okay. And October 13th, 1999 was actually the day that the Philip Morris corporate Website was launched, correct? A. Yes. Q. Okay. And as I just read, the statement there on cigarette smoking and addiction is that "cigarette smoking is addictive as that term is most commonly used today", correct? A. Correct. Q. And then the next question at the top of page 39 refers to the Website statement on addiction as it was altered in October of 2000, and that's U.S. Exhibit 77683? A. I see that, thank you. Q. Okay. And the question — the question there at the top of page 39 just asked you to identify that this is, in fact, the Website's statement as it appeared beginning in October of 2000, October -- precisely October 11th, 2000, correct? A. Yes. Scott L. Wallace, Official Court RtK, CPU Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10451 Q. Okay. Now, the next question on page 39 of your testimony, beginning at line 7, the question is posed: "In your view there is no substantive difference whatsoever between Philip Morris's Website statements on addiction as reflected in U.S. Exhibit 45673 and U.S. Exhibit 77683, is there?" And you confirm "No, there is no substantive difference in my view." And then you added the following: "Because I think the important and overriding principle was to communicate and encourage the public to be guided by the position of the public health community in both in instances." Do you see that? A. I do. Q. Now, when Philip Morris used, in its original iteration of the Website, used that "smoking is addictive as that term is most commonly used today," Philip Morris meant "addictive" the way people use the word colloquially in a conversational sense, right? A. I think it was making a broader statement. It was saying cigarette smoking is addictive as people understand — MR. WELLS: I need you to speak up. THE WITNESS: It was saying smoking is addictive as people understand that term, and then it went on to say — THE COURT: Ms. Keane, if you would bring your mic down a little bit, I think it would work better. THE WITNESS: Thank you very much. BY MR. GOLDFARB: Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10452 1 Q. Had you finished your answer? 2 A. Yeah, I was saying in 1999 we basically said cigarette 3 smoking is addictive as that term is most commonly used today. 4 Q. 5 Morris meant the phrase "addictive" as the term is most commonly 6 used colloquially, or the way people use the word "addiction" in 7 a conversational sense? $ A. 9 being used by the public health community. Okay. And my question is, is it not true that Philip It meant that. I think it also meant given the way it's 10 Q. 11 me ask you this: 12 Dr. Richard Carchman's deposition from June 20th 2001. 13 Okay. Well, if I could have — MR. WELLS: Are you aware that — if I could pull up — let let me just pull up Your Honor, I'm going to object asking the 14 witness about the deposition testimony of somebody else. 15 not an expert witness, he's just asking her about what some other 16 person said in a deposition I think is inappropriate and a waste 17 of time. 18 19 20 21 22 THE COURT: She is What kind of question are you going to be asking? MR. GOLDFARB: Well, Your Honor, Dr. Carchman was there as a 30(b)(6) witness on behalf of the company. THE COURT: That doesn't mean anything in and of itself. 23 Are you going to ask her whether she agrees or disagrees with 24 some statement he makes? 25 MR. GOLDFARB: Yes, I'm going to show what Philip Morris Scott X. Wallace, MR, CRR Offialal Court Reporter 339053'; Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537357 10453 said in its sworn testimony, was it's view of why it used the term — or how it meant the term. THE COURT: No. MR. GOLDFARB: THE COURT: That I think it's commonly used. I'm going to sustain the objection, he'll testify to that, presumably, and then of course you have a chance to cross-examine him. MR. GOLDFARB: But, Your Honor, he's there on behalf of the company. THE COURT: Well, I understand that, but why don't you just ask her the questions and not use his testimony as a way to get into those questions. It just seems to me you're dragging things out, Mr. Goldfarb. BY MR. GOLDFARB: Q. Well, when the public health community issues the conclusion — issued its conclusion through various organizations, the Surgeon General, NIDA, the APA and so forth, it was not — it's conclusion that smoking was addictive was not based on a colloquial or conversational definition of addiction, was it? A. No. Q. It was based on the conclusion that cigarette smoking is a form of drug dependence; isn't that correct? A. They each went through some analysis, I can't speak with specificity of what that analysis was, but without a doubt they Scott L. Wallace, Official Court RDR, CFR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10454 concluded that cigarette smoking is addictive. Q. But certainly the Surgeon General, for example, in 1988 you're aware, are you not, concluded that cigarette smoking is addictive because cigarettes deliver the drug nicotine, which is an addictive drug; isn't that correct? A. Yes, I believe that's what was stated in the report. Q. Okay. So when Philip Morris said on its Website in October of 1999 that smoking is addictive as the term is most commonly used, that, in fact, was not the position of the public health community, was it? A. I mean without a doubt the public health community had an independent analysis, but I don't know if the public health community would disagree with that. g. Well, Ms. Keane, using the term "addictive" in the colloquial or conversational sense, as Philip Morris intended it, that would included non drug related activity, wouldn't it? A. To me, Mr. Goldfarb, when I look at the sentence without a doubt it is talking about common parlance. It is not, however, inconsistent in saying that the sentence could also be referring to what was the pronouncement of the public health community. Q. Well, the — Philip Morris didn't indicate that in fact; -- well, strike that question. Philip Morris didn't indicate on its original Website that smoking is an addiction because of the drug nicotine, did Scott L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10455 it? A. What we said on our original Website is right here in front of us. Q. So you're confirming the answer to my question is no, Philip Morris did not make any reference to the fact that the public health community had concluded that smoking was a drug driven addiction, correct? A. There are links here to, if people wanted to understand in greater specificity what the public health community had said, but I think that what we have in front of us as this exhibit does, in fact, capture what the Philip Morris Website said, so you would have to go into the links if, in fact, you wanted greater detail. MR. GOLDFARB: Your Honor, this is a fine time to break. I'm going to shift to another. THE COURT: All right. Ms. Keane, you may step down and, of course, the rules remain in effect that you're not allowed to refresh your recollection with your testimony or any other matters for that matter, and you're not allowed to consult with counsel about your testimony. Yes, Mr. Wells? MR. WELLS: Your Honor, is it possible that we could go another 15 or 20 minutes and that way it would increase the odds of our finishing tomorrow and perhaps her getting out in time to make her appointment? Scott L. Wallace, Official Court RDR, CRR Reporter 990537360 3990537360 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10456 THE COURT: How much longer do you think you have on your direct? MR. GOLDFARB: Well, I think that it — I will probably fine tune in the course of the evening, Your Honor, if we do break. You know, I can — we'll definitely finish up within, I would say, two hours in the morning. THE COURT: Two hours still? MR. GOLDFARB: As I said — I do think that it will be under two hours and I think it will be further cut — THE COURT: What do you think your cross is going to be, Mr. Wells? MR. WELLS: Three hours, two and a half to three hours. THE COURT: I don't think 10 minutes is going to make a difference, and then there'll be redirect, maybe we can all get it done, I'm certainly going to do that. MR. WELLS: I was just wondering if we can get another 20 minutes. THE COURT: I don't know if Mr. Goldfarb is ready to proceed at this point, we've sat late a lot a lot of times. Mr. Goldfarb? MR. GOLDFARB: I can cover another small section, Your Honor. THE COURT: Pardon? MR. GOLDFARB: I can cover another small section, but, of course, Your Honor, it's your preference. Scott 1. Wallace, Rim, Offi Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10457 THE COURT: Go ahead, go ahead. But we will break at a quarter of, everybody, that's for sure. BY MR. GOLDFARB: Q. Let me direct your attention, please, to the bottom of — a series of questions toward the bottom of page 39, Ms. Keane. A. I see it, thank you. Q. And this is a series of questions about Philip Morris's purchase of certain brands of cigarettes from Liggett in 1999, correct? A. Yes. Q. And when Philip Morris — testimony — as you indicate in your when Philip Morris purchased those brands from Liggett, the packages for those cigarettes contained the statement that smoking is addictive, correct? A. Yes. Q. And after — when Philip Morris acquired the three Liggett brands, it removed the statement that smoking is addictive from the packs? A. Yes. Q. Correct? And then at the top of page 40, beginning at line 2, the question is asked: "That is an instance when Philip Morris acted to deprive smokers of accurate material information on the pack about its cigarettes, right?" And the proposed answer was "Right", and you struck that? A. Correct. Scott L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10458 Q. And you replaced that with "no, that is not how I would describe it. My understanding of what Philip Morris sought to do at the time was to adhere to the system of warnings mandated by the federal government." That was your answer? A, Correct. Q. Now, you agree that the fact that smoking is addictive is an accurate statement? A. Yes. Q. And you agree that the statement that smoking is an addiction is a material statement to communicate to smokers, correct? A. I think it is an important communication, however, as I stated in my answer, when it related to warnings, we defer to what, in fact, we had been directed to put on the pack. Q. Okay. But my question is, the fact that smoking is addictive is both accurate and material, correct? A. Yes. Q. Okay. And so it is true, then, that Philip Morris removed from the pack of Liggett cigarettes accurate, material information for smokers, correct? A. Given the regulatory regime, statutory and regulatory regime within which the company functioned, the decision was made because it was thought to be the right decision. Q. Okay, but Ms. Keane, you're not suggesting, are you, that it was illegal for Philip Morris to keep that information on the Scott L. Wallace, Official Court RIM, CPU Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10459 packages of cigarettes when it purchased them from Liggett, are you? A. Company's judgment was that at the time we have communication vehicles, you know, such as the Website, I mean, that is a way in which we can communicate information. As it related to the pack, the judgment was we existed under a statutory and regulatory regime and the content of the warning notices should, in fact, be directed by the government. Q. Okay. But my question was, it was not illegal for Liggett to have the statement that cigarette smoking is addictive on the packs, was it? A. Not illegal, but when it comes to something as serious as a warning, I think the company's judgment was we wanted to avoid unintended consequences. We wanted to make sure if, in fact, we chose a communication about a topic of importance and wanted to warn the public, that we should not be individually making that determination, that it should be made in conjunction with an appropriate regulatory body. Q. Okay. But just to — a smoker of one of the Liggett brands, and the Liggett brands that were purchased by Philip Morris were L & M, Lark and one other I'm not thinking of right now, correct? A. Chesterfield. Q. Chesterfield, thank you. And so a purchaser of a Lark cigarette with a — before Philip Morris purchased it would have Scott L. Wallace, Official Court RER, CRH Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10460 received the information that smoking is addictive on the pack when he or she purchased the pack of cigarettes, correct? A. Yes. Q. And that information would not have been there on that same pack of cigarettes after Philip Morris purchased and started — and became responsible for selling the Lark cigarettes, correct? A. Yes. But it was not one of the warnings. company had no problem with the warning. I mean, the In fact, if you go to things like the proposed resolution the warnings that were agreed upon there, you know, included topics such as addiction. It was just a decision made based on the fact that we should not, as a company, individually be making those determinations, they should, in fact, be made at a more collaborative way with, in fact, people who have the, you know, proper standing to, in fact, make those decisions. Q. Okay. Now Philip Morris for the first time stated its public agreement in 2000, did it not, that it agreed with the overwhelming medical and scientific consensus that smoking is addictive, correct? A. Correct. Q. And Philip Morris hasn't put that information back on the packs, correct? A. No. Q. And to your knowledge Liggett, when it had that Scott x. Wallace, RSR, CUR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10461 information on the packs, didn't encounter any sort of regulatory obstacles or impediments in providing that information to smokers, correct? A. Right, but we didn't put it back for the same reason I just articulated, Q. But in terms of a direct communication to smokers about material, accurate information, the pack is probably the most direct communication vehicle with smokers, correct? A. Which is why we have onserts that, in fact, include important information about causation and addiction and other topics relating to the product. Q. Okay, but the packs do not state that, correct? A. No, but our onserts are on the pack. Q. And when did Philip Morris start running onserts that tell the smoker that Philip Morris agrees that smoking is addictive? A. Our first onserts appeared in 2002 and we've run onserts in 2002, 2003 and 2004. Q. And those all contain — A. They have various — Q. Excuse me let me ask the question please. A. Sorry. Q. Those all contain the information that Philip Morris agrees that cigarette smoking is addictive? A. No. There are various public health oriented Scott L. Wallace, Official Court JtOR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10462 1 communications found on those pack onserts. The first one that 2 we ran had to do with lights, others, however, have, in fact, 3 related to what I call the core smoking and health messages. 4 Q. 5 smoking is — 6 A. Urn. 7 Q. Excuse me, let me ask the question. 8 stated that Philip Morris agrees that cigarette smoking is 9 addictive? And those have stated Philip Morris's agreement that Those onserts have 10 A. 11 our Website. 12 Q. 13 Morris agrees that smoking is addictive, correct? 14 A. No, I believe it does say that. 15 Q. Okay. 16 A. I think if you look at some of the — 17 an omnibus Website onsert that, if I'm not mistaken, because 18 we've had a number of them, but if I'm not mistaken does in fact 19 include the reference to the addiction portion of the website. 20 Q. 21 Philip Morris run onserts that state Philip Morris agrees that 22 cigarette smoking is addictive? 23 A. 24 the onsert that I'm referring to occurred post 2001 when, in 25 fact, this change was made so the reference to the addiction They basically call the smokers' attention to what is on I see, so the onserts do not contain the statement Philip Okay. we have what I call And my question is, does the statement — has What I would need to do, Mr. Goldfarb — S c o t t L. Wallace, Official Court I believe that RDR, CAR Reporter 339053736. 3990537367 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10463 portion would talk about in smoking is addictive. What I can't remember sitting right here is how much information was communicated on the onsert, whether, in fact, it included we agree. Q. So at this point you do not know whether it included — A. I could easily find out, but just given the volume of the communications we've had on that topic, I just cannot sitting here today specifically remember that onsert. Q. And the first onsert you indicated was issued in November 2002? A. Yes. Q. And that was three years after this case was filed; is that correct? A. That was because we didn't have the manufacturing capability to do otherwise. Q. Excuse me, Philip Morris first put the onsert in November 2002, correct? A. Yes. Q. And that's three years after this case was filed, correct? A. Yes. Q. And as far as any statements — any additional onserts, those have all come subsequent to November 2002, correct? A. As we didn't have the capability, yes. Q. Okay. But those have also -- any of those that occurred S c o t t Z. Wallace, Official Court JtBR, CFR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 104 64 after November 2002, correct? A. Our onserts started in 2002 for all intents and purposes. Q. Okay. MR. GOLDFARB: Your Honor, I am going to turn to a different portion that may be addiction related, but now is a good time to break. THE COURT: We'll take the recess now. I want to just take a moment to go over the government's witnesses for next week. You may step down, Ms. Keane, thank you. THE WITNESS: THE COURT: Thank you. The government, I believe has four witnesses for next week, is that right? MR. GOLDFARB: instructions about — Your Honor, just — you gave the witness did you already give the witness instructions? THE COURT: I gave her the instructions. MR. GOLDFARB: MR. BRODY: witnesses for — Okay. Thank you. That's correct, Your Honor. Three are adverse three of the witnesses, the testimony was submitted to counsel yesterday. That's Mr. Schindler, Mr. Parrish and Mr. Schechter, so that will be filed by their respective counsel by noon on Friday and the other witness is Dr. Erickson and his testimony was filed yesterday. MR. GOLDFARB: And Your Honor, Mr. Schechter is Scott X. Wallace, official Court RBR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10465 represented by separate counsel, not counsel who is here at the table. He's represented by a Mr. Kotelly, and he has received a copy in accordance with your orders, as we do the adverse witnesses who have their own counsel. THE COURT: Mr. Bernick? MR. BERNICK: Yes, Your Honor, I'm going to be responsible for the lead cross-examination for Dr. Erickson. I've taken a look at the proper direct examination and I think per the representations that were made to the Court last week it does not contain the witness's opinions regarding relief. Now, the issue of whether there ought to be the change in the trial format is obviously being placed before Your Honor in more generic terms, but we would like to get what Dr. Erickson is going to say under any set of circumstances. If it turns out that Your Honor rules there's going to be this change, so be it, but if he's going the testify next week and Your Honor decides otherwise, that is that we're going to follow the same format, we would like to be able to pro and con include Dr. Erickson's examination, moreover, there are connections, obviously, between what relief is appropriate and what the witness can say about the impact of our past or our current practices. His direct examination so far addresses the impact, and obviously we're going to pursue the connection, or lack thereof, between those matters and relief, and that really ought to be part of one examination. So we wrote a letter to the Department of Justice Scott I. Wallace, REB, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10466 last night highlighting this issue, but we wanted to make sure it got before Your Honor at an earlier time so you could give the parties some guidance in this area. THE COURT: Mr. Brody? MR. BRODY: I have not seen the letter. I don't know what time it was sent to us or whether it was sent to us last night, but in any event we think it would be inappropriate at this time to have Dr. Erickson be offering testimony as to the remedies that should be considered by the Court in light of the evidence as to liability that has — THE COURT: But wait, Mr. Brody. I mean, that's the subject of the motion which won't be fully briefed until Friday. When next week would Dr. Harrison be testifying? MR. BRODY: I assume that Mr. Schindler will take a full day, Mr. Parrish will take a full day, and so Dr. Erickson will probably -THE COURT: Erickson, I'm sorry, I misspoke. Mr. -- wait a minute everybody, just a minute. Mr. Schindler one day, next person? MR. BRODY: Mr. Parrish. THE COURT: One day. MR. BRODY: Right, and then Dr. Erickson. Even if the motion that we filed on the presentation were denied, it's our expect — it's our intention to, and we think it's entirely appropriate, to have Dr. Erickson testify as to remedies, and Scott x. Wallace, Rim, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10467 1 these are nonmonetary remedies, conduct remedies, if you will, 2 going to the issue of -- nonmonetary injunctive relief, that it 3 would be inappropriate to have him testify about that now before 4 we have what will be all the evidence as to bases for liability. 5 We don't know exactly over the course of the next few weeks as 6 we're finishing up our case in chief what evidence is going to 7 come in, what evidence is not going to come in. 8 instances where objections to certain testimony or — 9 10 11 We've had many THE COURT: When would you have him testify, last on your MR. BRODY: I think he would probably testify right before list? 12 Dr. Hilton -- we filed a Sixth Amendment order of witnesses, we 13 listed him as remedies testimony, only remedies testimony in that 14 portion of our case. 15 finalized and filed our trial outline to present the remedies 16 portion of the case as the final portion of our case he is 17 speaking to a range of remedies, he spoke to a range of remedies 18 in his expert report in his case. 19 that he's going to talk about that. But we think it would be 20 really a waist of time at this point. 21 the expeditious presentation of evidence to do anything but 22 separate his remedies testimony from his testimony about the 23 advertising literature, which he's offering next week. 24 not lengthy testimony. 25 cross-examination of Dr. Erickson when he takes the stand, and it It's been our intention, really, since we It's no surprise to defendants It's not going to serve That is I hope that there is not overly lengthy Scott £. Wallace, Official Court RDR, CRR Reporter 3990537372 3390537372 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 104 68 just seems to us that it would make little sense at this point in time, before the complete presentation of the liability case, to be offering testimony about what remedies the Court should consider imposing irrespective of the outcome of the motion. MR. BERNICK: Your Honor, I think, really, counsel's made the case of why this really should go forward, and since irrespective of the outcome of the motion, if he is going to address not a monetary relief, which is my understanding from his expert report, then the bifurcation or separation of his testimony really isn't warranted by the proposal that they've made which, after all, is derived from the issues that are now before the Court of Appeals. However, there remains a very direct — additionally, there remains a very direct tie between his opinions with regard to relief, which are conduct based, and his testimony about our conduct. taken up together. So, that's why they have to be There's no reason for separating them. As to whether the evidence will further evolve, it may further evolve, but he's already locked in to his opinions regarding conduct related relief and his expert report. Yes, I do know what they are and that's exactly why I believe that the cross-examination should be part and parcel of his opinions in the case which go to our conduct. I'll note, finally, that we now have got addiction, it's in the whole business of addiction and manipulation of nicotine alleged is in, advertising is in, ETS is in, most of their Scott i . Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10469 pillars are in -- I think the only pillar that really remains is allegations of suppression of research or suppression of evidence. So most of the conduct case -THE COURT: That's come in any way. MR. BERNICK: Some of that's come in any way. So there ought not to be any retooling of Dr. Erickson's testimony in light of further evidence in the case. He's locked into what he's saying and doing in his expert report, and I know from having read the direct examination, or reading the expert report exactly how the cross-examination would work to explore the connection, or absence thereof, between the conduct that he is able to say had an impact or that continues, the continuation is really key, and the remedies that he's proposing on the other hand. So I think it's really a compelling case and counsel has really helped make it this afternoon. THE COURT: If he's locked into his expert opinions, Mr. Brody, why should he not give them now? MR. BRODY: Because, Your Honor, at the time that he filed the expert report, he was required to give the entire range of expert opinions that he anticipated he might offer at the time that that report was filed in November of 2001 — THE COURT: He doesn't have to offer them all, I understand that you can pick and choose what you want him to offer, what he can't do is change them, so therefore, it seems to Scott I . Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10470 me while you had first convinced me that it was all right, let me put it that way to have him testify later on remedy, I now don't even see the justification for that because he can't say anything different in his remedies testimony, whenever he gives it, than what is contained in his expert report. He doesn't have to give all of it, but he can't change it. MR. BRODY: The point, I think that I was trying to make, and perhaps inarticulately, that while he is locked into the entire range, we in terms of what he is actually going to offer, don't believe it would be appropriate to decide what in that range ultimately based on the presentation of evidence here in the courtroom he is going to offer as remedies that can be supported based on the evidence of liability that has been presented to and come into the Court. MS. EUBANKS: THE COURT: Your Honor, if I might. That didn't make sense to me, Mr. Brody, and I know how articulate that you are, so therefore the government has some obviously strategic reason for not wanting him to testify on the remedy, although I can't figure out what it is. MS. EUBANKS: Your Honor, it's really not a question of strategy, it's really a question of the just speedy and in expensive resolution of the action. What the government will do, what the United States intends to proffer in the way of remedies is necessarily based upon the evidence that will come in during the liability phase. Scott L. Wallace, num., CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10471 There may be exclusions of certain evidence, but more importantly, and I don't want to get tied up in the motion that's filed, what the Court of Appeals tells us by way of guidance with respect to the issues pending there certainly may affect what it is that we request in the way of remedies. Correct, Mr. Bernick is, that the witness is locked in, in a senses, of what his opinions are, but we, the United States, are not committed to what we will bring forward to the Court of those opinions and necessarily ask the Court to enter. THE COURT: So what you're really saying is that the decision about this is part and parcel of your motion? MS. EUBANKS: It is in the sense that the Court of Appeals' decision could have some impact, and likely will have some impact, as we set forth in the motion, but quite apart from that, even without the Court of Appeals decision, the Court of Appeals is well aware of the trial outline that we filed months ago where we laid out the proof that we intended to put in. We will not know with any reasonable degree of certainty what we believe are appropriate remedies until all of the evidence on liability is in, and we hate to take the time of the Court, the witness and everyone else here, to layout possibilities rather than specificity, what it is that the United States intends to offer. Now, if it is a problem, what we can do is simply, if we are only going to be allowed to call Dr. Erickson once, then we Soott Z. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10472 would, I believe, prefer to defer his testimony, if we're going 2 to have to put it all together. 3 issues that he is going to be bringing forward by way of what's 4 in his current written direct and, you know, some of the issues 5 that are certainly related to the youth marketing case, we just 6 think it would be more efficient to hear that testimony, and as 7 Mr. Brody said, it's fairly short and it's straightforward. 8 remedies testimony will take us into a newer area and I don't 9 think we would finish with all four witnesses next week if we are 10 But because of the types of The to go that route. MR. BERNICK: 11 Can I make a suggestion, maybe, to advance 12 the cause here, because I think this is another one of those very 13 abstract discussions where it's probably hard for the Court to 14 come to grips with -THE COURT: No, it's not hard to come to grips with, but 15 16 it's abstract and it's taking longer than it need to. MR. BERNICK: 17 There's a very small portion of his expert 18 report that relates to remedies. I don't think the testimony's 19 going to last very long at all. He's been deposed on it. 20 the Court an overview of what he says about remedies in opening 21 statement. 22 take a look at the expert report and what he's going to say — This is not rocket science. I gave If Your Honor wants to THE COURT: No, I don't want to take a look at it the at 23 24 this point. Here's my ruling everybody. It's sort of a grudging 25 ruling, if you will, but it's a ruling. I think each party has a scctt I. Wallace, Rim, CRR Official Court Reporter 3390537377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10413 right to present their testimony in the way they want during their case. I may not particularly like it, I may not completely understand the strategy behind it, but I do think lawyers have a right to control their cases. There is no question that when he presents his testimony on remedies, that you can fully cross-examine him and link up his testimony to whatever conduct based testimony he gives next week. But I do think, as I say, that the government, just as the defendants, have a right to make certain strategic choices in terms of how they prepare — how they present testimony, not prepare it, so I'll allow the government to present Dr. Erickson only on liability issues and bring him back for what I gather is brief testimony on remedies issues. Okay, 9:30 tomorrow morning, everybody, please. (Proceedings adjourned at 4:52 p.m.) C E R T I F I C A T E I, Scott L. Wallace, RDR-CRR, certify that the foregoing is a^correct transcript from the record of proceedings in the above-Mtit/led/jftat^el. Scott L. Wallace, RDR, CRR Official Court Reporter Scott L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10474 INDEX Page Examinations DIRECT EXAMINATION OF DENISE F. KEANE BY MR. GOLDFARB 10365 E X H I B I T S Description Page 3390537379 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537379 89 3390537380 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537380 10475 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA UNITED STATES OF AMERICA, CA No. 99-2496(GK) January 19, 2005 Plaintiff, 9:30 a.m. Washington, D.C. v. PHILIP MORRIS USA, et al., Defendants. VOLUME 51 MORNING SESSION TRANSCRIPT OF TRIAL RECORD BEFORE THE HONORABLE GLADYS KESSLER UNITED STATES DISTRICT JUDGE APPEARANCES: For the Plaintiff: SHARON Y. EUBANKS, DIRECTOR U.S. DEPARTMENT OF JUSTICE Civil Division 1331 Pennsylvania Avenue, NW Suite 1150 Washington, DC 20004 (202) 616-8280 STEPHEN P. BRODY, DEPUTY DIRECTOR U.S. DEPARTMENT OF JUSTICE Civil Division 1331 Pennsylvania Avenue, NW Suite 1150 Washington, DC 20004 (202) 616-1438 RENEE BROOKER, ASSISTANT DIRECTOR U.S. DEPARTMENT OF JUSTICE Civil Division Tobacco Litigation Team 1331 Pennsylvania Avenue, NW Suite 1150 Washington, DC 20004 (202) 616-3797 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10476 APPEARANCES: (Cont'd.) For the Plaintiff: LINDA McMAHON, ESQ. U.S. DEPARTMENT OF JUSTICE Civil Division 1331 Pennsylvania Avenue, NW Suite 1150 Washington, DC 20004 (202) 307-0448 FRANK J. MARINE, SR.,ESQ. U.S. DEPARTMENT OF JUSTICE Criminal Division Organized Crime and Racketeering Section 1301 New York Avenue, NW Suite 700 Washington, DC 20530 (202) 514-0908 ANDREW N. GOLDFARB, ESQ. U.S. DEPARTMENT OF JUSTICE Civil Division 1331 Pennsylvania Avenue, NW Washington, DC 20004 (202) 616-4358 For the Defendant: Philip Morris USA, Inc, DAN K. WEBB, ESQ. THOMAS J. FREDERICK, ESQ. KEVIN NARKO, ESQ. JOHN W. CHRISTOPHER, ESQ. WINSTON & STRAWN 35 West Wacker Drive Chicago, IL 60601-9703 (312) 558-5700 For the Defendant: Philip Morris USA, Inc THEODORE V. WELLS, JR., ESQ. JAMES L. BROCHIN, ESQ. PAUL WEISS RIFKIND WHARTON £ GARRISON, LLP 1285 Avenue of the Americas New York, NY 10019-6064 (212) 373-3089 PATRICIA M. SCHWARZSCHILD, ESQ. HUNTON & WILLIAMS Riverfront Plaza, East Tower 951 East Byrd Street Richmond, VA 23219 (804) 788-8728 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10477 APPEARANCES: (Cont'd.) For the Defendant: Lorillard Tobacco Company For the Defendant: Brown & Williamson Tobacco Company J. WILLIAM NEWBOLD, ESQ. RICHARD P. CASSETTA, ESQ. THOMPSON COBURN LLP One US Bank Plaza Suite 3500 St. Louis, MO 63101-1693 (314) 552-6000 DAVID M. BERNICK, ESQ. STEPHEN R. PATTON, ESQ. KIRKLAND & ELLIS 200 East Randolph Drive Chicago, IL 60601 (312) 861-2248 KENNETH N. BASS, ESQ. KIRKLAND & ELLIS 655 15th Street, NW, Suite 1200 Washington, DC 20005 (202) 879-5000 For the Defendant: R.J. Reynolds Tobacco Company ROBERT F. McDERMOTT, JR., ESQ. PETER J. BrERSTEKER, ESQ. JONATHAN M. REDGRAVE, ESQ. JONES DAY 51 Louisiana Avenue, NW Washington, DC 20001 (202) 879-3939 For the Defendant: Liggett Group, Inc, For the Defendant: Tobacco Institute NANCY ELISABETH STRAUB, ESQ. I KASOWITZ, BENSON, TORRES & FRIEDMAN 1633 Broadway New York, NY 10019 (212) 506-1700 PHILLIP DUBE, ESQ. JAMES A. GOOLD, ESQ. JOSEPH A. KRESSE, ESQ. COVINGTON & BURLING 1201 Pennsylvania Avenue, NW Washington, DC 20009 (202) 662-6000 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10476 APPEARANCES: 3 (Cont'd.) For the Defendant; Council for Tobacco Research USA, Inc, 4 5 6 7 For the Defendant: British American Tobacco 8 J. WILLIAM NEWBOLD, ESQ. RICHARD P. CASSETTA, ESQ. THOMPSON & COBURN One US Bank Plaza Suite 3500 St. Louis, MO 63101-1693 (314) 552-6000 BRUCE SHEFFLER, ESQ. CHADBOURNE & PARKE 30 Rockefeller Plaza New York, NY 10112 (212) 408-5100 9 10 11 12 13 Court Reporter: 14 15 EDWARD N. HAWKINS, RMR Official Court Reporter Room 6806, U.S. Courthouse Washington, D.C. 20001 (202) 682-2555 16 17 Proceedings reported by machine shorthand, transcript produced by computer-aided transcription 18 19 20 21 22 23 24 25 3390537384 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537384 10479 P R O C E E D I N G S THE COURT: Good morning, everybody. This is United States versus Philip Morris, CA 99-2496. I just would mention to everybody that, in addition to the traffic issues that I have no doubt will exist this afternoon, at least according to the radio, there's an 80 percent chance of snow as well, so everybody can keep that in mind. Mr. Goldfarb, having had the evening, give me a rough estimate of how much time you're going to need. MR. GOLDFARB: Your Honor, I do think it's still going to take an hour and a half to two hours. There are some areas. Obviously, it depends in part on the witness's response to questions, but I hope we can move through it. THE COURT: Okay. Where is Ms. Keane? Would you please come forward? Ms. Keane, you're still under oath this morning. DENISE KEANE, Government's witness, RESUMES DIRECT EXAMINATION (Cont'd.) BY MR. GOLDFARB: Q. Good morning, Ms. Keane. Andrew Goldfarb for the United States. THE COURT: Ms. Keane, I know both Mr. Wells and I had some trouble yesterday occasionally hearing you. Try, to the extent you can, to talk into the mike. Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10480 I noticed that lowering it didn't help an awful lot, it was my impression, but I know our court reporter was able to hear you. But, in any event, just keep that in mind, please. THE WITNESS: Thank you. BY MR. GOLDFARB: Q. Ms. Keane, prior to receiving your proposed written direct from the United States you had met with your attorneys; is that correct? A. Yes, I did. Q. And you had met with your attorneys concerning your anticipated testimony in this case? A. Yes, I have. Q. And you had met with them and you had discussed, had you not, your cross-examination, by which I mean your examination by your own attorneys; is that correct? A. Yes, we did. Q. And how many attorneys did you meet with? A. Primarily my discussion was with Mr. Wells and with Tom Fredericks. Q. And that occurred prior to receiving the written direct from the United States on January — A. We just had — Q. Excuse me. A. I'm sorry. Q, That occurred prior to your receiving your written direct Let me ask the question. Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10481 examination on January 10th from the United States; is that right? A. As part of the work that we are doing in conjunction with this case, Mr. Wells and I and Mr. Fredericks and I would have occasion to meet. In the context of one of those meetings we had some general discussion about how we were going to proceed once we got the government's written direct. Q. Okay. And in the course of that, did you look at documents? A. Yes. Q. Approximately how many documents did your counsel show you during those discussions? A. The document review was basically the depositions to the written direct when we got them. It was a couple of our submissions, including the FTC petition I looked at. I also looked at our comments in response to the 1997 FTC request for comments. Q. And the deposition — when you say you referred to deposition, that was the deposition that you gave in this case? A. I did look at that, also, in the context of the week after we got the government's written direct, yes. Q. Did you look at other depositions as well? fl. No, I did not. Q. Okay. And then when you received the written direct examination from the United States, that was on January 10th? Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10482 A. It was Monday. Q. Okay. Late Monday, yes, that was the date. And the process is — I assume you read through it and then began to discuss some changes to make with your attorneys? A. The process that I followed was I received it that day. And, in fact, we had a phone call Tuesday afternoon, but I basically reviewed it and reflected on it. Q. Okay. And then you made changes to the proposed examination; correct? A. Correct. Q. And did you discuss those proposed changes with your counsel? A. Yes, I did. Q. And in the course of the — making those changes and discussing the changes you're going to make to your direct examination with counsel, you continued also, did you not, to discuss the cross-examination they would have of you at the close of your direct examination? A. Quite honestly, given the amount of time that we had to conduct this in — you know, within, we had a very limited conversation about what we were going to do thereafter. The bulk of it was an effort to go through and try to correct to the best of my ability the written direct. Q. But part: of those discussions — A. We did have some general discussions, yes. Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10483 Q. And those occurred after you had received and reviewed the proposed written direct examination? A. Yes. Q, And you received — I assume you received, when you did receive the direct examination, you also received the documents submitted with your testimony? A. I did. Q. And you reviewed those documents? A. I have. Q. And during the course of the week during which you were making changes, from a week ago Monday to Friday, did you review other documents as well? A. Basically, what I described to you. I would have looked at the FTC petition, our response to the FTC request for comments. Q. If I could ask you to turn to page 10 of your corrected written examination. A. Is that what I find here? Q. Yes, that should be the one with the blue cover on it. And if we — the question from lines 1 to 10, the portion of your testimony from lines 1 to 10 was a question about the work of Altria and the work of Altria Corporate Services. Do you see that? A. I do. Q. And Altria Corporate Services was formerly known as the 3390537389 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10484 Philip Morris Management Corporation; correct? A. Yes. Philip Morris Management Services. Q. So I will use — I may use the phrase Altria Corporate Services or PMMC interchangeably, but you understand A. That's fine. — I'll understand what you mean. THE REPORTER: Excuse me, Your Honor. Could I have one at a time? THE COURT: You all did this yesterday, too. So please, Mr. Goldfarb, it's your major responsibility. Go ahead. BY MR. GOLDFARB: Q. And the question was, in line 12, "Much of the work of Altria is done by people who are technically employed by Altria Corporate Services, Inc., which is formerly known as Philip Morris Management Corp; correct?" And you struck Yes, and said No, and then added the answer that you added. Correct? A. Correct. Q. Now, you were the head of the Worldwide Regulatory Affairs Department from 1998 to 2000 at Altria; correct? A. Yes. Q. And that was an Altria department? A. Worldwide Regulatory Affairs, basically the people who worked there were employees of Philip Morris -- excuse me — you know, Altria, you know, Management Corp or Philip Morris Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10485 Management Services. Q. Okay. So it was within the parent company, yes. Worldwide Regulatory Affairs was within the parent company Altria? A. Yes. Q. And the people who performed the work of Worldwide Regulatory Affairs were PMMC employees, technically? A. Correct. Q. And they were A. With one exception. Q. You? A. Which was me. Q. Because you were the head of the department? A. Yes. Q. And — — THE COURT: Just one minute now. You indicated that the people who worked in Worldwide Regulatory Affairs were within Altria but were PMMC employees; right? And I just want to make sure what PMMC is, which is Philip Morris Management Corporation. THE WITNESS: Is that right? Right. I apologize, Your Honor, I was going back and forth. In a sense, we're talking about the same entity, but after the change of name to Altria Group, that same group changed their name to Altria Corporate Services. Previously, that same group 3390537331 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10486 was Philip Morris Management Corp. MR. GOLDFARB: Any further questions on that, Your Honor, for clarification? THE COURT: Go ahead, please. BY MR. GOLDFARB: Q. And so again taking, for example, the — one of the functions that you had when you were the head of Worldwide Regulatory Affairs was to be the chair of the Strategic Issues Task Force; correct? A. Yes. Q. And that was your appointed — you were asked to serve in that role by Geoffrey Bible? A. That's correct. Q. And he at that time was the chairman, CEO of Philip Morris Companies? A. Correct. Q. And the — made a change. as you indicate somewhere in your testimony, you I think four of the eight people who served on the Strategic Issues Task Force were PMMC employees, technically; correct? A. The people who were identified to work on it — thinking through the list in my mind — I'm just now included people who were from the Philip Morris International, included people from Philip Morris USA, and included myself. I would have used the support of some people who were Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10487 in my group, and yes, there might have been one or two other people from PMMC. But it was basically a distribution from both parent company and the two operating companies that were focused on tobacco. Plus, I have to add, that it also included in our meetings representation from Miller and representation from Kraft. Q. Okay. If I could just have U.S. Exhibit 41574 up quickly, please, and I'm.... A, Thank you. MR. GOLDFARB: Can you pull that up, please, Charles? If you can just pull out the bottom box, please. So, this is a — I'm sorry, Charles. Go back to the full page for a second. Q. Ms. Keane, this a document that was cited in your written direct examination; correct? A. It is, yes. Q. And you recognize it to be a product of the Strategic Issues Task Force? A. I do. Q. And it's dated July 9, 1999? A. Correct. Q. And if you look at the members of the Strategic Issues Task Force — Which is the lower box, Charles, please. -- you can see that, in fact, four of the people listed Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 104B8 are PMMC employees; correct? A. Yes, that's correct. Q. In fact, there are other people — as you indicated, there are other people who also assisted the work of the Strategic Issues Task Force; correct? A. Yes. Q. And Mr. Mark Berlind was one of them? A. Correct. I was drawing the distinction, though, between people who worked for me who would have supported it, and sort of early on we realized that since we were working to support a corporate site, we included representation from the other operating companies. Q. And Mark Berlind, when he worked for you in Worldwide Regulatory Affairs, was technically a PMMC employee as well; is that correct? A. Yes, that's correct. Q. And he was one of the people who was responsible for drafting the website statements on smoking and health issues that ended up on the Philip Morris USA corporate website; correct? A. He was responsible for helping us collect the information and he was one of the scribes. He did, in fact, help draft the information. Q. In fact, when you were the senior vice president and general Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10489 1 counsel of Philip Morris USA from 1995 to 1997, you were also 2 technically a PMMC employee; correct? 3 A. Yes. 4 Q. Now, you gave some testimony around pages 4 and 5 of your 5 corrected written direct examination in response to questions 6 concerning 7 A. Go back to that? 8 Q. Yes, for reference. 9 generally. 10 The entire law department was. — I'm just going to refer to them But there are some questions that asked about your 11 litigation responsibilities when you were general counsel of 12 Philip Morris USA; correct? 13 A. Correct. 14 Q. And in response to a few questions about your litigation 15 responsibilities, you indicated that in fact there is a group of 16 attorneys at PMMC who are responsible for smoking and health 17 litigation. 18 A. Yes, correct. 19 Q. And they are responsible for supervising smoking and health 20 litigation; correct? 21 A. Yes. 22 Q. Now, did those — 23 as general counsel for Philip Morris USA; correct? 24 A. 25 those attorneys reported to you ultimately We were all members of PMMC, When I was general counsel of Philip Morris, you know, 3390537395 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537395 10490 1 Incorporated back in that period we were all PMMC employees and 2 the structure was such that my responsibilities were meant to be 3 forward looking. And the litigation department, given the 4 nature of the litigation at that point in time, which was 5 primarily retrospective, they managed it and they would keep me 6 apprised. 7 Q. Okay. And who had ultimate supervisory responsibility at 8 Philip Morris for the defense of the smoking and health 9 litigation while you were general counsel of Philip Morris? 10 A. 11 would have been kept informed. 12 While I was general counsel, I would have been apprised. I In addition, given the importance of the litigation to 13 the parent company, they also would have been kept informed. 14 Q. So they didn't report to anybody. 15 A. The way the department was structured at that point, lawyers 16 reported to lawyers, so I reported to Mary Bring who was the 17 general counsel of Philip Morris, Incorporated. 18 Q. 19 lawyers who you're saying had supervisory responsibility at PMMC 20 for Philip Morris's smoking and health litigation, which lawyers 21 did those lawyers report to? 22 A. 23 organizational chart, they did not report to me; however, it was 24 their job to keep me apprised. 25 Q. Is that your testimony? And my question, just so we can move on from this, is the Technically, in terms of, you know, actually on an And on an organizational chart who did they ultimately 3390537336 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537396 10491 1 report to? 2 A. 3 overall responsibility for litigation who reported into the 4 general counsel of, you know, Philip Morris. 5 Q. Of Philip Morris Companies? 6 A. Companies. 7 Q. And that would be Mary Bring? 8 A. At the time. 9 Q. At the time. They would have reported in to another PMMC attorney who had Now, if I could ask you to turn to page 26 of your 10 11 corrected examination. If we can cull out the first question and answer, 12 13 Okay. please. 14 Now, Ms. Keane, in this section of your direct 15 examination the question was asked, "Before October 1999, Philip 16 Morris had historically denied publicly that smoking cigarettes 17 was a proven cause of disease, right?" 18 And the proposed answer was that, "To my knowledge, 19 Philip Morris has not historically discussed smoking publicly. 20 Philip Morris has sold a product that has carried a warning 21 notice that has communicated to the public the risks and the 22 dangers of smoking cigarettes. 23 the Hatch Statement, basically did communicate more publicly." 24 "Without a doubt, Philip Morris historically has made 25 public — " . Oh, I'm sorry. Philip Morris, when it came to That was the proposed answer and 3390537337 3990537397 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10492 1 you struck that answer; correct? 2 A. 3 Q. And you gave a response, "Without a doubt, Philip Morris 4 historically has made public statements that debated the link 5 between smoking and disease. The government's proposed response 6 accurately quotes my deposition testimony where it states that 7 Philip Morris has not historically discussed smoking. Clearly, 8 there was some misunderstanding at that point in the deposition, 9 as my statement, read literally, is incorrect, and does not 10 Yes, I did. convey what I intended to communicate." 11 Did I read that answer correctly? 12 A. Yes, you did. 13 Q. I want to go back and look to see what was happening in your 14 deposition at that point to see whether there was, in fact, any 15 misunderstanding. 16 you. And, if I could — again, you have it before Page 2 of your deposition. 17 MR. GOLDFARB: And let's first go to page 297, please, 18 Charles. 19 A. Is it in this? 20 Q. It's in day two of the deposition, which I don't think was 21 in a 22 Have you found it? 23 A. I'm sorry. Where are you directing me to? 24 Q. Page 297, please. 25 Okay, if we look beginning at line 12 on page 297, you 390537338 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537398 10493 1 were asked the question, "Do you believe that the way Philip 2 Morris has historically discussed the health effects of smoking 3 has been a barrier to its credibility among the public." And your response was, answer, "From my perspective, 4 5 Philip Morris has not historically discussed smoking. Philip 6 Morris has sold a product that has carried a warning notice that 7 has communicated to the public the risks and the danger of 8 smoking cigarettes." So, that's the answer that was proposed in response to 9 10 the government's question on page 26 of your written 11 examination; correct? 12 A. Yes. 13 Q. And so when you answered this question, the question was 14 about whether Philip Morris's discussion, public discussion of 15 the health effects of smoking, has been a barrier to its 16 credibility, you in fact took issue with the premise of the 17 question, which is whether Philip Morris had historically 18 discussed smoking at all; correct? 19 A. That's what it says in the deposition. 20 Q. Okay. 21 2 98, your answer continued — 22 line 9 again, that paragraph, you continued to say, "But in 23 terms of --" you said, "But in terms of what the company did 24 historically, we have and will continue to take appropriate 25 measures in a litigation context to defend the product, again in And if you go — your answer continued down onto page and if we look at — beginning at 3390537339 3990537399 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10494 1 an appropriate fashion, but nonetheless, this company, to my 2 knowledge, has not been out historically doing anything to 3 communicate about the health risks other than to sell a product 4 for which there is a whole series of warnings that are 5 communicated to the public." 6 Did I read that correctly? 7 A. You did. 8 Q. Excuse me. 9 A. You did. 10 Q. If you can just respond to my questions, please. 11 But, Mr. Goldfarb I read that — — So in that answer you disputed the premise of the 12 question twice; correct? 13 A. 14 responsibility for any confusion that existed between you and I 15 over these several pages. We were having several conversations and I take 16 I mean, I think we had a very conversational deposition 17 for 16 hours and I would like to put this in context. 18 Q. 19 context. Okay. 20 Well, you will have a chance later on to put it in However, the answer to my question is in this answer — 21 what is the answer to my question, which is in this answer that 22 you provided at your deposition you took issue with the premise 23 that Philip Morris had historically discussed smoking twice; 24 correct? 25 A. B u t that's i m p o s s i b l e . W e were d i s c u s s i n g t h e Hatch 3390537400 3990537400 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10495 1 Statement where we were focused on walking away -- 2 Q. If you could answer my question 3 4 MR. WELLS: Your Honor, she should be permitted to finish her answer. 5 6 — THE COURT: I'm going to allow her to finish the answer. 7 Go ahead. 8 A. 9 creating a misimpression, given the literal interpretation of 10 It's impossible — I apologize if I am responsible for that language. 11 However, if you put it in the context we were talking 12 about Hatch, about walking away from the debate, clearly this 13 company debated issues around smoking and health, there is no 14 way that I would have intended to convey that in fact we have 15 not discussed smoking. 16 17 18 Clearly, we did not discuss smoking in a proactive aligned way with the public health community until we signed the I Hatch Statement. 19 We were talking about Hatch. But I never could have intended that this company was 20 not discussing issues relating to smoking and health. 21 Q. 22 didn't make changes to these things which you now say are 23 blatantly incorrect; correct? 24 A. 25 focused, I think as I indicated yesterday, on typographical Okay. And when you made changes to your deposition, you In terms of going over my deposition when it occurred, I 3390537401 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537401 10496 1 errors. 2 In fact, when I read this, I read it in the context of 3 what we were discussing. I did not go back and try to bring 4 literal accuracy to every single word that — 5 my responsibility for perhaps creating the situation, you know, 6 clearly it could not have been interpreted and should not be 7 interpreted as my saying something that in reality is so 8 preposterous. 9 Q. So just so you are clear. You did — you know, despite the answer to my 10 question 11 A. I did not correct it at that time, no. 12 Q. And then if we can — 13 questions goes on. 14 question, at lines 24 and 25, "When is the first time that 15 A. I'm sorry. 16 Q. I'm sorry. 17 going to go on to 299. 18 A. Thank you. 19 Q. At the bottom of 298 the question is, "When is the first 20 time that Philip Morris acknowledged its agreement with the 21 content of those warnings?" 22 — the question goes on — the series of At the bottom of page 298 you were asked the — The bottom of that same page, 298, and we're Do you see that question? 23 A. I do. 24 Q. And you understand at that point the deposition — 25 question concerned the content of the warnings under the Federal the 3390537402 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537402 10497 1 Labeling Act? 2 A. Yes. 3 Q. And then your answer at the top of page 299 was, "Again, 4 it's just a matter of — 5 apologize if I take a moment to try and re-reference it because 6 I think it is an important one. it's a subtle distinction, but I "The company historically sold the product with a 7 8 warning and, in fact, was not debating the contents of those 9 conclusions." Do you see that, Ms. Keane? 10 11 A. I do. 12 Q. And you give that answer at your deposition? 13 A. Yes. 14 Q. Okay. 15 corrected that statement in your written direct; right? 16 A. I'm sorry? 17 Q. So you reiterated in this answer what you now claim was an 18 error; correct? And you're now saying that that statement — strike the question. you've 19 This is the third — I'm sorry. 20 So this is the third time in which you have taken issue 21 with the premise that Philip Morris historically debated the 22 issues of whether smoking causes disease; correct? 23 A. 24 time where I think we were talking at cross purposes. 25 There were several pages in this deposition at that point in I was focused on Hatch, what was happening before 3390537403 3990537403 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10498 Hatch, and what was happening during my tenure as general counsel. And these statements, when in fact you read them out of that context, do not convey what I intended to convey at the time, Q. Okay. So the answer to my question.... (Pause) And so then if we can go down to the — again, on page 299, the question at line 15, please. And the question is, "Is the Hatch — " The question there that was asked at your deposition, "Is the Hatch Statement the first time that Philip Morris had discussed whether or not" — or, excuse me — "had discussed whether or not or had discussed its position on whether or not smoking causes disease?" I read that correctly? A. Yes. Q. And your answer, over an objection, "Clearly, Philip Morris has discussed issues relating to smoking and disease in a number of contexts. For example, in a litigation context the issues of smoking and disease would be the paramount focus of a lawsuit by a smoker alleging health effects." "So no, without a doubt, the company has in fact inappropriate forums, expressed its genuinely held belief and its issues relating to understanding causation, understanding the way in which cigarette smoking results in disease." And then you go on to say at line 8 of page 300 of your 3990537404 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10499 1 deposition, "That having been said, to my knowledge, this 2 company has not been out doing anything to impact or undermine 3 the very important message that has been carried on cigarette 4 products that have been sold in this country since the late 5 1960s." 6 So, again, you responded to a question, which you 7 didn't indicate you didn't understand. 8 question, correct, at the deposition? 9 A. 10 I heard your question. You understood the Obviously we were talking at cross purposes. 11 But you've accurately read what I had in my deposition 12 Q. So.... You raised four times at your deposition, did you 13 not, Ms. Keane, the fact that in your answer Philip Morris had 14 not historically publicly disputed that smoking causes disease; 15 is that correct? 16 A. 17 whole commitment was to walk away from the fact that we had been 18 debating. 19 discussion. 20 to be interpreted that way, and... 21 Q. Because those statements are wrong; correct? 22 A. Absolutely. 23 Q. Now, looking at page 28 of your deposition. 24 A. 28? 25 Q. In your corrected direct examination. But, Mr. Goldfarb, we were talking about Hatch where the I mean, clearly that was the focus of much of our So I absolutely never intended for those statements 3390537405 3990537405 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10500 A. Thank you. Q. Looking at — culling out the question and answer from lines 12 to 21. This is a section of your testimony where you're discussing the Philip Morris' website statements on the health effects of smoking; correct? A, Correct. Q. And the question in line 12 states the Philip Morris1 statement on causation that was placed on the website in October of 2000 replacing an earlier statement, and I'll just read what the -- into the record the question was. "As you can see from U.S. Exhibit 77683, in October 2000, Philip Morris revised the first sentence in its website statement on causation to state, 'We agree with the overwhelming medical and scientific consensus that cigarette smoking causes lung cancer, heart disease, emphysema and other various diseases in smokers.'" And then the question was, "And that was the first time Philip Morris told the public that it agreed with the overwhelming medical and scientific consensus on causation." And the proposed answer was, "Yes, it was." You struck that; correct? A. Yes. Q. And you stated — your response is, "This was the first time such a statement appeared on the website. I believe that Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537406 10501 company representatives had made substantially similar statements in courtroom testimony before this time." Now, certainly no company representatives had made that statement in courtroom testimony prior to October 1999; correct? A. Correct, to my knowledge. Yes, correct to my knowledge. Q. And October 1999 was when Philip Morris launched originally its corporate website? A. That is right. Q. And in that corporate website Philip Morris acknowledged that there is an overwhelming medical and scientific consensus that smoking causes lung cancer and other diseases; right? A. Right. Those earlier statements follow a philosophy that I think we generally brought to the website, which is to capture and communicate the conclusions of the public health community. Q. Okay. And so when you say that "other company representatives had made substantially similar statements in courtroom testimony before this time," you're referring, are you not, to Mr. Szymanczyk's testimony in the Engle case in June of 2000? A. Yes, I am. Q. And so the record is clear. Mr. Szymanczyk refers to Michael Szymanczyk who is the — who at that time was the chairman and CEO of Philip Morris? A. Correct. Q. And he gave that testimony at trial in the punitive damage 3990537407 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10502 1 stage of the Engle trial in Florida; is that correct? 2 A. 3 with, in fact, the conclusions of the public health community. 4 Q. 5 anyone at Philip Morris had ever made such a public statement on 6 behalf of Philip Morris; correct? 7 A. To my knowledge, yes. 8 Q. Now, looking at the bottom of that page of your corrected 9 testimony, Ms. Keane, at the last question that goes over onto Yes. It's my understanding that he was asked if he agreed Okay. And that was the first — that was the first time 10 page 29, the question is, "However, it is your view, is it not, 11 that there is no substantive difference whatsoever between 12 Philip Morris's website statement on smoking and disease as it 13 appeared from October 13th, '99 to October 10, 2000, and the 14 statement that has been on the website since October 11, 2000." 15 And the proposed answer was, Yes, and you added to that 16 and you said, "Yes, because I think the important and overriding 17 principle was to communicate and encourage the public to be 18 guided by the position of the public health community in both 19 instances." 20 So Philip Morris considered — even though you see no 21 substantive difference — Philip Morris considered this change 22 in its website to be an important one, did it not? 23 A, 24 need to have — 25 have a principle. What had happened is, in order to have a website you really or a public communication platform, you need to 3390537408 3990537408 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10503 1 So the company's principle has been to communicate the 2 position of the public health community. 3 the fact that historically issues surrounding causation and 4 addiction were such a point of disalignment, the company thought 5 it was appropriate, particularly given the conversations that 6 were taking place, to indicate its agreement. 7 Q. 8 it was a significant change, did it not? 9 A. Okay. In this case, given Ms. Keane, my question was that Philip Morris thought It thought it was an appropriate thing. 10 In terms of a significant change, I think — and I 11 believe the company would in fact agree with me — 12 significant change was the philosophy to defer to the judgment 13 and communicate the position of the public health community. 14 Q. 15 yes or no — 16 considered the change in its website statement from recognizing 17 that there exists a public health consensus to agreeing 18 stating its agreement with that public health consensus was a 19 significant and important change? 20 A. 21 change. Okay. My question, Ms. Keane — if you could just answer it is, it is true, is it not, that Philip Morris It was an important change, yes. 22 that the most But I don't think — — It was an important I mean, I just — I apologize, 23 Mr, Goldfarb, if I come back to draw the distinction. 24 think — 25 important change is the principle. I I don't want to lose sight of the fact that the most 3390537409 3990537409 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10504 1 Q. Now, the court has received testimony from Geoffrey Bible. 2 It's been submitted into evidence. 3 A. Yes, I do. 4 Q. And you said earlier — 5 until 2002, the chairman and CEO of Philip Morris Companies? 6 A. Yes. 7 Q. And part of the testimony that has been submitted to the 8 court by Mr. Bible is Mr. Bible indicating that he believed that 9 it was a significant and important change when Philip Morris You know who Mr. Bible is? you confirmed earlier that he was, 10 switched its website in October of 2000 to state its agreement. 11 And you're not disagreeing with Mr. Bible, are you? 12 MR. WELLS: Your Honor, I object to the reference to 13 another witness's deposition testimony. 14 said. 15 Mr. Bible said what he She's not here as an expert witness. MR. GOLDFARB: It's not an expert question. I'm asking 16 whether she disagrees, as general counsel of Philip Morris, as 17 to whether it was an important change. 18 19 MR. WELLS: She has just said it was important. She said that two minutes ago. 20 THE COURT: I'm going to sustain the objection. 21 BY MR. GOLDFARB: 22 Q. 23 Mr. Szymanczyk sent around an e-mail to all the employees in the 24 company announcing the change; correct? 25 A. In fact, it was — it was a significant enough change that I believe that was right. I was not in PM-USA at that time, 3390537410 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537410 10505 but I do believe that there was a communication that went around to PM-USA. Q. And Mr. Szymanczyk hasn't sent around an e-mail to every employee in the company every time there's been another change on the website; isn't that correct? A. Well, in fact, there are, you know, frequent communications. And I think — Q. I'm sorry. I didn't mean to interrupt you. A. I think that, given the sort of historic disconnect that the company had on these issues, this was a topic that the company chose to communicate on and share information as it related to its public communications, in particular with its employees, so that we could be assured that there was alignment, that our employees understood where the company was going. Q. Because this was a significant issue; correct? A. It was important. Q. Do you disagree with my characterization of significant? THE COURT: please. Everybody. Let me hear the question, The witness answered the last question. MR. GOLDFARB: I'm sorry, Your Honor. I'm interrupting you as well. BY MR. GOLDFARB: Q. Do you disagree with my characterization of it as a significant change, Ms. Keane? A. No, Mr. Goldfarb, I'm not disagreeing with you. 3990537411 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10506 1 Q. And again, to answer my previous question. 2 does not routinely send out e-mails to all employees about every 3 change that's made to the website; correct? 4 A. Not every change, but there are frequent communications. 5 Q. Okay. 6 significant preparation, did it not, as it prepared to make this 7 change to the website? 8 A. I'm sorry. 9 Q. If I could have U.S. Exhibit 25234, please. 10 And Philip Morris as — Mr. Szymanczyk Philip Morris undertook a I don't know what you're referring to. You have it before you, Ms. Keane. 11 A. I do. 12 Q. If we could just focus on the top. 13 Philip Morris' e-mail; correct? 14 A. Yes. 15 Q. Sent 16 A. It's an e-mail — 17 Q. And it was sent to — 18 10, 2000, at 7:20 PM; correct? 19 A. Yes. 20 Q. And that's the day before Philip Morris made the website 21 change? 22 A. I believe so, yes. 23 Q. And it's sent to — 24 You have no reason to dispute that it's a lot of people are 25 copied on this e-mail. This is an e-mail, a — right, it is. it was sent from J. Poole on October well, I counted, it's over 55 people. 3390537412 3990537412 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10507 A. I agree. Q. And you're one of them. THE COURT: If you look at the first name Wait a second. The question is — — Wait, wait. has everybody looked at the real time on this, namely the question, "And it's sent to — counted, it's over 55 people. well, I You have no reason to dispute that it's a lot of people are copied on this e-mail." Now, the real time says, "I agree." was slightly different. My recollection But if everybody agrees on the real time, that's fine. BY MR. GOLDFARB: Q. Ms. Keane — MR. GOLDFARB: Q. I can clarify, Your Honor. Ms. Keane, do you accept my representation that there are about 55 people copied on this e-mail? A. Yes, that's fine, yes. Q. And you in fact are — received it twice. If you look at the first CC and then the one that's highlighted already, your name appears in two instances; correct? A. I think that's because they have automatic distribution lists that are often used that create that. Q. And the subject is the website update, and it's dated October 10th; correct? A. Yes. 3990537413 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10508 1 Q, And the summary line, the topic line, the first line of the 2 e-mail, is, "The following is the working plan/time line for 3 activities associated with the website change." Correct? 4 A. 5 Q. And then if you look down under heading number one, it talks 6 about the website update. Yes, I see that. 7 And then the sentence under the timing of the website 8 update states, "Please note the change in time. This change was 9 made out of an abundance of caution in order — in an effort for 10 this to not be an issue in the U.S. presidential debate which 11 will be conducted tomorrow evening." 12 Do you see that? 13 A. I do. 14 Q. By the way, do you recall receiving this e-mail, Ms. Keane? 15 A. I would have received it. 16 Q. And so — 17 Ms. Keane, that the time of the website change was carefully 18 chosen by Philip Morris? 19 A. Yes. 20 Q. And if you look at the — 21 it talks about Philip Morris updating all of its employees, 22 Philip Morris USA, Philip Morris, Incorporated and PMMC. 23 Everybody in the company was going to be advised that this 24 change was being made; correct? 25 A. Correct. and then — so that indicates, does it not, at the, under heading number two, 3990537414 3990537414 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10509 1 Q. And this change — 2 Philip Morris changing to state for the first time, in a 3 communication directed and available to the public, that it 4 agrees that smoking causes disease; correct? 5 A. Correct. 6 Q. And it agrees that smoking is addictive? 7 A. I think your mike is off. 8 Q. And then if you look further.... 9 again, just so the record is clear — is And then, Ms. Keane, if you look further down at number 10 3, it discusses David Davies' press briefing and WHO testimony. 11 Do you see that? 12 A. Correct. 13 Q. And the change in the Philip Morris' website when it was 14 uploaded was carefully coordinated with Mr. Davies' press 15 briefing in Europe; is that correct? 16 A. 17 aware of it — 18 and work with WHO on the framework 19 Q. 20 the first time, made a public statement directed at the public 21 acknowledging that smoking — 22 causes disease and that smoking is addictive; correct? 23 A. 24 and meetings that went on around the WHO process, and clearly if 25 David Davies was going to be doing that, it was necessary that No. There appears to be an effort to make sure that he was this was a time when we were trying to reach out — In fact, Mr. Davies was about to give testimony that, for that Philip Morris agrees smoking I think the sequence was, we had a series of presentations 3390537415 3990537415 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10510 1 he, you know, properly reflect the most current communication 2 that the company would have had on its website. 3 Q. 4 closely coordinated; correct? 5 A. Yes. 6 Q. And looking at number 4, Philip Morris prepared media 7 activities in connection with the change; correct? 8 A. 9 company when, in fact, we have Corporate Affairs Departments So all of these changes around the time of the change were Well, this is all part of a process that happens at a 10 that need to be apprised, so it was an effort to make sure that 11 they understood the change and could properly respond to any 12 questions. 13 Q. Okay. 14 A. So yes. 15 Q. There was media preparation in association with the change; 16 correct? 17 A. Right. 18 Now, it's not that it was a proactive media, it was — 19 as I'm reading this here — let's see. It was intended to have 20 a communication platform prepared if, in fact, we received 21 questions. 22 Q. 23 releases, Q and A for media in response to every change of its 24 website, does it? 25 A. And Philip Morris doesn't prepare press materials, press No, but you would be amazed at how many responsive 3390537416 3990537416 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10511 1 communications we prepare. 2 Q. 3 number 6 on the second page, Charles — you indicate that Philip 4 Morris — or Mr. Poole indicates that on a case-by-case basis 5 Philip Morris employees will be briefing local business partners 6 and other interested parties to alert them to this change in the 7 website position; correct? 8 A. One of our — 9 Q. Can you — Ms. Keane, if you can answer my question. The And, in fact, if you go further down — if you look at 10 answer is yes? 11 A. Yes. 12 Q. Ms. Keane, if you can turn to page 35, please, of your 13 corrected examination. And it's — 14 A. I'm sorry. 15 Q. Sure. Let me know when you're there. 16 A. — 17 I'm just taking one second — to organize this. Page 20? 18 Q. Page 35, please. 19 A. Thank you. 20 Q. Do you have it? 21 Looking at the question from lines 10 to 22. The 22 question was posed, "Since October 2000, Philip Morris hasn't 23 told its customer" — excuse me, let me start again. 24 25 "Since October 2000, Philip Morris hasn't told its consumers, on or with the cigarette package, that it agrees that 3990537417 390537417 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10512 1 cigarette smoking causes diseases — 2 diseases in smokers, has it?" 3 causes cancer and other And the proposed answer was "No", and you add to that 4 to reverse — to change the meaning of the answer and you 5 stated, "No, that is not correct." And then you go on to 6 provide a longer answer. And I want to go through different 7 parts of that answer. Okay? 8 A. Yes. Fine. 9 Q. Now, first of all, the first sentence that you add to that 10 response is that "Philip Morris has included the website address 11 on cigarette packs and onserts on cigarette packs referring 12 smokers to its website where it states its agreement that 13 smoking cigarettes causes cancer and other diseases in smokers.1 14 Have I read that correctly? 15 A. Yes. 16 Q. 17 cigarette package is not a statement that Philip Morris agrees 18 that smoking cigarettes causes cancer and other diseases; 19 correct? 20 A. It is a way to direct people to that information. 21 Q. But it does not provide it — 22 statement or provide that information that Philip Morris agrees 23 smoking causes cancer on or with the cigarette pack itself; 24 correct? 25 A. Okay. So providing the website address on or with the it does not make that Correct, it's not on the pack. It is on the onsert or with 3390537418 3990537418 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10513 1 the address. 2 Q. 3 onsert, it's only the website statement that's on the onsert; 4 correct? 5 A. According to your testimony here, the statement is not on an Well, there are two things, I think, I'm referring to here. 6 One is that there's a website address and a phone 7 number that exists on the pack so people can call for complete 8 website brochure or booklet. 9 Then, in addition to that, there have been onserts that 10 have been used on the pack which both include the website 11 address and, in addition, talk to about, in one of the 12 executions, the company's position on smoking and health. 13 Q. 14 that includes the statement that Philip Morris agrees that 15 smoking cigarettes causes cancer and other diseases? 16 A. 17 remember the — 18 causation and addiction. 19 goes into, and given the court's instruction, I did not go back 20 to investigate. 21 Q. Okay. When did Philip Morris start circulating an onsert Right — I think yesterday what I indicated is I couldn't what I call the omnibus onsert that talks about Now, this is — 22 I can't remember how much detail it you have it. Ms. Keane, I'm handing you U.S. Exhibit 92048. 23 A. Thank you. 24 Q. Is this what you consider the omnibus onsert, Ms. Keane? 25 A. Yes. 390537419 3990537419 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10514 1 Q. And nowhere on this statement does it say Philip Morris 2 agrees that smoking causes cancer; correct? 3 A. That's correct. 4 Q. And nowhere on this statement does it say that Philip Morris 5 agrees that cigarette smoking is addictive; correct? 6 A. 7 indicates that there is information on health issues. 8 Q. 9 somewhere else to look for information; correct? No. It indicates serious health effects of smoking and it Okay. But all this onsert does is tell someone to go 10 A. That's what this says, yes. 11 Q. And it doesn't actually provide information? 12 Strike the question. 13 It doesn't provide substantive information about Philip 14 Morris's position on smoking and health issues; it provides 15 information about where to go to find additional information; 16 correct? 17 A. Correct. 18 Q. 19 to contrast it briefly to — Now, while we are on the question of the onsert, I just want can I have U.S. Exhibit 52 963? 20 And this exhibit, which is already in evidence, is a 21 copy of an onsert that was put on packages of cigarettes by a 22 company called Star Tobacco. 23 You've heard of Star Tobacco before, have you not? 24 A. Yes, I have. 25 Q. And you're aware that they market cigarettes? 3390537420 3990537420 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10515 1 A. Yes. 2 Q. And if you look at this — 3 A. I don't know if they still do, but yes, they do. 4 Q. And for a time when they were marketing a cigarette called 5 Advanced they affixed to the cigarette packages an onsert of — 6 the same sort of onsert that Philip Morris has used. 7 understand that? 8 A. Yes. 9 Q. Do you Now, if you look at this — if you look at this onsert, you 10 need to sort of look at it vertical because page 1 and page 2 11 actually run — 12 with the pack. 13 it's sort of a continuation of what was included And this is the top — this is the top of the onsert; 14 correct? 15 A. Yes. 16 Q. 17 strips so adult consumers have a sound basis for making informed 18 choices." And it says, "Star is providing this series of information 19 Do you see that? 20 A. I do. 21 Q. If you look down at the bottom -- it's actually the bottom 22 of that first column, which is actually on the second page of 23 the document, Bates number ending in 2389 — you see in that — 24 I toward the last two paragraphs are by "adding" — it states, and 25 I'll quote the onsert that Star put on its package. 3390537421 3990537421 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10516 1 "By adding filters and putting tiny ventilation holes 2 in the filters, cigarette makers developed many brands which 3 tested as having reduced tar and nicotine, even though the 4 tobacco itself was relatively unchanged." 5 Have I read that correctly? 6 A. Yes. 7 Q. And Philip Morris's onsert which we discussed yesterday 8 didn't explain -- didn't provide any of this type of information 9 in its onsert about low-tar cigarettes; correct? 10 A. It did not. 11 I add, however, that Philip Morris had a, and has, a 12 myriad of communication vehicles which, in fact, we used to 13 provide information which I don't believe is the case for Star. 14 Q. 15 reasons why Philip Morris uses onserts is because it is the most 16 direct — the packing of cigarettes is the most direct 17 communication with smokers; correct? 18 A. 19 Mr. Goldfarb. Okay. But you did indicate yesterday that one of the I don't believe — 20 I'm not, you know, quibbling with you, I don't think that was my exact language. I do think 21 onpack is very important. I do however think that you need to 22 look at the overall range of communication vehicles that exist. 23 Q. Okay. 24 A. Because I think there are different ways to reach consumers 25 Q. And then the Star onsert goes on to say, "Because many 3390537422 3990537422 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10517 1 smokers smoke to get nicotine they tend" — 2 go back to page 1 because the second column begins — 3 to smoke more intensely when smoking lights or ultralights." 4 And then it goes on — and then you have to "they tend it has a paragraph about the 5 phenomenon of compensation; correct? 6 A. 7 on our lights onsert, yes. 8 Q. 9 onsert to tell smokers that the reason why they compensate and Correct. Okay. This tracks, I mean, the topics that are covered But there's no mention of nicotine in your lights 10 the reason why they might get more smoke from a light cigarette 11 is because they smoke for nicotine; correct? 12 A. That is correct. 13 Q. Okay. 14 column, which is again on page 2 of U.S. Exhibit 52963, it also 15 provides the information to smokers, "All smoke tobacco products 16 are addictive and pose serious health hazards." 17 If we go down to the second — bottom of the second Do you see that? 18 A. I do. 19 Q. And none of the onserts that Philip Morris has put out have 20 included that information on the packets, have they? 21 A. Not in this fashion, no. 22 Q. "Not in this fashion" meaning 23 A. No. 24 Q. --it's only referred people to the website where they can 25 find additional information. — 3990537423 3390537423 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10518 1 I don't know. I just don't know if the court reporter 2 got an answer to the last question, which is — 3 just clarifying when you said "not in this fashion," you meant 4 the only way that Philip Morris has in your view provided that 5 information in onserts is by referring smokers to other places 6 where they might be able to find that information? 7 A. 8 onserts, yes. 9 Q. Right. Okay. the question was If we're talking about that particular issue and Looking back at page 35 of your testimony. The next 10 sentence that you added to this answer states, "It has also 11 placed brochures at points of sale — 12 cigarettes containing excerpts from its website, including an 13 excerpt stating that Philip Morris agrees that smoking causes 14 cancer and other diseases in smokers." at point of sale with its 15 Now, brochures placed at point of sale, those are 16 printed brochures that might be on the counter at a retail 17 outlet? 18 A. 19 where, in fact, somebody would be consummating a purchase. 20 would have that information there. 21 Q. 22 Exactly. Usually, they would be placed at the cash register They But it would be voluntary. If you purchased a package of cigarettes, the clerk 23 it's not affixed to the package; correct? 24 A. 25 thousands, and they have all in fact been, you know, taken Correct. — But we have printed thousands and thousands and 3390537424 3990537424 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10519 1 advantage of — 2 Q. Okay. But -- 3 A. — because we — 4 Q. I'm sorry. 5 not affixed to the package? 6 A. Correct. 7 Q. And the clerk is not mandated to hand one of these pamphlets 8 every time someone purchases a pack of cigarettes? 9 A. No. But the answer to my question is no, they are 10 Q. Okay. And I'm guessing you don't print 780 million of these 11 pamphlets per month; correct? 12 A. We print thousands and thousands. 13 Q. But you distribute 780 million packs of cigarettes a month? 14 A. Correct. 15 number is somewhat misleading because when you have a carton 16 purchase it is going to be a consolidated purchase. You're 17 going to have 10 packs. 18 7B0 million, no. But in fact we have a process — number one, that But I think the important thing is that we have a 19 process to fill that up. I mean, there is an ongoing, you know, 20 flow of brochures when in fact they are made available at 21 retail. 22 Q. 23 telling smokers that Philip Morris agrees on or with the 24 cigarette packaging that smoking cigarettes causes cancer and 25 other diseases; correct? But placing brochures at point of sale, it's not — is not 3390537425 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537425 10520 1 A. 2 "with." It's with the package, but not in the same way that you mean 3 You mean affixed on to is I think the distinction 4 you're drawing. And if that is the distinction, no, it is not 5 affixed onto the pack. 6 Q. 7 appears in the advertising for Philip Morris' brands, including 8 that placed at point of sale." And then the next sentence states, "The website address Do you see that? 9 10 A. I do. 11 Q. And again, you've previously agreed that just stating the 12 website address is not a substantive statement that Philip 13 Morris agrees that smoking causes disease and other — 14 and other diseases in smokers; correct? 15 A. 16 directs people to the website, so I'm agreeing with 17 Mr. Goldfarb. 18 Q. 19 Morris' brands, including that placed at point of sale, what are 20 you referring to? 21 A. 22 at the point of purchase — 23 that will direct people to the website. 24 25 No. It directs people to that, but it does not — cancer it Now, when you're talking about the advertising for Philip When, in fact, we have, you know, any sort of advertisement in fact, there's information on it There are two different communications we're talking about here. One are the brochures that would appear at point of 3390537426 3990537426 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10521 1 sale, the other has to do with what we call you know POS pieces, 2 point of sale pieces, that would include information, including 3 the website, address, and a telephone number that consumers who 4 are not as facile or don't have access to a website can call. 5 Q. 6 again include Philip Morris's positions on smoking and health? 7 A. No. 8 Q. 9 computer, it would be — But again just to be clear. And then.... Those advertisements don't So if a person didn't have access to a it would be more difficult to get — tq 10 get to information; correct? 11 A. 12 give the telephone number. 13 a, what I call a mini website brochure that we mail out. If 14 anyone calls that number, we have a process whereby they can get 15 that brochure which gives them that same information, because we 16 have contemplated that there may be people who are not 17 comfortable in using a website or may not have access to it. 18 Q. 19 also communicated its agreement that smoking cigarettes causes 20 cancer and other diseases in smokers in nationwide television 21 advertising, direct mail, freestanding inserts included in 30 22 major newspapers throughout the United States, and in materials 23 mailed in response to requests." Correct? 24 A. Yes. 25 Q. That's why we give — as I just mentioned, that's why we And that is why we have printed up And then you go on to say in your answer on page 35, "It has And again, none of those are communications made on or with 3990537427 3390537427 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10522 1 the cigarette package; isn't that correct? 2 A. Yes. 3 Q. Now, if you could turn to page in your written direct 4 examination to the top of page 36. 5 point here in a change that you made to your written direct 6 examination. 7 I just want to clarify one The question at lines 1 through 9, the question and 8 answer. The question states, "Before October 2000, Philip 9 Morris's publicly-stated position was that smoking was a risk 10 factor for disease, and that whether smoking is actually a cause 11 of disease was unknown, right?" 12 And the proposed answer is — was, "That is right." 13 And you changed that to say "That is not right." 14 A. Correct. 15 Q. And then you added the next sentence, "Beginning in October 16 1999, Philip Morris stated on its website that, quote, there is 17 an overwhelming and medical and scientific consensus that" 18 excuse me — 19 consensus that cigarette smoking causes lung cancer, heart 20 disease, emphysema, and other serious diseases in smokers." 21 Correct. — "there is overwhelming medical and scientific Have I read that correctly? 22 A. Yes. 23 Q. Now, just so your testimony is clear. 24 October 1999 that Philip Morris's position was that it agreed 25 with the medical and scientific consensus on causation; correct? You are not saying in 3390537428 3990537428 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10523 1 A. In October of 1999, what we did was communicate the position 2 of the -- of the public health community on that issue. The 3 clarification we made in 2000 was to accept the company's 4 agreement with, you know, that statement. 5 Q. 6 to mean by that answer is, beginning in October of '99 Philip 7 Morris's publicly-stated position on the issue of causation was 8 that everyone else agrees that smoking causes disease in 9 smokers; correct? So again just so the testimony is clear. What you intended 10 A. In fact, its only position was that there was an 11 overwhelming consensus. That is the only thing it communicated 12 to the public. 13 Q. Ms. Keane, in 19 — 14 entire compensation package? 15 A. 16 received a bonus in the area of about, I think it was about 17 $400,000. 18 Q. And did you receive — 19 A. 350. I can't quite remember. 20 Q. Did you receive any other compensation? 21 A. We receive stock options. I'm sorry — in 2004, what was your In 2004 my salary was — and still is -- $525,000, and I've 22 How our compensation package works is that there is a 23 salary, and then based on the company's performance, there are 24 incentive packages that include a bonus and stock, which varies; 25 you know, varies from year-to-year. 390537429 3990537429 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10524 1 Q, Do you know the current value of the stock options that you 2 received in 2004? 3 A. 4 of years. 5 Q. How many stock options did you receive in 2004? 6 A. It was probably in the area of — 7 of value — 8 Q. And that was just — 9 A. Right. I don't own them at this point in time. 10 Q. I understand. 11 A. If I continue to be with the company they will vest at some 12 point. 13 Q. At this point you have no plans to leave the company; is 14 that correct? 15 A. No, I don't. They haven't vested. No. 16 17 They vest over a period So, I'm sorry. I'm guessing now in terms about $300,000, but I truly don't recall. that was just for 2004; correct? I don't. THE COURT: Are there 401(k) contributions made by the company? 18 THE WITNESS: We have something called a deferred 19 profit — deferred profit sharing that there is, you know, 20 generally a percentage of salary that varies from year-to-year. 21 Some years, it's been 10 percent. 22 of factors. And that will be contributed to your retirement 23 fund, 24 25 It varies based on a variety THE COURT: But that 10 percent, is that paid by you or I is that paid by the company? 3390537430 3990537430 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10525 THE WITNESS: THE COURT: Paid by the company. So, in effect, with your $525,000 salary, there's an additional 52 five contributed by the company into a deferred 401(k) of some sort. THE WITNESS; THE COURT: Is that accurate? That is correct. And then, of course, you get health benefits as well. THE WITNESS: Yes, we get that and... BY MR. GOLDFARB: Q. Ms. Keane, if I could direct you to page 43 of your corrected written examination. A. I'm sorry? Q. Page 43. A. Yes, I am. Q. I want to focus on the questions — Are you there, Ms. Keane? Thank you. the question and answer at lines 4 to 12. And just to orient the court. The prior question concerned Philip Morris's placing of Marlboro Man imagery on cigarette packs, the cellophane of cigarette packs in January of 2005; is that correct? A. Yes. Q. And Philip Morris has printed several different variations of this pack; correct? A. Yes. Q. And the question that is highlighted on the screen now asks 3990537431 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10526 1 that "When Philip Morris counsel previously represented in this 2 case that Philip Morris has stopped using the Marlboro Man 3 imagery today, except in direct mail marketing and on display 4 racks behind the counter at retail outlets, that was not 5 accurate, was it?" 6 And the proposed answer was, "No, it was not accurate." 7 And you struck that; correct? 8 A. Yes. 9 Q. And you added, "This is not what Philip Morris counsel said. 10 He said in relevant part: 11 images of the Marlboro Man and that western motif is at points 12 of sale because Philip Morris -- we still, where we sell our 13 cigarettes, we do believe we have a right to let our customers 14 know that our products are available for sale at that 15 location.'" 'The second place you could see some And you added, "There is nothing inconsistent between 16 17 this statement and the distribution of Marlboro cigarettes with 18 the image of the Marlboro Man on the pack." Did I read that correctly? 19 20 A. Yes, you did. 21 Q. Well, I'd like to go back and show the court, since you 22 quoted Philip Morris* counsel, what Philip Morris' counsel 23 actually said during the opening statement on the subject of 24 where today the Marlboro Man or Marlboro imagery can be seen. 25 I Can we call up page 390 of the trial transcript? And 3390537432 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10527 1 if we can, beginning at line 10, 10 to 13. 2 Now, this is a section before the section you quoted, 3 just an introduction for the court, at page 390 of the opening, 4 counsel stated, "The only place you can see the Marlboro Man 5 western motif today is in two places and I'll talk about them. 6 You can see it in what we call direct mail and you can see it, 7 to a limited extent, at retail stores where we sell our 8 products." Did I read that correctly? 9 10 A. Yes, you did. MR. GOLDFARB: 11 And then if you can go to the next page 12 of the trial transcript, please, and cull out page — 13 Q, 14 direct mail marketing communications, and then at page — 15 lines 7 to 19, he discusses the second place, and he states, and 16 I'll quote for the court. And then counsel goes on to talk about the first area, the at "The second place you could see some images of Marlboro 17 18 Man and that western motif is today at points of sale, because 19 Philip Morris — 20 believe we have a right to let our customers know that our 21 products are available for sale at that location. we still, where we sell our cigarettes, we do "But, Your Honor, the days are gone when there's these 22 23 huge signs on the door or all over the store. 24 appear — 25 point of — what I'm going to show you — They basically this is what's called a I don't think it gets any bigger. This is the point 3390537433 3990537433 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10528 1 of sale sign that you can see in stores today." 2 And if I can have JD 0534 05. 3 A. Thank you. 4 Q. No, it's — 5 is that the one? I may have — let me put — Charles, you can pull that down, it's the wrong one. 6 A. No, I do believe it's the one he handed me. 7 Q. Yes. And that, in fact, is the wrong exhibit, so I just 8 want to put up the right.... 9 10 And, I'm sorry. To correct the record, that's JD-053405. 11 And counsel held up a sign or pointed to the screen 12 where the sign was displayed and it says, "This is the point of 13 sale sign you can see in stores today, usually behind the 14 counter, above where cigarettes are being sold that tell 15 consumers, that's it. That's where the Marlboro Man can be seen 16 today in America." 17 Do you see that? 18 A. I'm sorry. 19 Q. I'm pointing to the transcript there. 20 A. Oh, the transcript? 21 Q. Do you agree that's what counsel stated? 22 A, Yes. 23 I see — you're pointing to the POS. I Q. And so he indicated two places. 24 Now, this, Ms, Keane, do you agree that's the type of 25 sign that would go above a cigarette rack behind — behind the 390537434 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537434 10529 1 counter behind — 2 A. 3 example of a particular sign. 4 Q. 5 put the Marlboro Man on every pack of cigarettes? 6 A. 7 in fact we were identifying that point of sale is a place where 8 the Marlboro image could be found. 9 I think the packs that you were referring to are another 10 at the point of sale? There are different types of POS execution. This is an And you're saying that another type of POS execution is to When I read the statement that was made, it was clear that example. POS is an example of that. And just to kind of complete that. 11 Yes, there are packs that were available, I think, for, 12 you know, a 2-week period at point of sale that in fact had that 13 imagery. 14 Q. 15 signs do,* correct? 16 A. 17 what happens is you take the cellophane off and it's disposed 18 of. 19 Q. 20 and walk around with them, so they leave the point of sale? 21 correct? 22 A. 23 And — No. but the packs don't stay at point of sale like the But what happens — Right. the answer to that is no — but But sometimes people purchase packs of cigarettes Right. I mean, point of — communications on package and 24 imagery on package is not unique. 25 never been done before. It is not something that has 3390537435 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537435 10530 And this particular execution that you are referring to 1 2 happened the beginning of this year, but as I read the 3 communication that you've shared with me I think it is 4 accurately captured. 5 Q. And you said they ran for a 2-week period? 6 A. I believe it was — 7 just a sale, approximately. 8 Q. 9 nationally? it was a limited period. I think it was It was a limited period. And it was available -- the cigarettes were made available 10 A. Yes. 11 Q. Do you know roughly how many — 12 cigarettes Philip Morris distributed? 13 A. No, I'm sorry, I wouldn't. 14 Q. And, Ms. Keane, if I can now direct your attention to page 15 4 4 of your corrected examination, the question at lines 6 to 13. 16 This question reads — how many packs of these The prior questions have 17 confirmed that Philip Morris still utilizes several different 18 vehicles to communicate with the public. 19 And this question then asks, "In none of these public 20 communication vehicles — 21 packaging, package onserts, newspaper inserts, point of sale 22 materials, or television advertisements has Philip Morris told 23 its customers or the public that it agrees that nicotine 24 delivered in cigarettes is addictive, right?" 25 the corporate website, cigarette And the proposed answer is, "That is true." And you 3390537436 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537436 10531 1 left out there and added, "But the website expressly references 2 public health statements that nicotine is addictive. 3 addition, Philip Morris has delivered what it believes is a 4 broader and more relevant statement for smokers: 5 the overwhelming medical and scientific consensus that cigarette 6 smoking is addictive." In We agree with 7 Now, Ms. Keane, you agree that it is also a — it is 8 also a relevant point of information to smokers that cigarettes 9 deliver what Philip Morris agrees to be an addictive drug; 10 correct? 11 A. 12 of both the product and the sort of — 13 that is why the company has always viewed the statement 14 cigarette smoking is addictive to be the broadest statement 15 possible. 16 because that truly has been our objective. 17 Q. Now -- 18 A. So that is the vehicle that the company has chosen in its 19 communication. 20 Q. 21 important to smokers, as a relevant fact to smokers, that Philip 22 Morris knows that its product delivers nicotine, an addictive 23 drug? 24 A. 25 the information is there. What I think is relevant is that smoking really is composed Okay. the habit of smoking. So You know, kind of giving people the broadest warning, But my question is, is it not true that it is Clearly, people know that the product delivers nicotine, and We in fact have communicated, I 390537437 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537437 10532 1 think, the — 2 THE COURT: Ms. Keane, keep your voice up. 3 THE WITNESS: I'm sorry, Your Honor. 4 A. I think we have communicated the broadest message, and a far 5 broader message in talking about cigarette smoking being 6 addictive. 7 Q. Okay. 8 exclusive; correct? 9 A. No. Ms. Keane, the two statements are not mutually 10 Q. Okay. So, Philip Morris might believe that the message is 11 broader, but — 12 A. And, in fact — I'm sorry, Mr. Goldfarb — but I add that 13 you can in fact obtain the specifics of the public health 14 community position on that on the website. 15 Q. 16 Morris's position, because as of October 2002, it is true, is it 17 not, that Philip Morris agreed to state publicly in an 18 interrogatory response to the United States that it agrees that 19 nicotine delivered in cigarette smoke is addictive; correct? 20 A. 21 in 2003, but you, perhaps, you quote the right date. 22 Q. Okay. 23 October 2002 is when Philip Morris agreed that it could state 24 that publicly; correct? 25 A. At or around that time, yes. I couldn't give — I understand that, Ms. Keane. That was in the interrogatory. I'm asking you about Philip I think it might have been But in your testimony you confirm that in 3390537438 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537438 10533 1 Q. 2 correct? 3 A. 4 found on the website. 5 Q. 6 that cigarette smoking is addictive? 7 A. Correct. 8 Q. It hasn't told people it agrees that the nicotine delivered 9 in cigarette smoking is addictive; correct? 10 A. But Philip Morris has never told that to the public; Other than in the way that I've described in which it can be Okay. Now, Philip Morris has told people that it agrees Correct. 11 The only thing that it has done, just to be fully 12 complete on that, is Mike Szymanczyk has, in fact, made 13 different communications. 14 of his testimony before Congress where he spoke to the fact that 15 nicotine in cigarette smoke is addictive can, in fact, be found 16 on the website. 17 Q. 18 material fact for smokers to know that Philip Morris agrees that 19 its products deliver nicotine, an addictive drug; correct? 20 A. We try to be as 21 Q. Ms. Keane, could you answer my question, please? 22 A. Yes. 23 Q. My question is, you agree, do you not, that it's a material 24 fact for smokers to know that Philip Morris agrees that its 25 products deliver nicotine, an addictive drug? Okay. But — And, in fact, I believe a transcript so then you agree that it is — it's a — Please repeat it for me, Mr. Goldfarb. 3390537439 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537439 10534 1 A. I think it is material for people to have information. 2 When I look at those words and parse them out, I think 3 they are on the website and communicated in a way that gives 4 people the most complete information. 5 Q. 6 nicotine in cigarette in cigarettes is addictive." 7 A. 8 there is information, including the link to Mr. Szymanczyk's 9 testimony, that says nicotine in cigarette smoke is addictive. Okay. And again, Philip Morris doesn't say "we agree that It does not in the section under addiction. So again in the section at — Correct? But, as I said, 10 Q. 11 that discusses smoking and addiction, it doesn't say "Click here 12 to see Philip Morris's views on nicotine addiction," does it? 13 A. Not in that fashion. 14 Q. Okay. 15 and locate, and the person wouldn't necessarily know what 16 Mr. Szymanczyk testified to or who he is or what the content of 17 his testimony is; correct? 18 A. So someone would have to search around the website Well, I wouldn't quite describe it that way. 19 But to your broader point, it is not found in the same 20 section. 21 found in that section. 22 Q. 23 exclusive. 24 A. 25 the section of the website But I believe personally that the broader message is Again, you agree that the two statements are not mutually Philip Morris could make both statements? Yes, I do. MR. GOLDFARB: I have no further questions at this 3390537440 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537440 10535 1 time, Ms. Keane. 2 THE COURT: 3 And, Mr. Wells, I think you anticipated three hours. 4 All right. Let's take our break now, then. Is that right? 5 MR. WELLS: Yes, Your Honor. 6 THE COURT: 15 minutes, everybody. 7 (Recess began at 10:53 a.m.) 8 (Recess ended at 11:12 a.m.) 9 THE COURT: Mr. Wells, cross, please. 10 MR. WELLS: Thank you, Your Honor. 11 CROSS-EXAMINATION 12 BY MR. WELLS: 13 Q. 14 questions about the Hatch Statement; correct? 15 A. Yes. 16 Q. And you testified that Altria submitted the Hatch Statement 17 to Senator Hatch on October 2, 1997. And my question is: What 18 was happening in the summer and fall of 1997 that caused Altria 19 to issue the Hatch Statement? 20 A. 21 involved in negotiating what we referred to as the proposed 22 resolution. 23 negotiated with the state Attorneys General that was intended to 24 sort of bring forth a regime that would deal with product, 25 controlling the product. Ms. Keane, during its examination the government asked you At the time preceding the Hatch Statement Philip Morris was It was a very, very far reaching proposal that was It would relate to advertising. It 3390537441 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537441 10536 would relate to a whole host of things, including the resolution of some litigation issues. Q, Could you give us a fuller background as to the proposed resolution you referred to? A. Proposed resolution of what? It was, in a sense, an effort to try to work with the states and then support federal legislation that would introduce a whole new environment as it related to cigarettes in the United States. It would have bought into and supported an FDA control over the product in the communications around the product. It also would have entailed a whole series of, you know, very specific restrictions as to how the product would in fact have been sold in this country, THE COURT: Who were you negotiating that with? THE WITNESS: THE COURT: What happened — I was not personally I don't want a long explanation. — First of all, who were you negotiating it with? THE WITNESS: The negotiation was with the state Attorneys General along with communication with the federal government through the White House is my understanding of how it was taking place. THE COURT: And were other defendants in this case involved in those negotiations? THE WITNESS: THE COURT: Yes. Mr. Wells, go ahead, please. 3990537442 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10537 1 BY MR. WELLS: 2 Q. 3 lawsuits that were brought by the various state Attorney 4 Generals and how those lawsuits related to the resolution that 5 you just discussed? 6 A. 7 who were trying to collect what they had identified as expenses 8 associated with the, you know, use of the product. Could you generally describe the Medicaid reimbursement Philip Morris had, in fact, been sued by a series of states 9 They were lawsuits where the damages being requested 10 were very, very significant, and in fact where the relief being 11 requested by the states from a — 12 restriction and product control was very extensive. 13 in terms of, you know, product I mean, ultimately, although the proposed resolution 14 didn't go ahead, we ended up signing what we call as the Master 15 Settlement Agreement and the four separately-settled states 16 agreements, which took a very critical portion of the proposed 17 resolution and, you know, incorporated them in state specific 18 deals that the company has signed. 19 Q. 20 resolution that is discussed in the Hatch Statement and the 21 Master Settlement Agreement? What is the relationship, if any, between the proposed 22 MR. GOLDFARB: Your Honor, I'm going to object at this 23 point. There's nothing in Ms. Keane's testimony that makes 24 reference to the settlements or that called for testimony 25 concerning the state settlements or the MSA. So it's beyond the 33905374- 3990537443 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10538 1 scope of the witness's 2 THE COURT: — Well, the MSA is certainly a major element, 3 issue, factor — whatever word you want to use — in this 4 litigation. 5 this witness about the Hatch Statement. 6 there is any relationship between the two, it's relevant. 7 will allow the question. 8 A. 9 content of some of the restrictions that were going to be And certainly we've heard a lot of testimony from And to the extent that So I The proposed resolution, number one, as it related to the 10 imposed as it related to the way in which the product was going 11 to be sold, those, in fact, were followed through and carried up 12 and adopted in the MSA. 13 In addition, the proposed resolution also contemplated 14 a series of consent decrees and things of that nature so as to 15 ensure enforcement and the companies, you know, obligation, you 16 know, under the various agreements, and that also is carried 17 forward into the MSA. 18 Q. 19 a proposed resolution with the states who were parties to the 20 Medicaid reimbursement suits and the next thing that would 21 happen was that there would be have been federal legislation? 22 A. Yes, absolutely. 23 Q. And did the federal legislation pass? 24 A. No, it did not. 25 Is it correct that the original plan was that there would be There was a period of time, I have to add, that the 3390537444 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537444 10539 1 company was, in fact, actively engaged in trying to support the 2 enactment of federal legislation which would have included a 3 Medicaid — 4 never passed. 5 Q. 6 how did that relate to the Hatch Statement? an FDA component and things of that nature, but that And the federal legislation that was pending at that time, 7 MR. GOLDFARB: Objection, Your Honor. The court has 8 ruled, I think on more than one instance, that testimony about 9 proposed but not enacted legislation is irrelevant. 10 THE COURT: Well, that — that litigation before me 11 pertained to the McCain bill, it is my recollection, and 12 certainly there's not going to be any extensive questioning on 13 this issue. 14 rulings that I made regarding the McCain legislation are in 15 effect. So I will allow this question, although the former 16 Go ahead, please. 17 THE WITNESS: I'm sorry. 18 BY MR. WELLS: 19 Q. 20 was pending at that time, how did that relate to the Hatch 21 Statement? 22 A. 23 company was very interested in making sure that the proposed 24 resolution was properly considered on Capitol Hill. 25 The question, Ms. Keane, was in the federal legislation that The Hatch Statement was, in fact, communicated because the And so as part of those discussions, the question was 3390537445 3990537445 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10540 1 asked, you know, how can we be assured that the company is going 2 to, in fact, live up to its alignment with the public health 3 community on critical issues? So the Hatch Statement was formally issued to, I 4 5 believe it was the Judiciary Committee, Senator Orrin Hatch, 6 wherein the company made a formal commitment that, in fact, it 7 would walk away from the debate, it would no longer debate 8 critical issues around product relating to causation or 9 addiction, and in fact, it would stand to — it would stand with 10 the public health community to support a single consistent 11 message. 12 Q. 13 not pass; is that correct? 14 A. That is correct. 15 Q. And is it correct that when the proposed federal legislation 16 failed, that was when it was necessary to enter into the Master 17 Settlement Agreement with various states? 18 A. Yes. 19 Q. And had the legislation passed, is it fair to say there 20 would not have been a need for the Master Settlement Agreement? 21 A. No, absolutely not. 22 Q, Now, I would like to show you a copy of the Hatch Statement, 23 and I would like to call up U.S. Exhibit 39734, which is a copy 24 of the Hatch Statement. 25 the first paragraph which the government did not quote in the Now, you indicated that the proposed federal legislation did And I want to focus your attention on 3390537446 3990537446 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10541 1 2 examination that it supplied you in the written direct. The first paragraph of the Hatch Statement states, "We 3 are entering into an historic resolution of much of the 4 controversy that has been focused on tobacco and its use in the 5 United States. 6 era for the industry and its relationship with the public and 7 government. 8 cooperation and agreement. 9 The resolution should be the beginning of a new Hopefully, it will be an era characterized by "We are fully committed to the objective of 10 discouraging and reducing underage smoking, as embodied in the 11 terms of the comprehensive agreement we entered into on June 2 0 , 12 1997. We support and will work for passage of legislation 13 incorporating all the provisions of that agreement, including 14 the required new health warnings. 15 "In this regard, we have been asked b y various members 16 of Congress, Attorneys General, representatives of the public 17 health community, and others, to state our views on a number of 18 issues related to tobacco, and we are pleased to do so." 19 To what extent would you characterize Philip Morris's 20 issuance of the Hatch Statement as constituting a see change in 21 how Philip Morris had historically communicated with the 22 American public on the issues of health and smoking? 23 MR. GOLDFARB: Objection, leading. 24 MR. WELLS: I said to what extent. 25 THE COURT: N o . The objection is overruled. 3390537447 3990537447 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10542 1 A. 2 3 One of the things that, in fact THE COURT: It may be a puff ball question, but that's different than leading, everybody. 4 — Make that clear. {Laughter} 5 THE COURT: All right. Mr. Wells, go ahead. 6 A. One of the things that I discussed with Mr. Goldfarb 7 yesterday related to my responsibilities at WRA, and in fact, 8 Hatch was, I think, a critically important development. 9 One of the things that we did was to make sure that the 10 operating companies, you know, understood the commitment and, in 11 fact, that there was a mechanism in place to ensure compliance 12 with it because, you know, this represented — 13 the first in a whole series of events. I think it was 14 I mean, there were clearly things that were building up 15 to Hatch, but it was the first in a series of events where we so 16 publicly communicated our objective to be aligned with the 17 public health community. 18 Q. 19 align itself with the public health community been an 20 evolutionary decision and process? 21 A. 22 sort of pick, you know, the mid-90s. 23 And to what extent has the decision by Philip Morris to There are, you know, things that started — I would really But, you know, Hatch, I think, was a critical step and 24 it was soon followed, particularly with PM-USA, with really 25 trying to create a process because you can't manage a large 390537448 3990537448 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10543 organization without a process. So along with the Hatch, you know, we had a, you know, CEO who was, you know, focused on trying to create a vision and a values, and creating an infrastructure to ensure that the company continued marching in this direction. I mean, Hatch was a step that was irrevocable. could never move back from Hatch. We And then, in fact, you had the next step, you know, continue that, because we had our efforts to, and in fact, our successful efforts to resolve our disputes with the Attorneys Generals. You had what I would call a pronounced increase in the way in which we have tried to reach out and work both with regulators and elected officials; you know, whether it's on a State level or on a federal level, to try to make sure that we were no lodger so disengaged and so isolated from what was going on about our product. I mean, we have — if you look at the past, I mean that is a place that the company was committed to creating infrastructure and making commitments that we could ensure that that would not happen again. Q. Now, I want to read — or focus your attention on two other portions of the Hatch Statement, and I want to start with the section entitled Causation, which is the first paragraph at the top of the second page, and that paragraph reads: "Despite the differences that may exist between our 3990537449 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10544 1 views and those of the public health community, in order to 2 ensure that there will be a single, consistent public health 3 message on this issue, we will refrain from debating the issue 4 other than as necessary to defend ourselves and our opinions in 5 the courts and other forums in which we are required to do so. 6 For that reason, we are also prepared to defer to the judgment 7 of public health authorities as to what health warning messages 8 will best serve the public interest, as reflected in the 9 proposed new health warnings." Was a similar statement also made with respect to the 10 11 issue of addiction? 12 A. Yes. 13 Q. 14 causation and addiction, that Hatch contained two separate 15 commitments? is it fair to say that, with respect to the issue of disease One was to defer to the judgment of public health 16 17 authorities on warning labels, and the other was to withdraw 18 from the debate on smoking and health and addiction? 19 A. Correct. 20 Q. What was the company's purpose in making those commitments? 21 A. The company's purpose was, number one, to make in a very 22 public way its commitment to no longer being part of what I 23 would call an old world, but to take a step that would codify 24 really for all purposes going forward the fact that it was going 25 to be aligned with the public health community, that it was 3390537450 3990537450 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10545 1 going to communicate the message of the public health community. 2 And when we talk about what's on the website, you know, 3 to me, the guiding principle is communicating the message of the 4 public health community, and really that is — 5 is where that principle — 6 Hatch. 7 Q, 8 that the old world involved a world where Philip Morris and 9 other tobacco companies had been involved in an intense public 10 debate with the public health community over smoking and health 11 issues for many years? 12 MR. GOLDFARB: 13 THE COURT: to me, the Hatch you know, the principle comes from Is it fair to say that when you use the phrase, old world, Objection, Your Honor. That's leading. I think we need to get that clarified — or 14 to get an answer in order to clarify the last answer to the last 15 question, so I'm going to allow it. 16 A. Yes, it is true. 17 Q, Now, when Mr. Goldfarb asked you questions about some 18 language in your deposition testimony where if we had literally, 19 you indicated that Philip Morris had not been historically 20 discussing smoking and health issues and you said that was 21 preposterous on its face, what did you mean by that? 22 A. 23 and addiction. 24 25 Well, clearly, we had been debating issues around causation It is true that we were not discussing smoking and health in an aligned fashion, but it is absolutely preposterous 3390537451 3990537451 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10546 1 to suggest that we were not discussing the company's beliefs at 2 the time around smoking and health and addiction, and they were 3 beliefs that were not aligned with the public health community. 4 Q. 5 questioned you about, you and he — 6 pages preceding those pages and following those pages -- had 7 been talking about the Hatch Statement and the website; is that 8 right? 9 A. And as you indicated in the pages that Mr. Goldfarb You know, it's true. in those pages and other I mean, there are topics, because of 10 my personal involvement, that mean a great deal to me. 11 the extent to which I was not totally responsive to 12 Mr. Goldfarb, it was not for any — 13 to be. And to because I was intending not I was intending to communicate what was happening at 14 15 the time, to communicate — 16 that was aligned. 17 we had been discussing the debate, and Hatch led up to a 18 commitment not to debate. 19 smoking is — 20 Q. 21 you will take responsibility for it. 22 clearly, we were not doing something What we were doing was in fact debating and So to suggest we never discussed just doesn't make any sense. It's nonsensical. So there was some type of misunderstanding, as you indicated But in your testimony in this courtroom today and in 23 your corrected testimony, you made it clear that there's 24 absolutely no question that Philip Morris had historically been 25 involved in a public debate with the public health community 3990537452 3990537452 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10547 1 over smoking and health issues. 2 A. I agree with that. 3 Q. Now, is it true that despite the failure of federal 4 legislation referenced in the Hatch Statement, that Philip 5 Morris has continued to maintain its commitments expressed in 6 the Hatch Statement? 7 A. Yes. 8 Q. Please explain in general terms how it has maintained that 9 commitment. 10 A. 11 communicated, and is communicated, to our employees. 12 Well, clearly, it is, you know, something that has been And you know, to some extent, you know, Hatch really 13 became a tool internally. 14 for the company, not just as it related to our external 15 audience, but also as it related to our internal audience, to 16 make sure that people in the company understood what the company 17 was intending to accomplish. 18 I think it was a very important thing This has been held out as a compliance objective. You 19 know, people again in the organization are judged, not just by 20 what they do, but how they do it, and do they do it in a way 21 that is in full compliance with the company's commitments and 22 this is a critical one. 23 Q. 24 responsibilities do you have with respect to insuring that 25 Philip Morris and its employees comply with the Hatch Statement? Well, as general counsel of Philip Morris USA, what type of 3990537453 3990537453 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10548 1 A. Well, one of the things that we do is we have substantial 2 training. 3 example, but I think it's hopefully somewhat illustrative. In addition -- and this is just a very sort of small I mean, you know, the concept of the HOW (sic}, which 4 5 is what to me Hatch is so much about, is an element that we even 6 bring down to performance appraisals now. 7 company has objectives and initiatives, but it's not just 8 getting it done, it's the way in which one gets it done which is 9 an equally important part of how individuals within the 10 It is, you know, the organization are evaluated. 11 And this is, you know, sort of one of the guiding 12 principles. You know, how we talk about issues around our 13 product. 14 around the product in a way that is fully aligned with Hatch and 15 fully aligned with what is going on with the public health 16 community. I mean, the company internally now talks about issues 17 I mean, what we are doing with youth smoking 18 prevention, what we're doing now with regard to cessation, the 19 way in which we endeavor to update our website in a timely 20 fashion to capture important communications like a Monograph, 21 you know, 13, which, you know, had to do with, you know, light 22 and low-tar cigarettes. 23 Those are things that have really been built into the 24 institution that I think have only been augmented by what our 25 president and CEO talks about as mission and values. And, you 3990537454 3990537454 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10549 1 know, this is a way in which the organization has, in fact, been 2 trained to operate and the way in which the organization is 3 evaluated in terms of its performance. 4 Q, 5 bonus perhaps be tied to whether or not that person advanced the 6 commitments 7 A. Absolutely. 8 Q. — 9 A. Absolutely. 10 Q. Now, you testified that in Hatch Philip Morris committed to 11 withdrawing, withdrawing from the debate on public — 12 important smoking and health issues; correct? 13 A. Yes. 14 Q. Now, to what extent has Philip Morris done more than simply 15 withdraw from discussing smoking and health issues? 16 A. 17 And in terms of performance evaluations, would a person's — set forth in Hatch? on Well, I think the website is a very good example of that. Technically, Hatch told us to withdraw and to support, 18 but it did not necessarily go into specifics about what our 19 communication platform needed to be. 20 So, I mean, the website is a vehicle where, in fact, 21 the company's alignment with the public health community is, in 22 fact, communicated broadly across the wide range of issues that 23 are implicated by our product. 24 25 It then in a sense becomes a launching pad for things, such as a freestanding insert, a POS brochure, an onsert, a 3990537455 3990537455 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10550 1 television commercial. You know, all of it goes back to, you 2 know, having a plan and a vision for how communication should 3 take place. But I think I would call the website the core, you 4 5 know, the real basis on which, you know, we try to create the 6 broadest platform possible. We can't take every word of the website and communicate 7 8 it through each of these vehicles, but the overall gestalt or 9 objective of the communication platform is to ensure that there 10 are multiple ways that people can get information that reflect 11 our commitment. 12 Q. 13 the website was launched October 13, 1999; is that right? 14 A. Yes. 15 Q. Is it fair to say that, in terms of this evolutionary 16 process you referred to, that the Hatch Statement begins with a 17 statement of withdrawing from the public debate but that evolved 18 into affirmative efforts to communicate to the American public 19 the positions of the public health community about smoking and 20 health? 21 A. 22 business initiative. 23 Q, What did? 24 A. The commitment to try to advance and identify further 25 platforms in which to try to communicate with our consumers You indicated that Hatch is issued in October of 1997, and Yes, it did. And, in fact, it even became a specific 3990537456 3990537456 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10551 1 about, you know, health-related issues around the product. 2 Q. 3 "Hopefully it will be an error characterized by cooperation and 4 agreement." 5 Now, the Hatch Statement in the third sentence says, And the second sentence I should have read first. "The 6 resolution should be the beginning of a new era for the industry 7 and its relationship with the public and government." Even though the federal legislation was not passed, to 8 9 what extent was the Hatch Statement the beginning of a new era 10 for Philip Morris and its relationship with the public and 11 government? 12 A. 13 you know, what I've tried to do. 14 a job such as mine can make certain decisions as to what they 15 think is important in helping an organi2ation achieved its 16 mission and its values. 17 What the company has tried to do -- and I have to say that, I think every person whose in For me, I probably spend an inordinate amount of time 18 doing what I think is critical for the organization, and that is 19 focusing on an outreach, trying to communicate with elected 20 officials, such as, you know, state AGs, talking to regulators. 21 You know, those are things that I think accomplish two purposes. 22 Number one. It enables us to understand where our 23 critics -- and I still -- you know, we still are. We have 24 critics, as we should have critics. 25 critics are, but also to be able to communicate and share what But understand where our 3390537457 3990537457 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10552 1 the company is doing and, quite honestly, get feedback. 2 You know, I spend a lot of my time talking to the AGs. 3 I've spent a lot of my time at various periods talking to some 4 of our regulatory agencies. 5 thing for a company that had been historically characterized by 6 such a sense of isolation. 7 Q. 8 Strategic Issues Task Force. 9 A. And I think that is an important Now, you testified that you headed a group called the What was that? The first Strategic Issues Task Force was really the Website 10 Task Force. It was — I was asked to pull together a group to 11 think about, number one, how do you create a platform for 12 communicating? And number two, you know, if the recommendation was to 13 14 have a website, to what extent do you talk about tobacco 15 specific issues? 16 Q. 17 for developing the website as it first was launched in October 18 of 1999? 19 A. Yes. 20 Q. So it's fair to say you were the leader and the person at PM 21 that was the point person in terms of developing and overseeing 22 the website? 23 A. Correct. 24 Q. And who appointed you to be head of that task force? 25 A. I was asked to head it up by Jeff Bible. And it was that task force that ultimately was responsible 3990537458 3990537458 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10553 Q. Now, I'd like to call up JD 054555 and ask, Ms. Keane, if you can identify that document? A. I can. Q. What is it? A. It is a memo that I received — a memo that I sent to Jeff Bible sort of following up on recommendations that were being made with regard to the website. Q. And could I go to page 2 of the memo? It's dated August 10, 1999; correct? A. Yes. Q. And in that memo you wrote, "Our objective is to present materials in an accessible fashion. We will attempt to avoid lengthy position statements and focus on a concise format that we believe Internet users prefer when seeking information, "We intend to present our views in an open and direct manner and provide references reflecting the viewpoints of others. Our perspective has been to view the website less as a place for advocacy, but rather as a way to provide consumers with a range of information. We believe this approach is consistent with our overall philosophy, which is based on informed choice." To what extent does the website as ultimately developed — to what extent is the website as ultimately developed consistent with the statement you made in that memo? A. I believe it is consistent. 3990537459 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10554 I mean, that was the website that was, in fact, shared with both Jeff Bible and ultimately approved by the operating companies took this approach. We were trying to balance — there are different ways to go about communicating. The choice that we made was to keep things very simple and to just give people more information. Right click to get the information of the public health community was the best way to make sure that there was clarity. What we didn't want was, you know, multiple pages that people had to plow through to get — to understand what you were saying. You know, this was a first time for us. done it before. It was a very — We had never we had a lot of issues that we were grappling with, but this I think was one of the guiding objectives, to bring clarity and to bring as complete information as we could in the context of this website. Q. Now, is the version of the website that the public can view today the same as what appeared on October 13, 1999? A. Not totally. document. I mean, you know, the website is a living And we've already discussed with Mr. Goldfarb, or I discussed with Mr. Goldfarb some changes that have been made. Changes are made on a somewhat regular basis; as, in fact, something like Monograph 13 comes out, we would put it on the website. When we put it an onsert on our pack we would put it on the website, 3990537460 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10555 So it is something that kind of gives you the tool to ensure that you can change and include things on a timely basis. Q. Is it fair to say that you're constantly involved in trying to improve the website? A. Yes. No, we have people who have that responsible — very specific responsibility. Q. When you say it's a living document, what do you mean by that? A. Well, I mean, I think one of the challenges when, in fact, you use, you know, traditional printed word is how do you update things? How quickly can you update it? How quickly can you get it out the door? When have a website you have the ability to go and act in a timely basis. So that's why I call it the core platform for our communication, because we are able to very efficiently include information on a timely basis and include it with as much detail as people might be interested in. Because, you know, if you use a website the way we structured it was to give people a simple platform, but then give them the ability to drill down, integrate in greater detail if that is, in fact, what they wanted. Q. I want to ask you some questions about the statements that appeared on the website when it was first launched in October 1999. And I'd like to give you a copy of JD 04 6719, which is 3990537461 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10556 1 2 S a copy of the website as it existed in October 1999, and ask you to briefly review that document. 3 And do you recognize it? 4 A. I do. 5 Q. Now that is a copy of the website as it appeared in 6 October 1999; correct? 7 A. Correct. 8 Q. 9 the original version was in color? Now, that exhibit is in black and white. 10 A. Yes. 11 Q. 12 refers to the topics. Is it correct that Now, I'd like to direct your attention to page 5 where it 13 Now, is it correct if someone wanted to get information 14 about the various topics set forth on page 5, all they would 15 have to do is click on to those sections? 16 A. Yes. 17 Q. 18 was first launched in October of 1999 were youth smoking 19 prevention, cigarette marketing practices, cigarette smoking, 20 health issues for smokers; quitting smoking, ingredients in 21 cigarettes; understanding tar and nicotine numbers, and 22 second-hand smoke; is that correct? 23 A. Right. 24 Q. 25 causation and addiction, so I want to direct your attention to Okay. And the topics that were included when the website Now, you were asked some questions by Mr. Goldfarb about 3990537462 3990537462 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10557 1 those pages of the 1999 website that refer to causation and 2 addiction. 3 I would like to go to page 11 of the website. So when 4 the website was originally launched in October 1999, what it 5 said with respect to causation and addiction was as follows: 6 "Cigarette smoking and disease in smokers. 7 an overwhelming medical and scientific consensus that cigarette 8 smoking causes lung cancer, heart disease, emphysema and other 9 serious diseases in smokers. There is Smokers are far more likely to 10 develop serious diseases, like lung cancer, than nonsmokers. 11 There is no safe cigarette. 12 messages of public health authorities worldwide. 13 potential smokers should rely on these messages in making all 14 smoking-related decisions." These are and have been the Smokers and And then at the bottom, it says, "Cigarette smoking and 15 16 addiction. Cigarette smoking is addictive as that term is most 17 commonly used today. 18 but this should not deter smokers who want to quit from trying 19 to do so." It can be very difficult to quit smoking, Now, do you recall Mr. Goldfarb asking you some 20 21 questions whether or not the website, as originally launched in 22 October 1999, stated that Philip Morris agreed with the 23 overwhelming medical and scientific consensus concerning 24 causation? 25 A. Yes, I do. 3990537463 3990537463 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10558 Q, And he also asked you questions about whether, as originally launched, the website stated that Philip Morris agreed that cigarette smoking was addictive. Do you recall those questions? A. Yes, I do. Q. My first question is, is there anything on the website, as launched in October 1999, that indicated in any way that Philip Morris disagreed with the statements on the website concerning the positions of the public health community? A. No. Q. Now, a year later Philip Morris amended the language on the website to indicate that it did agree; is that correct? A. Yes. Q. Is that part of the evolutionary process in terms of constantly trying to improve the content of the website? A. Yes. Q. Now, is it correct that the 1990 website provides links to other sources of information regarding smoking and disease? A. Yes, it does. Q. Describe for the court just how the links work and how they are reflected on the page on the board. MR. GOLDFARB: record. I object. Just to clarify for the Your question referred to the 1990 website. MR. WELLS: I apologize. Thank you. It means 1999. Q. With that amendment, you can answer. A. What would happen is if you go to the first bolded section, 3990537464 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10559 1 you could click on any of those dates and you could get to, you 2 know, the Surgeon General's Reports and information from the 3 Surgeon General. 4 5 You could go down to, you know, the section below and choose whether or not you wanted to get information from WHO. 6 These links in many instances link automatically to the 7 principal site of the public health community so that people 8 can, as they are going through our website, they can go back 9 and, you know, dive down and if they want to see the WHO 10 framework convention on tobacco control, there would be a way 11 from our website to have access to it. 12 Q. 13 U.S. Surgeon General's Report of 1964, what would you do? 14 A. You would just go to 1964 and you would double click. 15 Q. Now you were asked some questions concerning whether or not 16 Philip Morris on its website indicated that nicotine was 17 addictive as opposed to just saying that smoking is addictive. So if you wanted to see highlights and conclusions from the 18 Do you recall those questions? 19 A. I do. 20 Q. Now, let me first direct your attention to the 1990 21 website — 22 the links to addiction, which should be the next page, on page 23 12. 1999, I apologize — to the 1999 website regarding 24 So, on the page, the link page of the 1999 website 25 there are links that will take you to public health reports 3990537465 3990537465 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10560 1 concerning addiction; right? 2 A. Yes. 3 Q. 4 to a link, there's a statement for anyone to read that the 5 nicotine in cigarettes and smokeless tobacco causes and sustains 6 addiction, and then in paren, it says US Food and Drug 7 Administration. 8 A. Correct. 9 Q. And is it correct that right on the page before you even go Is that correct? So there's no question that there was no attempt by Philip 10 Morris to hide in any way the concept that there was nicotine in 11 cigarettes and that the public health community was taking the 12 position that that sustains addiction; right? 13 A. Correct. 14 Q. And if you clicked on to the link page regarding the Surgeon 15 General's 1988 report, what would you get? 16 A. 17 on exactly that point. 18 Q. 19 respect to the question of addiction — I would just like to 20 call up J-DEM 4 0178. You would basically get information from the Surgeon General Now, if we look at the website as it exists today with And is this a copy of the website on addiction as it 21 22 reads today? 23 A. Yes. 24 Q. 25 they will see is, "Addiction, Philip Morris USA agrees with the And if anybody goes to the addiction page, the first thing 3990537466 3990537466 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10561 overwhelming medical and scientific consensus that cigarette smoking addictive." Correct? A. Correct. Q. And right on the face of that Web page is a statement, to the right, that says, "US Surgeon General's Report — addiction, 1998." nicotine Is that right? A. Yes. Q. And then if you click on that, you will go to the report? A. Yes. Q. And, in fact, it appears to be a typo because it really says "1998" and it should be "1988"? A, Correct. Q. Okay. Constant improvement. But when you click on, what jumps out at you is a copy of 1988 Surgeon General's Report that is titled Nicotine Addiction; right? A, Correct. Q. Now, I've been asking you questions about causation and addiction. Is it correct that in terms of the Philip Morris website as it exists today, that it also covers other topics? A. Absolutely. MR. WELLS: Could I bring up J-DEM 4 0018 which is a page from the current Philip Morris' website. Q. Could you describe to the court what other topics are contained in the Philip Morris' website as it exists today? A. Okay. This is an example of the first page. 3990537467 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10562 1 So when you come to the website, this is what would 2 greet you. And you can go down, and if you look under Health 3 Issues, you can click on this box and go immediately to talk 4 about cigarette smoking and disease, or addiction, or 5 information about quitting smoking. 6 You could get information on low-tar cigarettes. In 7 that, it would have information on, you know, descriptors, vent 8 holes, all the things that we have been discussing over the past 9 two days, 10 You could go to issues about smoking and pregnancy. 11 You could talk about ETS second-hand smoke and, of 12 course, along with other public health information you can 13 specifically go to the Surgeon General reports. 14 Q. 15 and addiction but, as you indicated, the website also has 16 information about low-tar cigarettes; correct? 17 A. Correct. 18 Q. 19 your dealings with the FTC with respect to the meaning of the 20 FTC numbers, and I'm going to ask you questions after lunch 21 about the information on the website concerning low tar. 22 not going to do that now. 23 and do the low tar questions all in one set. Okay? 24 A. Okay. 25 Q. Now, in order to save time and rather than put up each page Now, I've asked you some questions about disease causation Now, you were asked a lot of questions by Mr. Goldfarb about I'm I'm going to return at a later time 3990537468 3990537468 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10563 1 of the current website, I'd like to show you a summary exhibit 2 marked as J-DEM 040028, which summarizes some of the key 3 positions set forth on the Philip Morris' website as it exists 4 today with respect to smoking and health issues. 5 T H E COURT: 6 MR. GOLDFARB: 7 This talks about subjects that were not remotely 8 connected to anything covered by the witness's testimony. 9 Mr. Goldfarb. I'm going to object, Your Honor. To the extent that the witness's direct testimony 10 concerned particular statements about smoking disease, 11 addiction, low-tar cigarettes, we have no objection, but to the 12 extent that counsel is going to a general discussion of the 13 contents of Philip Morris's website, that starts to get beyond 14 the scope of what the direct examination covered. 15 MR. WELLS: I will give him comfort. I have no 16 intention beyond having her say this is a fair and accurate 17 representation of the topics that are covered. 18 intention of going beyond the three areas Mr. Goldfarb covered: 19 Smoking disease, addiction, and low tar. 20 I'm showing the court the topics so the court can see 21 it. 22 issues. Other witnesses will deal with ETS, youth smoking and other I am not going -- I'm not drilling down, so to speak. 23 THE COURT: All right. 24 MR. WELLS: I'm trying to save time. 25 I have no Fine. I think, given her responsibility as the developer of the website, responsible 3990537469 3990537469 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10564 1 for the website and all the questions, I think I could take time 2 and go through it. 3 court — 4 to see a summary and have her lay a foundation for the fact this 5 is a fair and accurate representation of the core information on 6 the website concerning smoking and health. 7 BY MR. WELLS; 8 Q. And you've indicated that this chart does represent a fair 9 and accurate representation of the smoking and health messages I'm not doing that. I just want the I'm trying to do this quickly — I just want the court 10 on the website as it exists today; is that right? 11 A. Correct. 12 Q. And to what extent do these messages line up with the 13 positions of the public health community? 14 A. 15 health community. 16 which is to identify with the public health community, provide 17 more information and access to their communications. 18 I think they fully align with the positions of the public That's the guiding principle on the website, You know, even something like, you know, quitting 19 smoking, you know, is a way that we try to develop programs that 20 are developed for us in conjunction with people who are quite 21 significant participants on this issue in the public health 22 community. 23 THE COURT; What's the objection? 24 MR. GOLDFARB: The objection is, again, just as to the 25 subjects Mr. Wells asked questions about alignment with the 3990537470 3990537470 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10565 public health community on topics that were not the subject of this witness's testimony. THE COURT: And the question went to all — The objection is overruled. The only possible topic just mentioned by Ms. Keane that was not discussed in the direct is quitting smoking, but it's a harmless error. Go ahead, please. MR. WELLS: Thank you. BY MR. WELLS: Q. Ms. Keane, I want to hand you JD 053199, and I know it's somewhat of a large document, but I want to have it identified for the record for its admissibility. Can you look briefly through that document and confirm whether it is a current version of the Philip Morris USA website. A. Yes, I believe it is. Q. Thank you. It is. Now, you responded to questions by Mr. Goldfarb about how Philip Morris tries to communicate with the public in myriad ways. Do you recall that testimony? A. Yes, I do. Q. I want to ask you some questions about how Philip Morris has communicated with the public with respect to the existence of its website and the content of the website. A. Okay? Okay. 3990537471 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10566 Q. Has Philip Morris taken steps to tell the public what they can expect to find on the website? A. Yes, we have. Q. Now, I want to place before you a board, and it's been marked as J-DEM 40177, and ask if this board is a fair and accurate illustration of the various ways that Philip Morris has communicated with the public about its website. A. Yes. THE COURT: Do you happen -- good, you do, Mr. Wells. I'll take that, please. For the record, this is just a paper version of the board that is being used as a demonstrative. BY MR. WELLS: Q. And what I'd like to do, Ms. Keane, is walk you through the items reflected on the board and have you give testimony about each item. Now, the board indicates that the website was launched October 13, 1999; correct? A. Correct. Q. And on that day the board indicates that Philip Morris issued a press release announcing the launching of the website? A. Correct, Q. I'd like to put up on the board a copy of that press release which is JD 54558. So on the day the website was launched, Philip Morris issued a press release that indicated that "the Philip Morris1 3990537472 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10567 1 family of companies will expand its efforts to communicate more 2 openly with the public about its people, products and values 3 through an Internet website and national television advertising. 4 Beginning today, these tools will help tell the company's story 5 and underscore its desire to engage the public in a more 6 constructive manner on issues of importance." 7 Now, the third item on the website indicates that 8 beginning in December of 1999 webkits were provided -- I'm 9 sorry, I misspoke. 10 The second item on the website indicates that Beginning 11 in 1999 website — 12 including Marlboro, Marlboro Lights, Players and Virginia Slims' 13 brands. 14 the website address was included on packs, Could you explain to the court what that involved? 15 A. 16 down the website address, along with a number that people could 17 call if, in fact, they wanted a copy of the webkit. 18 What it entailed is to go to our cigarette packaging and put So, it did two things. It gave them the address they 19 could independently go to the site or it gave them a number, you 20 know, that they could call for a brochure that attempted to 21 capture the critical information on the website. 22 MR. WELLS: Could I call up on the screen JD 54561, 23 which is a copy of a pack of Marlboro cigarettes? 24 have the cull out, please? 25 Q. J-DEM 4017 9. And could I Could you explain to the court just what is 390537473 3990537473 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10568 1 reflected on the actual pack of cigarettes? 2 I'll hand you an actual pack that you can use for 3 purposes of your testimony. 4 A. 5 Q. Y e s . 6 A. 7 by the BATF, and then it goes on to give a phone number that 8 consumers can call for information and it also includes the Web 9 address that consumers can, in fact, visit for direct Right. Focusing on this panel? What it includes is first our name and address as required 10 information on our website. 11 Q, Why does Philip Morris provide this toll free number? 12 A. I think, as I mentioned to Mr. Goldfarb, we thought it was 13 important to make sure that people who did not feel facile in 14 using a website or perhaps wouldn't have access to a website, 15 that they could just make a phone call, call the toll free 16 number and get that information sent to them directly by the 17 company free of charge. 18 Q. 19 toll free number? 20 A. 21 critical smoking and health issues and it, you know, puts them 22 in a website along with some information about youth smoking 23 prevention and things of that nature. 24 Q. 25 webkits were provided to 1-800 callers." And what information is provided to individuals who call the There's a what we call a website brochure. It takes the Now, item 3 on the chart indicates that, "Beginning in 1999 Do you see that? 990537474 3990537474 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10569 1 A. Yes. 2 Q. 3 copy of a webkit? 4 A. 5 requesting information from our website. I want to show you what is JD 52920 and ask you if that is a Yes. 6 It is a cover page that, you know, thanks people for It, you know, talks about our mission and our 7 commitments, and it goes and provides information about the 8 topics that we've been discussing. 9 smoking and health, addiction, tar and nicotine, descriptors and 10 You know, ingredients, that whole range of topics. 11 MR. WELLS: Could I hand up a copy for the court of the 12 actual webkit. 13 Q. 14 was sent a copy of that webkit which, in essence, duplicates the 15 website in terms of smoking and health issues? 16 A. Yes. 17 Q. 18 1999 website information was sent to 29 million smokers on 19 Philip Morris's direct mail database. Could you explain that? 20 A. Is it fair to say that anybody who called the 1-800 number Now, item number 4 refers to the fact that in December of I see it. Thank you. 21 Philip Morris has a database of adult smokers, and what 22 we did is we did what I would call a proactive mailing. We went 23 and we took a -- put together a piece that we could mail to 24 these 29 million smokers to make sure that they understood that 25 we had a website where they could find critical information 3990537475 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10570 1 about smoking and health. 2 Q. And could I call up JD 42707? And could you explain to the court what that exhibit 3 4 is? 5 A. 6 took place to the 29 million smokers on the database. Our 7 business, our values, our programs, youth smoking prevention, 8 health issues; goes on. 9 Q. This is an example of — this is, in fact, the mailing that You indicated that went to 29 million people; is that right? 10 A. Yes. 11 Q. 12 beginning in January 2000 the website address was included in 13 brand advertising. 14 A. 15 right, at the time it would have included some magazines, even 16 though we really don't have a presence there today, but it would 17 have included magazines, it would have included POS, which is 18 point of sale display materials, things that are at retail. Now, turn to the fifth item on the chart. It indicates that What does that mean? That any place where we would place an advertisement, all 19 So any place where we had an ad we would put down both 20 the toll free number and the website address so that if people, 21 you know, were looking at that time a magazine, or today, or at 22 a retail store and were looking at one of those headers, they 23 could, if they wanted to, you know, either jot down the phone 24 number or jot down the web address. 25 Q. Does Philip Morris USA currently adhere to that policy? 3990537476 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10571 A. Of placing it on all those communications? Q. Yes. A. Yes, we do. Q. I would like to direct your attention to item 6 which refers to the fact that in July 2000 website Take One brochures were distributed at approximately 200,000 retail locations. Can you explain that? A. Right. Philip Morris basically has, you know, some contact with approximately, you know, 200,000 retail locations, and so what we did was to prepare brochures that we could, in fact, deliver to the retail universe with which we had dealings. And it was an effort to have another, you know, execution where smokers could, in fact, have ready access to this information. Q. Could I call up JD 53192? A. Thank you. Q. Now, is that a copy of one of the Take One brochures? A. Yes. Don't have a home computer, log on at your local library, shop cop or cyber cafe, or call this number. Q. Could I go to the inside of the brochure? So that brochure indicates that we invite you to log on to our website for information. And, for example, under health issues for smokers, it says, "We agree with the overwhelming medical and scientific consensus that cigarette smoking causes serious diseases in smokers and is addictive." 3990537477 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10572 Is that correct? A. Yes, it does. Q. And that would be placed right in the retail store for anyone to take; is that right? A. Yes, it absolutely would have been. Q. Now, if we go to item 7 which refers to the fact that in September 2001 Take One brochures were distributed again at retail locations, what did that involve? A. Basically, the same thing that we were discussing. It was another effort to go back and refresh and make sure that brochures were available in retail locations across the country. Q. Okay. So you basically repeated in 2001 what you had done in July of 2000; is that right? A. Yes. Q. Now, if we go to item 8, we see that it is stated that in November 2002 over 15 million website inserts were included in major newspapers nationwide. A. This is a — What did that involve? this is really a very significant undertaking. It was a particular, what we call a freestanding insert. It was sort of a brochure that was placed in 30 major newspapers with a circulation across the country so that, you know, when you would buy your, you know, Boston Globe, for example, you could open it up and you would have a brochure that had information on critical tobacco issues. Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10573 Q. Well, I'm going to hand you JD Exhibit 54554 and ask if you can identify that document. I'm going to hand one up to the court. A. Yes. This is the FSI. I call the FSI, the freestanding insert. Q. So that insert wa3 included right inside the newspaper? A. Right inside the newspaper, and it would have been all the major newspapers across the country. Q. And that insert provides what type of information? Just in general. A. It provides information about serious health effects of smoking, quitting smoking. The bullet points on the front were meant to really bring people's attention to the fact that they could get this information inside. You know, cigarette ingredients, how to talk to your kids about not smoking. And so if you opened it up, you would then two to specific Web page — Web pages that would be reproduced. Q. If he we could call up tab 84, which is pages 2 and 3 of the insert, I'd like to have it reflected on the screen. So if people all over America in their newspapers received this insert, which included almost a replication of what actually was on the website; is that right? A. Right. Q. And included information like, "We agree with the overwhelming medical and scientific consensus that cigarette Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10574 1 smoking causes disease." Right? 2 A. Absolutely. 3 Q. And similar statements with respect to addiction and other 4 areas; correct? 5 A. Yes. 6 Q. 7 have that on the screen — and ask if you can identify that 8 document? 9 A. Now I want to show you a copy of JD 052908 — i f we could This captures the newspapers in which the freestanding 10 insert could be found. 11 Q. 12 that shows how many — well, shows the scope of the distribution 13 of the inserts? 14 A. Correct. 15 Q. And in terms of the number of inserts that Philip Morris 16 distributed in newspapers across the United States, the exhibit 17 shows it was 15.86 million? 18 A. Yes. Correct. 19 Q. And at a cost of 1.586 million? 20 A. Right. 21 materials; just the cost of the execution itself, meaning the 22 cost of the placement, 23 Q. 24 difference between an insert and an onsert. 25 A. And so this is an internal Philip Morris' business record I don't believe that that includes the cost of the Just so the record clear. Describe for the court the I know it's confusing, even for us sometimes. 3990537480 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10575 An insert, we call them a freestanding insert, something that is typically put inside the newspaper. An onsert, at least in our internal jargon, is in fact what would be put on the pack. It could either be put — generally, it is put between the package and the cellophane, some cases it can be put on the cellophane. In But it is something that is in some fashion affixed to the pack and is meant to be delivered to the smoker with the package. Q. Okay. THE COURT: Where did you get the information on total general market circulation and total minority circulation? Were the circulation figures supplied by the newspapers themselves? THE WITNESS: There would be a process through the advertising agency that had arranged this placement. You know, that type of information is, you know, generally available to people who were in that part of the business, those people who would have responsibility for that type of execution. Whether or not they would have an independent means of verifying it or would just take those statistics from the particular newspaper, I wouldn't know sitting here today. But it is something that I believe is quite customary and, you know, generally available when it relates to coming up with the media plan. 3990537481 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10576 THE COURT: To your knowledge, are advertising rates of newspapers based on their asserted circulation figures? THE WITNESS: THE COURT: THE WITNESS: Yes. If you know. I believe — I'm speculating, but I think I know. BY MR. WELLS: Q. Referring you to item number 9 on the chart which indicates that in November 2002 reference to Philip Morris's website was included in low tar pack onserts, could you explain that? A. What happened in 2001 was Monograph 13 had come out, which was a major communication from the public health community. Somewhat contemporaneous at that time the company had really developed the ability to use onserts in a way that we could actually execute on a broad scale basis pack onserts. So the company made the decision to take — use the onsert for purposes of a communication that dealt with, you know, low tar products and issues around low tar products, descriptors, problems with the -- what the test method was meant to be and not be. Q. Now I want to review that onsert concerning low-tar cigarettes with you after lunch. But the board indicates that that onsert was placed inside 131 million packs. A. Correct. Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10577 1 Q. 2 indicates that beginning in June 2003, PM-USA airs TV 3 commercials highlighting the website. Could you describe the TV 4 commercials in general? 5 A. 6 have been a number of advertisements, the purpose of which is to 7 bring people to the website. There have been a series of different executions, but there And what is communicated in those TV ads are, you know, 8 9 Now, directing your attention to item number 10 which information about, you know, smoking and health, addiction, 10 quitting, you know, low-tar cigarettes, and things of that 11 nature. But it also showcases — 12 showcases the website as being a place where, you know, 13 additional more complete information can be found. 14 Q. 15 30-second commercial. JD Exhibit 53157. 16 commercial? 17 I'm sorry, Mr. Wells — I would like to play just one commercial for the court, one Could we play that (Video shown.) 18 Q. And is it correct that there are multiple commercials like 19 this addressed to different health and smoking topics? 20 A. 21 more or less in the same format. 22 on youth smoking prevention initiatives, on quitting, and on 23 some other topics. 24 Q. Are these commercials run nationally? 25 A. Yes, they are. Yes. This particular commercial has been run, you know, But there are also commercials 3990537483 3990537483 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10578 Q. And is it fair to say Philip Morris has spent many, many millions of dollars in terms of advertising these commercials? A. Tens and tens of millions of dollars. Q. Now, the final item on the chart is item number 11, which indicates that in February 2004 over 130 million website onserts were included on packs of cigarettes. Could you explain that for the court? A. Yes. There have been a series of onserts that we have, in fact, put on product. In 2004, the onsert directed people's attention to the website and the website messages. Q. Could we have placed on the board JD Exhibit 54553? A. Thank you. Q. What is that exhibit? A. This is the exhibit of the onsert that was put on the product in 2004 trying to direct people's attention to where they could find information on tobacco issues, Q. It refers, for example, the serious health effects of smoking; right? A. Exactly. Q. Is the way the onsert works, it would be folded and actually stuck down in the pack? A. Correct. Q. Now, Ms. Keane, I'd like to just ask you a couple of more questions with respect to the website and then I'd like to turn 3990537484 3990537484 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10579 to low tar. THE COURT: We will finish the website and then we will take a lunch break. MR. WELLS: Yes, Your Honor. BY MR. WELLS: Q. I want to show you JD 53088, which is a June 23, 2003, letter from you to the California Attorney General and ask if you are familiar with that letter? A. Yes, I am. Q. Why was the letter sent? A. It wasn't just sent to General Lockyer. It is representative of letters that would have been sent to other AGs. It also representative of what we tried to do, which is, we think it's important — I personally think it's important, because of our extensive relationship with the states over the Master Settlement Agreement, to make sure that they find out from us what we are doing. They have multiple ways to sort of surveil our activities, but I think direct communication is an important one. So this is an example of what we would do in the course of business, which would be to post, you know, the Attorneys General and/or NAAG on particular steps that we were taking in conjunction with our business. 3990537485 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10580 Q. And as part of your job as general counsel of Philip Morris USA, to what extent do you interface with people at NAAG? MR. GOLDFARB: Objection, Your Honor. This calls — this is directly related to Ms. Keane's involvement in issues related to the Master Settlement Agreement and compliance that are wholly beyond the scope of the direct examination. MR. WELLS: Your Honor, Ms. Keane is not designated as a witness in our affirmative case. She was not designated by the government as a live witness. The government put Ms. Keane on the list of its 10 additional witnesses, and the government has chosen to call Ms. Keane. I think Ms. Keane, like any other witness, has an absolute right or has a right to advise the court about the scope of her responsibilities and what she does. And I don't think they can, in essence, give the court half the story by saying, well, we only asked her about responsibilities 1 through 3 without letting her explain to the court what she does, because ultimately the court has to make a decision about what type of weight to give to her testimony. THE COURT: I'll allow her to answer the question. Go ahead, please. A. The Master Settlement Agreement and dealings with the states and NAAG is something that I spend a significant amount of my time over. I think it's an important aspect of our business 3990537486 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10581 because it touches almost every aspect of our business. MR. WELLS: I have no further questions with respect to the website, so we will now break for lunch and I'll return to the area of low tar after lunch. THE COURT: All right. Let's talk timing for a minute. We usually, as everybody knows, take maybe an hour and a quarter for lunch so some of us can work on a few other things. When we took our morning break, I don't know how many of you looked out the window, but there was real snow out there. I couldn't believe it. And if you think that it will help us get through, I'm more than happy to do only an hour for lunch. I have a feeling people are going to want to get out of here on general principles, completely apart from Ms. Keane's personal issues. I see heads shaking, the record should reflect, so we will take an hour, everybody, 1:30, and do as much as we can this afternoon. MR. WELLS: Thank you, Your Honor. (Recess began at 12:28 p.m.) 3990537487 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10582 1 INDEX 2 3 4 5 WITNESS: PAGE: DENISE KEANE DIRECT EXAMINATION CROSS-EXAMINATION by Mr Wells 10479 10535 ***** 6 7 8 ***** 9 10 11 12 CERTIFICATE I, EDWARD N. HAWKINS, Official Court Reporter, certify that the foregoing pages are a correct transcript from the record of proceedings in the above-entitled matter. 13 Edward N. "Hawkins,~RMR~ 14 15 16 17 18 19 20 21 22 23 24 25 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 90 3990537489 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537489 10583 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA UNITED STATES OF AMERICA, Docket No. CA CA99-02496 Plaintiff, v. PHILIP MORRIS USA, et al., Washington, D.C. January 19, 2005 Defendants. VOLUME 51 AFTERNOON SESSION TRANSCRIPT OF BENCH TRIAL PROCEEDINGS BEFORE THE HONORABLE GLADYS KESSLER, UNITED STATES DISTRICT JUDGE APPEARANCES: For the Plaintiffs U.S. DEPARTMENT OF JUSTICE Civil Division Sharon Y. Eubanks, Director 1331 Pennsylvania Avenue, N.W. Suite 1150 Washington, D.C. 20004 202.616.8280 U.S. DEPARTMENT OF JUSTICE Civil Division Stephen D. Brody, Deputy Director 1331 Pennsylvania Avenue, N.W. Suite 1150 Washington, D.C. 20004 202.616.1438 U.S. DEPARTMENT OF JUSTICE Criminal Division Frank Marine, Sr, Litigation Counsel/ Organized Crime and Racketeering Section 1301 New York Avenue, N.W. Suite 700, P.O. Box 27598 Washington, D.C. 20530 202.514.0908 Scott £. Wallace, SDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10584 APPEARANCES: Cont. U.S. DEPARTMENT OF JUSTICE Civil Division Renee Erooker, Asstitant Director, Leo J. Wise, Trial Attorney 1331 Pennsylvania Avenue, N.W. Suite 1150 Washington, D.C. 20004 202.616.3797 U.S. DEPARTMENT OF JUSTICE Elizabeth Crocker, Trial Attorney, Andrew N. Goldfarb, Trial Attorney, MaryJo Moltzen, Trial Attorney, Tobacco Litigation Team 1331 Pennsylvania Avenue, N.W. Washington, D.C. 20530 202.616.4875 For Defendant: Philip Morris USA, Inc. WINSTON & STRAWN Dan R. Webb, Esq. Thomas J. Frederick, Esq. 35 West Hacker Drive Chicago, IL 60601-9703 312.558.5700 HUNTON & WILLIAMS Patricia M. Schwarzschild, Esq. Riverfront Plaza, East Tower 951 East Byrd Street Richmond, VA 23219 804.788.8728 PAUL, WEISS, RIFKIND, WHARTON & GARRISON James Brochin, Esq. Theodore Wells, Esq. 1285 Avenue of the Americas New York, NY 10019 212.373.3000 Por Defendant: Lorillard Tobacco Company THOMPSON COBURN J. William Newbold, Esq. William B. Minton, Esq. Richard P. Casetta, Esq. One US Bank Plaza St. Louis, MO 63101 314.552.6000 Scott L. Wallace, SOT, CRR Official Court Reporter 3990537491 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10585 FQT Defendant: Brown & Williamson Tobacco Corporation KIRKLAND & ELLIS, LLP David M. Bernick, Esq. Kenneth N. Bass, Esq. Renee Honigberg, Esq. 200 East Randolph Drive Chicago, IL 60601 312.861.2248 For Defendant: R.J. Reynolds Tobacco Company JONES DAY Jonathan M. Redgrave, Esq. Peter J. Biersteker, Esq. Robert Francis McDermott, Esq. 51 Louisiana Avenue, N.W. Washington, D.C. 20001 202.879.3939 For Defendant; British American Tobacco (Investments), Ltd. CHADBOURNE & PARKE, LLP David Wallace, Esq. Bruce Sheffler, Esq. 30 Rockefeller Plaza New York, NY 10112 212.408.5498 For Defendant: Liggett Group, Inc. KASOWITZ, BENSON, TORRES & FRIEDMAN Aaron H. Marks, Esq. Nancy Straub, Esq. 1633 Broadway New York, NY 10019 212.505.1700 For Defendant: Tobacco Institute COVINGTON & BURLING Phillip Dube, Esq. James Goold, Esq. 1201 Pennsylvania Avenue, N.W. Washington, D.C. 20009 For Defendant: The Counsil for Tobacco Research USA, Inc. THOMPSON COBURN J. William Newbold, Esq. William B. Minton, Esq. Richard P. Casetta, Esq. One US Bank Plaza St. Louis, MO 63101 314.552.6000 For Defendant: British American Tobacco Australian Services, Ltd. SHAW PITTMAN, LLP Jack McKay, EBq. Alvin Dunn, Esq. 2300 N Street, N.W. Washington, D.C. 20037 202.663.8355 Scott L. Wallace, ROR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10586 Court Reporter: Scott L. Wallace, RDR, CRR Official Court Reporter 333 Constitution Avenue, N.W. Room 6814, U.S. Courthouse Washington, D.C. 20001 202.326.0566 Proceedings reported by machine shorthand, transcript produced by computer-aided transcription. Scott h. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10587 AFTERNOON SESSION, JANUARY 19, 2005 (1:31 p.m.) THE COURT; All right, Mr, Wells, please. MR. WELLS: Thank you, Your Honor. CONTINUED CROSS-EXAMINATION OF DENISE F. KEANE BY MR. WELLS: Q. Ms. Keane, just so the record is clear, is it correct that as of today you are an employee of Philip Morris USA? A, Yes, I am. Q. And to whom do you report? A. To Mike Szymanczyk. Q. And what is his title? A. He's the chairman of Philip Morris USA. Q. Now, I would like to discuss with you a different topic, specifically the topic of light cigarettes and product descriptors, Do you recall a discussion in your written direct testimony about the FTC tar and nicotine numbers and product descriptors and contacts you had with the FTC on these issues in 1996 and 1997? A. Yes, I do. Q. Is it correct that product descriptors are terms like "light" and "ultra light" associated with cigarettes that have various tar levels? A. Yes, they are. Q. Did Philip Morris USA ever intend to deceive consumers by Scott L. Wallace, Official Court ROR. CRR Reporter 3990537434 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10586 using product descriptors? A. No, we didn't. Q. Yesterday Mr. Goldfarb asked you about a request trade by the FTC at a meeting in 1996 where information that Philip Morris might have concerned consumer perceptions of low-yield cigarettes. Do you recall that? A. Yes, I do. Q. And you testified that at the time that request was made to you, it was your understanding that PM USA had no such reports; is that correct? A. Yes, it was. Q. Yesterday Mr. Goldfarb also discussed with you some documents that were in Philip Morris's files that related to consumer perceptions of low tar cigarettes, and two of them were so-called Roper surveys, and one was a qualitative study concerning Merit Ultima. Do you recall that? A. Yes, I do. Q. And you said yesterday that the first time you ever saw those three reports was when you received them as part of the exhibits submitted by the government to you in connection with your proposed direct testimony? A. Correct. Q. Had you known of the existence of those reports, would you have disclosed them to the FTC? A. I would have. Mr. Peeler at the --as part of our Scott I. trail Ace, RVR, CKR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10589 discussions, had asked if people had any evidence. those reports, I would have shared them. evidence out there. If I knew of Clearly there was And even though ours was both old, going back to 1977, and we had that Merit study, that I think interviewed 40 people compared to the 40,000 that were covered in the Monograph 7 report, nonetheless I would have called him up and said we have some information. Whether or not he would have chosen to use it for purposes of the evidence he was looking for, I wouldn't know, but it wouldn't have persuaded me from having the conversation with him. Q. Is there any reason you would not have disclosed those reports had you known about them? A. No. To me it goes back to Monograph 7. There were 40,000 people interviewed there. I mean, the evidence was so much more extensive than we had access to, there would have been no motivation to not share that and Mr. Peeler know that we had something they might want to see. Q. And who is Mr. Peeler? A. Mr. Peeler was a gentleman who works at the FTC and who really does have a long history in working on our issue, and over the years we've had numerous conversations and had a series of meetings. Q, Do you understand he's scheduled to be a witness in this case, if you know? A. Yes. Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10590 Q. Yes, you understand? A. I'm sorry, yes, I do understand. Q. And during your meetings with the FTC back in 1996 did you dispute with the FTC the proposition that some consumers may be confused about the meaning of the FTC numbers? A. No. Q. In your written direct testimony you discuss a May 7th 1996 memorandum by David Remes of Covington & Burling that summarized the May 1996 meeting with Mr. Peeler. Do you recall that? A. Yes, I do. Q. And that memorandum summarizes the entire meeting, right? A. Correct. 0. To what extent was that meeting part of a continuing dialogue with the FTC, that continues even today regarding the FTC testing method? A. Well, we clearly had a series of meetings between '96 and •97. I had one, two, I can't remember, other lawyers that worked on my behalf, had a series of additional meetings, plus we sent our scientists in, because if you remember what the FTC was probing, it was trying to create what would have been a dual system, to keep the existing methodology, but then to come up with another, a second test range, and in fact we had our scientists go in and they had numerous discussions with the FTC about how to achieve that, because one of the problems was going Scott 1. Wallace, RDR, CRR OtClcial Court Reporter 990537437 3990537497 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10591 to ber unless we worked with them, if they came up with an alternate test method, it would have taken years to implement. What our scientists were trying to do, was to, if, in fact, that was the ultimate direction, to come up with a mathematical formula. They called it a quadratic equation that could be used to replicate what a dual testing system would, in fact, have achieved, Q. Could we show on the screen U.S. Exhibit 38555, which is the David Remes memo of the May 1996 meeting referred to in your direct. And who is Mr. Remes? A. Mr. Remes was an attorney -- is an attorney, I believe, still, with Covington & Burling. He was there representing, I think, Lorillard and also acted as some form of coordinator just in terms of sharing information. Q. Okay. In the opening paragraph of the memo, states that, "We met on Thursday morning, May 2nd, with representatives of the Federal Trade Commission to learn more about possible changes the Commission may propose in the current system for testing and reporting tar and nicotine yields. The meeting which we had requested lasted for about one hour." And then the document goes on to describe the meeting, and if we could go to the second page of the document and Mr. Remes writes on the second page: "While Mr. Peeler appeared to recognize that machine ratings do not reflect actual human intake, either for individual smokers or for the average smoker, he voiced concerns SCOCt L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10592 that smokers believed the ratings reflect actual human intake. Mr. Peeler indicated that the Commission wants it made clear to smokers that, one, they likely are receiving more than the yields produced by the current testing parameters, and two, how much they receive will depend on the manner in which the cigarette is smoked. Mr. Peeler also mentioned his concern that smokers of unadvertised brand, private label brand or generics are not getting any information regarding T and N yields". With respect to Mr. Peeler's concerns, did you have any disagreements with the concerns that he voiced in terms of giving consumers more information? A. No, In fact, that was very much the proposal that we discussed with them at great length. Q. Now, if we could go to the next page of the memo, page 4, it says, "Mr. Peeler indicated in response to a question that the Commission will rely for evidence in consumer perception primarily, if not exclusively, on the Joe Cohen article in the January 1996 issue of the American Journal of Public Health, which in Peeler called a good study that provides valuable insights. Mr. Peeler requested any evidence with respect to consumer perception that the cigarette manufacturers may have." So my first question is, is it correct, you're having a meeting at the FTC with Mr. Peeler in an attempt to have a constructive dialogue about the FTC testing method; is that right? Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10593 1 A. Correct. 2 Q. And in the context of that meeting he said to you and the 3 other participants, if you have any information, he'd like to 4 see it, right? 5 A. Right. 6 Q. This was not --he didn't give you an FTC subpoena or 7 response, it was an informal request made at the meeting, right? 8 A. Right. 9 Q. And it was your understanding that you didn't have any 10 such reports, right? 11 A. Yes, it was, 12 Q. Okay. 13 been happy to give him the reports, right? 14 A. Correct. 15 Q. Now, the memo concludes by saying the day after the 16 meeting, the meeting was on Thursday, it says: 17 morning we called Shira Modell, one of the staff attorneys, to 18 get the name of one of her colleagues who attended our meeting. 19 Ms. Modell took the occasion to say that the Commission wa3 more 20 interested in pursuing an informal dialogue with us than was 21 indicated at our meeting, and said that we could expect a call 22 from the Commission this week. 23 Ms. Modell that we were not receptive to starting the public 24 notice and comment process until the Commission had received the 25 final report of the Ad Hoc Committee." And as you said, if you knew it, you would have "On Friday We took the occasion to tell What is referred to by Scott L. Wallace, RPR, CRR Official Court Reporter 990537500 3990537500 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10594 the "public notice and comment process"? A. What happened is, the discussion was that we went in to talk to the FTC, and that is an agency for which there is a real history about coming to some form of resolution of issues through an agreement or understanding with the industry, what Mr. Peeler indicated was that even though they wanted to work with us and wanted us to participate in the process, wanted us, if, in fact, they went that direction, to help them devise a way to come up with an alternate methodology to test for tar and nicotine, nonetheless they felt compelled to go to a notice and comment whereby they were going to put out a series of questions on the public register in an effort to get input from a variety of people. In fact, that's what they ultimately did. I think what Ms. Modell wanted to do was make sure that didn't cutoff our conversation, which it did not. As I indicated earlier, we quite worked extensively on the way in which to come up with the test methods so that a dual system could, in fact, be implemented if that was the direction that the FTC chose to go. I think the other interesting thing was the FTC was of the belief, as was my impression, and I think as is captured in the Federal Register, that they wanted to get through this quickly. They thought they could make some progress on this topic. It didn't turn out to be the case. Q. Now, in terms of continuing informal dialogue, after the meeting, did you continue such informal dialogue with the FTC SCOtt L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10595 with respect to the issue of how consumers perceived the FTC nicotine and tar numbers? A. Yes. One of the things that I in particular thought would be very important was to see if we couldn't come up with some models that we could share with the FTC to just create an example of what a communication platform could look like. So, after one of these meetings, I had asked our advertising agency, Leo Burnett, to come up with some models that try to communicate the variability of the smoking experience as it relates to tar and nicotine deliveries. And so what they came up was a theme that sort of modeled itself on the way you -- you know, mileage may vary. I mean, that was in a sense an example of some form of execution that could be developed, but it was really meant to be illustrative, but the proposition was that we were happy to work with the FTC on this and be partners on it to put it out together, to either, you know, use some of our resources to make them available to the FTC if they thought that was appropriate, or alternatively, if, in fact, they wanted us to pursue it and would, in fact, give us direction as to the content, we would have gone off and at least Philip Morris would have gone off and communicated that unilaterally. Q. And is it correct that you were so personally interested in trying to assist the FTC in developing a public awareness program to communicate with consumers, that you personally Scott 1. Wallace, SLR. CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10596 1 called Leo Burnett and worked with him in terms of putting 2 together work advertisements? 3 A. That is true. 4 Q, I'm going to walk you through some of those 5 advertisements that you worked on as a result of your contacts 6 with the FTC, but first I want to show you a chart that will 7 speed up the examination that sets forth all of the efforts that 8 Philip Morris engaged in to communicate with the public about 9 the FTC numbers, and also with the FTC itself on this area. And 10 the chart is marked as JDEM 040176, and it is entitled; Philip 11 Morris USA Consumer Education Efforts, FTC Numbers and Product 12 Descriptors. Is that chart a fair and accurate description of the 13 14 efforts that Philip Morris made with respect to communicating 15 with consumers about the FTC numbers and product descriptors? 16 A, Yes, it is. MR. WELLS: 11 I have a copy for Your Honor if you would 18 like. 19 BY MR. WELLS: 20 Q. 21 campaign to FTC 1997." 22 advertisements that you personally participated in creating? 23 A. Yes, it does. 24 Q. And I'd like to call up JD 041454 and ask if you 25 recognize that exhibit as the consumer education materials that Now, number one says "Proposed consumer education That relates to the Leo Burnett proposed Scott L, Wallace, RDR, CRR Official Court Reporter 990537503 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537503 10597 you were involved in creating in 1997? A. Yes. Q. And were these materials given to Mr. Peeler at the FTC? A. Yes. Q. Now, explain to the Court -- withdrawn. Is it fair to say that that document contains four possible advertising approaches? A. Yes. Q. And I don't want to go through them all, for the sake of time, but if we look at proposal number 3, how would that have worked in terms of being an advertising --an advertisement to communicate to consumers? A. What was your understanding? My understanding was what we were proposing were different executions. There could, for example, be an ad that would be placed in a newspaper, right, where this would be a perfect newspaper ad. It was also contemplated that there would be counter cards. Counter cards are, you know, you put a box at retail at point of sale and you have information, much like we described before in terms of what we're doing with the Website where you could have a brochure. You could also have a display at point of sale where, in fact, you had this information. So this was not meant to be a dispositive set of examples, it was meant to be illustrative of what, you know, could be done, and it was shared with Mr. Peeler to, basically, create an example of if, in fact, we were going to work together or they wanted us Scott L. Official Wallace, Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10598 to proceed, this is the way in which we could try to first time out of the box come up with a model to communicate with consumers. Q. So, in terms of the advertisement reflected in advertisement number 3, the top says "counter card", and then it says "the method behind the numbers." And then underneath it says "tear pad" and I have yellowed some of the information that would be communicated to the consumer if the FTC had adopted the approach that you were suggesting; is that right? A. And a tear pad was something, literally, as it describes, you put it at the point of sale and you tear off a copy and you can take it home with you. Q. And the information that you proposed that should be disclosed to consumers in this particular advertisement stated: "How does the method work? The tar and nicotine ratings are developed by testing cigarettes on a machine. This provides a relative ranking from cigarette to cigarette. It doesn't, however, attempt to gauge or indicate how much tar and nicotine any one smoker may expect from a cigarette." "Remember, the ratings are produced by a machine. And a machine can't replicate actual smoking behavior. smoke exactly the same way. No two smokers Even an individual smoker will smoke differently throughout the course of a single day." "How you smoke affects how much tar and nicotine you can expect from a cigarette. The more intensely you smoke, the more Scott h. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10599 tar and nicotine you can expect. The less intensely you smoke, the less you can expect. The FTC method only tells you how tar and nicotine yields from two cigarettes compare, if both are smoked the same way." "So what do the numbers mean? That a smoker can compare tar and nicotine levels from one cigarette to another, if both are smoked in the same manner. And nothing more," And as you indicated, in addition to advertisement number 3, there are three other markups that you developed in conjunction with the Leo Burnett Advertising Agency, right? A. Correct. Q. Now, did the FTC indicate to Philip Morris that it wanted to go ahead with the consumer education campaign PM USA proposed in 1997? A. What the FTC indicated was they felt it was necessary for them to go to notice and comment and to put out a series of questions to get not just the industry's perspective but the perspective of others. So this was a thought that they were going to keep in mind and, in fact, it was a topic for which they asked a series of questions as part of the Federal Register notice and the request for comments. 0. Okay. I want to show you JD 40038 -- I'm sorry, it's JD 43 003 8, which is a copy of the FTC Federal Register notice dated September 12, 1997, and if we could go to the next page, what it says under summary is "that the Federal Trade Commission, FTC or Scott L. Wallace, RPR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10600 Commission, is soliciting comments on proposed revisions to the testing method used to determine the tar, nicotine, and carbon monoxide ratings of cigarettes and the disclosure of those test results". So that refers to the public comment period that you have just discussed that the FTC requested, right? A. Correct. Q. And if you go to tab 17, which is part of the notice, it says: "Communication of Ratings Through Advertising. The Commission is also seeking comment on ways to improve the communications to consumers of tar and nicotine ratings, as well as the importance of individual smoking", and finally in the Federal Register if you go to tab 18, there's a statement about public education awareness program as a possible policy option. And the Federal Register reads; options. "4: Other possible policy Rather than move to a two-tier test method, would it be preferable to continue to test cigarettes under a single protocol and use consumer education and an advertising disclosure to inform consumers what the ratings do and do not represent, and that what smokers get from any particular cigarette depends in large part on how they smoke it? if so, should cigarettes continue to be tested under a protocol that uses a two second 35 milliliter puff every minute, or should different smoking parameters be used? consumer education take? What form should such For example, informational materials at the point of purchase and what should it say?" Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10601 Was it your understanding that this policy option, which 1 2 refers to consumer education efforts, related to the type of 3 information you had already given to Mr. Peeler? 4 A. Yes, it did. 5 Q. Now, if we look at the chart, item number 2 says: 6 Philip Morris USA Website." And I want to ask you a couple of 7 questions about what Philip Morris said, as of 1999, on its 8 Website to consumers about the FTC numbers and descriptors, 9 okay. "1999 I did not ask you that before lunch, I said I would save 10 it until this time. And I want to show you JD 046719, which is 11 a section of the PM USA Website as it existed in 1999 relating 12 to low tar cigarettes. And if we go to tab 19, and it's also 13 page 19, there's a header that says "Understanding Tar and 14 Nicotine Numbers." 15 So, is it correct that as of 1999, on the PM Website, the 16 following information was given to consumers about understanding 17 tar and nicotine numbers and the Website reads: 18 smoke cigarettes exactly the same way. 19 yield numbers that are reported for cigarette brands are not 20 meant, and were never intended, to communicate the precise amount 21 of tar or nicotine inhaled by any individual smoker from any 22 particular cigarette. 23 testing methods which compare different brands when smoked by a 24 machine under identical laboratory conditions. As regulators 25 have said since their introduction, these tests, including those "No two smokers The tar and nicotine These numbers come from standardized Scott L. Wallace, RPR, CRR Official Court Reporter 3990537508 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537508 10602 1 developed in cooperation with the U.S. Federal Trade Commission, 2 FTC, and The International Standards Organization, ISO, show the 3 relative differences in yields among brands. 4 brand is held and smoked the same way as it is in the machine, 5 and then you list various links; is that correct? 6 A. Correct. 7 Q. Now, if you turn to page 23 of the 1999 Website, which is 8 tab 20, Philip Morris gives consumers on its Website in 1999 9 information about descriptors; is that correct? Assuming that each 10 A. Yes. 11 Q. And on the Website in 1999 regarding descriptors, the 12 Website states: 13 comparison with respect to attributes such as strength of taste 14 and flavor and tar nicotine yield as measured by machine method, 15 for a cigarette brand in a particular country in order to 16 distinguish it from other brands on the market in that country. 17 Smokers should not assume that brand descriptors such as "light" 18 or "ultra light" indicate with precision either the actual 19 amount of tar and nicotine that they will inhale from any 20 particular cigarette, or the relative amount as compared to 21 competing cigarette brands. Some researchers report that 22 consumers who smoke light cigarettes inhale as much tar and 23 nicotine as from full flavor brands" and then you have links 24 that would take the reader to other public health authority 25 publications; is that right? "Descriptors are generally used as a point of Scott h. Wallace, XDR, CRR Official Court Reporter 3990537509 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537509 10603 A. Correct. Qt Now, the third item on the site relates to Website awareness efforts which I discussed with you before lunch in general, and I'm not going to go over those again. If we look at the fourth item, it reads: "Philip Morris USA disclosure placed in all advertising, "2000", the amount of nicotine you inhale will vary depending on how you smoke the cigarette." A. Explain that to Judge Kessler. Basically, this was an effort to put together a legend that tried to communicate the principle issues surrounding the machine test method. machine method. The principle issue is that it is a It doesn't tell people about how much tar and nicotine they're going to get when they smoke a cigarette. So this legend tried to capture that. These were the words that, in fact, have been used by the FTC in the context of discussions, and that were also referenced by the FTC, more or less, in a very similar, if not quite identical, but very similar fashion in the Federal Register notice. So it became a way that we thought in 2000, given what had happened or not happened, that we thought it was appropriate for us to include in our advertising. So whenever we advertised we would put this legend in our advertising. Q. Now, when you just said "given what had not happened", explain to the Court what you mean by given what had not happened? Scott I. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10604 A. I think the FTC clearly intended, in fact, even so stated in the Federal Register notice, that they wanted to move quickly and thought that they could move quickly on this topic. However, I think they got what they would even call an unprecedented response to their request for information. Rather than being able to move quickly, they got such a wide range of input that what the FTC clearly thought they needed to do was to involve the support of HHS. So, you know, rather than comment on the input they received and come forward with a regulation, they thought it was necessary for them to, in fact, go and get input from HHS. They announced that publicly. HHS, in fact, kept that and solicited the support of NCI to look at some of the issues surrounding the health issues, you know, the relative safety issues of low tar cigarettes. Since nothing had happened, we thought that there had been enough of a discussion of this particular language, and, in fact, if I'm not mistaken, somewhat shortly before we actually affixed our legend in our advertising, the FTC had come out with a consumer alert where they again, you know, re emphasized their message about the tar and nicotine numbers and the machine test method. So, that was another indication to us as to -- they were giving it a priority, they were, however, unable to give guidance, so we chose this as a course of action. Q. Now, I want to direct your attention to JD 004402, which is a statement by the FTC that was released on November 27, 2001 Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10605 after the publication on Monograph 13 and ask if you have seen that statement before? A. Yes, I have. Q. And is it correct that the request for public comment went out in 1997; is that right? A. Correct. Q. To your understanding, is that request still open? A. Yes, it is. Q. As of today, correct? A. Correct. Q. And as of today the FTC has not acted on the issue in terms of issuing any rules or regulations concerning the FTC testing method, right? A. correct. Q. Now, the notice dated November 27, 2001, really says to the public that the reason they haven't acted is they've been asked by public health agencies to postpone any decision, right? A. Correct. Q. And the notice by the FTC in November 2001 states: "In 1997, the FTC issued a Federal Register notice proposing revisions to the testing methodology. Comments submitted by public health agencies urged the Commission to postpone revisions until a broader review of unresolved scientific issues surrounding the system could be addressed," So, at least as of 2001, the FTC has publicly stated the Scott I. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10606 1 reason we haven't done anything is because public health agencies 2 have asked us to withhold any revisions, right? 3 A. Correct. 4 Q. Now, you referred to a consumer alert. 5 you JD 051614, which is a copy of the FTC's May 2000 consumer 6 alert and ask if you recognize that document and can you explain 7 it to the Court? 8 A. 9 on tar and nicotine numbers and tar and nicotine ratings. I guess I do. I want to show It is basically an announcement by the FTC 10 Q. And in terms of the consumer alert, at the bottom of the 11 page it states: 12 from your cigarette depends on how you smoke your cigarette," is 13 that right? 14 A. Yes. 15 Q. And based on that consumer alert, Philip Morris decided 16 to require disclosures in all of its advertising, that the 17 amount of tar and nicotine you inhale will vary depending on how 18 you smoke the cigarette? 19 A. Correct. 20 Q. Now, I want to call your attention to item 5 on the chart 21 which states: 22 Monograph 13." 23 Philip Morris decided to update its Website in response to 24 Monograph 13. 25 A. "That the amount of tar and nicotine you get "Website updates in response to publication of Tell the Court what Monograph 13 is and how Monograph 13 was a very significant pronouncement by the Scott £. Wallace, RDR, CRR Official Court Reporter 3990537513 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537513 10607 public health community. It reflected their assessment that, you know, over the years there had been a series of communications by various public health groups, you know, clearly not saying low tar or reduced tar cigarettes were good, but I think, you know, the sort of catch-all was they might be bad, but others are worse, but there was an effort to have people consider lower tar cigarettes as an alternative because of what were then -- what were then perceived health advantages over full flavor cigarettes, clearly Monograph 13 was a definitive communication that said that the scientific community could not conclude that there was any benefit from smoking low tar cigarettes, and it was extensively supported and there were a series of extensive, you know, contributions to that monograph by a number of people in the public health community. We found it to be very significant, which is why we, number one, put it on our Website as an important piece of information, and number two, which is why we then worked towards developing a petition and. we petitioned, formally petitioned the FTC to give us guidance on a series of issues because we viewed Monograph 13 as being a very definitive sea change in an effort to bring, you know, scientific consensus to this issue. Q. Is it correct that scientists within Philip Morris are still involved in researching the issue of whether compensation is 100 percent or less? A. Correct. In fact, far before Monograph 13, something Scott L. Wallace, Official Court RDR. CRR Reporter 3990537514 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537514 10608 that we have shared externally quite extensively with the scientific community, and I say that our scientists have shared quite extensively with the scientific community is the prototype for a piece of research that I call the exposure study, which is meant -- and ultimately when it is all concluded will give, you know, information about how smokers actually smoke, how much tar and nicotine they actually get, and plus it will give us insight on, you know, is there a way to reduce, you know, toxic chemicals and constituents in smoke, but it's a very important research that goes directly to that issue. Q. And that research is ongoing as we speak? A. Yes, it is. Q. And even though Philip Morris scientists continue to research this issue and also to examine the merits of the conclusions reached in Monograph 13, Philip Morris, nonetheless, nonetheless modified its Website to alert consumers as to the information in Monograph 13, right? A. Correct. Q. And I want to show you JD 054550, which is an excerpt from PM USA's current Website. And under low tar cigarettes, on the Website, consumers are told "read the National Cancer Institute Monograph 13 press release, which includes a link to the full study: Risks associated with smoking cigarettes with low machine-measured yields of tar and nicotine." And then right next to that text is a link, correct? Scott X,. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10609 A. Yes. Q. And the link -- one of the links is to the U.S. National 3 Cancer Institute, NCI, press release on Monograph 13, 2001, 4 correct? 5 A. Correct. 6 Q. Now, if one clicks on to that link, one will get a copy 7 of the press release issued by NCI in connection with the 8 release of Monograph 13, correct? 9 A. Yes, correct. 10 Q. And if we go to that link, which is JD 054549, we see a 11 copy of the press release issued by the National Cancer 12 Institute, correct? 13 A. Yes, it is. 14 Q. And the title of that is Low Tar Cigarettes: Evidence 15 Doesn't Indicate Benefits to Public Health, right? 16 A. Correct. 17 Q. And if one wants to go -- well, withdrawn. And, in fact, 18 it goes on to state in the first paragraph: 19 Americans smoke low tar, mild or light cigarettes, believing 20 those cigarettes to be less harmful than other cigarettes. 21 new monograph from the National Cancer Institute, NCI, titled 22 Risks Associated With Smoking Cigarettes With Low 23 Machine-measured Yields of Tar and Nicotine, national scientific 24 experts conclude that evidence does not indicate a benefit to 25 public health from changes in cigarette design and manufacturing "Millions of In a Scott L. Wallace), RVR, CRR Official Court Reporter 3990537516 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537516 10610 1 over the last 50 years." Now, is it correct, you can go further and you can click 2 3 on to a link and actually get a copy of Monograph 13 itself? 4 A. Yes, I believe that to be the case. 5 Q. The sixth item on the chart states September 2002, Philip 6 Morris USA petition to the Federal Trade Commission requested 7 mandatory consumer information. 8 relates to. 9 A. Explain to the Court what that It was what I was referring to before. Philip Morris 10 filed a formal petition with the FTC. It basically asked the 11 FTC to focus on a series of questions. One, what sort of 12 disclaimers, you know, should be used when communicating. Two, 13 what should we do with the test? 14 it, should we -- how will we come up with a new one. That was 15 the second point. And the third point was how do we handle 16 descriptors, what should be done with regard to descriptors, 17 Q. 18 had the wrong number. 19 is a copy of Philip Morris USA's FTC petition. 20 A. I have it, thank you. 21 Q. And this petition was filed on September 18, 2002, 22 correct? 23 A. Yes, it was. 24 Q. And Philip Morris filed it on its own by itself, it was 25 not joined in by any other tobacco company, correct? Should we, you know, abandon I want to show you a copy of JDEM 4 0176 -- withdrawn. I I'll hand you a copy of JD 045823, which Scott l. Official Wallace, Court It's JE 054 823. RDR, CRR Reporter 3990537517 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537517 10611 1 A. Correct. 2 Q. And it was not done at the invitation of the FTC, right? 3 A. No. 4 Q. And, basically, it was done to try to prod the FTC into 5 acting in this area? 6 A. Yes. 7 Q. And would PM USA in that petition was for FTC to take 8 formal action regarding the FTC test method product descriptors $ and consumer education; is that right? 10 A. Correct. 11 Q. Now, I want to show tab 27, which is part of the petition 12 itself, and it's Bates 8032. 13 petition ending in Bates number 8032, PM USA asked the FTC to 14 mandate to consumers which would communicate to consumers the 15 following information, "One, low-yield cigarettes had not been 16 proven to be less hazardous than other cigarettes and are not a 17 substitute for quitting,- two, the amount of tar and nicotine 18 that a smoker obtains from a cigarette depends on how the 19 individual smokes the cigarette; three, that smokers may intake 20 more tar and nicotine than measured by the FTC testing 21 methodology; four, that low tar cigarettes do not make quitting 22 smoking easier than other cigarettes." 23 meant by a request that the FTC require disclosure of such 24 information? 25 A. And if we look at the page of the Please explain what is In our petition, we brought to the attention of the FTC Scott L. Wallace, Official Court RDR, CRR Reporter 990537518 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537518 10612 1 the fact that based on the conversations we had had over the 2 preceding few years and, you know, what had been pronounced by 3 the public health community, that we thought that these were 4 examples of communications that would be important for 5 consumers. 6 which we developed our onsert on light cigarettes, the one we 7 affixed to the pack, but we were asking the FTC for guidance, 8 and suggesting that these disclaimers be required for low-yield 9 brands, In fact, ultimately, this was the template from 10 Q. And you wanted them required of all tobacco 11 manufacturers, right? 12 A. Yes. 13 Q. Now, has the FTC to this day acted on your petition? 14 A. No, they haven't. 15 Q. Now, in addition, in that petition PM USA told the FTC 16 that it planned to move forward with consumer education efforts 17 in the area of low tar cigarettes, correct? 18 A. Correct. 19 Q. And I want to go to Bates page 8032, the same page that's 20 up, and I want to look at the bottom of the page. 21 after a discussion of the disclosures that you wanted the FTC to 22 make mandatory, you wrote: 23 appropriate wording and placement for disclaimers, PM intends to 24 continue and expand its efforts to communicate with its 25 consumers on this issue. PM already provides information on So right "Until the FTC determines the Scott L. Wallace, Official Court RDR, CRR Reporter 3990537519 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537519 10613 this topic on its Website and includes the disclaimer, "the amount of tar and nicotine you inhale will vary depending on how you smoke the cigarette" next to the tar and nicotine disclosure in cigarette advertising. In addition, PM is considering additional communication vehicles for the information set forth in attachment A to this petition." Now, is it correct, if you go to attachment A you see the additional communication vehicles? A. Yes. Q. And if we could go to attachment A, which is tab 29, and basically, in attachment A, you discuss additional information that should be communicated to the public; is that correct? A. Correct. Q. And the FTC understood that you wanted to communicate this additional information by way of onserts and inserts, right? A. Correct. In addition to the petition, we actually went in and met with the FTC to talk to them about the petition and to talk to them about what we were hoping to accomplish. Q. And is it correct that after you met with the FTC, they sent you a letter responding to your request to go forward with certain interim steps? A. Yes, it is. Q. And I want to call up JD 054547. That is a copy of the letter that the FTC sent you on November 14th, 2002? Scott L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10614 A. Yes. They sent it to an attorney that represents us on a series of FTC issues. Q. And that's Mr. Chapman? A. Mr. Chapman. Q. At Arnold and Porter? A. Correct. Q. And it's written by Mary Kagel (sic) -- is it Engle? A. Engle. Q. Associate director at the FTC and she writes, "Dear Mr,, Chapman, thank you for taking the time to meet with the Federal Trade Commission staff to discuss Philip Morris's petition for a rule making proceeding concerning the existing tar and nicotine rating system. As stated at the meeting, we currently are evaluating the petition." It goes on to say, "In the interim, you stated that, absent any objections from commission staff, Philip Morris planned to provide consumers with additional information concerning the rating system and the tar and nicotine numbers by various means -- including package inserts or onserts and information on the company's Website. The FTC staff typically encourages efforts to give consumers truthful and non misleading information with which they can make informed decisions. Please note, however, that the FTC staff has not made any substantive evaluation of the labeling materials you showed us and Philip Morris should not draw any conclusions about the staff's views Scott L. Wallace. XDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10615 concerning these materials. As you know, the FTC does not prescreen or preapprove advertising or labeling." So it's fair to say even though you met with them, told them what information you planned to disseminate, they told you they would not give you any type of preapproval, right? A. Correct. Q. You proceeded anyway to make those communications to the American public; is that correct? A. Yes, we did. Q. Now, if you go to item 7, it says: "Package onsert, November 2002, package onsert repeated 2003, and 2 004, package onsert planned for 2005." Now, does that refer to the package onsert that I referred to during my examination before lunch? A. This refers to package onserts that specifically focus on the low tar issue. Q. And where was that onsert -- withdrawn. I want to direct your attention to JD 54551, which is a copy of the 2004 PM USA lights onsert. And tell the Court what was done with this onsert. A. This is an example of an onsert. Since we filed the FTC petition, we have put a lights onsert on our product every year, and we put it on for a period of time, and based on the way in which we plan the execution, we believe that we're reaching 90 percent of our smokers over, you know, a several week period so that we have high expectations and, you know, we believe we Scott h. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10616 have been quite successful in getting this onsert into the hands of our smokers. Q. And I'm holding a pack of cigarettes, Marlboro Lights -- I'm sorry, Marlboros. It's not a light cigarette, but it's a pack of cigarettes and this is a copy of the actual onsert; is that right? A. Correct. Q. And the way it works, this would actually be stuck down in the cellophane, behind the cellophane? A. Correct. THE COURT: What's the basis for your estimate that you're reaching 90 percent of the above age legal smokers in the country? THE WITNESS: They have a way. We have a research department, and they have an understanding as to how people buy product, and, you know, an average smoker will, you know, buy a pack of cigarettes -- some of them do it every day, so they have a program that, you know, starts with the premise, some buy every day some buy only once a week, because some people are carton purchasers and a carton purchaser is going to buy less frequently, so they designed the duration of the onsert to both try to maximize the technology that we had available and also to try to get that extensive a reach with regard to the onsert. So we have a, as I said, a program and an analysis that predicts that, in fact, we had a 90 percent reach. Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10617 THE COURT: And let me just ask one more question because I think my first question was not as clear as it should have been. Does the 90 percent that you have cited, does that apply to all above age smokers in the country or does that apply only to above age Philip Morris smokers in the country? THE WITNESS: It would be our smokers. THE COURT: Okay. BY MR. WELLS: Q. And would it be all your smokers or all the your low tar smokers? A. This would be put on any packing, you know, of lights, ultra lights, medium, low tar. Q. So somebody, just so the record is clear, if someone smoked a full flavor cigarette, the onsert was not inserted in that package? A. Yes. Q. It was designed to be inserted in the low tar packages and aimed at the low tar consumer population of Philip Morris, right? A. That's the audience I'm talking about, thank you, MR. WELLS: Your Honor, I just want to hand you, if I may, THE COURT: Well our courtroom clerk given the record has had to go home. BY MR. WELLS: Q. And if fin -- withdrawn. And on the insert, there's a Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10618 1 statement, "There is no such thing as a safe cigarette. The 2 terms ultra light, light, medium and mild were used as 3 descriptors of the strength of taste and flavor. 4 also serve as a relative indication of the average tar and 5 nicotine yield per cigarette, as measured by a standard 6 government test method. 7 not meant to communicate the amount of tar or nicotine actually 8 inhaled by any smoker, as individuals do not smoke like the 9 machine used in the government test method. These terms The tar and nicotine yield numbers are The amount of tar 10 and nicotine you inhale will be higher than the stated tar and 11 nicotine yield numbers if, for example, you block ventilation 12 holes, inhale more deeply, take more puffs, or smoke more 13 cigarettes. 14 such as ultra light, light, medium, or mild, you may not inhale 15 less tar and nicotine than you would from other brands. It 16 depend on how you smoke. 17 brands using descriptors like ultra light, light, medium or mild 18 are less harmful than full flavor cigarette brands, or that 19 smoking such cigarette brands will help you quit smoking." Similarly, if you smoke brands with descriptors You should not assume that cigarette Now, you recall Mr. Goldfarb asking you some questions 20 21 about whether or not Philip Morris made any reference to 22 ventilation holes in its communications with the public -- 23 A. Yes, I do. 24 Q. -- and it's clear in this insert, that went to 9 0 percent 25 of Philip Morris's low tar smokers, that there is an express Scott L. Wallace, RDR, CRR Official Court Reporter 990537525 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537525 10619 mention of ventilation holes; is that right? A. Correct. Q. And as you indicated, Philip Morris did not just do this on a one shot basis, it did it in 2002, 20 03, 2004, and it will be done in 2005 also; is that right? A. Yes. Q. Now, turn to item 8, which refers to free-standing newspaper insert November 2002. Is that the same newspaper insert that you discussed before lunch? A. Yes, it is. Q. Now, I want to at this time direct you to the language in that insert that specifically refers to low tar cigarettes, because I did not read that language before. And you had indicated before lunch that that insert was circulated to consumers nationally through various newspapers? A. Correct. Q. And if the witness could be given JD 41513, which is a copy of that free-standing insert, I would like to direct your attention to the part of the insert that refers to low tar cigarettes. So on that insert under low tar cigarettes, Philip Morris makes the statement: "A smoker should not assume that brand descriptors such as light or ultra light indicate with precision either the actual amount of tar and nicotine inhaled from any particular cigarette or the relative amount as compared to Scott L. Wallace, FDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10620 1 competing cigarette brands. Some researchers report that smokers 2 of light cigarettes inhale as much tar and nicotine as from full 3 flavor brands. 4 higher if, for example, a smoker blocks ventilation holes, 5 inhales more deeply, takes more puffs or smokes more cigarettes." The amount of tar and nicotine inhaled will be So is it correct that in the newspaper insert there's also 6 7 an express reference to ventilation holes? 8 A. Yes, there is. 9 Q. Turn to go item 9, national television and radio 10 advertising campaign launched in 2003. 11 commercial that focused on the issue of low tar cigarettes? 12 A, Yes. 13 Q. I would like to play that commercial, which is JD 053157, 14 Was there a specific (Video clip played.) 15 BY MR. WELLS: 16 Q. 17 Philip Morris's other commercials? 18 A. Yes, it does. 19 Q. The final item states: 20 including regulation of product descriptors". 21 describe what that means? 22 MR. GOLDFARB: Is it correct that commercial runs nationally as part of "PM USA supports FDA regulation, Could you Objection, Your Honor, this demonstrative 23 talks about consumer education efforts on numbers and product 24 descriptors. 25 proposed, but not in accounted, there are several different Philip Morris's support for regulation, that is Scott L. Wallace, RDR, CRR Official Court Reporter 3990537527 3990537527 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10621 versions of FDA regulations that have been proposed in Congress and it's certainly beyond the scope of the examination, but also beyond the scope of -- it's outside the scope of even the purpose of the demonstrative, but also outside the scope of the direct examination for this witness. THE COURT: Objection's overruled. BY MR. WELLS: Q. In terms of the PDA regulation, was it your understanding that if the regulation had been passed it would have given the FDA authority to regulate product descriptors? A. Yes. In fact, more than that, the bill that Philip Morris actively supported provided that descriptors had to be removed from the product unless there was independent scientific verification -- I'm using that word -- to the reduced health benefits. MR. GOLDFARB: Your Honor, could we please have clarification about what regulation the witness is talking about here. THE COURT: Well, you can clarify. I must admit, I don't know whether Ms. Keane is talking about the legislation that was under consideration in the last session of Congress or different legislation. BY MR. WELLS: Q. Were you just addressing the legislation that was under consideration in the last session? Scott t . Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10622 1 A. Yes, I was. 2 Q. Okay, 3 Court to know descriptors, regulation under descriptors was part 4 of that legislation that Philip Morris supported? I don't want to go beyond that, I just want the THE COURT: 5 Since that wasn't in the newspaper, I wasn't 6 aware of that, 7 BY MR. WELLS: 8 Q. 9 petition to the FTC requesting that the FTC act in this area, You testified that Philip Morris in 2002 had filed a 10 right? 11 A. Correct. 12 Q. And the FTC, as of today, has still not done anything on 13 your petition, right? 14 A. Correct. 15 Q. And the request for public comment that was filed in 16 1997, the FTC has not acted on that, right? 17 A. Correct. 18 Q. Now, is it correct that in your 2002 petition to the FTC, 19 that you expressly refer to some litigation that took place in 20 this courthouse involving Brown & Williamson and the FTC? 21 A. Yes, we did. 22 Q. And that litigation goes back to 1983, right? 23 A. Yes, it did. 24 Q. Very well known in the industry and by yourself? 25 A. Yes, the Barclay case. Scott L. Wallace, RDR. CRR Official Court Reporter 3990537529 3990537529 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10623 1 Q. 2 Barclay case that was litigated in this courthouse, the issues 3 of the FTC numbers and compensation and whether there was any 4 deception on the American public, were all part of the 5 litigation back in 1983, right? 6 A. Yes, it was. 7 Q. And a fellow District Court Judge issued a ruling in this 8 case that you're familiar with? 9 A. Okay. So is it fair to say that -- withdrawn. In the Plus was affirmed on appeal by Justice Scalia, Bort and 10 Edwards. 11 Q. 12 were in play back in 1983, even today in 2005 the FTC has still 13 not taken any action in terms of issuing rules with respect to 14 low tar cigarettes and what the tobacco companies should be 15 required to communicate to the American public about low tar 16 cigarettes and the FTC numbers, right? 17 A. And even though that litigation, and all those issues That's correct. 18 MR. WELLS: Maybe 15 more minutes of questioning. 19 THE COURT: Well, we have redirect. 20 MR. WELLS: I know, I'm moving as fast -- I'm moving very 21 efficiently, well, I feel I am, Your Honor. It's late in the 22 day, you believe your own stuff, I guess. 23 BY MR, WELLS: 24 Q. 25 specific tar ranges and how they relate to Philip Morris's use Yesterday Mr. Goldfarb asked you some questions about Scott L. Wallace, RDR, CRR Official Court Reporter 3990537530 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537530 10624 1 of product descriptors like light and ultra light. Do you 2 recall that? 3 A. Yes, I do. 4 Q. Does Philip Morris oppose having standard uniform tar 5 ranges for use in conjunction with product descriptors? 6 A. Absolutely not. 7 Q. And, in fact, that was part of the petition that Philip 8 Morris filed before the FTC in 2002 requesting such mandatory 9 uniform tar ranges; is that right? 10 A. And I think it was also clear, based on our conversations 11 with the FTC and the communications we had at the time of their 12 original 1997 request for comments, 13 Q. 14 have September 2nd petition, tab 93. JE 45823. And the 15 petition states, "The FTC however should promulgate appropriate 16 regulations to ensure that descriptors are used in a uniform 17 manner throughout the industry and are defined by specific tar 18 and nicotine ranges as prescribed by the FTC." And if we could just call up JE 4 5823 which is part that And that's what you were requesting the FTC act on, 19 20 right? 21 A. Correct. 22 Q, Now, yesterday Mr. Goldfarb asked you about industry 23 practice and the FTC's views concerning tar levels and the use 24 of product descriptors. Do you recall that? 25 A. Yes, I do. Scott L. Wallace, Official RDR, CRR Court Reporter 3990537531 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537531 10625 Q. And he showed you a number of charts from the FTC about the amount of tar in Philip Morris Lights and Ultra Lights and Mediums. Do you recall that? A. Yes, I do. Q. And you had a long discussion about 14 versus 15, right? A. Yes, we did. Q. Okay. And you told him that to your understanding there was an industry practice in terms of how one would define low tar cigarettes, right? A. Yes. Q. Now, if we turn to the petition that Philip Morris filed with the FTC in 2002, which is joint Exhibit 45823, footnote one of the petition, which was written back in 2002 states: "The FTC has historically defined "low-yield" cigarettes by tar range. For instance, as early as 1968, the FTC established three categories of tar yields: 15 milligrams and under; 16 to 21 milligrams; and 22 milligrams. The FTC characterized low-yield cigarettes as those having 15 milligrams of tar or less. FTC report to congress at 18 to 19, June 30, 1968. As the industry succeeded in reducing average tar yields, standardized industry practices in the use of descriptors is reflective of those reductions. Today, continuing to rely on the FTC method, the industry standard for full flavor cigarettes are those with an average yield of 15 milligrams or more tar per cigarette? light cigarettes, those with an average yield of 7 to Scott L. Official Wallace, Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10626 14 milligrams of tar per cigarette; and Ultra Lights, an average yield of less than 7 milligrams of tar per cigarette." So, in that footnote back in 2002, you discuss both how the FTC, -- even though it was not an official statutory standard -- had historically viewed lights and you also talked about the industry practice,- is that right? A. Yes, yes, I did. Q. And yesterday Mr. Goldfarb showed you some FTC tar and nicotine reports and identified a couple of instances in which the lights descriptors was used with Virginia Slims Lights and the FTC tar rating was 15 milligrams. Do you recall that? A. I do. Q. And am I correct, it's your understanding that in arriving at an FTC tar rating, some rounding occurs? A. That is true. Q. So it's fair to say if a cigarette brand measured, according to the FTC test, at 14.4 milligrams of tar, that would be rounded downward and the FTC tar rating for the brand would be 14 milligrams, right? A. Correct. Q. And if the cigarette brand measured, according to the FTC test method, at 14.6 of tar, they would be rounding upward and the FTC tar rating for the brand would be 15 milligrams; is that right? A. That is right. Scott L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10627 1 1 Q. And to your knowledge has it been PM USA's consistent 2 practice not to use the "light" product descriptor with any 3 brand that had an FTC rating in excess of 15 milligrams of tar? 4 A. Yes. 5 Q. And is it correct that since these numbers are published 6 by the FTC, if the FTC has any concerns about the tar 7 measurement of a particular Philip Morris cigarette and how the 8 descriptor is being used, it is standard in the industry for the 9 FTC to have conversations with the particular tobacco company 10 involved? 11 A. 12 built into it. When we get the report, you know, tobacco is an 13 agricultural product, and when you're talking about, you know, 14 14.4 versus 14.5 or 6 with an agricultural product there is 15 variability, so there's a procedure built into it that once you 16 get these FTC numbers, you have a certain period of time within 17 which you can go back and reformulate your product to reduce the 18 tar so that, in fact, you meet your target if, in fact, it is 19 your objective to use a descriptor in the way in which is 20 described in the petition footnote. 21 Q. 22 FTC regulates in this area, is it true that from Philip Morris's 23 perspective that it is not free to indiscriminately use the 24 lights product descriptor any way it chooses? 25 A. Yes, and in addition, there's another procedure that's And based on industry practice and your view of how the Absolutely, absolutely. Scott h. Hal lace, RDR, CRR Official Court Reporter 3990537534 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537534 10628 Q. Now, yesterday Mr. Goldfarb asked you some questions about Philip Morris USA's efforts to inform consumers about ventilation holes. You recall that, right? A. I do. Q. And I would like to direct your attention to the Philip Morris USA Website as it originally appeared in 1999, which is JD 046719 at page 21. And on the page in 1999 the Philip Morris Website stated: "An additional word for smokers who may be interested in obtaining less tar and nicotine from their cigarettes, the claim that smokers compensate for the reduced tar and nicotine yields of some brands by smoking them differently than smokers of higher yield brands. For example, they may take more or larger puffs, smoke more of the cigarette or block ventilation holes that contribute to the lower reported yields of some brands." And then it says: "Click here for a diagram pointing out the typical location of ventilation holes on our cigarette brands that utilize them." So there's no question that on the Philip Morris Website as of 1999, consumers are advised that they can click on to the web page and get a diagram pointing out the typical location of ventilation holes; is that correct? A. Yes. Q. Now, I want to direct your attention to Philip Morris's current Website, which is JD 054562, and then the last sentence Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10629 today Philip Morris has gone so far as to underline "ventilation holes"; is that correct? A. Correct. Q. And is it correct that if a visitor to the Website clicks on "ventilation holes", a diagram appears on the screen as of today under the current Website? A. Yes. Q. And I want to show you what has been marked as JD 054 563 and ask if this is a picture of the diagram that appears on the screen? A. Yes, it's a picture of the image and the text that's underneath. Q. And when you click there, it says: "Cigarette filter ventilation is one way that tar yields, as measured by the machine test method, are reduced." So it's clear that Philip Morris, on its Website, is advising consumers that one way consumers may get reduced tar is because of ventilation holes, right? A. Correct. Q. And then it goes on to state: "The ventilation holes utilized on some of our brands permit the controlled introduction of diluting the air into the smoke screen during puffing by the consumer. The diagram above presents a depiction of where, as a general matter, ventilation holes are placed on the cigarette filters of our brands that utilize this figure. Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10630 As noted in the diagram the holes are placed approximately 12 millimeters from the end of the filter, brands that utilize more than one row of holes place additional rows further from the end". So it's clear that Philip Morris has on its links system given consumers an actual diagram and more extensive information with respect to the issue of ventilation holes, correct? A. Correct. MR. WELLS: Just maybe five more minutes and I'll be finished, Your Honor. BY MR. WELLS: Q. Now, you stated in your direct that one of your job functions was to deal with compliance of the MSA, correct? A. Yes. Q. And is it correct that since the MSA was adopted, Philip Morris has never been charged with any type of MSA violation? MR. GOLDFARB: objection, Your Honor. beyond the scope of this witness's direct. This is entirely Philip Morris has called six witnesses to discuss Philip Morris's compliance with the Master Settlement Agreement, and they did not call Ms. Keane. They can put on this evidence during their case in chief, and it is entirely inappropriate for something that's so far beyond the scope of the direct examination to ask -- to be able to pose these questions to this witness. MR. WELLS: I have three questions, Your Honor. Scott U. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10631 THE COURT: No, it doesn't matter how many, the objection is sustained. MR. WELLS: Even though it is part of her duties and she's not permitted -THE COURT: It may be part of her duties, but the rules are that you cross-examine a witness on the subject matter of their direct testimony, and there's no question she didn't deal with any of the substance of the enforcement of the MSA. I allowed you one or two questions because I felt they were so superficial in terms of mentioning that subject, but certainly not a detailed examination of her on what goes into compliance. MR. WELLS: Your Honor, in her direct she specifically states that compliance with the MSA is one of her functions. MR. GOLDFARB: And Your Honor -MR. WELLS: And I only want to establish that it is -that in terms of how she carries out this function, there have been no violations by Philip Morris of the MSA, and show you the compliance book that she produces. It is two questions and she's not -- and -- may I be permitted to call her back? I don't understand how the government can call a witness. THE COURT: You may always be permitted to call her back in your case. MR. GOLDFARB: Your Honor she's not -- MR. WELLS: Your Honor, she was not on our list because we didn't put her on our list because they said they weren't going Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10632 to call her, but as long as I'm permitted to call her back on the case given that the government has chosen to call her, and now I'm being restricted in terms of scope I'll do it in my case. THE COURT: Just a minute. I answered you too quickly not knowing that she was not listed on your witness list. Let me hear from Mr. Goldfarb, please. MR. GOLDFARB: Your Honor, if they wanted this testimony, if -- this goes directly to one of their -THE COURT: sense. So this whole discussion doesn't make any There are other witnesses for Philip Morris who can clearly testify, I think, that it was never cited for violation of the MSA. MR. WELLS: correct. I have two questions, Your Honor. That is Because Ms. Keane is the person at Philip Morris with direct responsibility for MSA compliance, she keeps a book. If I could do nothing more than show her the book, let her say for the record, this is my compliance book that she prepares, so I can have a foundation, because she is the one who does the book and I won't have anymore questions. But they should not be permitted, Your Honor, to add her in the middle of trial, that's what happened, as a witness and then say I can't call her back on the grounds that they constructed a direct that doesn't permit me to give a full picture of her responsibilities. THE COURT: First of all, add her in the middle of trial? MR. GOLDFARB: She has always been on our witness list, Scott I. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10633 Your Honor, she was deposed in this action, she has been on the United States witness list, she is one of the ten witnesses that we shifted from priors to live in accordance with the prior Court orders- Defendants have been obviously on notice, she was deposed in the case, they have six witnesses on their witness list to testify to MSA compliance. If they were so interested in getting this document in and it was so important to have this witness here, they should have put her on their witness list. Under order 625, Your Honor precluded witnesses, even witnesses that defendants put on their witness list, from calling -- from completing their examination during the United States examination, during the United States case of those witnesses. Ms. Keane is outside of that even to an even greater extent because they didn't even put her on their witness list. So, it is beyond the scope of the direct. United States asked no questions, any questions that could have come up about the MSA or any testimony was nonresponsive to the questions that the government asked, and they simply should not be allowed to ask any questions of this witness during the United States' examination and if they -- again, if it was so important, they should have put her on their witness list, they have six people listed. MR. WELLS: May I respond, Your Honor? First she was not on the live witness list, she was on the list of witnesses for deposition testimony. In the middle of the case they were Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10634 permitted to add ten people that they could select, of the ten people selected. witness. she was one They have called her now as a Part of their examination has put into question not only her credibility, but how she does her job. They suggested that she had -- that she didn't produce information to the FTC, I think it's a very serious allegation, and I think the -- one of the things that you as a fact finder can consider whether this alleged suppression of research reports that they suggested is how did she do her entire job, how is she as the person with compliance for the Master Settlement Agreement. THE COURT: It opens up much too much. The government raised the issue of an alleged failure to submit certain reports to the FTC, you properly, and I think completely, covered that issue in your direct -- I'm sorry if your cross either this morning or this afternoon, who knows whether the government will have anything more on that subject, but it was directly raised as a major issue in the government's direct. The objection is sustained, everybody, let's move on. MR. WELLS; May I have permission, then, to call her back on our case since she was -- I don't see how they can call her? THE COURT: Mr. Wells. I'm not going to rule on that right now, I'm not going rule on that, in all fairness to the government, and to give everybody a little time to think about whether they really need to go through all this trouble to get this narrow piece of information out of this witness rather than S c o t t L. Official Wallace, Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10635 some other witness. I'm going to require a motion on it, but I have a feeling people are going to re think all of that. MR. WELLS: One final question. THE COURT: Mr. Goldfarb. MR. WELLS: This is a totally different question. BY MR. WELLS: Q. Ms. Keane, you were asked earlier about your 2004 compensation, including salary and annual bonuses. Do you recall that? A. Yes, I do. Q. Just so the record is absolutely clear, does PM USA also award longer term incentive bonuses that may be paid every three years in addition to annual bonuses? A. Yes, they do. Q. And what was the amount of the last three year long term incentive bonus that you received? A. It was approximately $500,000. Q. Okay. And when was that? A. It was for the years 2001, '2, and '3. Q. 2001, '2 and '3. MR. WELLS: I just wanted the record to be clear on that. I have no further questions, Your Honor. THE COURT: All right. Let me just find out from Mr. Goldfarb how long you expect to be, and I have a feeling I'm going to have to confer with Mr. Wallace, who is going to soon Scott L, Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10636 refuse to work on this case. Go ahead, Mr. Goldfarb. MR. GOLDFARB: Your Honor, I think I should be done in under a half an hour. THE COURT: Mr. Wallace are you all right with that? THE COURT REPORTER: Yes, Judge I'm fine. REDIRECT EXAMINATION OF DENISE F. KEANE BY MR. GOLDFARB: Q. Ms. Keane, in response to defense counsel's questions, you gave extensive testimony about the FTC -- about Philip Morris's interaction with the FTC from 1996 through 2002, of its petition, correct? A. Yes, we did. Q. Now, regardless of the FTC regulatory time line, or any actions undertaken by the FTC, at no point has Philip Morris been precluded from providing accurate non misleading information to consumers; isn't that correct? A. I know we've had this conversation. In terms of are we precluded by law, no. But the decision as to whether or not to do it would be an analysis based on what we thought was going on - - what I thought was going on in terms of what was appropriate and what guidance I thought the FTC had clearly communicated they would or would not give. Q. And you recall at your deposition you indicated that in your view Philip Morris was, in fact, precluded from providing that information, correct? Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 1063 7 A. And I said based on my judgment. Q. Okay. A. On my judgment at the time. So it was a preclusion based on your judgment? I thought that the FTC said they were going to act quickly, they had indicated that they wanted to get information on how to affect these communications, it was clearly square with exactly what information they were probing, so my judgment was let's wait and see what they're going to tell us because that would be a far better situation for us because then we would have their guidance on what would be the most appropriate communication. Q. And then in 2000, when the FTC hadn't acted yet, then the preclusion disappeared, correct, and your judgment changed and you decided to voluntarily provide some information to consumers about the meaning of -- or the differences between the FTC tar yields and potential human intake, correct? A. Based on my judgment, particularly following the FTC consumer alert, and the fact that nothing had, in fact, evolved, we had no further guidance. I thought in 2000 that adopting a disclaimer was the appropriate thing to do and that was my recommendation to the business. THE COURT; By the way, if you had decided after your meeting with the FTC to go ahead and do something on your own and your judgment turned out to be wrong, what was the risk facing Philip Morris at that point? THE WITNESS: Well, the FTC, under section 5 of the act, Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10638 would have been able to have come against Philip Morris and challenged our communication, but in addition to that -THE COURT: And would that have been criminal, civil or both, depending on the FTC's choice? THE WITNESS: Urn, my expectation would have been it would have been civil, it would have been a civil action on their part, but the other thing, and this is something that comes up very frequently, and came up in our conversations with the FTC, was the concern about unintended consequences. I mean, if you read that FTC Federal Register notice, it even goes down to talking about asking how people should talk about ventilation holes and how to communicate, because I think the FTC was appropriately concerned about making sure that you're delivering the right message and setting the right behavior, so that people wouldn't purposely include them, so they will know where they were to avoid -- things of that nature. There's a series of checks and balances, and all of that, you know, kind of came together to influence me that the right thing to do for the company and consistent with what I believed was, in fact, the guidance we were getting from the FTC, was to wait and see if we could get further information. BY MR. GOLDFARB: Q. And just putting this up for a moment, this is JD 054551. This is the onsert that defense counsel showed you, and he confirmed, in fact, that it mentions ventilation holes, correct? Scott i . Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10639 A. It does. Q. But surely the FTC, when it was discussing -- when it was asking questions about ventilation holes, certainly didn't tell Philip Morris mention ventilation holes but don't tell people where on the cigarette they are, correct? A. No, Mr, Goldfarb, we didn't go into that detail, but we did, in fact, discuss, you know, do people need to have some guidance on how to communicate effectively, and that's why they posed that in their Federal Register notice. Q. And they didn't say mention ventilation holes but don't tell them why they're there or give them instructions about how not to block them, correct? A. No. Q. Now, counsel showed you JD 054555, and this is the strategic issues task force memorandum that you wrote to Mr. Bible in August of '99. Do you see that? A. I do. Q. And counsel pointed you to the second page where you indicated that the objective, and I'm reading the second page, Bates number ending in 8136 -- that the objective is to present materials in an accessible fashion. Do you see that? A. Yes. Q. And on examination by defense counsel, you talked about how one of the things you wanted to do was communicate information to visitors of the Website clearly, correct? SCOtt h. Official Wallace, Court RDR, CRR Reporter 3990537546 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 1064 0 A, Q. Yes. And you didn't want them to have to, I don't know exactly what phrase you used, but you didn't want to have to force people visiting the Website to go through lots of different links and drill down to find out information, correct? A. No, that's not what I meant. For me, the platform was to provide things simply and then give varying degrees of detail that people could choose to take advantage of and then drill down. In some of the links that we were talking about today, you get a general summary and a highlight, so that's your first link, and then if you go on to that cite and you can click again you can go to a primary document. So that was, in a sense the model that we tried to use. It wasn't exactly the format with every execution, but that was a way in which, you know, we were trying to balance the extent of the information that's available publicly and the types of communications that we thought consumers would take the time to read. Q. And the next sentence beyond that states: "We will attempt to avoid lengthy position statements and focus on a concise format that we believe internet users prefer when seeking information", and you wrote those words? A. Q. Yes. Would it have been a lengthy communication to tell people there's an overwhelming medical and scientific consensus that the nicotine in cigarettes is a drug? Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10641 A. No, that's not lengthy. Q. Okay. Would it have been a lengthy position statement once Philip Morris agreed at the latest to state publicly by January 2003 that Philip Morris agrees that nicotine delivered in cigarette smoke is addictive? A. As I indicated earlier, I thought we have communicated the broader message. Q. My question is whether my -- A. It is not lengthy. Q, Whether my statement would have been a lengthy statement? A. It is not lengthy, no. Q. And if you look at the Website, there are a number of documents that looked similar like this on the cover, so I'm actually not sure what this one -- I think this is the mailing, and just for the record, I'll note it's JD 052920. And do you recognize this, which one of the -- which one of the pamphlets says - - i s this the one that was mailed to people who called in and asked for information? A. If you show it to me, I should be able to tell you. MR. WELLS: It's the website packet, Your Honor. THE WITNESS: Okay. MR. WELLS: Website packet, the 1-800 number. THE WITNESS: Okay. BY MR. GOLDFARB: Q. So you understand this to be something that Philip Morris Scott I. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10642 would mail to people in response? A. Yes. Q. Philip Morris agrees that nicotine in cigarettes is a drug, correct? A. Philip Morris agrees that nicotine in cigarette smoke is addictive and nicotine is a drug. Q. Okay. And on its website and on its 1-800 pamphlet, as reflected in JD 05292 0, there's a -- as you indicated in response to a question from counsel, a page on quitting smoking, correct? A. Yes. Q. And the title of it -- and I'll just put it under here for the Court. And if you look at the top, it's "Health Issues," "Quitting Smoking" and "If You Want to Quit, Things to Know." Do you see that? A. I do. Q. Now, nowhere on this page does it indicate that maybe if you want to quit, you should know that you are inhaling a drug every time you inhale a cigarette, does it? MR. WELLS: I object, Your Honor. This is the very page from "Quitting Smoking" that he did not want me to go into. I did not go into it. And the notion that he would object and now put it up on the board and want to go into the details of it, I think that's objectionable. SCOtt L. Official Wallace, Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10643 THE COURT: The objection's sustained. BY MR. GOLDFARB: Q. Okay. Ms. Keane, to your knowledge, nowhere on the website, which you discussed extensively with defense counsel does it state that nicotine is the drug in cigarettes that causes addiction; isn't that correct? A. That could well be in the FDA submission that is found on the website. You can go on our website and click on the FDA submission, so there could be sections within the website where you could access the perspective and information from the public health community. Q. And this is the link for the FDA findings related to addiction that's on the website that counsel presented you earlier today, correct? A. If I could see the whole page. don't know if it's the only link. THE COURT: I'm sure it is,- I just I can't -- Why don't you pull the page down. MR. GOLDFARB: THE WITNESS: I'm sorry. It is clearly from our website. BY MR. GOLDFARB: Q, Okay. So here are statements that -- if you click on the FDA Findings link on the Addiction page, you call up "FDA Findings Relating to Addiction," correct? A. Correct. Q. And nowhere on this excerpt that Philip Morris has chosen Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10644 to use as a link to its website does -- I don't even think the word nicotine appears, does it? A* Could you auto focus? I can't read it on this. I'm sorry. Q. Oh, yes. I hope. A. Or you can give me a copy of the page. Thank you. MR. WELLS: Your Honor, excuse me. I'm going to object under 403 in terms of wasted time. She's already testified that the entire 1988 Surgeon General's Report -MR. GOLDFARB: Your Honor, I object to counsel's -- this is entirely irrelevant. THE COURT: Counsel, one at a time. Go ahead, please. MR. WELLS: She's already testified that the entire 1988 Surgeon General's Report is linked on that website. It's been an exhibit. She's testified to it and -- THE COURT: That requires clicking on to another place? MR. WELLS: That's what she testified to. And that's what he -THE COURT: I understand. This is argument. It doesn't go to the facts that the witness is allowed and required to testify to. Let's ask the question and move on, please, BY MR, GOLDFARB: Q. Ms. Keane, my question remains: Nowhere on that Scott b. Wallace. RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10645 statement - - o n the excerpts from the FDA findings that Philip Morris has chosen to put on its website does it refer to the fact that nicotine is a drug and nicotine is addictive, correct? A. It doesn't refer to that here, but I can't tell you sitting here, Mr. Goldfarb. I believe that there may be other places where you can access information on the FDA on the site. So on this particular page, I agree with you. Q. Okay. But you don't know - - i n fact, you don't know whether such an other hypothetical link exists, correct? A. It's an extensive site. Talking about the information of the public health community is clearly our objective. The FDA is a big piece of that. I would be totally speculating. My instinct is there's potentially another location; I just don't know, sitting here. MR. WELLS: Your Honor, could I see what page he has handed the witness, if he's given the witness the page of the website or has he given her something else? MR. GOLDFARB: I've given her the page from U.S. Exhibit -- from Joint Defendants' Exhibit 053199. And I gave it to her for her convenience. MR. WELLS: Was that from the kit or from the website? MR. GOLDFARB: That was from -- that is from, Your Honor, JD 053199 that counsel represented and the witness confirmed was an entire copy of the Philip Morris website. THE COURT: And that was done during cross-examination, Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10646 oh, maybe an hour or so ago at most? That's a very large packet? THE WITNESS: No, that's not what this is. MR. WELLS: No, that's not what that is, Your Honor. This is the actual picture of the website that was on the board (indicating) and he said it was a different document. MR. GOLDFARB: Your Honor -- I'm sorry. THE COURT: One at a time, everybody. Let's have some numbers to identify things, please. MR. WELLS: Okay. THE COURT: Mr. Goldfarb? What's the page that the witness was given by Do we have a Bates number on that? MR. GOLDFARB: There is no Bates number on it, Your Honor. It is one page pulled from JD 053199, which Mr. Wells handed to the witness and said -- asked her if she could confirm that this is a printout of the entire Philip Morris website. THE COURT: the package. She did so confirm. I saw you pull it from Of course that doesn't necessarily mean that the package itself which Mr. Wells proffered was accurate and complete. MR. WELLS: And what she also testified to, Your Honor, is that JDEM 04 0178 is a copy of the website on addiction. I believe that's the actual copy and I would like to -THE COURT: Let's get that clear for the record. Mr. Goldfarb, I understand exactly what you did. I Scott L. Wallace. RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10547 i happened to directly see you pull it from that package. It may have been defendants' error in including it. Mr. Bernick, try not to look so unhappy. (Discussion had off the record between Mr. Wells and Mr. Goldfarb.) MR, GOLDFARB: Your Honor, if I could suggest, since I pulled it out of my own copy, if I could have the witness's copy or counsel's copy, I could pull the exact same copy. I will note, Your Honor, that I pulled this document in response to the witness's statement about the FDA statements on the website. And my question does not go to the 1988 report, which counsel -- was the basis for counsel's objection. This is entirely beside the point. His objection is itself improper and I should be able to continue my examination. MR. WELLS: No, Your Honor, He pulled -- I just figured out what happened. It's a multiple page document. He showed her one page. He didn't show her the other page. And the other page says: "Nicotine Addiction, Surgeon General's Report" right on the front. And that's why I got up to object, because he's pulling pages and not showing the witness all of the relevant pages. And that's what was misleading. THE COURT: They're all pages from the website; is that correct? MR. WELLS: Yeah, but there are only two or three pages on Scott h. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10648 I — addiction. In other words, this is -- the addiction pages are either two pages or three pages. He showed her one page, so she couldn't see the entire page. That's why I was objecting, because I know -THE COURT: Mr. Goldfarb, did you find the relevant pages? MR. WELLS: It's printed out and you don't capture the way it comes up on the screen completely. That's why it's multiple pages. MR. GOLDFARB: I think I can sort it out very quickly. THE COURT: Go ahead, please. MR. WELLS: I think we're in agreement now. BY MR. GOLDFARB: Q. Can I have the page I gave to you? A. I gave it back to you. MR. GOLDFARB: I pulled this from my copy. I don't think I -- Did you take the copy from the witness, Mr. Wells? MR. WELLS: Is this the page you gave her (indicating)? MR. GOLDFARB: This is what I think I gave her, yes. MR. WELLS: But this is the page -MR. GOLDFARB: This is the front page. MR. WELLS: This is the other page. MR. GOLDFARB: I'm happy to show her the front page. THE COURT: All right, Mr. Goldfarb. Go ahead, please. BY MR. GOLDFARB: Q. Ms. Keane, in the exhibit -- the copy of the website Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10649 proffered by counsel this morning or earlier this afternoon, this is the -- this in fact is the addiction statement on the website, correct? A. Yes, it is, Q. And you see on the right there's a reference to "U.S. Food and Drug Administration Statements on Addiction, 1995." Do you see that here? A. Yes, I do. Q. And that's what you made reference to. And if you click on that, the next page that you get is: Relating to Addiction." "FDA's Findings Do you see that? A. Yes, I do. Q. Now, my question to you remains: Is there any statement on here that refers to nicotine as a drug or the fact that nicotine is addictive? A, On this page, no. Q. Thank you. MR. WELLS: Your Honor, objection, because the original question that started all this: web page? Was there any reference on the And right above it, it says: "Nicotine Addiction, Surgeon General's Report," That was the original question that started the objections. THE COURT: The objection's overruled. All of this is now in the record and can be the subject of argument when argument is presented about how to evaluate what is on the website, what is Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10650 i meaningful, what will convey sufficient information to the consumer. Mr. Goldfarb, next question. MR. GOLDFARB: Thank you. BY MR. GOLDFARB: Q. So, just for the record, this series of statements that counsel -- defense counsel discussed with you concerning JD 041454, which are these proposed public communications that were discussed with the FTC in early 1997; is that correct? A. Yes, it is. Q. Philip Morris never ran any of these public communications, correct? A. No, they didn't. Q. Now, also in response to my questioning during your initial examination, you indicated that you had had general discussions concerning your cross-examination by your own counsel prior to receiving your written direct examination, correct? A. Before we received my written direct, it was, you know, just conceptually. Q. Okay. And then you continued to have general discussions about your cross-examination by your own counsel after you received the proposed testimony from the United States a week ago Monday, correct? A. Yes. Scott h. Wallace, Official Court RDR. CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10651 Q. And counsel put up this demonstrative and asked whether this demonstrative accurately captured Philip Morris1 communications with the public about its website. And I noticed that it took you about a second and a half to respond that it in fact was an accurate depiction of Philip Morris' communication with the public about its website. And so my question is: When did you first see this demonstrative? A. I did not see that chart until today. Q. And just so the record is clear, it's JDEM 040177, So it's your testimony you didn't see the demonstrative prior to today? A. Not until today. Q. Now, if we look here, and I will zoom in, you discussed your -Did the auto focus work for you? A. That's fine. Thank you. Q. I think it's number four on the list, the December 1999 website information sent to 29 million smokers on the direct mail database. Do you recall giving testimony in response to defense counsel's questions about that mailing? A. Yes, I do. Q. Now, the direct mail database is a database maintained by Philip Morris to communicate with people who want to receive its information about smoking, smoking-related items, correct? A. Correct. It's basically a database for which we have SCOtt I. Official Wallace, Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10652 different procedures to identify smokers who are 21 years of age and older. Q. And in 1999, Philip Morris mailed out millions of sweepstakes contests -- mailings to the --to the people on the direct mail database, correct? A. We would have had promotional communications. Exactly which ones we did in 1999, sitting here today, I wouldn't know. But yes, we would have had promotional communications. Q. And those typically would go out to millions of people, correct? A. Having a mailing of 29 million smokers, which is basically the entire database, is very unusual. It is not something that is done as a general rule. Q. Right. And I'm not saying that every mailing goes to 29 million people, but you would have mailed millions of -whatever promotional items, you would have mailed millions of them out to members of the database, correct? A. Yeah. I don't know the number. disagreeing or quibbling. I'm not, you know, I just don't know. It would be a significant number. Q. Okay. But you're not disagreeing that it would be in the millions? A. I don't know. It could be. It would be significant. I just can't quantify it, sitting here. Q. And those are sent to households all over the United Scott L. Wallace. RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10653 States, correct? A. Sent to smokers, people on the database who are meant to be smokers, legal age --21 years of age and older. Q. Okay. And Philip Morris also sends out millions of gifts to smokers on its database in 1999? A. I don't know if I would count that in the millions. Yes, in fact, we did have a Continuity Program where in fact unbranded merchandise could in fact be obtained by smokers who were on the database, for which we had copies of government issued I.D. Q. And millions of copies of Marlboro Unlimited Magazine sent into households of people on the database, correct? A. Large numbers of copies. Again, I'm just sorry, I don't know the exact number. Q. And coupons -- Philip Morris sends coupons to millions of people every year on its database? A. It sends coupons. Q. To millions of people, correct? A. Again, I'm truly not trying to dispute the number or to, you know, be anything but accurate. number. I truly don't know the But it would be -- yes, we would have coupon mailings. Q. So it did all these things in 1999, correct? A. Yes. Q. And 2000, correct? A. Yes. SCOtt I . Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10654 Q. 2001? A. Yes. Q. 2002? A. Yes. Q. 2003? A. Yes. Q. 2004? A. Yes. Q. And so far in 2005, correct? A. We would have mailings, yes, of the nature you described. Q. Okay. And these would include coupons? A. Would they include coupons? Q. But in the course of a year, they're certainly going to They could. include millions of coupons being sent out to smokers? A. Again, I don't -- I would be very surprised if -- I don't think the number is in the millions, but yes, that would be a vehicle that we would use. Q. Okay. Now, Ms. Keane, defense counsel also showed you the press release from the National Cancer Institute from, I believe it's November 2001. And it's JD 05454 9. Do you recall being asked questions about this NCI press release? A. Yes. Q. Okay. And counsel read the -- I think counsel read' the first paragraph that's marked in pen on the left. The first sentence reads: "Millions of Americans smoke low tar, mild or Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10655 light cigarettes, believing those cigarettes to be less harmful than other cigarettes." Does Philip Morris agree with that statement? A, Yes, I'm sure that people buy cigarettes, believing -- light cigarettes, believing they're less harmful. Q. And does Philip Morris agree that "Millions of Americans smoke low tar, mild or light cigarettes, believing those cigarettes to be less harmful than other cigarettes"? A, I don't know the number, Mr. Goldfarb, but I would expect that people believe that. In fact, it's broadly communicated by the public health community. Q. So is your answer that you don't know whether Philip Morris agrees with statement or are you saying Philip Morris does agree with that statement? A. I do not know, nor do I believe Philip Morris has any empirical data to quantify what percentage of the American public believes it, but in fact I'm not disputing in any way that there are members of the American public that do believe it. Q. And the second statement states that: "In a new monograph from the NCI titled 'Risks Associated With Smoking Cigarettes with Low Machine-Measured Yields of Tar and Nicotine,' national scientific experts conclude that evidence does not indicate a benefit to public health from changes in cigarette design and manufacturing over the last 50 years." SCOtt L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10656 Does Philip Morris agree with that conclusion of the National Cancer Institute as well? A. That is basically an issue that I know our scientists are studying. They are very carefully looking at this issue. It is -- we will, you know, defer to the message of the public health community as to how this topic should in fact be discussed with consumers, but we do have scientists who are trying to collaborate with people in the public health community through some of our research programs to make sure we have a fuller understanding of that issue. Q. And so the answer is Philip Morris does agree or does not agree or you don't know? A. Philip Morris is looking at this issue. Philip Morris is trying to study the issue and has, you know, commissioned, I think, very significant research to be able to, through a series of experiments that have been broadly shared -- the content of which have been broadly shared with members of the scientific community to try to give us a better perspective on that. Q. And Philip Morris continues to use brand descriptors currently, correct? A. We do. Q. It uses "light," correct? A. Yes. Q. "Medium"? A. Correct. Scott £>. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10657 Q. And "ultra light"? A. Um-hmm. Yes, which is why we have the extensive communication platform that accompanies our use of those descriptors. Q. Now, in response to counsel's question, questioning about some of the FTC tar ratings for particular brands of Philip Morris cigarettes, he went back to some of the on FTC reports that were discussed yesterday in your testimony, correct? A. Yes. Q. And you discussed the rounding errors, correct? A. I did. Q. Now, whether or not there are rounding errors or not rounding errors -A. I also discussed the reformulation option that, in theory, we have and have used on different occasions over the years. What I can't speak to definitively is how the particular issue you brought to my attention -- how that was handled and what those specific facts are. Q. All right. I'm not asking you about that at this point, Ms. Keane. What I'm asking you is regardless of whether or not there is a rounding error or not a rounding error, the fact remains, and it is true, is it not, that in 1998, 1997 and 1995, which I believe are the years of the cigarettes that were reported in the respective FTC reports shown to you yesterday, Philip Morris was selling Virginia Slims regular cigarettes and Scott h. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10658 Virginia Slims light cigarettes that had the same FTC tar yield, correct? A. No, because one of the points I guess I wasn't clear on making is the FTC report, although generally reflective of what, in fact, would be advertised and sold, right, is not definitive of what is advertised and sold. Because of this reformulation option, the company could receive a report like that and would have a period of time within which to reformulate the product. So that's a small distinction, but it does mean that you can't automatically look at that list and say this is in fact how it was communicated in the market. Q. But for any of the cigarettes that were discussed yesterday in your testimony, you have no idea whether this reformulation option -— A. I don't. Q. -- occurred or was implemented, correct? A. Correct. Q. Now, counsel also showed you JDEM 040176 and that's "Philip Morris USA Consumer Education Efforts, FTC Numbers and Product Descriptors." Do you see that? A. Yes, I do. Q. And this is actually the demonstrative that's right behind you, correct? A. Yes. Q. You didn't prepare this demonstrative, did you? Scott X. Wallace, RDR. CRR Official Court Reporter 3990537565 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10659 A. No, I didn't. Q. It was prepared by counsel for you? A. Yes, it was. Q. Now, with respect to Philip Morris' interactions with the FTC, you had your meeting in May of 1996, correct? One -- none of your meetings was in -A. The meeting was referred to in a memo of May of 1996. I can't remember the exact date of that particular meeting. It was some time shortly before that, I believe. Q. Okay, And it was at that meeting that, as the David Remes memo reflected, FTC asked you for any information that you -- that the companies had concerning consumer perception of brand descriptors, correct? A. Right. They asked us if we had any evidence relating to consumer perception, Q. And Philip Morris in response to that, as you testified, didn't provide any information in response, correct? A. Correct. Q. And then -THE COURT: Didn't we go over that yesterday? MR. GOLDFARB: Yes, but -THE COURT: Let's not repeat. MR. GOLDFARB: BY MR Q. I understand. GOLDFARB: And just to be clear, again, in 1998, when the - - when Scott J,. Wallace, RDR, CRR Official Court Reporter 3990537566 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10660 the tobacco companies responded to the September 1977 -September 1997 FTC request for comment, it again indicated affirmatively that -- Philip Morris again indicated affirmatively that it had --it was unaware of any evidence other than that presented in Monograph 7, correct. A. Correct. Well, not exactly those words, but yes, it indicated that it didn't have any evidence. Q. Okay. Now -- A. It referenced by incorporation the survey results that were contained in Monograph 7. Q. Now, in response to one of the Court's questions, you indicated that researchers at Philip Morris can figure out how many people buy cigarettes and how many people are exposed to a certain number of cigarettes for a particular ad campaign or a particular onsert exposure, correct? A. Correct. Q. And so it's your testimony, Ms. Keane, is it not, that in your written direct, that you are unaware that in the 25 years that Philip Morris had been selling light and low tar cigarettes prior to that FTC meeting in 1996, that it was your belief that Philip Morris had conducted no consumer research about how consumers perceive light and low tar cigarettes at Philip Morris? A, Philip Morris probably conducts thousands and thousands of research exercises, you know, throughout those years and as Scott h. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10661 1 it related to whether or not we focused on consumer perception, 2 I had been told that we did not. The fact that those three 3 examples have, in fact, been identified -- I did not know they 4 were there and I had been told that we do not conduct that type 5 of research. We do not research consumer - - w e had not 6 researched consumer perception. 7 That information was wrong. I would have given the 8 information to the FTC. I don't even believe they would have 9 found it, quite honestly, given the age of the '76 report and 10 the limited scope of the Merit, would have found it evidence, 11 but nonetheless, I would have made it available to Lee Peeler. 12 Q. 13 marketing research reports that are conducted over -- 14 A. 15 whole variety of research topics. And yes, I mean there are 16 hundreds, thousands -- 17 Q. Okay. And as you -- 18 A. -- over that timeframe. 19 Q. And you testified under oath at your deposition, 20 Ms. Keane, that you didn't even ask anyone whether Philip Morris 21 had conducted such research, correct? 22 A. So you say there were thousands of market - - o f consumer Companies -- marketing companies, obviously, focus on a I never -- 23 MR. WELLS: I object. 24 THE WITNESS: I answered that question. 25 THE COURT: Everybody, one at a time, Ms. Keane. Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10662 MR. WELLS: I object. This is just a repeat of what he did on his direct. THE COURT: Yes, Mr. Goldfarb, it is. I mean, immediately after I mentioned that the question you asked had been gone over yesterday, you asked a succeeding question and there was no question that we had covered it yesterday. So please, try only to focus on new issues -- or I shouldn't even say it that way --on questions that relate to what was brought up on the cross-examination. MR. GOLDFARB; And, Your Honor, if I may, the only questions I'm asking are to impeach the -THE COURT: I know what you're trying to do, but you're simply repeating questions that you asked in your direct. BY MR. GOLDFARB: Q. Ms, Keane, are there any other -- are there any other statements from your deposition of October 10th -- October 1st and 2nd, 2002 that you now know to be erroneous, other than the ones that you have identified in the past two days? MR. WELLS: Objection, Your Honor. I didn't ask any such question during my examination about the deposition in general. THE COURT: Sustained. MR. GOLDFARB: Your Honor, the question goes to the witness's credibility. THE COURT: Sustained. MR. GOLDFARB: I have no further questions. Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10663 THE COURT: All right, Ms. Keane. Thank you. You may step down. THE WITNESS: Thank you. THE COURT; I know that everybody was informed through my law clerk that I would certainly like to take care of some remaining objections which are floating around, but we're certainly going to take a ten-minute recess at this time. I believe there are a few objections relating to Dr. Chaloupka. Dr. Krugman. I think there are a couple relating to You all better be really clear on all of this because I don't have those files with me, but I'd like to deal with those if they're just isolated objections. MS. EUBANKS: I understand that, Your Honor, but I received a communication that the Department of Justice was released three hours earlier, so I don't know if the proper personnel -- and this was due to the weather, not the inaugural activities -THE COURT: What is going on outside? MS. EUBANKS: I can't see. I don't know. But I can immediately make inquiry to see if the people are there. And if they can get here in ten minutes is another matter as well. THE COURT: Well, if they can't, of course I understand. MR. BERNICK: will you excuse those of us who are not involved in the objection process to go? THE COURT: Well, with great charity and compassion, yes, Scott Z. Wallace, RDR. CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10664 I will. Yes, I will. If we can do business in ten minutes, I would like to. Certainly I remember the commentary a day or two ago that there were just a couple of short matters and I'd like to clean up the record. We all need a break, though. And then I'll want to make sure that you're all working on Dr. Biglan's testimony, Ms. Keane's, of course, and I'm leaving out a witness in between and that is Dr. Slovic. All right. Let's take ten minutes, everybody. (Thereupon, a break was had from 3:34 p.m. until 3:48 p.m.) THE COURT: All right. What can we usefully take care of at this point? MS. EUBANKS: I would propose that if there are areas of agreement that counsel have reached, that that might be a good way to start. I did reach Ms. Brooker, who is responsible for responding on those witnesses she handled, and I told her to hop in a cab and come on down, but it's from 13th and Pennsylvania. THE COURT: Is that where you are? Oh, my gosh. I thought you were at main Justice. MS. EUBANKS: No. So, she's on her way over and I haven't received a communication to say that she isn't, so I'm sure she'll be here shortly. So, that's what I would propose, Your Honor. Scott h. Wallace, RDR, CRR Official Court Reporter 571 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10665 THE COURT: Before we get to the ones that involve her, let me just make sure about something. first of all Dr. Biglan's testimony? Are counsel working on And I know that does involve Ms. Brooker, but are there disputed issues on that? MR. NARKO: the record. Good afternoon, Your Honor. Kevin Narko, for There are a few documents with regard to Dr. Biglan. We argued a number of those last Thursday, I think it was. There are a couple still to address. We have corresponded with Ms. Brooker, come to agreements on some of the exhibits at issue, but I think the only things we have to address with Your Honor this afternoon do involve Ms. Brooker. THE COURT: I see. Are you working on Dr. Slovic? I guess that involves Ms. Brooker also. MS. EUBANKS: Yes, we're working on Dr. Slovic and Ms. McMahon has been involved on that. MS. McMAHON: Yes, Your Honor, Linda McMahon. I spoke with Mr. Minton yesterday, and he said he was working on a list of the exhibits that he wants to proffer, and so that he would communicate with us and then we would come prepared. THE COURT: Then who -- I guess Mr. Goldfarb will be working on Ms. Keane although there wasn't an awful lot. Now, have we lost Mr. Wells? I guess we have. MR. NARKO: Mr. Wells is not here. MS. EUBANKS: I can speak on his behalf. THE COURT: Who's going to be working on any objections Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10666 regarding Ms. Keane? MR. NARKO: I'm sorry, I didn't hear your question. THE COURT: Who's going to be working on any objections concerning Ms. Keane? MR. NARKO: Mr. Wells will be working on those and we will exchange a list, as we've done with some of the other witnesses. I'll make sure and talk to Mr. Wells about that this evening. THE COURT: All right. Well, I don't think it's going to be any easy matter to just hop in a cab. I didn't realize she was so far away. MS. EUBANKS: Your Honor, it only takes once -- on a good day when there's no bad weather or traffic, we can usually get here by cab in about 10 minutes. I just don't know about the availability of a cab, and if you'll allow me to check, I'll see. She does have a -THE COURT: I don't mind waiting. It's the kind of thing that we really can do. Are all these defense counsel necessary? can some of you be excused? MR. BASS: Judge. We tried to get rid of as many as we could, I wanted to just let you know there are still some issues open on Brennan Dawson. THE COURT: Really? MR. BASS: They're the exhibits we're offering from her cross-examination, and we've exchanged -- well, we sent a list over yesterday morning to Mary Jo Moltzen. Ms. Moltzen told us Scott It. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10667 this afternoon that she was working on the list, but because of everything else she hasn't got through it yet. That has yet to be resolved- I don't know if there are going to be any objections or not, but that should be ready in the next day -next court day, for sure. And then when Ms. Brooker gets over here she can confirm this, but my understanding is that we've now worked out all the issues on Dr. Krugman and there's nothing that needs to be argued to Your Honor. THE COURT: Oh, that would be good. All right. MR, REDGRAVE: Your Honor, Jonathan Redgrave, for the record. Last week I mentioned some Reynolds' documents with Dr. Krugman. By e-mail here in court with Ms. Brooker we were able to resolve those, so the list will be for the Reynolds' documents in what the government will prepare. I had the one document I will argue when we have a chance for Dr. Slovic, but I assume we'll do that next week when we get to that point in the proceedings, unless you direct otherwise. THE COURT: All right. And so you want to be excused at this point? MR. REDGRAVE: Unless you want to hear argument on that. If Ms. Brooker comes over, she'd be the person, and that was that one document from Canada where the government was going to try to get it in another way, and we're still objecting to it. THE COURT: I would hear argument about it. MS. EUBANKS: That's fine with us, Your Honor. We can Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10668 proceed because, as you may recall, I was on the other side of that argument with another document from Canada. It would be helpful if you would show me precisely which document we're talking about, but I think I'm familiar with the issue and maybe we could make some progress and not waste the Court's time. MR. REDGRAVE: Jamey, could you put up Document 2 0848, U.S. Exhibit 20848. Your Honor, while Mr. Johnson is getting that up there, this is the Canadian document. Your Honor ruled it out with Biglan and Dolan under 403. And you will recall I showed you some documents that showed the background, what the genesis of this was. The government carae back in the submission with Dr. Slovic, you recall we had that argument on Thursday. Thursday evening I half thought the government would withdraw this exhibit from their proffer. Instead of doing that, they tried to resubmit it saying it's offered for a different purpose. They gave four reasons why, Your Honor. The first was the same reason they had given before about a business record, it being in Reynolds' file, but of course we went through why that document had come to Reynolds' file, it wasn't for the business purpose of Reynolds; it's in the Law Department, so I don't think that really gets them anywhere. The second thing they say, Your Honor -- Jamey, could we go to the ELMO? This is the government's pleading. They say, "Dr. Slovic Scott L. Wallace, RDR, CRR Otticiel Court Reporter QQ 390537575 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537575 10669 discusses this exhibit in his direct testimony and relies on it to support his understanding that the tobacco companies utilize survey data."' Again, Your Honor, the documents we showed in the arguments last week, it came into the Law Department's possession, it doesn't show that Reynolds utilized this data. And if we're just talking about whether some third-party who's not a defendant in this case, albeit an affiliate, had the data in their files, that doesn't prove anything with respect to this RICO case against these defendants and in particular Reynolds, so I don't think that gets them above it. They say that Dr. Slovic -THE COURT: I have the pleading. MR. REDGRAVE: All right. It goes on to say Dr. Slovic doesn't rely on it to show underage, but if you look at the portion of the written direct testimony for Dr. Slovic where he mentions it -- and this is on page 55 of his written direct, Your Honor — they specifically use it and they focus on the 15 to 24 age range in that document. And the preceding pages, if you look at their proffer in their document from last Thursday, they talk again about Dr. Slovic wants to show that the defendants utilized this data. Again, for Reynolds, which is a defendant in this case, Reynolds Tobacco Company from Winston-Salem, Reynolds didn't utilize this data from this document. It was there tor the Law Department Scott L. Wallace, RDR, CRR Official Court Raportar 990537576 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537576 10670 because of that Canadian litigation. Now, the last thing, Your Honor, with respect to the document itself, is the Findings of Fact. They try to come back again and say, well, it's presumptively admissible and cited in the Findings of Fact. The reason it was cited in the Finding of Fact in two paragraphs was the reason I brought up last week. They were trying to use it to show the underage data. The proffer that's in the Findings of Fact, there's nothing in their prior Findings of Fact about Dr. Slovic in this particular point where he's relying upon it. And quite frankly, Your Honor, I climbed the hill with this document. It's really of marginal value whatsoever in this case because it doesn't show anything that Reynolds did contemporaneous. Even with studying tracking or using data, it only came into Reynolds' file through a Canadian litigation. Your Honor looked at this carefully last week. You made the ruling under 403. I think that stands. I climbed the hill, I don't think I should have to climb it again, Your Honor, and I certainly don't think they've dragged me back down it. THE COURT: Ms. Eubanks. MS. EUBANKS: Well, Your Honor, I would like the privilege of dragging him back down the hill. meets two presumptions. This is a document that One, it was not just cited as a reliance material of Dr. Slovic, but as well it was cited in his direct testimony, and he relied upon it as such. Scott L. Wallace, RDR, CRR Official Court Reporter 3990537577 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10671 In fact, the document itself is one that Dr. Slovic used 1 2 to rely -- to discuss the fact that the tobacco companies use 3 surveys to determine consumer needs and so forth when they make 4 certain decisions. He wanted -- through this document, this is 5 one of them that in his testimony he used to discuss the fact 6 that the companies collect information to show what it is that -- 7 who their consumers are. Insofar as any proffer is concerned, this is similar to an 8 9 issue that was raised with respect to a document, another 10 Canadian document last week. 11 whether these documents -THE COURT: 12 13 The only statements we have about Another Canadian document or this same document? 14 MR. REDGRAVE: 15 MS, EUBANKS: A different one. It was a different one that I'm speaking of, 16 but the document was used in Biglan and it was proffered here, 17 but the situation here with Dr. Biglan is different from 18 Dr. Slovic because with respect to Dr. Slovic it not only is 19 cited in the proposed findings, it's cited and discussed and 20 relied upon in his testimony. 21 different purpose than what Dr. Biglan was proffering the 22 document for. 23 He uses it for a completely I'd also note that the Court has held in this case with 24 respect to a similar situation, and what I'll do is just read a 25 quote from January 13th at the trial, and it states: Scott X.. Wallace, Official "And all RDR, CRR Court Reporter 3990537578 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537578 10672 that would go to the weight to be given to this document. Acting on the assumption now that these documents were used in the proposed Findings of Fact, the presumption of admissibility attaches and I see no reason to rule that it has been overcome. Additional evidence about the -- about why the document shouldn't be considered may, of course, be proffered and will be weighed by me. But there's no reason to exclude the document given the presumption of admissibility since they were cited, since I'm going to assume they were cited in the proposed Findings of Fact." And here this document is doubly relevant because not only is it a document that prior to coming to trial the United States relied upon, but one of its experts testified extensively with respect to the type of information contained in this document and with respect to this document in particular. So the Dr. Slovic example is very different from the situation that was presented with Dr. Biglan's use of the document, and we've met the burden of the Court's recent orders as well as its prior rulings on admissibility. If anything, it goes to the weight; not its admissibility. MR. REDGRAVE: Your Honor. THE COURT: No, I don't think so. It seems to me that the issues, while not identical to that contained or that involved with Dr. Biglan, are very similar. The fact of the matter is that while Dr. Slovic relied on this document, he shouldn't have. And I don't mean that critically of Dr. Slovic, of course, or in Soott L. Wallace, RDR, CRR Official Court Reporter 3990537579 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537579 10673 1 any ethical way, but this was a document that was not used by 2 Reynolds at all. It was not -•• it did not concern any tracking 3 or obtaining of consumer information that was done by Reynolds. 4 It came into Reynolds' files solely because it had been used in 5 some litigation. 6 found with Dr. Biglan, and I think it is equally prejudicial in 7 this context with Dr, Slovic and the objection is going to be 8 sustained. 9 There's no question that it's prejudicial, as I MS. EUBANKS: Your Honor, with respect to that, when I 10 said this is the same as the document or similar to the instance 11 we had with another Canadian document, last week when we were 12 arguing objections dealing with Ms. Ivey, we had a similar 13 situation where -- 14 THE COURT: Ms. Ivey was a while ago. 15 MS. EUBANKS: Well, last week we argued the objections 16 with respect to the documents. 17 THE COURT: That's true. 18 MS. EUBANKS: There was a document from the Imperial 19 Tobacco Company, a Canadian tobacco company. We had only a 20 statement of counsel because counsel was relying upon an 21 affidavit in another case to suggest that the information that 22 was contained in that record was not in Brown & Williamson's 23 files. 24 25 Similarly here, all we have without the proffer of an affidavit at all, and this is subsequent to the Court's ruling Scott z. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10674 last week, is statements of counsel as to how the Reynolds -- how Reynolds came into contact with the documents, but I would submit to the Court that insofar as ruling about whether something is prejudicial or not, counsel certainly has had an adequate opportunity since that ruling last week to come forward with appropriate evidence; that is, direct evidence from someone who is able to -THE COURT: Why would he bother to? ruling. ruled. He prevailed on the Lawyers don't have to get additional evidence. No, I've Let's move on. Ms, Brooker is present, which I appreciate. Ms. Brooker, how bad is it out? MS. EUBANKS: It's a terrible traffic mess, really, much more than the snow. It's a disaster. And don't try getting a cab because people are sitting on laps in every cab. I squeezed into a cab and practically had to bribe the cab driver. It's a typical D.C. mess. THE COURT: But is that all probably inauguration-related or weather-related? MS. BROOKER: I had just looked at WTOP online when I left and it's probably a mixture or both, but the weather has caused most of the traffic jams, it appears. MR. REDGRAVE: Your Honor, I beg your indulgence. If it's permissible to Your Honor, I would like to have leave to fight the weather, so it is. I don't have any other arguments for Scott L. Wallace, RDR. CRR Official Court Reporter 3990537581 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537581 10675 Reynolds, and unless there is some other issue the Court would need me to address, I will take my leave. THE COURT: Okay. MR. REDGRAVE: That's fine. Thank you, Your Honor. Excuse me. MS. BROOKER: Sure. THE COURT: All right. Now, I heard that issues as to Dr. Chaloupka may have been resolved. Is that right, Ms. Brooker? MS. BROOKER: Let's see. I've been dealing with today. I was going by each company that I know that -- oh, no. I believe that --it may only be Mr. Narko and I that have some outstanding issues related to Dr. Chaloupka. MR. NARKO: That's right, Your Honor. If you took that from what I said, I didn't mean to say that they were all resolved. We had resolved some of the issues with regard to some of the exhibits, but there are a few remaining. MS. BROOKER: That's right. remaining? is that correct? I think we have six We resolved all but six. THE COURT: Well, let's go over those, please. MS. BROOKER: Certainly. Let me start. I think I can probably hopefully summarize here. There are three -- excuse me. Let's just see. There are, unless Mr. Narko has sent another e-mail this afternoon, this is the latest -- we've been corresponding on e-mail. There are four exhibit -- three exhibits -- four of them. Scott L. Wallace, RDR, CRR Official Court Reporter 3990537582 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537582 10676 Excuse me. And let me just state what the exhibit numbers are, and the United states has the same objection to all four of them. The four exhibits are JD 05 -THE COURT: I just think Ms. Sonaji better get this down because Ms. Hightower had to leave because of the weather. She lives way out, and I know how carefully she follows, meaning Ms. Hightower, follows these discussions. notes. So we'll all take careful Go ahead, please. MS. BROOKER: Okay, certainly. There are four exhibits, JD 054444, JD 002763, JE 064577. THE COURT: MS. BROOKER: Zero -064577 and JD 054502. All four of these -- THE COURT: As to the second one, I think you better give me that again. MS. BROOKER: Sure. The second exhibit number is JD 002763. THE COURT: All right. MS. BROOKER: As to all four of those exhibits, they're all studies which squarely fall within 803.18 as inadmissible hearsay which could be on, as the rule says, to the extent called to the attention of an expert witness upon cross-examination -exactly as was done with Dr. Chaloupka -- the document may not be received as exhibits, but the citation itself that was called to the attention of the expert is part of the record. I believe that when I raised this in response -- and again Scott L. Wallace, RDR, CRR Official Court Reporter 3QQ 390537583 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537583 10677 in an e-mail exchange with Mr. Narko -- I believe that the defendants' position is that, well, it's impeachment and so therefore it comes in. But the government's position would be that just because it's used on impeachment does not obviate the requirements of hearsay, and it's just -- Again, all four of those squarely are prohibited to come in as exhibits under 803.18, and the United States itself has withdrawn any exhibits that were, you know, fall within the rule as a treatise because it recognizes that they do not come in as documents. THE COURT: All right. MR. NARKO: Go ahead, please. Your Honor, again, Kevin Narko for the record. So I can track my own notes, I'll do the exhibits in numerical order. So I'll start with JD 002763, and this exhibit, like two of the other exhibits Ms. Brooker just mentioned, is an article written by Dr. Chaloupka, and this one in particular was also cited in the Findings of Fact. It's included within Dr. Chaloupka's reliance materials, and we are offering it for impeachment purposes, and I think that gets it around the learned treatise exception that Ms. Brooker mentions. THE COURT: How do you get around the last sentence of 803.18. MR. NARKO: We're not using it to be consistent with his testimony but to impeach his testimony; that is, something he said before inconsistent with what his testimony is now. MS. BROOKER: But I believe. Your Honor, 803.18 addresses Scott Z. Wallace, RDR, CRR Official Court Reporter >&Q 990537584 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537584 10678 specifically use of an exhibit on cross-examination. THE COURT: It does. However, to make it more complicated, this was included in the Findings of Fact. Whose, yours? MR. NARKO: Yes. It's in Joint Defendants' Final Proposed Findings of Fact, Chapter 13, paragraph -THE COURT: And it's written by the witness himself? MR. NARKO: Yes, Your Honor. THE COURT: Included in the reliance materials. So if you were objecting, of course, that would not be a valid grounds for objection. Of course, the government knows any reliance materials of its own -- It is in an unusual posture in that this is an article written by the witness himself being used to impeach him, and so while I admit it's a close issue, because it's written by the witness and because it's included in the Findings of Fact, I am going to allow it in. I think that 803.18 just could not have foreseen this particular circumstance and doesn't cover what I think is a rather unusual procedural posture. And when it comes in, yes, at that point of course I'll consider the weight of it, and most importantly I'll have to consider it in the context of however it was used for impeachment, but for the record 002763 may be admitted. (Defendants' Exhibit JD 002763 admitted into the record.} Scott L. Official Wallace, Court RDR, CRR Reporter 3990537585 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537585 10679 1 THE COURT: Next one. 2 MR. NARKO: 3 4 Your Honor, the next exhibit is JD 054444, and perhaps we should address this at the same time as JE 064577. Both of these exhibits are articles written by 5 Dr. Chaloupka. 6 the Proposed Findings of Fact, in the same position as the 7 exhibit we just addressed, and being offered for the same 8 purpose. 9 10 They are, with the exception of being cited in THE COURT: Government have any other argument? MS. BROOKER: Your Honor, these are not even cited in the 11 Findings of Fact, and I would stand on our objection under 12 803.18. 13 THE COURT: 14 MS. BROOKER: 15 THE COURT: Oh, I misunderstood you, 16 Well, since that was one of the bases on which I They are not cited in the findings? They are not cited in the Findings of Fact. 17 distinguished the applicability of 803.18 and that basis doesn't 18 apply as to these two exhibits, and therefore they're not 19 presumptively admissible under 471(b), I'm going to rule that 20 these two are not admitted. 21 054444, 064577. 22 23 24 25 And for the record, these are THE COURT: That leaves one more, I believe, and that's 054502. MR. NARKO: Correct, Your Honor. Just for the record, it's JE 064577. I may have misheard you. I'm not sure if you said JD Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10680 1 or JE. 2 THE COURT: I think I said it -- I wrote it that way. 3 MR. NARKO: Excuse me then. I respectfully suggest that 4 Your Honor's ruling would apply to this document as well, JD 5 054502. This is not a document written by Dr. Chaloupka. 6 THE COURT: Not written by -- 7 MR. NARKO: Not written by Dr. Chaloupka. 8 THE COURT: Is it in the Findings of Fact? 9 MR. NARKO: No, Your Honor. 10 THE COURT: Well, this doesn't come in then. 11 not admitted. 12 Now, does that close out -- 13 MS. BROOKER; 14 Well, we still have a few more Dr. Chaloupka ones. 15 THE COURT: 16 MS. BROOKER; 17 So this is All right, go ahead. We just categorized those. If I may just for a moment ask Mr. Narko something. 18 (Discussion had off the record between counsel.) 19 MS. BROOKER: 20 Then the United States has two remaining objections to JD 054445 and JD 040674. 21 THE COURT: 22 MS. EUBANKS: 4. 23 THE COURT: 24 MS. BROOKER: 25 04067 -- - - 4 . Okay. Both of these documents do not appear in the Findings of Fact, they are presumptively inadmissible, and they Scott L. Wallace. RDR. CRR Official Court Report or 3990537587 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537587 10681 are hearsay for which no foundation was laid through Dr. Chaloupka. THE COURT: Are these articles? MS. BROOKER: No, these are -- one is a voluntarily produced Philip Morris document, December Report 2003 Adult Smoker Watch, which there was a lot of dialogue on the record because it was -- Since it was voluntarily produced, it was not something that was -MR. NARKO: MS. BROOKER: Excuse me, that's the one document. For the exhibit number I just cited? (Discussion had off the record between counsel.) MS. EUBANKS: Let me start again. JD 04 0674 is a document that is a Philip Morris document. It's a draft document, a 5-year plan speech from 1996 to 2000, and it is not a document that was cited in the Findings of Fact, and the same is true of JD 054445. Neither one of those documents, Mr. Narko informs me, were cited in the Findings of Fact, and both of those documents are hearsay. THE COURT: MS. BROOKER: speech. Is that a 5-year plan as well, the second one? The first one is a -- apparently it's a It's entitled: Jim Morgan, 5-year plan, 1996 to 2000, Sea Island Speech, and it appears to be a speech. The second one is really nothing more than an organizational chart, several pageB of an. organizational chart which Dr. Chaloupka, you know, testified he's not familiar with. Scott L, Wallace, RDR, CRR Official Court Reporter 7588 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537588 10682 1 THE COURT: All right. Let me hear the response, please, 2 from defendants? 3 MR. NARKO: Your Honor, first I'll address JD 040674. As 4 counsel said, it's a speech. 5 authentic. 6 it for a hearsay purpose but for what Philip Morris considered. 7 The witness was familiar with the document. He had reviewed it, 8 was his testimony, and that is -- that is why we're offering it 9 at this time. 10 It's clearly relevant. It's It's a business record. We're actually not offering THE COURT: Are you offering it for the fact that the 11 speech was made, are you offering it for the truth of what is 12 contained in the speech? 13 MR. NARKO: Not for the truth of what's contained in the 14 speech, not for the particular data that's cited, but just for 15 the fact that Philip Morri3 was considering price gap 16 information. 17 THE COURT: It certainly is a business record. It may 18 come in, but I want to make it very clear that it's being 19 admitted not for the truth of what's contained in it but rather 20 to merely demonstrate that Philip Morris considered the subject 21 matter of it. 22 (Defendants' Exhibit JD 040674 admitted into the record.) 23 THE COURT: And then as to 054445, what is your argument? 24 MR. NARKO: 25 Yes, Your Honor. This is a final document for Dr. Chaloupka, and I think Your Honor will recall the multi-page Scott L. Wallace, RDR. CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10683 organizational chart that Dr. Chaloupka -- excuse me, Mr. Webb did walk through with Dr. Chaloupka, and it's a business record, Your Honor. Again, both relevant and authentic, THE COURT: Anything further from the government? MS. BROOKER: No, Your Honor. THE COURT: It may be admitted as a business record. (Defendant's Exhibit JD 054445 admitted into the record.) THE COURT: Now, does that conclude Dr. Chaloupka? MR. NARKO: Yes, Your Honor. MS. BROOKER: I believe it does, Your Honor. There's still one or more -- one or two more issues. One -THE COURT: With him? MS. BROOKER: THE COURT: No, not with Mr. Narko. Oh, all right, but still with Dr. Chaloupka? MS. BROOKER: I don't believe so. Let me just look at the list of what we have left here. Was it Dr. Biglan? MR. CASETTA: It was Dr. Biglan, was the only issue. MS. BROOKER; And it's just one document because Mr. Casetta and 1 were able to work out all others. THE COURT: All right. What is that document? MS. BROOKER: Okay. The document is U.S. Exhibit 72747. The document -THE COURT: MS. BROOKER: 7274 -72747. The document is not cited in the Findings of Fact, it is a document entitled: Market Profile, put Scott I,, Wallace, RDR, CRR Official Court Raporter 3990537530 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537590 10684 out by the magazine Publishers of America. The document is clearly hearsay, and when Mr. Webb asked Dr. Biglan about the document, the dialogue was that he showed him the document, which was referenced in Dr. Biglan's, I believe 2001 expert report, and Mr. Webb asked, "Can you tell the Court what this document is, and Dr. Biglan said "I don't remember," and Mr. Webb said, "but you relied upon it in reference to your expert report," and Dr. Biglan said, "yes," that's what he recalled. THE COURT: And that's a U.S. exhibit? MS. BROOKER: It was a U.S. Exhibit, 72747, but it is not cited in the Findings of Fact and it is hearsay. THE COURT: And you're moving it in? MR. CASETTA: Yes, Your Honor, we are moving it in. Rick Casetta for Lorrilard Tobacco Company. U.S. exhibit. A few things. It is a It was discussed in Dr. Biglan's expert report. It was on his reliance material. Mr. Webb also at trial asked Dr. Biglan to confirm that he talked about it in his expert report and that it was reliance material, and he acknowledged that it was. It is actually -- and one my partners just pointed this out to me -- the defendants actually cited this document, obviously not with the U.S. exhibit number, but we cited this document in our Findings of Fact, Chapter 6 of our underview, paragraphs 360 to 361. Additionally, the Court should know that joint defendants listed this document on their exhibit list as well with another Scott L. Wallace, RDR, CRR Official Court Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10685 number. It really should be a joint exhibit, but joint defendants listed it as JD 020347. Now, in terms of the three criteria that the Court laid out in order 861, relevancy, authenticity, and exception to a hearsay rule or nonhearsay, I'd like to briefly address those. First, Jamey, would you call up the Document 72747. It's a market profile that looks at teenagers and basically what was published by the Magazine Publishers of America, and it talks about, who are teenagers, what are they interested in, what types of magazines do they look at. And Jamey, please go to page 4 of the document, and -MS. BROOKER; this. Your Honor, I may be able to short circuit Earlier when Mr. Casetta and I spoke he indicated this was not in the Findings of Fact, and that was my primary basis for my objection. So if the document is in the Findings of Fact and presumptively admissible, then the United States will withdraw its objections. THE COURT: But it should be admitted under the proper number, which is Joint Defendants' Exhibit 020347. MR. CASETTA: Your Honor, the only reason that we would want the U.S. exhibit is because that's what Dr. Biglan was cross-examined with. MS. BROOKER: MR. NARKO: It might be -I agree. In the record Mr. Webb asked him, you know, did you rely on this, et cetera. Scott h. Wallace, RDR, CRR Official Court Reporter 3990537532 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537592 10685 THE COURT: All right. Then U.S. 72747 is admitted at this time. (Government's Exhibit US 72747 admitted into the record.) MR. CASETTA: Thank you, Your Honor. And then, just for the record, I want to make sure we know what Ms. Brooker and I have agreed on. With respect to Dr. Chaloupka, U.S. 22724, she has indicated they don't object to its admission, and with Dr. Krugman there are two documents, U.S. 56953 and U.S. -- I'm sorry -- and JD 025061. Ms. Brooker also indicated that she does not object to the admission of that document. MS, BROOKER: That's correct. THE COURT: All right. So those three documents may be admitted. {Government's Exhibits U.S. 22724, U.S. 5 6953 and Defendants' JD 025061 admitted into the record.) THE COURT: Now, does that resolve all issues with Dr. Biglan, first of all, for all defendants? MS. BROOKER: Yes, I believe it does because I spoke with Renee Honigberg via e-mail today earlier today and except for this one exhibit I believe that resolved all issues. THE COURT: And all issues with Dr. Chaloupka are resolved; is that right? MS. BROOKER: Yes, Your Honor. THE COURT: And all issues with Dr. Krugman are resolved? MR. CASETTA: I believe, unless Mr. Bass has anything. Scott L. Wallace, Official Court RDR, CRR Reporter Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 10687 MR. BASS: 1 It's my understanding, as I said earlier, 2 unless you had anything, Renee, that you thought was open. 3 we're done with Dr. 4 MS. BROOKER: 5 THE COURT: All right. So Yes, I believe we're finished. That leaves issues, everybody, 6 with Ms. Keane, who obviously just finished her testimony, with 7 Dr. Slovic, and people are working on that, I do believe, and I 8 gather with Ms. Dawson, and we'll have to hear from the 9 appropriate people next week on that. 10 MS. BROOKER: 11 THE COURT: Yes, Your Honor. That's it, everybody. Tomorrow -- not 12 tomorrow. Friday I'm going to get testimony from at least two 13 witnesses from the government, two or three. 14 MR. NARKO: 15 MS. EUBANKS: 16 Three, Your Honor. Yes, yes, Your Honor. They will be for the upcoming week. THE COURT: And I have Dr. Erickson's. 17 18 everybody, we are in recess at this point. 19 (Proceedings adjourned at 4:23 p.m.) All right, Thank you. 20 C E R T I F I C A T E 21 22 23 I, Scott L. Wallace, RDR-CRR, certify that the foregoing is a correct transcript from the record of proceedings in the above-entitled matter. 24 25 ^.JUaAa^....... ' Scott L. Wallace, RDR, CRR Scott L. Wallace, RDR, CRR Official Court Reporter 3990537534 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537594 10688 INDEX Examinations Page CONTINUED CROSS-EXAMINATION OF DENISE F. KEANE BY MR. WELLS 10587 10636 REDIRECT EXAMINATION OF DENISE F. KEANE BY MR. GOLDFARB EXHIBITS Defendants' Exhibit JD 002763 admitted Defendants' Exhibit JD 04 0674 admitted Government's Exhibit US 72747 admitted Government's Exhibits U.S. 22724, U.S. 56953 and Defendants' JD 025061 admitted Defendants' Exhibit JD 054445 admitted 10678 10682 10686 10686 10683 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 91 3990537536 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537596 1 MISSOURI CIRCUIT COURT TWENTY-SECOND JUDICIAL CIRCUIT (CITY OF ST. LOUIS) DAYNA CRAFT, DEBORAH LARSEN, WENDI ALPER-PRESSMAN, Individually and on Behalf of All Others Similarly Situated, Plaintiffs, Case No. 002-00406-02 Division No. 6 v. PHILIP MORRIS INCORPORATED, a corporation, Defendants. SUPERIOR COURT OF THE STATE OF CALIFORNIA CITY AND COUNTY OF SAN DIEGO Coordination Proceedings Special Title (Rule 1550(b)) JCCP No. 4042 In re TOBACCO CASES II Willard R. Brown, et al., v. The American Tobacco Co., Inc., et al. (San Diego Superior Court Case No. 711400) VIDEOTAPED DEPOSITION OF CORPORATE DESIGNEE BRENDAN MCCORMICK Richmond, Virginia Friday, August 26, 2011 9:00 a.m. Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 2 £ 1 2 Videotaped deposition of BRENDAN MCCORMICK 3 held at the law offices of: 4 5 Hunton & Williams 6 951 East Byrd Street 7 Richmond, Virginia 23219 8 9 Pursuant to applicable Rules of Civil 10 Procedure, before Linda S. Kinkade, Certified 11 Shorthand Reporter, Registered Professional 12 Reporter, Registered Merit Reporter, Certified 13 Realtime Reporter, Registered Diplomate 14 Reporter, and Notary Public, in and for the 15 Commonwealth of Virginia. 16 17 18 19 20 No. 4760 21 Pages 1-286 22 Reporter: 23 Videographer: Linda S. Kinkade, RDR, CRR, RMR, CSR Krishna Sharma 24 Thompson Court Reporters, Inc. 312-421-3377 3990537538 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 1 MISSOURI CIRCUIT COURT TWENTY-SECOND JUDICIAL CIRCUIT (CITY OF ST. LOUIS) DAYNA CRAFT, DEBORAH LARSEN, WENDI ALPER-PRESSMAN, Individually and on Behalf of All Others Similarly Situated, Plaintiffs, Case No. 002-00406-02 Division No. 6 v. PHILIP MORRIS INCORPORATED, a corporation, Defendants. SUPERIOR COURT OF THE STATE OF CALIFORNIA CITY AND COUNTY OF SAN DIEGO Coordination Proceedings Special Title (Rule 1550(b)) JCCP No. 4042 In re TOBACCO CASES II Willard R. Brown, et al., v. The American Tobacco Co., Inc., et al. (San Diego Superior Court Case No. 711400) VIDEOTAPED DEPOSITION OF CORPORATE DESIGNEE BRENDAN MCCORMICK Richmond, Virginia Friday, August 26, 2011 9:00 a.m. Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 1 2 Videotaped deposition of BRENDAN MCCORMICK held at the law offices of: 3 4 Hunton & Williams 5 6 951 East Byrd Street 7 Richmond, Virginia 23219 8 9 Pursuant to applicable Rules of Civil 10 Procedure, before Linda S. Kinkade, Certified 11 Shorthand Reporter, Registered Professional 12 Reporter, Registered Merit Reporter, Certified 13 Realtime Reporter, Registered Diplomate 14 Reporter, and Notary Public, in and for the 15 Commonwealth of Virginia. 16 17 18 19 20 No. 4760 21 Pages 1-286 22 Reporter: 23 Videographer: Linda S. Kinkade, RDR, CRR, RMR, CSR Krishna Sharma 24 Thompson Court Reporters, Inc. 312-421-3377 3990537600 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537600 3 ) 1 APPEARANCES: [ 2 On Behalf of Plaintiff DAYNA CRAFT, et ) 3 4 al., Individually and on Behalf of All Others ( 5 Simil arly Situated: \ 6 STEPHEN A. SWEDLOW, ESQUIRE j 7 Korein Tillery j 8 2 05 North Michigan Avenue 9 Suite 1940 10 Chicago, Illinois 60601 j 11 Telephone: 312.899.5063 j 12 Email: sswedlow@koreintillery.com i On Behalf of Defendant PHILIP MORRIS \ 13 14 15 INCORPORATED, a corporation: [ 16 JEFFREY M. WAGNER, ESQUIRE i 17 KAYE SCHOLER, LLP I 18 3 First National Plaza, Suite 4100 19 70 West Madison Street 20 Chicago, Illinois 60602 21 Telephone: 312.583.2391 22 Email: jeffrey.wagner@kayescholer.com 23 24 \ [ -and\ Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 3990537601 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537601 1 APPEARANCES (continued): 2 3 4 5 On B e h a l f INCORPORATED, of a Defendant P H I L I P MORRIS corporation: 6 ERIK W. SNAPP, ESQUIRE 7 Winston & Strawn, 8 35 West Wacker 9 Chicago, LLP Drive Illinois 10 Telephone: 11 Email: 60601 312.558.7488 esnapp@winston.com 12 13 14 15 16 17 18 19 20 21 22 23 24 Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537602 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537602 5 INDEX OF EXAMINATION 1 2 3 EXAMINATION OF BRENDAN MCCORMICK BY STEPHEN A. SWEDLOW, ESQUIRE 4 ^ PAGE 13 237 BY JEFFREY M. WAGNER, ESQUIRE 6 136 272 7 BY JEFFREY M. WAGNER, ESQUIRE 8 (Brown) 275 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 3990537603 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537603 6 j INDEX OF EXHIBITS 1 (Attached to transcript) DESCRIPTION BATES RANGE 2 3 4 NO. 5 Exhibit 2 Notice of Deposition N/A Defendant's Response to Plaintiffs' Supplemental Set of Interrogatories Affidavit of N/A Brendan McCormick Deposition 5012623233 5012623274 Transcript of Brendan McCormick Page 1 of 6 7 Philip Morris USA Litigation Document Site 14 14 j Exhibit 6 AC5000916398 AC5000916402 Exhibit 7 N/A Exhibit 1 6 7 8 Exhibit 3 9 10 Exhibit 4 11 12 Exhibit 5 13 14 N/A 15 16 17 18 19 20 21 PAGE ) Email correspondence from C. O'Rourke sent 7252005, Subject: FW: Lowered T&N points Color PowerPoint Presentation Advertising of the Original Marlboro Lights & 14 1 14 14 j 79 136 I 22 23 24 Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537604 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537604 71 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 INDEX OF EXHIBITS (continued) DESCRIPTION BATES RANGE NO. N/A Color Print Ad Exhibit 8 Marlboro Lights N/A Color Print Ad Exhibit 9 Come to Marlboro Country Exhibit 10 N/A Color Print Ad Come to where the flavor is. . . N/A Color Print Ad Exhibit 11 Marlboro Lights PM3007086561 Advertising Exhibit 12 PM3007086633 Compliance Regs . 955024807 Public Health Exhibit 13 Service 955024810 Technical Report on "Tar" and Nicotine 514263587 Exhibit 14 Public Service by the /American Cancer Society N/A Exhibit 15 5 ways to reduce the risks of smoking N/A Exhibit 16 The cigarette world is divided into the bad and the worse PAGE 137 ; 138 144 149 153 156 157 159 160 Thompson Court Reporters, Inc 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 NO. Exhibit Exhibit 10 Exhibit 11 12 13 Exhibit 14 15 16 Exhibit 17 18 19 20 21 Exhibit INDEX OF EXHIBITS (continued) BATES RANGE DESCRIPTION N/A The Health 17 Consequences of Smoking, The Changing Cigarette, a report of the Surgeon General N/A The 1990 18 Health Objectives for the Nation: A Midcourse Review 19 283205931 /American 283205962 Cancer Society, Cancer Facts & Figures 1989 20 N/A Lung Cancer and the Changing Cigarette, Hoffmann & Wynder 21 HHX0014797 American HHX0014799 Cancer Society, Cancer Facts for Men 22 N/A Monograph 7, The FTC PAGE 163 164 165 166 168 16 9 Cigarette Test Method f o r Determining Tar... 22 23 24 Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 3990537606 3990537606 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 9 I INDEX OF EXHIBITS (continued) 1 2 NO. BATES RANGE DESCRIPTION PAGE j 3 Exhibit 23 2074407060 2074407061 Philip Morris' Statement of Position 173 4 j: i 5 Exhibit 24 N/A Our Mission 176 I 6 Exhibit 25 N/A Philip Morris USA, Understanding Tar and Nicotine Numbers legacy.library .ucsf.edu Philip Morris USA Here's the important information you requested from Philip Morris USA Our business. Our Values. Our Programs 179 7 8 9 Exhibit 26 2073565099 2073565101 10 11 Exhibit 27 3000179371 3000179374 Exhibit 28 2079137965 2079137966 Exhibit 29 2085126846 2085126847 18 Exhibit 30 19 Exhibit 31 j Do you want to know more about... 191 [ 2061161376 Color Print Ad 194 j N/A FTC Consumer Alert! Up in Smoke: The Truth about Tar and Nicotine Ratings 195 1 17 21 22 I 190 15 20 j { 13 16 188 189 12 14 i 23 24 Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537607 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537607 10 1 2 j) INDEX OF EXHIBITS BATES RANGE NO. 2085586492 Exhibit 32 2085586493 4 5 6 7 Exhibit 33 N/A 8 Exhibit 34 5012623039 5012623047 10 Exhibit 35 9510000129 9510000163 11 12 Exhibit 36 3000184661 3000184662 Exhibit 37 3034014029 and 3007287612 17 18 Exhibit 38 N/A 19 Exhibit 39 N/A Exhibit 40 N/A 9 13 14 15 16 20 21 22 (continued) DESCRIPTION News Release, PM USA Responds to National Cancer Institute Report Information for Smokers Detail Back Up of Low Tar Communication Analysis Product Distribution Spreadsheet Where smokers can find information on tobacco issues... Corporate Responsibility Television, Print and Radio Philip Morris USA Home Page Light, Low, Mild or Similar Descriptors Light Tobacco Products Pose Heavy Health Risks I PAGE \ 203 ! i 1 205 209 I 212 212 220 233 267 268 23 24 Thompson Court Reporters, Inc 312-421-3377 3990537608 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537608 11 ! INDEX OF EXHIBITS (continued) 1 2 NO. BATES RANGE DESCRIPTION PAGE 3 Exhibit 41 N/A Amended Cross-Notice of Deposition of Philip Morris USA on Designated Topics 276 Exhibit 42 N/A 276 Exhibit 43 3000155619 3000155638 Color PowerPoint Presentation, PM USA Communications Vehicles A Closer Look at the Resources, Links and Information You'll Find 4 5 6 7 8 9 10 11 12 13 280 at. . . 14 15 16 17 18 19 20 21 22 23 24 Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 12 1 2 P R O C E E D I N G S VIDEOGRAPHER: Good morning, everyone. 3 Here begins the videotaped deposition of Brendan 4 McCormick, tape 1, in the matter of Craft versus 5 Philip Morris, case number 002-00406-02 in 6 Missouri, and also in re Tobacco II Willard R. 7 Brown, et al. v. American Tobacco Company, 8 et al., JCCP number 4042, in the Superior Court 9 of California, for the City and County of 10 11 San Diego. Today's date is August 26th, 2011 and the 12 time on the video monitor is 9:21. 13 Krishna Sharma and the court reporter today is 14 Linda Kinkade of Thompson Court Reporters. 15 Today's deposition is taking place at Hunton & 16 Williams in Richmond, Virginia. 17 18 19 Will counsel please introduce themselves and state whom they represent. MR. SWEDLOW: 20 behalf of plaintiffs. 21 MR. WAGNER: 22 23 24 My name is Stephen Swedlow on Jeffrey Wagner and Erik Snapp on behalf of Philip Morris USA. VIDEOGRAPHER: Will the court reporter please swear in the witness. Thompson Court Reporters, Inc. 312-421-3377 3990537610 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537610 13 1 BRENDAN MCCORMICK, 2 3 Being first duly sworn, testified as follows: 4 MR. WAGNER: Mr. Swedlow, before we 5 begin, I just wanted to note for the record 6 that, pursuant to orders of the courts in 7 Missouri and California, that this deposition, 8 the Craft deposition, will take place and 9 conclude. So we'll go with your questioning, if 1C I have any questioning, and that will conclude, 11 to be finished, and to be followed by 12 questioning that will be usable only in the 13 Brown case in California and not in the Craft 14 case. 15 any, will take place when you have completed 16 your deposition. So the Brown-specific questioning, if 17 EXAMINATION 18 BY MR. SWEDLOW: 19 Q. 20 Thank you. Good morning. Can you state and spell your name for the record? 21 A. My name is Brendan McCormick, 22 B-R-E-N-D-A-N, 23 Q. What i s 24 A. My c u r r e n t t i t l e M-C-C-O-R-M-I-C-K. your current is job title? vice president Thompson C o u r t R e p o r t e r s , 312-421-3377 of Inc. 3990537611 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537611 14 1 2 investor relations for Altria Client Services. Q. Do you have responsibilities that 3 include any role for Philip Morris USA at this 4 point? 5 A. In my current role I provide services 6 to Altria Group and its operating companies, but 7 in the investor relations role my primary 8 responsibilities are to communicate the 9 consolidated results of Altria and its 10 11 companies. Q. In your current role you say you 12 provide services to the group and its operating 13 companies, but in the investor relations role, 14 is there a current role that isn't the investor 15 relations role? 16 17 18 A. My current role is the investor relations role, which I have been in since June. Q. I'm going to hand you what is marked 19 as Exhibit 1, which is a notice of deposition. 20 I'm going to hand you what is being marked as 21 Exhibit 2. 22 (Exhibit Nos. 1 through 5, inclusive, 23 marked for identification.) 24 BY MR. SWEDLOW: Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537612 15 1 2 Q. number 4 and number 5. A. 9 f I joined Philip Morris USA in a full-time capacity in 1993. 7 8 f Morris or Altria? 5 6 f How long have you worked for either Philip j 3 4 And I'm going to give you number 3, Q. Was it called Philip Morris USA in 1993? j ) A. it was. And I was with that company 10 through 2000 — 11 point I moved to Altria Client Services and have j 12 been with that company until the present. 13 Q. beginning of 2008. At that In 1993 do you know how Philip Morris 14 Companies, Inc. fit into the corporate structure 15 within Philip Morris USA and Altria? 16 A. Philip Morris Companies, Inc. was the 17 name of the parent company that owned Philip 18 Morris USA and other operating companies. 19 Q. And what about Philip Morris, 20 Incorporated? 21 A. Philip Morris, Incorporated, I believe, is the official name of Philip Morris 23 USA at the time. Q. ! \ 22 24 1 What do you mean "the official name"? Thompson C o u r t R e p o r t e r s , 312-421-3377 \ Inc 3990537613 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537613 16 1 A. Philip Morris USA is how it was 2 referred to internally, and I believe in terms 3 of corporate documents Philip Morris 4 Incorporated referred to Philip Morris USA. 5 6 7 8 9 Q. Okay. Have you ever seen your page of the Philip Morris USA litigation document site? A. Is that this page that you've marked Exhibit 5? Q. No. I'm actually asking you a 10 separate question and then I'll ask you about 11 that page. 12 Philip Morris USA litigation documents? Have you ever seen your page of the 13 A. I'm not sure what you're referring to. 14 Q. Okay. If you would take a look at 15 Exhibit 5, have you ever seen that description 16 of yourself? 17 A. No, I have not. 18 Q. Okay. This description says that you 19 are or were vice president, corporate 20 communications, Altria Client Services. 21 the same thing as your current job title? 22 A. It is not. 23 Q. What i s 24 president, the corporate difference between communications, Thompson C o u r t R e p o r t e r s , 312-421-3377 and la that vice senior Inc. 3990537614 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537614 17 I 1 vice president — 2 A. Vice president. 3 Q. -- vice president, investor relations? 4 A. In investor relations I am focused on 5 and have responsibility for communication to the [ 6 investment community. 7 communications I had a number of entirely 8 different job responsibilities. 9 entirely different positions. 10 11 Q. In corporate j So they are two j What were the job responsibilities as j corporate communications? 12 A. j In corporate communications my 13 responsibilities included communications with 14 the media, management of corporate websites for 15 Philip Morris USAr for Altria Group and its 16 Altria operating companies. 17 responsibilities for employee communications and 18 issues management, corporate advertising. 19 was the scope of my responsibilities in 20 corporate communications for Altria Client 21 Services. 22 Q. And when — are your a c c u r a t e 23 these 24 c a n work from t h i s I had I want t o confirm job t i t l e s document that so t h a t a n d you d o n ' t Thompson C o u r t R e p o r t e r s , 312-421-3377 That we have Inc. 3990537615 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537615 18 l 1 to have seen it before. 2 from scratch on who you were. 3 I didn't want to start It says you're senior director of f 4 corporate communications from the end of 2006 to I 5 2008; is that correct? 6 A. That is correct. 7 Q. Were your job responsibilities similar i 8 as senior director of corporate communications j 9 to what you just described as vice president of j corporate communications? I 10 11 A. They were a little bit more narrow at 12 that point in time. They did not include j 13 management and oversight of our corporate j 14 website or employee communications, but the j 15 other responsibilities were the same. 16 other key difference there is I was doing that 17 solely for Philip Morris USA and not for Altria 18 and the other companies. 19 Q. And the And the job before that, director, I 20 business planning strategy and consumer contact, \ 21 what were the job responsibilities then? 22 A. The business planning job involved a 23 couple of different things. It was primarily a 24 department that provided support for our j I j I Thompson Court Reporters, Inc. 312-421-3377 3990537616 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537616 19 1 executive team. 2 including investor communications for Philip f 3 Morris USA working on speeches for executives 4 for both external and internal audiences. 5 worked on a little bit of merger and acquisition 6 work and some business analysis work in those 7 positions 8 I worked on a number of things, f I Then for a year and a month you were 1 director, media affairs, Philip Morris USA; is f 10 that correct? [ 11 A. That's correct. 12 Q. What were the job responsibilities 9 13 14 15 16 Q. 1 then? That was focused on our communications \ A. directly with members of the media. Q. And before that you spent 14 years as 17 planning manager, media affairs; is that 18 correct? 19 A. I believe that planning manager was 20 probably my most recent job prior to being 21 director of media affairs. 22 19th, 1989 date refers to when I started at the 23 company, and I started as a summer intern. 24 worked a number of years as a summer intern I joined — Thompson C o u r t R e p o r t e r s , 312-421-3377 the June = Had Inc 3990537617 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537617 20 1 before joining the company on a full-time basis 2 in 1993, and worked in positions that were 3 either — 4 position for about a year before moving into the 5 media affairs department. 6 positions during those years from 1994 on were 7 in the media relations department in roles of 8 varying responsibilities, but they all related 9 to media relations, and, generally, there was an I had a short stint in a public policy And the rest of my 10 upward path within that department culminating 11 in the position of director of media affairs in 12 2003. 13 Q. Right, but so this job title was the 14 job title right before director of media 15 affairs, planning — 16 A. 17 be one before. 18 manager position before being named director. 19 As I'm looking at it right now, it may Q. I believe I held a senior You said there was a short period of 20 time where you were in a public policy group or 21 division; is that correct? 22 A. Yes. 23 Q. What was the name of that group or 24 division? Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 990537618 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537618 21 I I 1 A. The — I believe the department at the \ 2 time was probably called something along the 3 lines of public affairs, and I worked in a 4 supporting role as a — 5 internship position for in kind of an issues 6 management capacity. in a year-long 7 Q. What year was that, if you recall? 8 A. That was July of — 9 10 11 12 13 I beginning July of I 1993 and probably continued for a little bit over a year into 1994. Q. And what's the difference between public affairs and media relations? A. j j The media relations job is focused on 14 directly communicating to members of the media, 15 handling their inquiries about our business 16 practices. 17 conducting research, supporting the development 18 of white papers, issues positioning, but that 19 group was not necessarily the only user of those l 20 communications materials. 21 that went to provide support to the media 22 relations department at the time. 23 24 Q. In the public affairs area I was In some instances What were the subject matters of the white papers that you were producing? Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 22 1 A. At that point in time it probably 2 would have been broad in its scope and could 3 have included — 4 every issue I worked on — 5 included issues like excise taxes, smoking bans, 6 proposed marketing restrictions. 7 probably the primary issues that were being 8 considered in our group at that time, but that 9 may not be an all-inclusive list of everything I 10 11 12 13 I don't recall specifically but it would have Those were did at the time. Q. And what is — when you say "white paper," is that a specific term of art to you? A. It's an example of the type of thing 14 we would work on where at the essence 15 summarizing the company's positions on, for 16 example, the issues that I mentioned, developing 17 argumentation, doing research to see what others IS had to say about that issue, and consolidating IS that information into the company's positions. 20 21 22 Q. So the white paper term means that it's the company's official position? A. A white paper would be an example of a 23 consolidation of the company's position that 24 would be used for a specific execution. Thompson Court Reporters, Inc. 312-421-3377 3990537620 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537620 23 1 2 Q. Would that include consultation with the legal department? 3 A. In developing those materials we would 4 work with the legal department and share the 5 materials for their input. 6 with a range of other departments within the 7 company. 8 Q. 9 We would also work If you look at Exhibit — well, if you could pull out Exhibit 1 from your stack of 10 exhibits and tell me if you've ever seen that 11 before. 12 A. Yes, I have. 13 Q. When did you see that? 14 A. This was one of the materials in one 15 of the documents that I reviewed in preparation 16 for my deposition today. 17 Q. When did you see that? 18 A. I believe I saw it for the first time 19 earlier this week. 20 Q. Were there other documents that you 21 reviewed in preparation for your deposition here 22 today? 23 24 A. that, Actually I think, if I can correct I t h i n k t h i s may h a v e b e e n o n e o f Thompson C o u r t R e p o r t e r s , 312-421-3377 the Inc 3990537621 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537621 24 j 1 documents that I saw prior to that. 2 have been a few weeks prior, I believe, is the •-> o first time I may have seen this. L If you turn to the certificate of f 5 service page, which is the last page of the j 6 document, it has the date May 16th. 7 around the time you think you would have seen it j 8 for the first time? Q 10 11 Q. It would A. No. Q. When, if you can approximate, do you \ think you saw this for the first time? 12 13 Is that MR. WAGNER: Objection, asked and \ answered. 14 THE WITNESS: 15 probably late July, early August. 16 BY MR. SWEDLOW: 17 Q. I believe it was Were there any other documents that 18 you were provided or reviewed in late July, 19 early August related to this document? 20 MR. WAGNER: 21 THE WITNESS: [ [ Object to form. Is the question what — 22 is what you're asking me what documents I 23 reviewed in relation to preparing for this 24 deposition? Thompson C o u r t R e p o r t e r s , 312-421-3377 \ j Inc 3990537622 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537622 25 I 1 2 BY MR. SWEDLOW: Q. No. You indicated that you received 3 that document several weeks before other 4 documents that you reviewed in preparation for 5 this deposition; is that correct? 6 MR. WAGNER: 7 THE WITNESS: 8 BY MR. SWEDLOW: 9 Q. Object to form. No. When I first asked you when you saw 10 this document, you said earlier this week. 11 you recall that? Do 12 A. Yes. 13 Q. And then you said, no, I think this 14 was a document I saw several weeks before that. 15 Do you recall that? 16 A. I do. 17 Q. So this document you saw before the 18 documents from earlier this week; is that 19 correct? 2C A. That's correct. 21 Q. Were there any other documents when 22 you saw this document that you also saw? 23 A. Yes. 24 Q. What w e r e t h o s e documents? Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537623 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537623 26 j 1 A. There were documents that I reviewed 2 throughout the preparation process for this 3 deposition. 4 which I would have seen all of those. 5 reason I answered your question the way — 6 were other documents that were viewed either 7 prior to or simultaneous with this one. 8 9 10 Q. j I don't recall exactly the order in jj The there \ j What documents were reviewed either prior to or simultaneous with this one? A. Again, I don't have a detailed memory 11 of exactly when I reviewed which document over 12 the course of the last — 13 weeks. 14 and beginning of August and I reviewed 15 additional documents in preparation for my 16 deposition today during the past week. 17 the last couple of j I reviewed documents at the end of July Q. And I'm trying to ask you what 18 documents did you review at the end of July and f 19 the beginning of August. I; 20 same words that you used, which was to say 21 shortly before or simultaneously with this one. 22 I'll pick whatever words you want. I tried to use the We can j 23 call it shortly before or simultaneous with this j 24 one, or we can say at the end of July and the Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537624 27 1 beginning of August, but I'm looking to find out 2 what documents you reviewed around the time of 3 this document. 4 A. Okay. 5 Q. It doesn't have to be in chronological 6 I will do so — order. 7 A. Okay. And I will do so to the best of 8 my knowledge. 9 process over the course of this time that I viewed this as a preparation 10 involved a comprehensive review of a range of 11 different documents, which I'm happy to discuss. 12 What I want to make sure you understand is 13 I have a decent sense of what I reviewed- 14 not be entirely accurate when I tell you what I 15 reviewed on which day because I did review a lot 16 of different documents and some of those 17 documents I came back to at different points in 18 time. 19 20 21 Q. I may Okay. Let's start by identifying some The — where I started with my review documents. A. 22 is really going back through the affidavit that 23 I shared in the MDL case in Maine. 24 outlined in there an overview of our There was Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537625 28 1 communications efforts. 2 document. 3 materials that I used in preparing that 4 document. 5 document — 6 the document that you shared in Exhibit 3. ? I reviewed some additional materials 8 related to company communications around this in 9 addition to the materials that are attached, 10 again, some of the source materials that were 11 used to support that, that affidavit. 12 So I reviewed that I reviewed some of the source Several of those are attached to that it looks like they are attached to i reviewed examples of the company's 13 websites over the years. 14 additional documents that involved regulatory 15 decisions during the period of time that the 16 notice of deposition referenced. 17 depositions of company executives that were done 18 in cases related to this where some of the 19 subject matter was discussed. 20 I reviewed some I reviewed i reviewed other documents and company 21 communications that touched on the issues that 22 are raised in this. 23 deposition, a copy of which you have handed me 24 in the Maine MDL. I reviewed my own It looks like that is Exhibit Thompson Court Reporters, Inc. 312-421-3377 3990537826 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537626 29 1 2 4, as you have marked it. That's my recollection of the documents I 3 have reviewed over the period of time of my 4 preparation for this deposition. 5 those were reviewed late August, early July. 6 Others were reviewed when I returned in the last 7 week prior to this deposition. 8 9 10 Q. Several of Without getting too personal, were you on vacation or out of town in the intervening period? 11 A. I was. 12 early August? I was. Did I say late July, 13 Q. Yeah, but it doesn't matter. 14 A. Okay. 15 Q. Have you ever been deposed as a 16 corporate designated witness for Philip Morris 17 USA or Altria? 18 A. I believe that that was the 19 designation that I had in the Maine 20 multi-district litigation. 21 Q. Do you have an understanding as to 22 what that means to be a corporate designated 23 witness? 24 A. I have an u n d e r s t a n d i n g a s i t ' s Thompson C o u r t R e p o r t e r s , 312-421-3377 been Inc. 3990537827 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537627 30 1 explained to me by my counsel. 2 it, my job is to communicate the company's 3 position on the issues that you're interested 4 in. 5 Q. As I understand Was the review of the materials you 6 previously identified for the purpose of 7 educating yourself on the company position? 8 A. Yes, it was. 9 Q. You referred to source materials. 10 11 What did you mean by source materials? A. For example, in my affidavit I 12 discussed the number of pack onserts that were 13 distributed at various points in time. 14 prepared this affidavit, I went back and 15 reviewed some of our original business reports 16 related to that issue to compile that we had 17 summarized — 18 by others in the company to pull for multiple 19 reports and consolidate those numbers. 20 back and reviewed some of those reports to 21 refresh my memory. 22 the type of material that I reviewed. 23 24 When I some of those had been summarized I went That would be an example of i reviewed snapshots of the web pages from October 1999 when we launched our website, Thompson Court Reporters, Inc. 312-421-3377 3990537828 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537628 31 1 again, to refresh my memory on some of the 2 things we were saying at that point in time. 3 I went back and clicked around an older version 4 of that website. 5 types of things that I looked at to refresh my 6 memory based on that information that I had put 7 out there or other information that I had 8 acquired during the course of my career at the 9 company. 10 Q. So [ \ Those would be examples of the \ \ I was trying to group these into \ 11 categories. 12 websites was separate from source material, but j 13 would you consider that source material also? 14 A. I thought the examples of the As it relates to the types — to the 15 information we were communicating, it would be 16 an example of what we were communicating. 17 Q. Your first example, I think, refers to j 18 paragraph 10 of your affidavit. Can you turn to f 19 paragraph 10? 20 A. 21 November 2002? 22 Q. Yes. 23 A. Yes. 24 Q. it says, the onsert was enclosed in j This is the one that begins in Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537629 32 1 approximately 130 million packs. 2 that? 3 A. I do see that. 4 Q. Was that — Do you see and then there is another 5 statement that says, in the fourth quarter of 6 2003 it was enclosed in 109 million packs, 2004, 7 118 million packs, and then it was twice in 8 2005, one for approximately 150 million packs, 9 and the next one for 135 million packs; is that 10 correct? 11 A. That's correct. 12 Q. How did you calculate the 13 0 million 13 14 packs for November 2002? A. At the time what I did is I had asked 15 to see the original reports from our 16 manufacturing organization and reviewed a number 17 of reports, some of which were the original 18 reports from the time. 19 additional work done to consolidate that 20 information and roll it into a single document 21 that summarized this. 22 original reports as well as subsequent reports 23 to track those numbers and sum those up in this 24 paragraph 10 in my affidavit. There had been some And I reviewed both the Thompson Court Reporters, Inc. 312-421-3377 3990537830 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537630 33 Q. Is the 130 million packs the number of packs that were sold in the week? under the — Because I was I was under the impression that the onsert was included on packs for about a week; is that correct? A. The way in which we started out to estimate what we were going to do here is we looked at and had targeted about a week's worth 9 of production. So 130 million packs represents 10 about a week's worth of production of the 11 non-full-flavor brands on which we would be 12 placing this onsert. 13 14 15 Q. The non-full-flavored brands means Light, Light Low Tar, Ultra Lights, et cetera? A. Those would be — the ones that you 16 mentioned would certainly be examples of the 17 types of things that — 18 on Lights, it was placed on Marlboro Lights, 19 Ultra Lights. 20 the types of brands on which this was placed. 21 Q. 22 correct? 23 A. 24 correct. it was certainly placed Those would all be examples of And Mediums and Milds as well, Those would be included, that's Thompson Court Reporters, Inc. 312-421-3377 3990537831 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537631 34 1 Q. And what else? 2 A. I think you've hit the primary 3 examples, but it would not have, for example, 4 been placed on a Marlboro Red. 5 Q. So it would have been placed on 6 Marlboro Lights, Ultra Lights, other Lights, 7 Mediums and Milds. 8 A. That's correct. 9 Q. And so one week's worth of — 10 approximately one week's worth of sales of the 11 Lights, Ultra Lights, Mediums and Mild brands or 12 brand line extensions is about 130 million 13 packs? 14 MR. WAGNER: 15 THE WITNESS: Object to form. 130 million packs 16 represents approximately one week's of 17 production volume. 18 BY MR. SWEDLOW: 19 Q. So the number of packs in terms of 20 production volume for 2002 in the 21 non-full-flavored lines that had an onsert was 22 just under 2%; is that correct? 23 MR. WAGNER: 24 THE WITNESS: Object to form. Not — not necessarily. Thompson Court Reporters, Inc. 312-421-3377 3990537832 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537632 35 1 I have not gone back and looked at what our full 2 production volume was. 3 assumes that the plant would be running 52 4 weeks, and I haven't gone back and done that 5 calculation to be able to answer your question 6 with that level of precision. 7 BY MR. SWEDLOW: 8 Q. 9 I think your calculation But assuming it runs 50 weeks, it would be about 2%. 10 MR. WAGNER: 11 THE WITNESS: 12 about 2%. 13 BY MR. SWEDLOW: 14 Q. Object to form. One divided by 50 is So the total number of non-regular or 15 Light, Ultra Light, et cetera, packs sold by 16 Philip Morris in 20 02 would be approximately 8 17 billion packs; is that correct? 18 MR. WAGNER: 19 THE WITNESS: Object to form. Again, I have not gone 20 and looked at — 21 that number, so I don't have an independent 22 knowledge of that. 23 BY MR. SWEDLOW: 24 Q. at that number and looked for Do y o u k n o w how many p a c k s Thompson C o u r t R e p o r t e r s , 312-421-3377 of Inc. 3990537833 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537633 36 1 non-regular Light, Ultra Light, et cetera, 2 Philip Morris sold in any year? 3 A. I don't know off the top of my head, 4 no. And I did not go back and look for that 5 information. 6 looked at from an onsert standpoint. 7 Q. I was focused really on what we Was each of these 130 million, 109 8 million, 118 million, was each of these a week's 9 worth of production? 10 A. I believe it varied during this period 11 of time from 2002 through 2008. 12 when we started it in 2002, my understanding it 13 was a week's worth of volume on all of those 14 brands. 15 evolved our capabilities and reviewed our 16 process on some of these things, I think later 17 on — 18 we had added two weeks of volume on some of the 19 lower-volume brands and kept it at one week on 20 some of the higher-volume brands. 21 BY MR. SWEDLOW: 22 Q. 23 24 I believe that, I believe that as time went on and we and I don't remember exactly which year — Marlboro Lights would be considered a higher-volume brand? A. I b e l i e v e t h a t t h e — most of Thompson C o u r t R e p o r t e r s , 312-421-3377 the Inc. 3990537834 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537634 37 j 1 packings of Marlboro Lights would be those 2 higher-volume brands. 3 packings of Marlboro Lights, for example, in a 4 soft pack that may have been on some of those 5 slower-moving brands, but I think the vast 6 majority of Marlboro Light volume would have 7 been — 8 majority of Marlboro Light volume. 9 10 We may have had certain j it would have been one week on the vast Q. It's possible that Marlboro Lights soft pack is a lower-volume brand? j j 11 A. A lower-volume packing. 12 Q. On what do you base that? 13 A. The fact that most smokers prefer hard f 14 Most — I pack versus soft pack. 15 Q. For every brand; is that correct? 16 A. Generally, if you look at the market 17 dynamics, there are far more hard packs sold 18 than soft pack. 19 Q. 20 21 22 23 24 What is the best-selling brand of Philip Morris USA today? MR. WAGNER: Object to form and beyond j the scope. j THE WITNESS: best-selling j Marlboro is the brand. Thompson C o u r t R e p o r t e r s , 312-421-3377 f ij Inc. 3990537635 3990537635 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 38 1 2 BY MR. SWEDLOW: Q. What is the best brand line extension? 3 4 MR. WAGNER: the scope. 5 THE WITNESS: 6 to that. 7 BY MR. SWEDLOW: 8 Q. 9 10 Object to form and beyond I don't know the answer You don't know the answer to what is the best brand line extension of Philip Morris? A. 11 I do not. MR. WAGNER: 12 BY MR. SWEDLOW: 13 Q. Object to form. Do you know approximately — do you 14 know if this in paragraph 10 constitutes all of 15 the onserts that were sent out on Philip Morris 16 non-regular brands? 17 MR. WAGNER: 18 THE WITNESS: Object to form. What this represents in 19 paragraph 10 is a summary of all of the 20 low-tar-related onserts that were communicated 21 by our company from 2002 through 2008. 22 was the period of time in which we were using 23 onserts to communicate about low-tar issues, and 24 this represents a summary of all of our efforts So that Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537636 39 I 1 to communicate via onserts using a low-tar 2 message only. 3 BY MR. SWEDLOW: 4 Q. 5 6 7 8 9 So is this the universe of low-tar messaging onserts? A. This is the universe of onserts that were focused solely on the low-tar issue. Q. Were there other onserts that were with focused on low tar and other issues that 10 were placed on packs of cigarettes during this 11 same time period? 12 A. Yes, there were other onserts that 13 were a little bit broader of which low tar was 14 one of the messages and issues referenced. 15 16 17 Q. Do you have any information about where and when those onserts were placed? A. I believe that there was, for example, 18 I believe the year was 2004, we communicated an 19 onsert to call attention to information that was 20 available on our — on Philip Morris USA's 21 corporate website. That listed examples of the 22 types of information that people would find. 23 That onsert included references to the health 24 effects of smoking, it included references to Thompson Court Reporters, Inc. 312-421-3377 3990537837 3990537637 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 40 i 1 low-tar cigarettes, references to quitting 2 smoking. 3 multiple issues that we were highlighting as an 4 example of what people would find on 5 philipmorrisusa.com. 6 So that would have been one of Q. So this is — this only identifies the 7 number of packs that contained low-tar-focused 8 onserts; is that correct? 9 10 11 12 A. It is the packs that are focused on delivering a substantive low-tar message. Q. So this adds up to over a billion packs; is that correct? 13 A. That's correct. 14 Q. Do you know the precise number? 15 16 didn't see it in the affidavit. A . I don't. I know it's over — 17 over a billion packs. 18 number off the top of my head. 19 I Q. it's I don't have the exact So during the period of 2002 to 2008 20 Philip Morris communicated on over a billion 21 packs of non-regular cigarettes the focused 22 low-tar message; is that correct? 23 A. That's correct. 24 Q. Do you know at what cost this was to Thompson Court Reporters, Inc. 312-421-3377 3990537838 3990537638 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 41 1 Philip Morris? 2 A. I do not know the exact cost, 3 that there were certainly — 4 don't know the exact cost, no. I know to give you — I 5 Q. Do you know the approximate cost? 6 A. I don't. 7 Q. Do you know how much this cost in any 8 of these years? 9 A. I do not. 10 Q. Do you know if this came out of a 11 budget that was specific to low-tar messaging? 12 A. I donft. 13 Q. Do you know what budget this came out 15 A. I don't. 16 Q. Do you know what percentage of Philip 14 of? 17 Morris's overall sales are non-regular 18 cigarettes? 19 20 MR. WAGNER: scope. 21 THE WITNESS: 22 mean by "non-regular." 23 BY MR. SWEDLOW: 24 Objection, beyond the Q. I'm not sure what you I mean the packs of cigarettes that Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 42 1 include Lights, Ultra Lights, Mediums and Milds 2 that were eligible for the onserts. 3 4 5 A. I don't know that number off the top of my head. Q. Can you approximate by percentage how 6 many packs of cigarettes that say Lights, Ultra 7 Lights, Mediums and Milds on them had an onsert 8 versus those that did not have an onsert? 9 A. I think the best way that I can be 10 responsive to your question in the way that I've 11 looked at this and the way we have traditionally 12 talked about this and the way we talked about it 13 internally as we were developing this project is 14 that our goal was to communicate and place 15 onserts on — 16 a week's worth of volume. 17 number of packs that we used, it was 130 18 million. 19 Q. in November 2002 — approximately And the precise And the week's worth of volume was for 20 the Lights, Ultra Lights, Mediums and Milds 21 packings, correct? 22 23 24 MR. WAGNER: Objection, asked and answered. THE WITNESS: The w e e k ' s w o r t h Thompson C o u r t R e p o r t e r s , 312-421-3377 of Inc 3990537640 3990537840 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 43 1 volume is for — 2 all of the SKUs or stock keeping units, all of 3 the individual brand executions that would have 4 had this onsert on them. 5 BY MR. SWEDLOW: 6 Q. Right. the week's worth of volume for I'm trying to identify which 7 individual brands would have had this onsert on 8 them. 9 non-regular, but we hadn't, so I'm trying to I thought we had defined that term as 10 figure out what brands, SKUs, would have this 11 onsert on them. 12 A. I believe that I answered that 13 question earlier and we talked about that as you 14 ran through a list of various brands. 15 would — 16 I would use to describe that. 17 I non-full-flavor would be the term that Q. The various brands that we ran through 13 I read from your affidavit — 19 Light, Medium and Mild. 20 non-full-flavor brands that would be included as 21 well? 22 A. Ultra Light, Were there other There may have been. I don't know 23 every brand. I mean, I reviewed a comprehensive 24 l i s t , but i t would have i n c l u d e d anything t h a t Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537641 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537641 44 1 was non-full-flavor, even if that did not 2 include one of those descriptors, I believe. 3 Q. You indicated previously that you 4 reviewed a copy of the website from October of 5 1999; is that correct? 6 A. Yes. 7 Q. Did you review a copy of the website 8 from prior to October 1999 to prepare for your 9 deposition today? 10 MR. WAGNER: 11 THE WITNESS: Object to form. I did — we did not have 12 a corporate website prior to October 1999. 13 BY MR. SWEDLOW: 14 Q. 15 Is it Philip Morris didn't have a website or there was no corporate website? 16 MR. WAGNER: 17 THE WITNESS: Object to form. When you're using the 18 terms "Philip Morris and corporate," when I use 19 the term "corporate website," I refer to, for 20 Philip Morris, philipmorrisusa.com. 21 the first website that our company launched and 22 it was launched in October of 1999. 23 BY MR. SWEDLOW: 24 Q. And p r i o r to that That was date there Thompson C o u r t R e p o r t e r s , 312-421-3377 was no Inc 3990537842 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537642 45 1 website for Philip Morris USA regardless of 2 whether it was called philipmorrisusa.com? 3 A. There was certainly no public-facing 4 website at that point in time, no. 5 this was the first — 6 website, I believe, of any kind. 7 was no — 8 website. 9 Q. I believe it was certainly the first I'm certain it it was the first public-facing Were you responsible prior to October 10 1999 for communications with the public of any 11 kind relating to the health risks of cigarettes? 12 A. I had responsibility and our 13 department had responsibility in 1999 of 14 communicating directly with the media. 15 the extent they were interested in the company's 16 position on health-related issues, that would 17 have been one of the issues that we communicated 18 with them about. 19 20 Q. And to Were you responsible prior to 1999 for communications on health-related issues? 21 A. Are you asking me individually? 22 Q. Yes. 23 A. I d o n ' t remember e x a c t l y a t what p o i n t 24 i n t i m e , but I ' l l g i v e you some p e r s p e c t i v e on Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537843 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537643 46 1 kind of my roles within the media relations 2 department. 3 I would have started in an intern role, 4 and, as I gained increasing responsibility, I 5 would have taken on, gradually, responsibilities 6 as a company spokesperson. 7 So when it comes to communicating about 8 those issues in a public fashion, that would 9 have increased gradually over time. I don't 10 recall exactly when my personal 11 responsibilities — 12 been that they expanded to include dealing with 13 the media on a broad range of — 14 of issues, but, as my responsibilities 15 broadened, that would have been one of the 16 issues that I would have communicated with the 17 public about through the media. 18 Q. what year that would have a broader range Is the version of the October 1999 19 website attached as an exhibit or as — 20 as an exhibit to your affidavit exhibit? 21 A. yeah — I believe that Exhibit F in my 22 affidavit contains the relevant pages from the 23 October 1999 website. 24 pages that were on that website when it was Those are all examples of Thompson Court Reporters, Inc. 312-421-3377 3990537844 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537644 47 1 2 3 4 originally launched in October 1999. Q. Is Exhibit A a more recent version of the website? A. Can you tell? I do not believe it is, but if you 5 give me a second I'll go through my affidavit. 6 I believe it's referenced exactly what Exhibit A 7 refers to. 8 MR. WAGNER: 9 THE WITNESS: Paragraph 7. Thank you. Exhibit A is 10 an example of — 11 insert, which is something that was — 12 pages from our website, and that was 13 distributed, as I outline in my affidavit, also 14 distributed, in November 2002. 15 BY MR. SWEDLOW: 16 Q. it is a copy of a freestanding included If you look at the Exhibit A, which is 17 from the freestanding insert you just referred 18 to, there appears to be a table of contents that 19 says, "a closer look at our website." 20 see that? Do you 21 A. I see that page, yes. 22 Q. So this would have been in the insert, 23 in the newspaper, and referencing the website; 24 is that correct? Thompson Court Reporters, Inc. 312-421-3377 3990537845 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537645 48 1 A. Yes. The entire document that is 2 included in Exhibit A would have been an example 3 of what — 4 would have seen in their newspaper when that was 5 distributed. 6 Q. that would have been what people In this document, under Health Issues, 7 it states that we agree with the overwhelming 8 medical and scientific consensus that cigarette 9 smoking causes lung cancer, heart disease, 10 emphysema and other serious diseases in smokers. 11 Do you see that? 12 A. I do. 13 Q. Do you know when the first time Philip 14 15 16 17 Morris made that statement publicly was? MR. WAGNER: Object to the form, beyond the scope of Rule 57.03 notice. THE WITNESS: I know that there was 18 similar language launched on our website in 19 October 1999. 20 slightly different. 21 the extent of which other public statements may 22 have tracked that over time. 23 all of our statements on this particular issue 24 in preparation for this deposition. This version may be slightly — What I do not know is to I haven't reviewed Thompson Court Reporters, Inc. 312-421-3377 3990537646 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537646 49 1 2 3 4 BY MR. SWEDLOW: Q. Exhibit F is the website you reference; is that correct? A. Exhibit F is the certain pages from 5 the October 1999 website with a specific focus 6 on those pages that are focused on tar and 7 nicotine numbers. 8 9 10 Q. Is there anywhere in this Exhibit F where a comparable statement regarding the health issues of smoking are discussed? 11 MR. WAGNER: 12 THE WITNESS: Object to form. If your question is 13 getting at attempting to compare this versus the 14 statement that you had mentioned from the prior 15 page, these are different pages from the 16 website, so it's not an apples-to-apples 17 comparison from one page to another. 18 BY MR. SWEDLOW: 19 Q. Did you review the apples-to-apples 20 page of the 2009 — October 2009 — version of 21 the website in preparation for your deposition? 22 MR. WAGNER: Object to form. 23 THE WITNESS: I reviewed the October 24 1999 pages that were — I reviewed the website Thompson Court Reporters, Inc. 312-421-3377 3990537847 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537647 50 1 at a very high level. 2 page of the website. 3 raised in the notice of deposition, I focused my 4 attention on those issues that were focused on 5 understanding tar and nicotine numbers. 6 not do a word-by-word comparison across those 7 pages, but I reviewed each of those from a 8 substantive level. 9 BY MR. SWEDLOW: 10 Q. I did not review every Given the issues that were I did Upon what is it that you base your 11 testimony that a similar statement regarding the 12 fact that cigarette smoking causes lung cancer, 13 heart disease, emphysema and other serious 14 diseases in smokers existed on the website in 15 October 1999? 16 MR. WAGNER: 17 beyond the scope of the notice. 18 THE WITNESS: Object to form and it's In October 1999 I was in 19 our communications department and I reviewed our 20 website at the time, so I have a recollection, a 21 very good recollection, from that point in time. 22 i realize that that was part of what we 23 communicated at the time. 24 articles that appeared on that issue at the I remember the news Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537648 51 1 time. 2 a high level that we — 3 communicated about the health effects and we 4 communicated that cigarette smoking causes 5 disease when the website was launched in October 6 1999. 7 BY MR. SWEDLOW: 8 Q. 9 10 So I've got a pretty good recollection at I know that we And what were the news articles about that issue? A. I remember there were a number of news 11 articles that ran in The New York Times and 12 other — 13 that was one of the things that was mentioned 14 when we launched the website. 15 16 17 18 19 and other places, and that was the Q. What was one of the things that was mentioned? A. That the website included references to cigarette smoking causes disease. Q. This is reviewed as part of your role 20 as media relations person at the time, as a 21 media relations person at the time? 22 — A. As a media relations person, I had 23 both a familiarity with the content of our 24 website, which communicated our positions, and I Thompson Court Reporters, Inc 312-421-3377 3990537849 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537649 52 1 was also regularly reviewing media coverage of 2 our company and our industry. 3 recollection of what those stories were focused 4 on at the time. 5 familiarity of the positions that were 6 communicated on our website when it was launched 7 as well as a recollection of the types of 8 newspaper coverage that resulted following the 9 launch of that website. 10 BY MR. SWEDLOW: 11 Q. And that's my So I would have had both a Do you recall whether the news 12 articles identified 1999 as the first time 13 Philip Morris publicly acknowledged that 14 cigarette smoking causes disease? 15 MR. WAGNER: 16 beyond the scope of the notice. 17 Objection to the form and THE WITNESS: I don't remember all of 18 the specific language that was in those 19 websites, but certainly they noted with interest 20 that we were communicating in a very public 21 fashion that cigarette smoking causes diseases 22 and using our website to do that. 23 BY MR. SWEDLOW: 24 Q. Do y o u k n o w i f the communication Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537850 3990537650 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 53 1 regarding cigarette smoking causing disease was 2 a result of a litigation settlement? 3 4 MR. WAGNER: Object to form and beyond the scope. 5 Steve, just so we're clear, when I say 6 beyond the scope of the notice in this case, 7 what I am saying is that Mr. McCormick is 8 presented here as the company witness authorized 9 to speak on the matters raised in your notice of 10 deposition. He's not being tendered and is not 11 authorized to speak as a company witness on 12 matters that are outside the scope. 13 I'm not preventing Mr. McCormick from 14 answering those questions, and so that's an 15 issue that can be resolved later if these are 16 issues you want to bring to the court's 17 attention, but that's what I mean by that 18 objection. 19 record. 20 21 MR. SWEDLOW: Can you read back the question? 22 (Record 23 24 I just wanted that clear on the read.) MR. WAGNER: it's beyond t h e And my o b j e c t i o n s c o p e of t h e is that notice. Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537651 3990537651 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 54 1 THE WITNESS: 2 the case, no. 3 BY MR. SWEDLOW: 4 Q. I don't believe that's If you turn to the exhibit that says 5 Lewis Rice at the top, and if you turn to the 6 third sheet of paper in that exhibit — 7 side of the third sheet of paper — 8 have you seen Philip Morris USA's response to 9 the supplemental set of interrogatories prior to 10 the back sorry — today? 11 A. I have. 12 Q. When did you see these? 13 A. Reviewed that this week. I believe I 14 reviewed sections of it in the early part of my 15 review. 16 in a little bit more detail earlier this week. 17 Q. I went back and reviewed the document If you look on the page marked page 2 18 of these responses, it references in this first 19 full paragraph that, pursuant to Section 4 of 20 the Master Settlement Agreement, in the 21 Attorneys General cases entered into on November 22 23, 199 8, Philip Morris undertook to implement 23 certain enhancements to its original public 24 document website. These enhancements became Thompson Court Reporters, Inc. 312-421-3377 3990537652 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 55 1 available on January 7, 1999. Do you see that? 2 A. I do. 3 Q. Do you know if the website that you're 4 referring to was also pursuant to Section 4 of 5 the Master Settlement Agreement? 6 A. It was not. 7 Q. How — 8 A. This refers to, I believe, the same 9 go ahead. database or website that you referred to, which 10 is making certain documents available, public 11 documents, available from litigation that are 12 available in litigation. 13 different websites. 14 document here refers to the litigation document 15 website (indicating). 16 Q. So they are two This refers — this Was Philip Morris required to make any 17 public statements regarding cigarette smoking 18 and disease as a result of the Master Settlement 19 Agreement? 20 21 MR. WAGNER: Object to form and beyond the scope of the notice. 22 THE WITNESS: I don't believe the 23 agreement required us to make any statements. 24 I'm not — I did not review the Master Thompson Court Reporters, Inc. 312-421-3377 3990537853 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537653 56 1 Settlement Agreement in detail because it was 2 not mentioned in the notice of deposition. 3 know that there were provisions of that 4 agreement that governed corporate statements, 5 that had corporate conduct provisions, they had 6 marketing restrictions. 7 other provisions in there, but I am not aware 8 and don't recall the agreement requiring us to 9 affirmatively make any public statements. 10 11 I There were a range of BY MR. SWEDLOW: Q. The public statement in the insert 12 regarding cigarette smoking causing disease that 13 we referred to earlier, do you know if Philip 14 Morris made any public acknowledgment about 15 cigarette smoking causing disease prior to the 16 entry of the Master Settlement. Agreement? 17 18 19 MR. WAGNER: Object to form and beyond the scope of the notice. THE WITNESS: As I said earlier, I 20 have not reviewed all of our public statements 21 as it relates to that specific issue. 22 was not mentioned in the notice of deposition, 23 so it was not an area I focused on in 24 preparation for our conversation today. Again, it Thompson Court Reporters, Inc. 312-421-3377 399053765- 3990537654 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 57 1 BY MR. SWEDLOW: 2 Q. But you did start at Philip Morris in 3 1989 as an intern and worked for Philip Morris 4 from 1989 through at least 1998, which would be 5 nine years, in areas that include media affairs; 6 is that correct? 7 A. 8 9 That's correct. MR. WAGNER: Objection to the form. BY MR. SWEDLOW: 10 Q. In your experience in the media 11 affairs department for the nine years preceding 12 199 8, are you aware of any public statements by 13 Philip Morris to the media or anyone that 14 cigarette smoking causes disease? 15 16 MR. WAGNER: Objection to the form and beyond the scope. 17 THE WITNESS: And as I indicated, I 18 did not go back and focus on that period of 19 time. 20 talked about. 21 in time the specifics of the exact position that 22 we were communicating and did not because it 23 wasn't an issue that was mentioned in the notice 24 of deposition and was not an area that I focused I know it's an issue that we would have I do not remember for that point Thompson Court Reporters, Inc. 312-421-3377 3990537655 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 58 1 on in my preparation. 2 BY MR. SWEDLOW: 3 Q. I'm asking a slightly more specific 4 question. Do you recall any public statements 5 during your nine-year stint prior to 1998 where 6 Philip Morris publicly acknowledged that 7 cigarette smoking causes disease? 8 9 MR. WAGNER: Objection to the form and beyond the scope and asked and answered. 10 THE WITNESS: As I just said in my 11 previous answer, I remember that this is an 12 issue that certainly would have been the subject 13 of public communications. 14 specifics of our communications at that time. 15 BY MR. SWEDLOW: 16 Q. I do not recall the What do you mean it would have been an 17 issue that was the subject of public 18 communications? 19 20 21 MR. WAGNER: Object to form and beyond the scope. THE WITNESS: You asked if I remember 22 public statements by the company at that time. 23 I recall that certainly the issue of the health 24 effects of cigarette smoking was an area of Thompson Court Reporters, Inc. 312-421-3377 3990537856 3990537656 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 59 I 1 interest. There would have been a range of 2 different ways in which we could have 3 potentially shared our views on that. 4 certainly I recall that it would have been an 5 issue that we would have been communicating 6 about, but, as I mentioned, I did not go back 7 and review those and because of that I'm not in 8 a — 9 because I don't remember with any degree of I So I'm not able to answer your question 10 specificity any of those specific communications 11 and the language that we used at the time. 12 BY MR. SWEDLOW: 13 Q. I wasn't asking if you remembered any 14 specific communications or any language that was 15 used. 16 communications of any form to anyone publicly to 17 any media outlet in the nine years that you 18 worked at Philip Morris prior to 1998 where IS Philip Morris publicly acknowledged that 20 cigarette smoke caused disease? 21 I was just asking you if you recall any A. I would have been just to — I joined 22 the company full-time in 1993, so just to 23 clarify that piece. 24 j Q. Oh. Thompson Court Reporters, Inc. 312-421-3377 3990537657 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 60 1 A. I was a summer intern. So just to get 2 the time frame right. 3 several times now, I do remember public — 4 the company had made public statements on these 5 issues. 6 Q. And as I've answered that You do remember that the company made 7 public statements acknowledging that cigarette 8 smoking causes disease? 9 10 MR. WAGNER: Objection, beyond the scope of the notice. 11 THE WITNESS: I remember that the 12 company, as I've said several times now, I 13 remember that the company made public statements 14 related to the health effects of cigarette 15 smoking, and, as I said, I do not remember 16 specifically the content of those communications 17 during that period of time. 18 BY MR. SWEDLOW: 19 Q. The next heading on the "closer look 2C at our website" says "addiction." 21 that? 22 A. I do. 23 Q. The i n s e r t 24 overwhelming medical states, Do you see we a g r e e and s c i e n t i f i c Thompson C o u r t R e p o r t e r s , 312-421-3377 with the consensus Inc 3990537658 3990537658 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 61 1 that cigarette smoking is addictive. 2 that? Do you see 3 A. I do. 4 Q. When was the first time that Philip 5 Morris acknowledged publicly that cigarette 6 smoking is addictive? 7 MR. WAGNER: 8 Objection, beyond the scope of the notice. 9 THE WITNESS: 10 to that question. 11 BY MR. SWEDLOW: 12 Q. I don't know the answer Do you know if Philip Morris publicly 13 acknowledged that cigarette smoking is addictive 14 prior to the Master Settlement Agreement? 15 16 17 MR. WAGNER: Objection, beyond the scope of the notice. THE WITNESS: The one communication 18 that I did go back and review prior to this that 19 may be on point to your question is there was a 20 communication that we made to members of the 21 Senate Judiciary Committee in, I believe it was 22 1997, and it was at a time when we were being 23 asked about our position on issues like 24 causation, whether cigarette smoking caused Thompson Court Reporters, Inc. 312-421-3377 3990537659 3990537659 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 62 1 disease in smokers, addiction, and what we did 2 is we responded with a communication to Senator 3 Hatch, who was the chairman of the Senate 4 Judiciary Committee at the time, and we did a 5 couple of things with that communication. 6 noted and summarized our views on the health 7 issues. We 8 The other thing that we did in that 9 communication is that we said that, regardless 10 of the views that we have, we would no longer 11 publicly dispute the conclusions of the public 12 health community related to whether or not 13 cigarette smoking caused disease in smokers, 14 whether or not cigarette smoking was addictive, 15 and that we would defer to the public health 16 community as far as the content of the warnings 17 that should be communicated to the public about 18 those issues. 19 The other thing we agreed to do is just 20 restate our belief and our agreement that there 21 should be a single, consistent public health 22 message on these issues. 23 of one of the communications I reviewed. 24 think it's probably the one I reviewed in most So that's an example I Thompson Court Reporters, Inc 312-421-3377 3990537660 3990537660 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 63 1 detail that seems to be on point and I think 2 relevant for the questions that you've been 3 asking me related to this. 4 BY MR. SWEDLOW: 5 Q. When you were referring to the 6 materials you reviewed, you also indicated that 7 you reviewed several regulatory decisions. 8 you recall saying that? 9 Do I don f t know if I used that exact A. 10 language. 11 from the Federal Trade Commission. 12 examples of some of our communications to the 13 Commission. 14 Commission published, examples would include 15 press release, there were some reports that were 16 considered as part of the regulatory process, 17 there were — 18 opinion, I believe, is what it was titled. 19 those would be examples of the types of 20 documents in the regulatory space that I 21 reviewed in preparation for today. I reviewed examples of communications I reviewed And some of the things that the there was at least one advisory 22 Q. What was the advisory opinion? 23 A. The advisory opinion was a 24 So communication that the Commission made in Thompson Court Reporters, Inc 312-421-3377 3990537661 3990537661 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 64 response to a request that Lorillard Tobacco Company had made related to variations that they were interested in publishing that deviated from the standardized tests that the Trade Commission 1 had required of all manufacturers. Q. What year was that? A. I believe it was 1978, if I'm not mistaken. 9 Q. Do you know what brand it was? 10 A. I don't. 11 Q. Do you know what the deviation was? 12 A. I believe that what they wanted to 13 communicate was they wanted to test in a 14 different way that would have resulted in 15 disclosing a higher nicotine content than that 16 cigarette delivered on the Federal Trade 17 Commission's testing methodology and the 18 Cambridge Method that they required. 19 Q. Did you bring that document with you 21 A. I did not. 22 Q. Did you bring any documents with you A. I brought a copy of my affidavit with 20 23 24 today? today? Thompson Court Reporters, Inc 312-421-3377 3990537662 3990537662 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 65 1 2 3 4 5 6 me today. Q. Which is the same as the one we marked? A. It's the same one. We were going to bring it in, but you delivered the same one. Q. Were there any regulatory — you did 7 say regulatory decisions, but I'm not trying to 8 bind you to that word. 9 A. Okay. 10 Q. Are there anything in the 11 regulatory — is there anything else in the 12 regulatory context besides the FTC information 13 you just identified that you reviewed to prepare 14 for today? 15 MR. WAGNER: 16 MR. SWEDLOW: 17 form — MR. WAGNER: 19 regulatory decisions. 21 22 23 24 I can fix that. What what is your form objection? 18 20 Object to form. MR. SWEDLOW: I don't believe he said Okay. Let's go off the record for a minute. VIDEOGRAPHER: We're now going off the record at 10:25. (Proceedings recessed.) Thompson C o u r t R e p o r t e r s , 312-421-3377 In: 3990537863 3990537663 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 66 1 VIDEOGRAPHER: 2 the record at 10:26. 3 BY MR. SWEDLOW: 4 Q. We're now going back on Are there any other regulatory 5 documents that you reviewed to prepare for today 6 other than the FTC documents you just 7 identified? 8 9 A. As I just mentioned, there were some other documents that would have been either — 10 they were documents that, as I understand them, 11 were considered as part of various regulatory 12 processes, some of those at the request of the 13 Surgeon General. 14 that scientists had issued in 1966 related to 15 tar and nicotine. 16 There was a technical report I reviewed some of the other documents and 17 pieces of some of the National Cancer 18 Institute's reports on this, this issue, and 19 their monographs which related to this. 20 reviewed some of the summaries of those 21 documents. 22 types of documents that, while they may not have 23 been Federal Trade Commission documents, they 24 were, as I understand them, documents that were I So those would be examples of the Thompson Court Reporters, Inc. 312-421-3377 3990537864 3990537664 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 67 1 in some cases in response to requests that the 2 Federal Trade Commission has made for public 3 health agencies to look at some of these issues. 4 In other instances they were — 5 documents that certainly would have bearing on 6 conversations that were going on at the time. 7 they were I also looked at other examples of 8 government communications on this issue from 9 other government agencies beyond the Federal 10 Trade Commission. 11 was probably the primary communicator — 12 and Human Services. 13 other government communications on this issue 14 that I reviewed. 15 Q. So the Public Health Service Health Those would be examples of When you said the technical report in 16 1966, do you know what the title of that report 17 was? 18 A. I believe it was labeled Technical 19 Report. 20 I believe that it was — 21 group of scientists that had been convened by 22 at the Surgeon General's request to look at 23 issues related to tar and nicotine. 24 I don't remember the precise title, but Q. it was the report of a — And what was the conclusion of that Thompson Court Reporters, Inc. 312-421-3377 3990537665 3990537665 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 68 I 1 2 \ technical report, if you recall? A. The conclusion of that report, I 3 believe, that there were — there were several. 4 The pieces that come to mind was that this group j 5 had reached the conclusion that reductions in 6 tar had potential public health benefits, 7 specifically as it relates to lung cancer, 8 which, I believe, was the primary focus of the 9 public health community at that period of time 10 as it relates to cigarette smoking and disease. 11 There was a discussion about the benefits 12 of switching people who were not going to quit 13 to low-tar cigarettes. And there was a 14 discussion and acknowledgment that some of those l 15 benefits would be impacted should people change 16 the way they smoke those low-tar cigarettes 17 compared to full-flavored brands. 18 that those were the primary issues addressed in 19 that report. { 2C BY MR. SWEDLOW: j 21 Q. 22 I believe Why were you reviewing communications from government agencies other than the FTC? 23 MR. WAGNER: 24 THE WITNESS: Object to form. jj I reviewed documents Thompson Court Reporters, Inc. 312-421-3377 3990537666 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 69 1 that were focused on this issue. The notice of 2 deposition had some questions relating to going 3 back to 19 71, and I felt that, in order to get 4 an understanding of the company's views on this 5 issue, there was extensive discussion on this in 6 Washington, some of which seemed to factor into 7 the Federal Trade Commission's decisions on 8 these issues and the public health community's 9 decisions on those issues. So in order to 10 familiarize myself with some of those documents, 11 I went back and reviewed in some cases documents 12 that I had reviewed prior as part of my job 13 responsibility to get comfortable with the 14 issues. 15 documents that were referenced elsewhere. 16 17 And in other instances they were THE WITNESS: now? Is now a good time? 18 MR. WAGNER: 19 MR. SWEDLOW: 20 VIDEOGRAPHER: 21 22 23 24 Do you want to break Is this okay with you? Okay. We're now going off the record at 10:31. (Proceedings recessed.) VIDEOGRAPHER: We're now back on the record at 10:50. Thompson Court Reporters, Inc 312-421-3377 3990537667 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 70 I 1 BY MR. SWEDLOW: 2 Q. If you'd take a look at the Exhibit 1, 3 turn to the subsection 5, is this the subsection 4 that you understand you are here to testify 5 about on behalf of Philip Morris? 6 A. It is. 7 Q. Why did Philip Morris decide in 2002 8 to stop advertising Marlboro Lights in print 9 media? 10 A. The decision that we made in 2002 was 11 to stop advertising all Marlboro cigarettes in 12 print media. 13 Q. Why? 14 A. It occurred against a backdrop — we 15 had been engaged in conversations with the 16 Attorneys General related to magazine 17 advertising practices in the years leading up to 18 2002. 19 industry magazine advertising, even though that 20 was permitted under the Master Settlement 21 Agreement, they had some questions related to 22 it. 23 in dialogue with them over a number of years. 24 And during the period of time leading up to this They had raised some concerns about We were to answer their questions, engaged Thompson Court Reporters, Inc. 312-421-3377 3990537668 3990537668 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 71 1 we had made a number of policy changes that 2 limited the number of publications in which we 3 were placing magazine advertising. 4 to no longer place magazine ads on the back 5 covers of magazines. 6 backdrop of some of the things that were going 7 on leading into that decision. 8 the wake of some of those restrictions that we 9 put on ourselves in terms of stricter readership We decided So that's kind of the And I think in 10 numbers in terms of where we would place 11 advertising, as we looked at the best use of our 12 marketing dollars for Marlboro, we decided to 13 invest that money elsewhere. 14 limited number of publications that were still 15 on our list of places that we could place 16 advertising, and we decided that a better use of 17 our marketing funds would be to use that on some 18 of our other marketing activities. So we had a 19 Q. What other marketing activities? 20 A. The primary ways in which we market 21 our products from an advertising standpoint are 22 really in a one-to-one manner, so that would 23 include things like direct mail or meeting 24 smokers at a bar night promotion, retail point Thompson Court Reporters, Inc. 312-421-3377 3990537669 3990537669 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 72 1 of sale would be another way, and then there's 2 other ways you could reallocate those funds when 3 you look at price promotion and other things 4 like that. 5 Q. If I understand your answer correctly, 6 Philip Morris's position was that the print 7 media advertising was permitted by the Master 8 Settlement Agreement entered into with the 9 Attorneys General; is that correct? 10 11 MR. WAGNER: Objection to the form, beyond the scope. 12 THE WITNESS: The Master Settlement 13 Agreement permitted the companies to place 14 magazine — 15 cigarettes, that's correct. 16 BY MR. SWEDLOW: 17 Q. print advertising in magazines for Then why did Philip Morris consider 18 the discussions with the Attorneys General part 19 of the reason why Philip Morris stopped 20 advertising Marlboro Lights in print media? 21 MR. WAGNER: 22 THE WITNESS: Objection to the form. As I mentioned, we 23 engaged in conversations related to the — our 24 practice as it related to running advertising in Thompson Court Reporters, Inc. 312-421-3377 3990537670 3990537670 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 73 1 magazines. 2 agreement, had the ability to ask us questions 3 about a broad range of issues related to our 4 business. 5 were in compliance with the Master Settlement 6 Agreement, we agreed to take steps as part of 7 the dialogue we were having with the Attorneys 8 General to do some additional things that 9 weren't required, and, as a result of those, we 10 ended up imposing our own restrictions on where 11 we placed advertising and how we ran our 12 advertising within the publication. 13 BY MR. SWEDLOW: 14 Q. 15 The Attorneys General, under the And while we believe that our actions What was it that the Attorneys General were seeking in the context of this advertising? 16 MR. WAGNER: 17 THE WITNESS: Object to form. I don't know if I can 18 answer specifically what they were seeking. I 19 can't speak exactly for — 20 were asking for anything in particular. 21 give you a sense, though, of the issues that 22 they were raising and the concerns that they had 23 related to the potential visibility of print 24 advertising to people under the age of the legal I'm not sure if they I can Thompson Court Reporters, Inc 312-421-3377 3990537671 3990537871 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 74 1 smoking age. 2 BY MR. SWEDLOW: 3 Q. The potential visibility of print 4 media to underage — 5 smokers — 6 General that was being expressed to Philip 7 Morris; is that correct? 8 9 potential underage was the concern of the Attorney MR. WAGNER: Object to form, beyond the scope. 10 THE WITNESS: As I understand the 11 concerns that they had and they were 12 communicated publicly and in other types of 13 communications to us is they were concerned 14 about print magazine advertising and the 15 potential visibility of that to young readers of 16 those magazines where those ads appeared. 17 BY MR. SWEDLOW: 18 Q. So part of the basis and 19 decision-making process to stop advertising 20 Marlboro Lights in print media was related to 21 the Attorneys' General concern that the 22 advertisements might be seen by underage 23 potential smokers; is that correct? 24 MR. WAGNER: Object to form. Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 75 1 THE WITNESS: That's not exactly what 2 I said. I think the decision not to advertise 3 Marlboro cigarettes in print media was a 4 business decision that considered a range of 5 factors that were related to our business 6 objectives. 7 have been considered would have been the 8 regulatory considerations that changed the 9 number of places where we had agreed voluntarily One of those factors that would 10 not to place our advertising, and that that 11 would have been one of the factors and certainly 12 an important factor. 13 the important factor I'm talking about is the 14 restrictions we imposed on ourselves that 15 limited the number of places where we indicated 16 that we would place our advertising. 17 be one of the factors you would consider in 18 making the business decision. 19 BY MR. SWEDLOW: 2C Q. Again, just to clarify, That would Why did Philip Morris remove "lower 21 tar and nicotine" from the packs of Marlboro 22 Lights beginning in the first quarter of 2003? 23 24 A. What we had done as a company in probably beginning really in the late '90s as Thompson Court Reporters, Inc 312-421-3377 3990537673 3990537673 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 76 1 the Federal Trade Commission and others started 2 revisiting and raising questions about the 3 testing methodology for tar and nicotine, there 4 was kind of an ongoing monitoring of the 5 regulatory environment as well as looking at our 6 communications related to these issues, and as 7 that issue continued to evolve, I think the 2001 8 publication of the National Cancer Institute 9 report related to tar and nicotine was a key 10 moment in that that report reached very 11 different conclusions from where members of the 12 public health community had been for many years. 13 So I think that along — around that 14 period of time — and it certainly accelerated 15 in 2001 when the public health community views 16 evolved — 1? review of how we communicate about issues 18 related to tar and nicotine. 19 to remove the phrase "lower tar and nicotine" 20 from the pack beginning in the first quarter of 21 2003 evolved from those conversations and was 22 part of that ongoing review of our 23 communications to decide, is there more we 24 should be doing given the changing position of we were conducting kind of an ongoing And the decision Thompson Court Reporters, Inc. 312-421-3377 3990537874 3990537674 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 77 1 the public health community on these issues. 2 Q. When you decided to remove — when 3 Philip Morris decide to do remove "lower tar and 4 nicotine" from the pack in the first quarter of 5 2003 consistent with the, well, gee, is there 6 more that we should be doing, did Philip Morris 7 consider removing "Lights" from the pack in 8 2003? 9 MR. WAGNER: 10 MR. SWEDLOW: 11 Object to the form. I'll fix the question. What's wrong with the form? 12 MR. WAGNER: The things about, gee, 13 what about this and so forth. That's not a 14 faithful recitation of the testimony. 15 BY MR. SWEDLOW: 16 Q. I'll restate the question. In the 17 context of Philip Morris's analysis of whether 18 there is more that Philip Morris should be 19 doing, did Philip Morris consider removing the 20 term "Lights" from the packages of Marlboro 21 Lights in 2003? 22 A. I think the company as it looked at 23 I would think that's one of the things that we 24 had certainly considered. — The decision that we Thompson Court Reporters, Inc. 312-421-3377 3990537875 3990537675 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 78 1 made is really twofold and based on two 2 different things. 3 to continue to use the term "Lights." We 4 believe that that was a useful point of 5 comparison for the consumer. 6 to do a number of other things, which really 7 involved communicating with both the public as 8 well as seeking additional guidance and input 9 from the Federal Trade Commission related to 10 disclaimers around what those terms mean and 11 what they don't mean. 12 I think the decision was made And we continued So we continued to provide information 13 to — we made the decision to keep — continue 14 to use those because we believed that they were 15 useful, and at the same time we provided 16 additional — 17 information to consumers about those terms and 18 what they meant and what they didn't mean. 19 BY MR. SWEDLOW: 20 Q. What do you mean "they were useful"? 21 A. We believe that for consumers having continued providing additional 22 the phrase "Lights" on the pack was one way to 23 help them differentiate between that product 2^ offering and other product offerings that were Thompson Court Reporters, Inc. 312-421-3377 3990537676 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 79 1 in the marketplace. 2 (Exhibit No. 6 marked for identification.) 3 BY MR. SWEDLOW: 4 Q. 5 Handing you what has been marked as Exhibit 6 6 — MR. WAGNER: About to run out of tape? 7 We went our 15 minutes. 8 VIDEOGRAPHER: 9 I was saying fifty, 5-0. 10 MR. WAGNER: 11 BY MR. SWEDLOW: 12 Q. Oh, sorry. This appears to be an email that has 13 been sent a couple places but was sent from you 14 on the bottom of page 1 to Max Ernst at 15 dechert.com. 16 A. 17 exactly right. 18 Q. 19 Do you see that? I don't think you've articulated that You said — Oh, it seems to be sent, I'm sorry, from you to Michael Sieja? 20 A. Sieja, among others. 21 Q. And Billy — 22 hear it. 23 A. Among others. 24 Q. Oh. what's that? I didn't Did you answer something? And Billy Abshaw; is that Thompson Court Reporters, Inc 312-421-3377 3990537677 3990537677 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 80 [ 1 correct? 2 sorry. 3 No, I'm reading the wrong thing. I'm looking at the email I'm l — This appears to be an email that you sent 4 from April 15th, 2003 to Nancy Lund, Tina Walls, j 5 Joe Murillo, Michael Pfeil and Michael Sieja; is \ 6 that correct? 7 A. Would you mind if I took a few minutes Q. Yeah, go ahead. 8 to -- 9 10 it wrong to this point, so — 11 A. 12 question was — 13 an email I forwarded to the address list on page 14 2, Nancy Lund, Tina Walls, Joe Murillo, Mike 15 Pfeil and Michael Sieja. 16 T & N points." 17 would have included with that. 18 attachment, and I assume that this is the 19 attachment that was contained as part of that 20 email. 21 Okay. I've been analyzing Q. I reviewed it. this is — I believe your part of this email is It's titled "Lowered That appears to be the text I It refers to an The text of the email states: 22 Attached are the points we used yesterday in 23 response to calls from the LA Times, Richmond 24 Times Dispatch and Dow Jones. Do you see that? Thompson Court Reporters, Inc. 312-421-3377 3990537678 3990537678 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 1 A. I do. 2 Q. Do you recall having calls with the LA 3 4 Times, Richmond Times Dispatch and Dow Jones? A. I do not recall specific calls with 5 them, but this would have been a standard way in 6 which we communicated about our activities and 7 dealing with the media. 8 9 10 11 Q. Do you send this as part of the standard way of communicating or do you use this as a guide to what to say? A. Based on the email that I sent here, 12 it likely would have been used as part of our 13 conversation and would have been there to assist 14 me as I was answering their questions on these 15 issues. 16 Q. Who wrote this? 17 A. I believe that I wrote that. 18 Q. So you would have written this to use 19 as a guide for what to say to the media. 20 A. Correct. 21 Q. And who is Bill Ohlemeyer? 22 A. Bill Ohlemeyer was one of our 23 attorneys who was representing the company and 24 overseeing some of our litigation issues at the Thompson Court Reporters, Inc. 312-421-3377 3990537679 3990537679 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 82 1 time. 2 Q. It says, this message is — the 3 messages also track what Bill Ohlemeyer told 4 journalists on his afternoon call. 5 that? Do you see 6 A. I do. 7 Q. Were you on that afternoon call with 8 those journalists? 9 A. I don't know. I don't recall. 10 Q. Do you know what it was Bill Ohlemeyer 11 specifically was referencing in that afternoon 12 call? 13 A. I don't remember the specifics of what 14 Bill's call would have been. Based on this 15 note, if Bill was asked a question on his call 16 related to this issue and he answered it, what I 17 would have been indicating here is that his 18 comments on this would have been consistent with 19 the messages and the information we were sharing 20 with journalists in our conversations and it 21 would have been related — 22 would have been related to those first three 23 media outlets. 24 Q. in my instance it The last heading on your memo says, Thompson Court Reporters, Inc. 312-421-3377 3990537680 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537680 83 1 "cost, we are not disclosing the cost of this 2 effort." 3 A. I do. 4 Q. Do you know the cost of that effort? 5 A. I don't. 6 Q. Under the "Why Not Drop Milds, Lights Do you see that? 7 or Ultra Lights, " you indicate — 8 Morris — 9 this issue as of April 15, 2003? 10 A. is this Philip Morris's position on I would have been communicating the company position to the 12 media at that time. Okay. So as of /April 15, 2003 Philip 14 Morris communicated that the tar and nicotine 15 numbers and descriptors also provide a useful 16 relative ranking of average tar and nicotine 17 yields. A. I do. 19 Q. How is that different than the lower 21 22 23 24 j I \ Do you see that? 18 20 j This would have been — Q. \ I guess Philip \ 11 13 \ \ tar and nicotine communication? A. I think it's different in that they are different phrases. Q. The words are different? You mean j "light" and "lower tar and nicotine" are Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 3990537681 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537681 84 1 2 different? A. That the relative ranking of average 3 tar and nicotine yields is a different phrase 4 than lower tar and nicotine. 5 Q. What's different about it? 6 A. They are different — 7 Q. Right. different words. One says relative ranking of 8 average tar and nicotine yields and the other 9 one says lower tar and nicotine. 10 different words. So those are Is that what you're saying? 11 A. That's what I'm saying, yes. 12 Q. Do they have different meaning? 13 A. I think one refers to relative 14 ranking — "lower" could be a relative 15 ranking — but they are different phrases. 16 would use them differently and I think they mean 17 different things. 18 Q. I So if I understand Philip Morris's 19 position at the time, "light" communicated the 20 relative ranking of average tar and nicotine 21 yields, but that's a different communication 22 than lower tar and nicotine; is that correct? 23 24 A. Our position, I think, to understand our complete position, you need to review the Thompson Court Reporters, Inc. 312-421-3377 3990537682 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537682 85 j 1 full paragraph there, which says, we believe the j 2 descriptors provide a useful tool to adult 3 smokers when selecting and purchasing a brand 4 style on the basis of strength of taste and 5 flavor, particularly when choosing amongst brand 1 6 styles within a single brand family. ? and nicotine numbers and descriptors also 8 provide a useful relative ranking of average tar I 9 and nicotine yields. 10 The tar I 1 So that, I think, is a more complete i 11 description of our position as it relates to f 12 that. l 13 that those descriptors were relevant. 14 communicated a similar point of view to the 15 Federal Trade Commission but at the same time 16 continued to look at a range of other 17 communications and take steps to communicate 18 both information about the limitations of those 19 tests as well as information, as I — 20 mentioned elsewhere in this document about what 21 those descriptors mean and don't mean. 22 23 24 We continue to believe that that was — Q. as is Above that it says, "relationship to the Miles case/litigation." A. We Do you see that? I do. Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 I I 86 1 Q. What is the Miles case/litigation? 2 A. The Miles case is, as I'm sure you 3 know — I believe you were involved in the 4 case — is a case that raised similar issues 5 related to Light cigarettes, and I believe it 5 was going on at the time. 7 exact timing of when that trial started or 8 ended, but that would have been a case that 9 raised similar issues that would have been going 10 I don't remember the on around that time. 11 Q. And underneath that heading — I don't 12 want to be incomplete, so I'm just going to say 13 part of the text says that we, I think meaning 14 Philip Morris, have been working on plans to 15 make these changes for many months. 16 some time to implement packaging and changes and 17 these plans were underway prior to the Miles 18 case going to trial. 19 A. I do. there, but — 21 but I do see that. Q. 23 not the 24 related Do you see that? You had one extra word in 20 22 It takes you had an "and" that was extra, This paragraph removal of lower to the Miles doesn't tar say whether and n i c o t i n e case/litigationr Thompson C o u r t R e p o r t e r s , 312-421-3377 does or was it? Inc. 3990537684 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537684 87 1 MR. WAGNER: 2 THE WITNESS: Object to form. What the paragraph says 3 is we've been working on plans to make these 4 changes for many months. 5 underway prior to the Miles case going to trial. 6 And I think the first sentence there is designed 7 to indicate that — 8 most recent of several actions we have taken in 9 response to evolving scientific evidence about The plans were what it says is this is the 10 low-yield cigarettes, including the National 11 Cancer Institute's Monogram 13. 12 So it explains — it's an attempt to 13 explain what's driving the action here and 14 refers to this as the latest of several actions 15 that the company has taken in response to 16 Monogram 13 and that articulates what the reason 17 is that we took this action. 18 BY MR. SWEDLOW: 19 Q. So did Philip Morris consider the 20 Miles case and litigation in its decision to 21 remove "lower tar and nicotine" from the pack? 22 A. I think what we're stating here is 23 that the primary — the primary context in which 24 we would have evaluated these decisions would Thompson Court Reporters, Inc. 312-421-3377 3990537685 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537685 88 have been the evolving regulatory environment 2 with really the major event being the National 3 Cancer Institute report. 4 we regularly monitor the external environment. 5 We would have been aware of litigation. 6 have been litigation out there on these issues 7 for a number of years. 8 9 That said, you know, There So I can't say that we were ignorant of it and it wasn't something that came up in our 10 conversations, but when it comes to the primary 11 driver for making our decision and the primary 12 factors that we were considering at the time, 13 the main driver would have been ongoing 14 conversations we were having within the company 15 related to particularly the National Cancer 16 Institute report and the evolving public health 17 community views of this issue. 18 Q. Was the Lights and lowered tar and 19 nicotine litigation, including the Miles 20 litigation, any factor in the company's decision 21 to remove "lower tar and nicotine" from the 22 packages? 23 MR. WAGNER: 24 THE WITNESS: Object to form. I think I've answered Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537686 89 1 that in my previous answer, which is it's 2 certainly a factor that we would have been aware 3 of. 4 conversations, but really the primary driver and 5 the primary context in which those conversations 6 were taking place was in the context of an 7 evolving regulatory environment and evolving 8 public health community point of view, and, as 9 you're listing the reasons, that was really the It likely would have come up in our 10 driver and the reason we were having those 11 conversations to begin with. 12 BY MR. SWEDLOW: 13 Q. Are you aware that the announcement of 14 the removal of lower tar and nicotine from the 15 pack of Marlboro Lights took place at the same 16 time the Miles verdict was rendered? 17 MR. WAGNER: 18 THE WITNESS: Object to form. As I mentioned, I don't 19 remember the specific timing of when that trial 20 began or ended. 21 dealing with the — 22 rendered — 23 April of 2003, but I don't remember the specific 24 date when that ruling came down. My recollection is that we were that the verdict had been I can remember dealing with it in Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537687 90 1 BY MR. SWEDLOW: 2 Q. 3 that correct? 4 A. It's dated April 15th, 2003. 5 Q. Was this the point at which Philip This memo is also dated April 2003; is 6 Morris announced publicly it was removing "lower 7 tar and nicotine" from the packages of Marlboro 8 Lights? 9 A. As it relates to a media announcement, 10 it seems like it would have been announced 11 this appears to indicate that the first media 12 inquiries we got about our actions would have 13 been on April 15th, 2003. 14 Q. — And when you were discussing the 15 primary factor being the Monogram 13 and public 16 health community's evolving scientific evidence 17 about low-yield cigarettes, if I understand what 18 you're saying, that was the primary factor for 19 removing "lower tar and nicotine" in Philip 20 Morrisfs decision-making process; is that 21 correct? 22 A. That's 23 Q. But t h a t f a c t o r 24 correct. did not lead Philip M o r r i s t o d e c i d e t o remove " L i g h t s " from Thompson Court R e p o r t e r s , 312-421-3377 the Inc. 3990537688 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537688 91 1 2 packages of Marlboro Lights; is that correct? A. That's correct. We made a decision to 3 continue to use those terms while providing 4 additional information about what those numbers 5 meant and didn't mean and continued to look for 6 ways to enhance our communications about them. 7 Q. And the Lights in part was useful to 8 provide a, quote, relative ranking of average 9 tar and nicotine yields to smokers when 10 comparing amongst brand styles within a single 11 brand family; is that correct? 12 13 14 A. Partially. It was also useful as a descriptor of strength of taste and flavor. Q. Subpart D of the notice of deposition 15 refers to Philip Morris's decision not to 16 include the warning on its Marlboro Lights 17 packages between 1971 and 2003 inclusive, quote, 18 that smokers compensate for the reduced tar and 19 nicotine yields of some brands by smoking them 20 differently than smokers of higher yield brands. 21 Do you see that? 22 A. I see that sentence, yes. 23 Q. Do you know why Philip Morris did not 24 include that warning prior to 2003? Thompson Court Reporters, Inc. 312-421-3377 3990537689 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537689 92 \ '• MR. WAGNER: Objection to the form and f 2 there is an objection on preemption grounds to -3 that question. 4 MR. SWEDLOW: 1 1 j Objection to asking the 5 question on preemption grounds? 6 understand the objection. 7 question, but I don't know how to fix an j 8 objection — j 9 10 11 MR. WAGNER: I don't § I'll fix the I Asking about failure to warn implicates preemption. MR. SWEDLOW: Do you mean suing on j 12 failure to warn implicates preemption or asking I 13 a question implicates — [ 14 MR. WAGNER: Basing a claim, trying to \ 15 elicit evidence on a purported failure to warn 16 is preempted. 17 questioning on that ground. 18 19 So I am objecting to the MR. SWEDLOW: I understand what you're { saying now. 20 MR. WAGNER: 21 MR. SWEDLOW: [ Okay. That's all. I think that's fair. 22 won't say I agree with it, but 23 MR. WAGNER: 24 MR. SWEDLOW: I — Okay. ; I've just never heard, Thompson C o u r t R e p o r t e r s , 312-421-3377 j Inc 3990537630 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537690 93 1 objection, preemption, in a deposition before. 2 BY MR. SWEDLOW: 3 Q. That colloquy will be eliminated from 4 the transcript, including this part that I'm 5 saying right now, so I'm going to ask you a new 6 question, but it's going to be a lot like the 7 old question. 8 9 Why didn't Philip Morris warn smokers of Marlboro Lights by placing on the packages a 10 warning that says, smokers compensate for the 11 reduced tar and nicotine yields of some brands 12 by smoking them differently than smokers of 13 higher yield brands? 14 15 MR. WAGNER: The same preemption objection. 16 THE WITNESS: 17 at — 18 some ways implies that there is an active 19 decision there, so I'm struggling a little bit 2C with the question, but I'll work to be as 21 responsive as I can given that we're talking 22 about a 20-something year period of time here. 23 BY MR. SWEDLOW: 24 I've got some — I think, as you look Q. Thirty it's a — the question in — Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537631 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537691 94 1 A. Thirty something — 32-year period of 2 time — 3 You're using language here that we made a 4 decision to use later on. 5 talk about what you did do and why you did that 6 and I'm much more comfortable doing that. 7 8 9 thanks for the help with the math. It's always easier to I think, as we look at what was going on during the 1970's Q. — Do you want to do that first? Do you 10 want to talk about what you did do first? 11 that's easier, we can do it that way. 12 A. It's not phrased in that way. If We've 13 been doing that, I think, across the various 14 communication vehicles. 15 information on the website and we've talked 16 about removing lower tar and nicotine. 17 think, in the context of those communications, 18 in a general sense, the common theme that runs 19 across those is going to be very similar, which 2C is looking for ways to enhance our 21 communications as the regulatory environment was 22 evolving beginning in the late 1990' s, 23 accelerating with the National Cancer Institute 24 report in 2003, and looking for ways to continue When we've talked about Thompson C o u r t R e p o r t e r s , 312-421-3377 So I Inc 3990537632 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537692 95 1 2 to evaluate our communications. So I think when you — across the range of 3 different things that we were doing, that's what 4 was going on at the company in a way that drove, 5 conceptually, the desire to find additional 6 communications vehicles and continue to look for 7 ways to improve what we were doing in light of 8 that evolving regulatory environment. 9 So I think that that's the best way to 10 kind of answer across several of these things, 11 which pick up information from and specific 12 language from our specific communications, and 13 then ask questions about, well, tell me about 14 1971 through 2003. 15 So, I think, when you look at some of that 16 language, some of it appears on our website in 17 October 1999, some of that language appears in 18 other communications prior to that, so it's 19 difficult — 20 quite accurate in the 32-year time frame it has, 21 but when I look at when we begin to take steps 22 to communicate this, it was in that type of 23 environment and with those goals in mind. 24 I don't think your question is MR. SWEDLOW: Could we take a short Thompson Court Reporters, Inc. 312-421-3377 3990537633 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537693 96 1 break? 2 MR. WAGNER: 3 VIDEOGRAPHER: Sure. This is the end of tape 4 1 in the videotaped deposition of Brendan 5 McCormick. 6 11:26. 7 (Proceedings recessed.) 8 9 We're now going off the record at VIDEOGRAPHER: This begins tape 2 in the videotaped deposition of Brendan McCormick. 10 We are now on the record at 12:21. 11 BY MR. SWEDLOW: 12 Q. Mr. McCormick, did you review any 13 documents during the lunch break to prepare for 14 your deposition on behalf of Philip Morris here 15 today? 16 A. No, I did not. 17 Q. Did you review any documents at all? 18 A. During the lunch break? 19 Q. Yes. 20 A. No. 21 Q. Why did Philip Morris place tear tapes 22 on the packs of Marlboro Lights in 2009 that 23 stated, "Lights does not mean safer, it refers 24 to taste, Lights won't help you quit smoking"? Thompson Court Reporters, Inc 312-421-3377 399053763^ Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537694 97 1 A. Our communications at that point in 2 2009 and the addition of tear tape to the mix of 3 communications we were engaged in was really 4 part of the evolution of — 5 of our communications on this issue. 6 communicated on pack via onserts from 2002 7 through 2008. 8 to incorporate a communication on the tear tape, 9 which is the first point of contact that the continued evolution We had We had identified an opportunity 10 consumer has when they are opening their 11 cigarette pack. 12 communicate a shorter message given the space 13 1imitat i ons. 14 It gave us the ability to So what we did is we tailored some of the 15 messages that we had been communicating in other 16 places and used that instead of onserts during 17 that period of time beginning in 2009. 18 Q. How many packs had the tear tape 19 placed upon it? 20 A. Beginning in June what we did is we 21 put them on all of the non-full-flavor brands 22 for the duration of time that they ran. 23 believe it was in the vicinity of about one year 24 through June 2010 with that specific message I Thompson Court Reporters, Inc. 312-421-3377 3990537635 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537695 98 I 1 that you mentioned, but it was on all of our 2 non-full-flavor packaging with the Lights 3 any — 4 descriptor on it. 5 "Lights," the phrase would be, as you indicated, 6 with the word "Lights" used. 7 "Mediums" was used, the word "medium" would be 8 included on that message. 9 10 11 — it was on any packaging that had a Q. So to the extent it had To the extent that j How many packs, if you know, were — \ included that tear-tape message? A. { I don't know the exact number of 12 packs, but it would have been on every pack of 13 the brands that I described during that period 14 of time. 15 Q. Do you know approximately how many 16 packs of those brands that you described were j 17 sold in any particular year, month or week? 18 19 MR. WAGNER: Objection to the form, f asked and answered. 20 THE WITNESS: 21 don't know the specific number. I 22 BY MR. SWEDLOW: \ 23 24 Q. No. As I indicated, I When y o u s a i d P h i l i p M o r r i s opportunity, had t h e w h a t d o you mean b y " o p p o r t u n i t y " ? Thompson C o u r t R e p o r t e r s , 312-421-3377 j j \ Inc. 3990537636 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537696 99 1 A. We had been looking for a number of 2 years, broadly, at ways to enhance our 3 communications, and onserts is one example of 4 ways where we identified a new technology that 5 we could incorporate into our manufacturing 6 process. 7 manufacturing process, there are new tools that 8 need to be used. 9 ensure that they work and deliver consistent Whenever you are changing your They need to be tested to 10 quality, that they don't disrupt your 11 manufacturing process, and, particularly, when 12 you are talking about putting something on 13 every — 14 want to make sure that that's a reliable 15 communications vehicle. 16 technology that we got comfortable with at that 17 period of time to use for this type of 18 communication. 19 every packing of a certain brand, you So that was a So the opportunity was really one that was 20 driven by a technological enhancement and its 21 integration — 22 into our manufacturing process. 23 24 Q. and the ability to integrate it Is it your testimony that Philip Morris was unable to technologically place Thompson Court Reporters, Inc. 312-421-3377 3990537637 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537697 100 1 anything on the tear tape before second quarter 2 2009? 3 A. I am not aware that we have used the 4 tear tape prior as a consistent communication 5 for a text-oriented message during that period 6 of time. ? we used this to communicate with that frequency 8 and that continuity, a consistent message for 9 the period of time that we used that on. 10 Q. I believe this is the first time that What I'm focusing on is the fact that 11 you called it an opportunity and then you talked 12 about technological advances, and I'm trying to 13 figure out if it's Philip Morris's testimony 14 that — 15 was it June 2009 that this began? A. I believe it ran — I'm not sure of 16 the exact start date. I was looking at my 17 affidavit to see if we mentioned the start date. 18 if you would give me just a second on that, I'll 19 confirm the start date. 20 Q. Okay. 21 A. It was the second quarter of 2009. So 22 June would be one of the months in the second 23 quarter. 24 that, but it would have been during that second I don't have a more specific date on Thompson Court Reporters, Inc. 312-421-3377 3990537638 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537698 101 1 2 quarter of 2009 when that began. Q. You don't have a more specific date on 3 the actual date the first one appeared in the 4 stores; is that what you're saying? 5 A. That's what I'm saying. I don't 6 remember the exact time. 7 the second quarter, and I just don't recall the 8 specific month that that began shipping. 9 Q. It was sometime during Where did you get the second quarter 10 of 2009 for your affidavit? 11 that time period? 12 A. Where did you get It would have been based on documents 13 that were contemporaneous at the time that I 14 the reason I can't give you an answer is just 15 because I don't have it in front of me but would 16 have relied on documents that would have had 17 probably had a more specific date and 18 description of how we rolled that out. 19 would have been the business documents that 20 communicated that decision at the time. 21 Q. — — That Is it Philip Morris's testimony that 22 the second quarter of 2009 is the first time 23 that it was technologically feasible to place 24 that message on a tear tape? Thompson Court Reporters, Inc. 312-421-3377 3990537639 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537699 102 1 A. My understanding of it is, is that was 2 the first time that we had used — it was a 3 combination certainly of technology as well as 4 the decision to use that specific vehicle as a 5 communications vehicle, and to do that you 6 needed to be comfortable with it from a 7 technological standpoint. 8 we used that type of tear tape to communicate a 9 message prior to that. I do not believe that So I believe that a key 10 component of that was the ability to do that 11 from a technological standpoint. 12 The second part of the decision was the 13 decision to pursue that vehicle as a choice as 14 we were looking at a range of different ways to 15 communicate messages on low-tar cigarettes. 16 i believe technology was — 17 it is it was a factor. 18 addition to the decision to move ahead with 19 pursuing that, but you needed to be 20 technologically comfortable with it that it 21 could be executed at a quality level. 22 Q. So my understanding of It was one factor in The fact that you never did it before 23 is what you cited as the reason for the 24 technological capacity being a factor; is that Thompson Court Reporters, Inc. 312-421-3377 3990537700 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 103 1 correct? 2 A. That would be one of the factors. It 3 was not a tool that was integrated into our 4 communications. 5 by other manufacturers. 6 certainty, but I believe that the integration of 7 this — 8 technology into our system. 9 with the onserts, we chose to apply a low-tar I am not aware of it being used I can't say with 100% it took work to integrate this And just as we did 10 message to that and use that as an opportunity. 11 So I am not aware that we have used it 12 previously. 13 technological enhancements and changes to our 14 existing manufacturing processes to add that as 15 a communications tool. 16 Q. If we weren't using it, it involved I certainly understand that it 17 required enhancements tc place a message where 18 you had not placed one before, but I'm confused 19 as to why Philip Morris believes it wasn't 20 technologically feasible before. 21 identify for me what — 22 supports that belief or is consistent with that 23 belief other than the fact that you haven't done 24 it before as a company? So can you what is it that either Thompson Court Reporters, Inc. 312-421-3377 3990537701 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537701 104 1 2 3 MR. WAGNER: Objection, asked and answered. THE WITNESS: I think really the key 4 factor here — there's two pieces to this. In 5 order to pursue a specific type of 6 communications vehicle, it needs to be on your 7 radar screen, and, you know, the tear tape is a 8 very functional part of the cigarette pack and 9 that's really what it was — was used for. 10 So if you're not using it as a 11 communications vehicle, it requires you to 12 identify it as a potential communications 13 vehicle, and I think that the identification of 14 that novel form of communication was really 15 something that was, as I understand it, new. 16 that's really where this starts. 17 you identify it as a potential communications 18 vehicle, you need to work on the technological 19 aspects of things. 20 So And then once So the order in which I just outlined it 21 is the order in which you would approach it. 22 First you have to identify the communications 23 vehicle and then you work on the technological 24 solutions to see if that's a viable way to Thompson Court Reporters, Inc. 312-421-3377 3990537702 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537702 105 1 communicate the message you're interested in 2 communicating or any message. 3 communicate a low-tar message. 4 BY MR. SWEDLOW: 5 Q. We chose to So if I understand your testimony 6 correctly, the technological limitations were 7 not a barrier at any point prior to the second 8 quarter of 2009 because saying "Lights are not 9 safer" on a tear tape was not something Philip 10 Morris had on its radar screen prior to that 11 time; is that correct? 12 MR. WAGNER: 13 THE WITNESS: Object to form. I'm not — I am not sure 14 if that's correct. 15 conversations that may have been taking place at 16 that period of time. 17 period of time where we brought together both 18 the idea of communicating en the tear tape as 19 well as the technological process that was 20 necessary to move that into your high-speed 21 manufacturing process. 22 BY MR. SWEDLOW: 23 24 Q. I don't know all of the I know that 2009 was the Had P h i l i p M o r r i s ever communicating a message about considered Lights Thompson C o u r t R e p o r t e r s , 312-421-3377 and lower Inc. 3990537703 3990537703 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 106 1 tar and nicotine cigarettes on the tear tape 2 prior to 2009? 3 4 MR. WAGNER: Objection, asked and answered. 5 THE WITNESS: I'm not aware of all of 6 our — of the specifics of the company 7 conversations related to tear tape, but I think 8 the context in which all of our conversations 9 we were looking broadly at a range of different 10 communications vehicles. 11 specifically when things may have first been 12 raised into consideration, but what I have 13 looked into really is when we first got 14 comfortable and made the decision to execute 15 these types of communications, and 2009 was the 16 first time we added this new vehicle to our 17 existing communications. 18 BY MR. SWEDLOW: 19 Q. — I don't know I recognize it's the first time you 20 added this new vehicle to your communications, 21 but I was asking more specifically and I don't 22 think it's been answered yet as to whether or 23 not Philip Morris considered the tear tape for 24 low-tar communications prior to using it this Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537704 107 1 time. 2 3 MR. WAGNER: Objection, asked and answered. 4 THE WITNESS: I think I've answered it 5 the last two times when I said I didn't know 6 whether or not it was considered by the company 7 prior to — 8 considered by the company. 9 I've stated in the last three answers is that I at what point it was first 10 don't know. 11 BY MR. SWEDLOW: 12 Q. So the answer that Do you know, therefore, whether or not 13 it was technologically feasible to place a 14 message on the tear tape prior to 2009? 15 A. The way I would answer that is the 16 same way I would answer it in relation to other 17 communications vehicles. 18 in which in a manufacturing environment you 19 would answer technological feasibility is that 20 you would need to test that in your 21 manufacturing environment, and that testing had 22 not gone on to my knowledge prior, or, if it had 23 gone on, it — 24 results. I think that the way we weren't satisfied with the But, again, I don't know the specifics Thompson Court Reporters, Inc. 312-421-3377 3990537705 3990537705 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 108 1 of when that would have begun. 2 technological feasibility is not an abstract 3 concept. 4 applied to cigarette manufacturing specifically 5 and Philip Morris cigarette manufacturing even 6 more specifically. 7 But It's a concept that needs to be Q. You testified that you don't know if 8 Philip Morris ever considered tear-tape 9 communications prior to the 2009 communications, 10 correct? 11 A. It would have been considered prior in 12 order to execute it beginning in 2009. 13 know specifically when it was first raised. 14 Q. I don't So how do you know that it was ever 15 technologically considered prior to that 16 consideration that led to the tear-tape 17 communication? 18 A. When I put together my affidavit, I 19 had conversations with those in our 20 manufacturing operations related to both onserts 21 and the addition of tear tape and asked them 22 about the process that we went through to place 23 those communications on pack or within the 24 cellophane when it came to the brochures that we Thompson Court Reporters, Inc. 312-421-3377 3990537706 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537706 109 1 were using, and in both instances what they 2 described to me was the challenges that they 3 faced in terms of integrating that into our 4 high-speed manufacturing process. 5 f So when I say technological feasibility, I ; 6 base that on conversations with our 7 manufacturing staff that had responsibility for 8 working through the practical matter of 9 integrating that into our manufacturing process. I 10 Q. How do you know that Philip Morris j 11 ever considered the technological feasibility of \ 12 tear-tape communications before the time it 13 considered it and then did it in 2009? 14 15 MR. WAGNER: Objection, asked and answered. 16 } f THE WITNESS: I think I answered that 17 and I said I don't know. j 18 BY MR. SWEDLOW: ) 19 Q. 20 21 22 23 24 Are you familiar with the Family Smoking Prevention and Tobacco Control Act? A. I I am familiar at a high level and with f some of the bill's major provisions. Q. Have you had any communications with the public on behalf of Philip Morris about the Thompson Court Reporters, Inc. 312-421-3377 3990537707 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 f 110 1 FDA Family Smoking Prevention and Tobacco 2 Control Act? 3 MR. WAGNER: Objection. This is 4 beyond the scope of the notice, the areas on 5 which Mr. McCormick is being proffered to 6 testify, so — 7 that's my objection. THE WITNESS: 8 question the company? 9 BY MR. SWEDLOW: Is the "you" in that 10 Q. Philip Morris. 11 A. Philip Morris has communicated with 12 the public about various provisions of the Act 13 and the Act as a whole. 14 15 Q. Have you participated in any of those communications as Mr. McCormick? 16 A. Yes, I have. 17 Q. What portions of that communication 18 have you personally participated in? 19 MR. WAGNER: 20 THE WITNESS: Same objection. I would have 21 participated in communications with the media 22 related to our position on the bill as it was 23 working its way through the legislative process, 24 our position on the bill once it was passed, and Thompson Court Reporters, Inc 312-421-3377 3990537708 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537708 111 various provisions of the bill if the media had questions on it. I participated in communications to employees made by others through our Intranet and employee presentations, and I would have participated — I participated in overseeing the website communications about those issues. Those would have been the primary types of communications. It may not be a one hundred percent inclusive list, but it's the 10 primary types of communications I would have 11 been responsible for in my role as vice 12 president of communication or during the 13 consideration of the bill, my positions earlier 14 than that. 15 BY MR. SWEDLOW: 16 17 Q. FDA directly about the bill? 18 19 Did Philip Morris communicate with the MR. WAGNER: Objection, beyond the scope. 20 THE WITNESS: I am not familiar 21 well, what you're — 22 time frame in what you're asking. 23 BY MR. SWEDLOW: 24 Q. — help me understand your 2008 and 2009. Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537709 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537709 112 1 A. Prior to the bill. So your question 2 relates to did the company communicate with the 3 FDA prior to the bill passing and becoming law? 4 5 Q. Do you know when the bill was passed and became law? 6 A. It was June 22nd, 2009, I believe. 7 Q. Is that the second quarter of 2009? 8 A. That is in the second quarter of 2009, 9 10 11 that's correct. Q. Did Philip Morris communicate to the FDA its tear-tape communications to the public? 12 MR. WAGNER: Objection to the form. 13 THE WITNESS: I believe that the — I 14 am not aware of any communications that the 15 company made to the FDA related to tear-tape 16 communications at the time. 17 have had jurisdiction over tobacco products 18 until late in the second quarter. 19 think that, from a timing standpoint, it doesn't 20 seem like that is — 21 period of time, it doesn't seem like there would 22 have been anyone at the FDA with accountability 23 for this. 24 have been involved directly in regulatory The FDA would not So I don't if you're looking at that And this is not an area where I would Thompson Court Reporters, Inc. 312-421-3377 3990537710 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537710 113 1 communications. 2 was raised in the notice of deposition, it's not 3 something that I specifically looked into prior 4 to our conversation today. 5 Q. As this is not a matter that Do you know if Philip Morris 6 communicated the contents of the tear tape to 7 the FDA after June 2009 until the present? 8 9 MR. WAGNER: Objection, beyond the scope of the notice. 10 THE WITNESS: 11 to that question. 12 BY MR. SWEDLOW: 13 Q. I don't know the answer Do you know what the FDA's statement 14 in the bill was with respect to labeling and 15 advertising of descriptors "light," "mild," 16 "low" or similar descriptors? 17 A. I'm not sure if I understand your 18 question when you say "the FDA's statement in 19 the bill." 20 Q. Philip Morris has now removed all of 21 those descriptors from its packaging of 22 cigarettes; is that correct? 23 A. That's correct. 24 Q. Why did Philip Morris do that? Thompson Court Reporters, Inc. 312-421-3377 3990537711 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537711 114 1 2 3 4 5 A. Because it was required by the legislation. Q. Required by the FDA legislation we're talking about right now? A. The FDA legislation contained 6 provisions prohibiting the use of descriptors 7 like "Lights," "mild" and other descriptors in 8 packaging and advertising. 9 Q. Do you know why? 10 MR. WAGNER: 11 THE WITNESS: 12 I know why what? 13 BY MR. SWEDLOW: 14 Q. Object to form. Help me understand. Do Do you know why the bill prohibits the 15 use of descriptors like "Lights," "mild" and 16 other descriptors in packaging and advertising? 17 18 MR. WAGNER: Objection to form, calls for speculation, and it's beyond the notice. 19 THE WITNESS: In terms of what goes 20 into any particular legislation, that would be 21 pure speculation on my part. 22 BY MR. SWEDLOW: 23 Q. In terms of what goes 24 A. I n t e r m s o f why a p a r t i c u l a r Thompson C o u r t R e p o r t e r s , 312-421-3377 into — language Inc. 3990537712 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537712 115 1 is in a particular bill that was drafted by 2 members of Congress, I don't have any 3 independent insight into why that information is 4 in the — 5 the way it is. 6 Q. why that legislation is articulated Oh, I'm not asking you to give me 7 insight as to why members of Congress or 8 Congress did anything, so let me ask it in a 9 slightly different way. 10 Has Philip Morris communicated with the 11 public about the FDA ban on the use of the 12 descriptors "Lights"? 13 MR. WAGNER: 14 Objection, beyond the scope. 15 THE WITNESS: Philip Morris has 16 communicated as we were making changes to our 17 packaging. 18 about those packaging changes. 19 information related to the FDA bill and its 20 provisions on our website. 21 in press releases about our support for that 22 legislation. 23 our communications we've outlined the major 24 provisions of that bill and what those elements We have communicated to consumers We have We have communicated We've also indicated — in some of Thompson Court Reporters, Inc. 312-421-3377 3990537713 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537713 116 1 were as it was in that legislation. 2 BY MR. SWEDLOW: 3 Q. One of the elements in the bill is 4 that descriptors like the word "Lights" and "low 5 tar" cannot be used on packages, correct? 6 A. That's correct. 7 Q. Was it a factor in Philip Morris's 8 decision to communicate in the tear tape that 9 "Lights does not mean safer, it refers to 10 taste," the fact that the FDA was at the same 11 time banning the use of the descriptor "Lights"? 12 A. I disagree with your assertion that 13 FDA was taking action at the same time. The 14 reason for us including that language is part of 15 a continuum of communications that began as the 16 regulatory environment at the Federal Trade 17 Commission and the public health community's 18 views began to evolve beginning in the late 19 '90s. 20 tool that we chose to use. 21 as an on-pack communication. 22 context in which the genesis of that 23 communication was really originated, where it 24 originated. Tear tape was the latest communications It replaced onserts And that's the Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537714 117 1 Q. Is it your testimony that Philip 2 Morris did not consider as a factor in its 3 decision to include the tear tape the fact that 4 the FDA bill was passed in the second quarter of 5 2009? 6 A. We certainly would have been aware of 7 the passage of the FDA bill, but the FDA bill 8 did not require the removal of terms such as 9 "Lights" until one year after the passage of the 10 bill. Our effort to use tear tape would have 11 begun prior to the passage of the bill. 12 we certainly would have considered what the FDA 13 legislation would have done, but there was a 14 one-year period from passage of the legislation 15 to removal of those terms during which these 16 terms would have continued to have been on pack. 17 And, again, as I've mentioned a few times today, 18 i think, that what we had decided to do is 19 continuing to use those terms to provide more 20 information to consumers about what that 21 those terms mean and don't mean, and that would 22 have been really the driver behind our decision 23 to continue to communicate that information 24 while those terms were on the pack. The — — Thompson Court Reporters, Inc 312-421-3377 3990537715 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537715 118 1 Q. Philip Morris was intending to 2 communicate what the term "Lights" meant and 3 didn't mean from the period of time when the FDA 4 bill passed until "Lights" were required to be 5 removed from the package one year later; is that 6 correct? 7 MR. WAGNER: 8 THE WITNESS: 9 Objection to the form. We communicated that information in a range of different ways, the 10 most visible starting with our website back in 11 October 1999. 12 information today. 13 the way the packaging has evolved. 14 continue to use some of the same tools, 15 including tear tape and the website. 16 17 18 We continue to communicate MR. SWEDLOW: And we Can you read back my question? (Record read.) 19 BY MR. SWEDLOW: 20 Q. 21 That has evolved to reflect I didn't ask you about 1999 or any of those other forms of communication, so — 22 A. You didn't ask me about any form of 23 communication. 24 which is why I felt it was important to put it You asked a general question, Thompson Court Reporters, Inc. 312-421-3377 3990537716 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537716 119 1 in the context of our overall communications 2 which were taking place. 3 Q. Oh, I'm sorry. In your answer, three 4 answers ago, you said that the tear tape was 5 intended to communicate what those terms meant 6 and didn't mean. Do you recall that? 7 A. Yes. 8 Q. Those terms included the word 9 "Lights"; is that correct? 10 A. That's correct. 11 Q. The term "Lights," as it appeared on 12 Marlboro Lights, was defined by Philip Morris 13 for what it meant and didn't mean in part by the 14 tear tape that was first put on the package in 15 2009 second quarter; is that correct? 16 A. Tear tape was one of multiple forms of 17 communication that we had used over time to 18 communicate that information. 19 20 Q. To communicate that information being what "Lights" means and doesn't mean, correct? 21 A. That's right. And I can read you 22 the — I think you've read the language that, 23 the tear tape language, said, "Lights does not 24 mean safer, it refers to taste, Lights won't Thompson Court Reporters, Inc. 312-421-3377 3990537717 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537717 120 1 help you quit smoking." 2 And that definition of what "Lights" Q. 3 means and doesn't mean was first placed on the 4 packages in the second quarter of 2009, correct? { 5 If your question is specific to tear A. 6 tape, that's true. 7 communicated via pack onserts from 2002 through 8 2008. 9 Similar language was 1 Q. You just read the tear-tape language 10 into the record. 11 reading? 12 A. That is the language I was reading. 13 Q. And I'm asking about the tear-tape Isn't that what you were [ l 14 language that you just read. 15 on packs of Marlboro Lights in the second 16 quarter of 2009; is that correct? It first appeared 17 A. That's correct. 18 Q- And it remained on packages until [ \ [ [ 19 Philip Morris was no longer allowed to call 20 cigarettes "Lights" pursuant to the FDA bill; is } 21 that correct? 22 A. j When "Lights" were removed from the 23 packaging, that specific language no longer 24 appeared. There is some additional information Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537718 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537718 121 1 and different execution of similar language, 2 although not using the term "Lights" that has 3 been added following that beginning, I believe, 4 in August of 2010. 5 Q. Was one factor in the decision to 6 communicate to the public through the use of the 7 tear tape on Marlboro Lights the fact that the 8 FDA was going to require Philip Morris to remove 9 "Lights" one year after the passage of the bill 1C in June of 2009? 11 12 MR. WAGNER: Objection, asked and answered. 13 THE WITNESS: Yeah. I don't think I 14 would agree with that assertion. 15 BY MR. SWEDLOW: 16 Q. Why would Philip Morris feel it 17 important to tell people what "Lights" means if 18 "Lights" was going to be removed in a year from 19 the pack of Marlboro Lights forever? 20 21 MR. WAGNER: Objection, asked and answered. 22 THE WITNESS: to We b e l i e v e d 23 important — and c o n t i n u e d 24 about what t h o s e t e r m s meant -- to it communicate and d i d n ' t Thompson C o u r t R e p o r t e r s , 312-421-3377 was mean as Inc. 3990537719 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 122 1 long as we were continuing to use them on the 2 packaging. 3 some time across a range of different 4 communications vehicles. 5 use the term "Lights" on our cigarette 6 packaging. 7 so, we thought an appropriate thing to do was to 8 continue to communicate what that term meant and 9 didn't mean and provide additional information 10 to consumers through the vehicles, the various 11 vehicles, we were using at the time. 12 BY MR. SWEDLOW: 13 Q. So really we had been doing so for We were continuing to And because we were continuing to do In 2003, when Philip Morris chose to 14 remove "lower tar and nicotine" from the pack, 15 Philip Morris communicated that Lights was, in 16 part, a useful relative ranking of average tar 17 and nicotine yields; is that correct? 18 A. That's correct. 19 Q. And then Philip Morris in 2009 20 communicated that "Lights" refers to taste; is 21 that correct? 22 A. That's correct. 23 Q. Did the meaning of "Lights" change 24 between 2003 and 2009? Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537720 123 1 A. No, but your reading of the first 2 section, which you said "in part" omits the 3 taste portion of our answer. 4 Q. So in 2003 "Lights" meant a taste j 5 portion and a relative ranking of average tar 6 and nicotine yields, correct? 7 A. Yeah. I read the more complete 8 description of what our answer is. 9 refers to relative strength — it ! taste of 10 strength — 11 it also serves as a useful comparison in terms 12 of the relative rankings on the machine tests 13 that we were doing pursuant to the Federal Trade j 14 Commission's agreement. 15 Q. strength of taste — It's a — and flavor, and j In 2009 was it no longer a good 16 relative ranking of average tar and nicotine 17 yields? 18 A. f j I don't remember the date, but at a 19 certain point of time the Federal Trade 20 Commission rescinded its guidance related to the j 21 use of that test, so that may have been a 22 factor — 23 that took place, we evolved our communications 24 to reflect their latest thinking on that issue. that impacted our communications. As Thompson Court Reporters, Inc. 312-421-3377 3990537721 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537721 124 1 I just don't remember the exact date when that 2 took p l a c e . 3 Q. So Philip Morris decided to 4 communicate that "Lights does not mean safer, 5 Lights refers to taste," and it won't help you 6 quit smoking for the last year that Philip 7 Morris was allowed to call them "Lights," but 8 unrelated to the fact that the FDA was 9 regulating the use of that descriptor; is that 10 correct? 11 12 MR. WAGNER: Objection, asked and answered. 13 THE WITNESS: I'm not sure what your 14 question is there. I think I've — I've 15 answered exactly what our approach is, so I'm 16 not sure what else you're asking me there that 17 wasn't answered and I'm not quite sure what the 18 question — 19 BY MR. SWEDLOW: 20 Q. what question you're asking. Is it Philip Morris's testimony that 21 the tear tape started in the second quarter of 22 2009 regarding the meaning of "Lights" was 23 unrelated to the FDA's regulation of the use of 24 the descriptor "Lights"? Thompson Court Reporters, Inc. 312-421-3377 3990537722 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537722 125 1 2 MR. WAGNER: Objection, asked and answered. 3 THE WITNESS: I believe I answered 4 that and I indicated that our decision to put 5 the tear tape on was the latest action among 6 many that we had taken to enhance our 7 communications in response to an evolving 8 regulatory environment and public health view. 9 The decision was made — and this was an 10 additional tool that we added to the mix of 11 tools that we were using. 12 question you are asking is did you put this on 13 because FDA had been given the authority — 14 had not been given authority when we decided to 15 move ahead, so the decision was not made as a 16 result of FDA regulation, if that is the 17 question that you keep asking, if that's the 18 part of the question that you don't think I'm 19 answering, this was not — 20 that's why you're not satisfied with the answer, 21 so It was not — if the FDA I'm not quite sure if — 22 I've 23 if the 24 b e c a u s e of tried question to is, answer it, but if d i d you p u t t h i s FDA r e g u l a t i o n , my a n s w e r Thompson C o u r t R e p o r t e r s , 312-421-3377 that's on there is, no. — Inc. 3990537723 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537723 126 1 I'm not sure — 2 question as best I could, so I'm not sure if 3 there is a piece there that you're not happy 4 with that I'm missing. 5 me if there is something there that you don't 6 think I've answered. 7 BY MR. SWEDLOW: 8 Q. 9 I've tried to answer the So I'm not sure — Yeah, I will. help I definitely hear your answer that it was not put on there because of 10 FDA regulation. 11 the regulatory environment that you've 12 identified, was the FDA regulation or impending 13 regulation of the use of the descriptor "Lights" 14 a factor in Philip Morris's decision to include 15 the tear tape on packs of Marlboro Lights and 16 similar brand line extensions? 17 MR. WAGNER: 18 I'm asking, in the context of Objection, asked and answered. 19 THE WITNESS: Again, it would have 20 been something that we were aware of. It's not 21 something that I would describe as a driver of 22 our decision to put that information on the 23 packs. 24 a long time ago. Again, it's part of a process that began The FDA legislation was under Thompson Court Reporters, Inc 312-421-3377 3990537724 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537724 127 1 consideration going back, you know, eight years 2 prior to its passage. 3 there had been extensive Congressional debate on 4 that over a multi-year period, and that debate 5 would have been going on for a long time. 6 certainly something we were aware of and 7 involved in and testifying on, but I wouldn't 8 agree with your — 9 BY MR. SWEDLOW: 10 Q. So that was, you know — It's the way you've described it. And I didn't describe it as a driver. 11 I said, was the FDA regulatory scheme related to 12 "Lights" a factor in Philip Morris's decision to 13 include the communication on the tear tape of 14 Marlboro Lights. 15 16 MR. WAGNER: Objection, asked and answered. 17 THE WITNESS: Help me understand what 13 you mean if I haven't answered your question. 19 What do you mean by a factor? 20 BY MR. SWEDLOW: 21 Q. Well, you said that it's not because 22 of, and it wasn't the driver, and I'm saying a 23 factor, meaning — 24 second. well, let's back up for a Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537725 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537725 128 1 Philip Morris doesn't make a decision 2 based on one factor or one thing as it relates 3 to this low-tar communication issue, does it? 4 MR. WAGNER: 5 THE WITNESS: Object to form. As I indicated, we 6 look — in making business decisions and 7 conducting our business, we look and are aware 8 of a broad range of things going on in the 9 external environment. I've tried to give you 10 some insight into the reason we've taken certain 11 actions and the approaches that we used in 12 considering those, and I feel that I've done 13 that in this instance as well. 14 BY MR. SWEDLOW: 15 Q. I believe that this question is a yes 16 or no question, but maybe it isn't, so I will 17 try one more time. 18 Was the decision — excuse me. Was the 19 FDA regulatory scheme regarding the use of the 20 descriptor "Lights" a factor in Philip Morris's 21 decision to communicate on Marlboro Lights 22 through the tear tape? 23 24 MR. WAGNER: Objection, asked and answered. Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537726 129 1 THE WITNESS: Help me understand what 2 you mean by "factor." If what you're asking 3 is — 4 times — 5 that we would have been aware of and considered, 6 I've acknowledged that. 7 been aware of it. 8 mean was it the driver behind the decision, I 9 feel like I've answered that question as well. and I think I've answered this multiple if you're asking if this is a factor 10 BY MR. SWEDLOW: 11 Q. Okay. Certainly we would have If you're asking factor to I think maybe we've identified 12 the piece that drops out each time we ask this 13 question and you just did it. 14 that it was something you were aware of and 15 considered, you said that you acknowledged you 16 were aware of it. 17 this way: If I'm asking So now why don't we ask it 18 Did the FDA regulatory scheme that relates 19 to the descriptor "Lights" weigh in the decision 20 of Philip Morris to communicate on Marlboro 21 Lights with the tear tape? 22 mean was it a factor, and by "factor," I mean 23 was it something that the Philip Morris company 24 considered. And by "weigh," I Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537727 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537727 130 1 2 3 MR. WAGNER: Objection, asked and answered. THE WITNESS: I think that's been 4 contained in several of my answers, but I can 5 repeat it for you. 6 Certainly,, as I've mentioned a couple of 7 times now, the decision to use tear tape as a 8 communications vehicle was the continuation of 9 efforts we were making to enhance our 10 communications on the low-tar issue that had 11 been underway for a number of years. 12 In doing so, you always look at the 13 external environment. We were aware of the FDA 14 legislation. 15 tear tape was made before the legislation was 16 approved and signed into law. 17 ahead with that process. 18 law passed, you would evaluate all of your 19 actions and say, well, gee, is there anything we 20 should be doing differently? Our decision to move ahead with We were moving Obviously, once the 21 And as I mentioned in a previous answer, 22 we made a decision to continue to include that 23 informaLion on the pack, on the tear tape, and 24 through multiple other communications vehicles Thompson Court Reporters, Inc. 312-421-3377 3990537728 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537728 131 1 because we believed that where we were using the 2 term "light" we should continue to communicate 3 about what that term means and doesn't mean. 4 BY MR. SWEDLOW: 5 Q. Philip Morris was aware prior to June 6 2009 that the FDA bill relating to — well, the 7 Tobacco Control Act was going to pass, wasn't 8 it? 9 MR. WAGNER: Object to form. 10 THE WITNESS: The bill, as I 11 mentioned, was under consideration for at least 12 eight years. 13 consideration going back to the '90s. 14 legislation was introduced — 15 advocating for it for at least eight or nine 16 years since beginning in 2 0 01. 17 specifically when legislation was first 18 introduced, but the history of that bill had 19 been a history where it moved through the 20 legislative process. 21 along there where we thought it was likely to 22 pass that it didn't and other times where we may 23 have thought that, you know, things were quiet 24 and it seemed to have some prospects for The concept had been under I think we had been I don't remember There were various times Thompson Court Reporters, Inc. 312-421-3377 3990537729 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537729 132 1 passage. So I don't remember the exact 2 sequencing of the passage of that bill in 2009 3 and where — 4 occurred, but certainly that would be something 5 that we were following closely. 6 that the way — 7 quite some time is the point I'm making, and I'm 8 not sure — 9 would have predicted it would have passed. when the various milestones But I think the bill had been out there for there were various points where we I 10 don't know specifically what our thinking would 11 have been at various points and it maybe would 12 depend on when you — 13 place in the House and the Senate and with the 14 President in 2009. 15 BY MR. SWEDLOW: 16 Q. on the actions that took Did Philip Morris advocate the portion 17 of the Tobacco Control Act that banned the use 18 of the descriptor "Lights"? 19 20 21 MR. WAGNER: Objection, beyond the scope. THE WITNESS: As I believe — I 22 believe our position, as it relates to that 23 bill, was similar to what we had advocated with 24 the Federal Trade Commission, and the essence of Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537730 133 1 that position was that we continued to believe 2 that those were useful descriptors for 3 consumers. 4 opportunity to provide consumers with useful 5 information about what those numbers meant and 6 didn't mean, some of the limitations of the 7 testing, information along the lines of what 8 we've disclosed on our website and in other 9 vehicles. We continued to believe there was an And the approach that we had 10 advocated with the Federal Trade Commission In 11 our petition to them was that the use of 12 descriptors be permitted but that additional 13 disclaimers be provided alongside those 14 descriptors to provide more information. 15 believe that we took a similar position on that 16 provision of the bill, but in the end what we 17 decided to do is, even though there may have 18 been provisions in the bill with which we did 19 not agree is that we supported the bill in its 20 entirety, and that was our — 21 decision on the whole bill as well as our 22 position on that issue as it evolved and I 23 believe was pretty consistent over the years. 24 BY MR. SWEDLOW: I that was our Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537731 134 1 2 Q. the bill in its entirety? 3 4 In what form did Philip Morris support MR. WAGNER: Objection, beyond the scope. 5 THE WITNESS: Philip Morris testified 6 throughout the years — 1 multi-year legislative process. 8 executive officer testified before Congress on 9 this bill a number of times. again, this was a Our chief He sent letters to 10 individual members of Congress. He sent letters 11 to the leadership in the House and the Senate. 12 He sent a letter to President Obama and did a 13 number of individual meetings with members of 14 Congress, as did our government affairs staff. 15 Those would be the primary ways in which we 16 were — 17 have supported the passage of the bill. 18 BY MR. SWEDLOW: 19 Q. the most visible ways in which we would I was referring specifically to the 20 portion of the Tobacco Control Act which bans 21 the use of the descriptors — 22 that include "Lights." 23 support that portion of the bill in the context 24 of supporting the bill in its entirety? the descriptors Did Philip Morris ever Thompson Court Reporters, Inc. 312-421-3377 3990537732 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537732 135 MR. WAGNER: Objection to the form and beyond the scope of the notice. THE WITNESS: Your question was focused on how did we support the bill in its entirety, and that's the — that was exactly how we supported the bill in its entirety. And as I said, we indicated, while there may be portions 8 of the bill with which we disagree, we support 9 the passage of the bill in its entirety. Our 10 language would have been very similar to exactly 11 what I articulated. 12 BY MR. SWEDLOW: 13 Q. Has Philip Morris ever supported 14 specifically the banning of the use of the 15 descriptor "Lights"? 16 17 18 MR. WAGNER: Objection, beyond the scope of the notice. THE WITNESS: I'm not aware of us 19 supporting that, and the description of what I 20 gave of what our position is is my understanding 21 of the way in which we prefer this issue be 22 dealt with in this country. 23 24 MR. SWEDLOW: Okay. I'm going to turn the questioning over to Mr. Wagner, and then Thompson Court Reporters, Inc. 312-421-3377 3990537733 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537733 136 I I'11 probably talk to you again in a couple hours. So thank you. MR. WAGNER: Why don't we take a five-minute break and I'll get set up. VIDEOGRAPHER: We're now going off the record at 13:09. {Proceedings recessed.) VIDEOGRAPHER: 8 9 We're now back on the record at 13:17. EXAMINATION 10 11 BY MR. WAGNER: 12 Q. Mr. McCormick, welcome back. I want 13 to begin by handing you an advertisement for 14 Marlboro Lights and have you just identify it 15 for the record, which I'm going to mark as 16 Exhibit — 17 7 and handed you a collection of demonstrative 18 slides. 19 what those are for us so we know what it is 20 we're all looking at. 21 22 actually, first, I marked as Exhibit Why don't you just identify in general (Exhibit No. 7 marked for identification.) THE WITNESS: These are some slides 23 that summarize and highlight some of the key 24 points from some of the documents that I Thompson Court Reporters, Inc 312-421-3377 3990537734 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537734 137 1 reviewed in preparing for this and I thought it 2 would be helpful in helping to communicate about 3 some of these key points and do that in a 4 PowerPoint form. 5 (Exhibit No. 8 marked for identification.) 6 BY MR. WAGNER: 7 Q. Okay. Here is what I've marked as 8 Exhibit 8, a Marlboro Lights advertisement. 9 talked about communications from the company 10 about Marlboro Lights. 11 that for the record? 12 13 MR. SWEDLOW: You Why don't you identify Objection as beyond the scope of the notice. 14 THE WITNESS: This ad is an example of 15 the original print advertising that was used to 16 introduce Marlboro Lights back in late 1971 or 17 early 1972. 18 BY MR. WAGNER: IS Q. 2C And is that when Philip Morris first marketed Marlboro Lights? 21 A. Yes, it is. 22 Q. What d i d t h e 23 that there 24 that you've is, advertising especially prepared, on t h e a call-out Thompson C o u r t R e p o r t e r s , 312-421-3377 say — I know demonstrative about numbers. Inc 3990537735 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537735 138 1 I don't want to ask about that just yet. 2 did the ad say about Lights in particular? 3 4 What MR. SWEDLOW: Object as beyond the THE WITNESS: The language throughout scope. 5 6 the ad makes it clear that this is a product 7 that's intended for those smokers who prefer low 8 tar and nicotine cigarettes. 9 language that we use is that it's for those The specific 10 smokers who prefer the lighter taste of a low 11 tar and nicotine cigarette. 12 BY MR. WAGNER: 13 Q. Now we're going to move to an 14 advertisement that ran during the class period 15 of 2001 and have you identify Exhibit 9 for the 16 record. 17 (Exhibit No. 9 marked for identification.) 18 THE WITNESS: This is an example of an 19 advertisement that ran in print for Marlboro 20 Lights during the year 2001. 21 BY MR. WAGNER: 22 Q. And is this the advertisement that 23 you've duplicated at the third page of Exhibit 24 7? Thompson Court Reporters, Ire. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537736 139 1 A. It is. 2 MR. SWEDLOW: I'm going to object as 3 beyond the scope of the -- I'm going to object 4 as beyond the scope of the noticed deposition. 5 Also object to this question and similar 6 questions as lacking form and foundation, both 7 for the document and the testimony itself. 8 BY MR. WAGNER: 9 Q. Now, there is no longer an express 1C reference to lighter taste like we saw in the 11 earlier ad, Exhibit 8. 12 Morris mean with respect to "Lights" when it 13 said "come to Marlboro country" in the 14 advertisement? 15 MR. SWEDLOW: So what did Philip I'm going to object as 16 leading and objection, lack of foundation, 17 object as beyond the scope of the noticed 18 deposition for the meaning of an ad in 2001 that 19 is not authenticated or there is no foundation 20 for it. 21 THE WITNESS: The ad uses a slogan 22 that was used throughout Marlboro brand family 23 advertising over the years. 24 for the Marlboro brands has always been focused The basic premise Thompson Court Reporters, Inc 312-421-3377 3990537737 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537737 140 1 on flavor. 2 to where the flavor is," "come to Marlboro 3 country." 4 of that saying "come to Marlboro country" and 5 features a pack of Marlboro Lights contained 6 within that slogan. 7 BY MR. WAGNER: 8 Q. 9 10 Many of our ads use the terms "come This ad uses an abbreviated version Did the advertisement we've designated as Exhibit 9 in fact run in print advertising in 2001? 11 MR. SWEDLOW: I'm going to object as 12 lack of foundation, leading, beyond the scope of 13 the noticed deposition topics. 14 THE WITNESS: 15 yes. 16 BY MR. WAGNER: 17 Q. This ad did run in 2001, Now, in Exhibits 8 and 9 we saw that 18 there was some language in the bottom left, some 19 additional writing. 20 writing that was at the bottom left of each of 21 those exhibits? 22 A. Can you read for us the Both the 1971 ad and the 2001 ad 23 feature the disclosure of tar and nicotine 24 according to the method prescribed by the Thompson Court Reporters, Inc. 312-421-3377 3990537738 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537738 141 1 2 agreement with the Federal Trade Commission. Q. And in Exhibit 8, which is highlighted 3 on the first slide of Exhibit 7, I think, what 4 does it say about the tar and nicotine yields 5 according to the FTC's method? 6 l MR. SWEDLOW: foundation, beyond the scope. 8 9 Objection, form, THE WITNESS: In the 1971 ad the legend reads, Marlboro Lights, 14 milligrams 10 tar, 1.1 milligram nicotine, average per 11 cigarette by FTC Method. 12 BY MR. WAGNER: 13 Q. And by 2001 there were some different 14 numbers, but what did the FTC legend say in that 15 ad in 2001? 16 MR. SWEDLOW: Same objections. 17 THE WITNESS: The legend follows a 18 similar form of the 2001 ad. 19 milligrams tar, 0.8 milligrams nicotine, average 20 per cigarette by FTC Method. 21 BY MR. WAGNER: 22 Q. 23 24 It says, 11 And just so we're clear, what does "FTC" stand for? A. It stands for Federal Trade Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537739 142 1 Commission. 2 3 Q. And what was the FTC Method that was referenced in these advertisements? 4 5 MR. SWEDLOW: Objection, form, foundation, beyond the scope. 6 THE WITNESS: That language refers to 7 the testing method that was prescribed by the 8 Federal Trade Commission and agreed to between 9 the companies and the agency from — in terms of 10 the language that should be disclosed to 11 consumers in the advertising. 12 MR. SWEDLOW: 13 conclusion. 14 BY MR. WAGNER: 15 Q. 16 17 j Move to strike, legal What is a standardized test? MR. SWEDLOW: Objection, form, foundation. 18 THE WITNESS: In the context of 19 cigarette advertising and the testing of tar and 20 nicotine, it is a single test that will be used 21 consistently over time under which certain 22 parameters are followed by anybody, any company 23 or individual or laboratory, that conducts that 24 test. Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537740 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537740 143 1 MR. SWEDLOW: I'm going to add a 2 further objection based upon the answer that it 3 calls for improper expert and opinion testimony 4 both outside the scope of the notice of 5 deposition and also outside the scope of this 6 witness's potential or even possible expertise. 7 BY MR. WAGNER: 8 Q. 9 Were Marlboro Lights tested under this FTC Method before making any advertising 10 statements about tar and nicotine yields or low 11 tar? 12 MR. SWEDLOW: I'm going to object, 13 form, foundation, calls for expert opinion, 14 beyond the scope of the noticed deposition. 15 THE WITNESS: Yes. Marlboro Lights 16 would have been tested according to the FTC 17 Method to derive those numbers to include in the 18 advertising. 19 BY MR. WAGNER: 20 Q. Were all of Philip Morris cigarettes 21 tested under this method once the method was 22 announced and adopted? 23 MR. SWEDLOW: Same objection. 24 THE WITNESS: Consistent with the Thompson Court Reporters, Inc. 312-421-3377 3990537741 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537741 144 j 1 agreement, we agreed to test all cigarettes and 2 disclose that information in our advertising. 3 BY MR. WAGNER: j 4 Q. j You pointed out in the advertisements 5 the language and we highlighted it in the 6 demonstratives that you brought. 7 Morris include this language in its advertising? I 8 MR. SWEDLOW: j Why did Philip j Objection, beyond the j I 9 scope of the deposition, beyond the scope of 10 this witness's personal knowledge, calls for I 11 improper opinion and expert testimony, lacks j 12 foundation. j 13 THE WITNESS: We included this 14 information because we had reached an agreement 15 with the — 16 agreement with the Federal Trade Commission to 17 include that information in their advertising 18 and to do it according to the — 19 language that was part of that agreement. 20 J the tobacco companies had reached an f using the j (Exhibit No. 10 marked for 21 identification.) 22 BY MR. WAGNER: j 23 Q. 24 the I've marked a s E x h i b i t one from December 10 — I need \ 17th. Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537742 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537742 145 1 In the course of your preparation did you 2 review the agreement that the cigarette 3 companies, including Philip Morris, reached with 4 the FTC in December of 1970? 5 A. Yes, I did. 6 Q. And have you prepared a demonstrative 7 slide that highlights some information from that 8 document? 9 MR. SWEDLOW: Objection, leading. 10 THE WITNESS: Yes, I did. 11 BY MR. WAGNER: 12 Q. If we turn to the next slide in 13 Exhibit number 7, is that a demonstrative of the 14 December 17th, 1970 agreement that you were 15 referencing? 16 A. Yes. 17 MR. SWEDLOW: Same objection. 18 THE WITNESS: This is a screen shot of 19 that document as well as some language that I 20 pulled out that related to how the disclosure 21 should be made in cigarette advertising. 22 BY MR. WAGNER: 23 Q. 24 that And w h a t is you h i g h l i g h t e d it that about the disclosures you w a n t e d Thompson C o u r t R e p o r t e r s , 312-421-3377 to Inc 3990537743 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537743 146 1 emphasize? 2 MR. SWEDLOW: Same, leading. 3 THE WITNESS: There were — there were 4 two different ways that the Federal Trade 5 Commission outlined. 6 a space for milligrams of tar, blank, milligrams 7 of tar, blank, milligrams nicotine, average per 8 cigarette. 9 The first refers to, with The only difference between the two 10 disclosures is the first method they outlined 11 here was to refer to the most recent Federal 12 Trade Commission report, which disclosed that 13 information, and to provide the date of that 14 report. 15 They also recognized that there may be 16 activities and new product introductions from 17 manufacturers or additional testing that went on 18 subsequent to that report, and they provided a 19 way for manufacturers to disclose by referring 20 to FTC Method without having to refer to a 21 report that may not have mentioned that 22 cigarette brand. 23 BY MR. WAGNER: 24 Q. And so in Philip Morris' advertising Thompson Court Reporters, Inc. 312-421-3377 3990537744 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537744 147 1 for its Marlboro Light cigarettes from that I 2 p o i n t forward — j 3 appear until after this agreement — 4 the advertising contain the legend as it's 5 described in the December 17th, 1970 letter that } 6 you've testifying about? 1 8 actually they didn't even MR. SWEDLOW: did all of j 1 I O b j e c t i o n , form, I foundation, beyond the scope of the n o t i c e . I; 9 THE W I T N E S S : A l l of our advertising 10 after — subsequent to that agreement in the 11 terms of the agreement would have included one f 12 of those l e g e n d s . f 13 BY MR. WAGNER: I 14 Q. \ And did you just for demonstrative 15 p u r p o s e s , then, include — 16 Exhibit 9 — 17 agreement? I think it was and lay it next to the FTC I 18 MR. SWEDLOW: Objection, leading. j 19 THE W I T N E S S : In the demonstrative ) 20 I've included the legend that we used just to I 21 show that the two — \ 22 used in 2001 is using the same form that was I 23 agreed to in 1970. \ 24 BY MR. WAGNER: 1 that the legend that was Thompson Court Reporters, Inc. 312-421-3377 3990537745 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 148 Q. So to your knowledge, Mr. McCormick, did this legend about so many milligrams of tar and so many milligrams of nicotine average per cigarette by FTC Method appear in all Marlboro Lights advertising since that brand was first launched in 1971 through the end of the class period in 2003? MR. SWEDLOW: Objection, form, foundation, beyond the scope of designated 10 THE WITNESS: Yes, it did. 11 MR. SWEDLOW: — 12 BY MR. WAGNER: 13 Q. notice. We've seen an ad from 19 71 and ad from 14 2 001. 15 examples of advertising in the 1980's and 16 1990's? Did you bring also some demonstratives of 17 MR. SWEDLOW: Same objection. 18 THE WITNESS: I did. 19 BY MR. WAGNER: 20 Q. The next slide in our demonstrative is 21 the same as what I'm marking as Exhibit 10. 22 I'll have you identify that for the record. 23 24 — A. This is an example of a print ad that featured both Marlboro Red and Marlboro Lights. Thompson Court Reporters, Inc. 312-421-3377 3990537746 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537746 149 1 It ran in 1984, and the slogan on that ad is 2 similar to the one that I had mentioned 3 previously. 4 come to Marlboro country." 5 Q. It's "come to where the flavor is, Okay. The next demonstrative slide 6 that you prepared is an ad that says from 1997, 7 so I'll mark it as Exhibit 11 and have you 8 identify that for the record. 9 10 11 MR. SWEDLOW: Same objections. (Exhibit No. 11 marked for identification.) 12 THE WITNESS: This is a copy of the 13 print ad that ran for Marlboro Lights in 1997 14 and it contains the slogan "come to where the 15 flavor is." 16 BY MR. WAGNER: 17 Q. Did Philip Morris monitor what 18 Congress and the FTC said about cigarette 19 advertising? 20 21 22 MR. SWEDLOW: Objection, form and foundation, beyond the scope. THE WITNESS: Yes, we did. The 23 company was involved in conversations with the 24 Federal Trade Commission over the years, Thompson Court Reporters, Inc. 312-421-3377 3990537747 3990537747 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 150 1 participated in their — when they have had open 2 regulatory processes, and certainly we paid 3 attention to communications they had that were 4 made in public hearings or in a public way to 5 other manufacturers. 6 investigations. 7 paid attention to. 8 BY MR. WAGNER: 9 Q. They conducted public Those were all things that we We've looked at a number of Marlboro 10 Lights advertisements, print advertisements. 11 Are. you aware of any print advertisement for 12 Marlboro Lights in which Philip Morris ever said 13 that those cigarettes are safer than any other 14 brand? 15 16 MR. SWEDLOW: Object as to form, foundation. 17 THE WITNESS: 18 BY MR. WAGNER: 19 Q. No, I'm not. Are you aware of any public statement 20 that Philip Morris has made at any time since 21 launching Marlboro Lights in 1971 in which the 22 company has said that those cigarettes are safer 23 than any other brand? 24 MR. SWEDLOW: Same objections. Thompson Court Reporters, Inc. 312-421-3377 3990537748 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537748 151 1 THE WITNESS: 2 BY MR. WAGNER: 3 Q. No. Are you aware of any advertisement or 4 public statement for Marlboro Lights in which 5 Philip Morris has ever said that those 6 cigarettes are less addictive than any other 1 brand? 8 MR. SWEDLOW: Same objection. 9 THE WITNESS: No. 10 BY MR. WAGNER: 11 Q. Are you aware of any advertisement or 12 public statement for Marlboro Lights in which 13 Philip Morris has ever said that those 14 cigarettes are easier to quit than any other 15 brand? 16 MR. SWEDLOW: Same objection. 17 THE WITNESS: No. 18 BY MR. WAGNER: 19 Q. Now, in order to organize the 20 questions that I want to ask at this point, I 21 want to try to refer to some blocks of time in 22 my next questions. 23 in the Craft case, begins in 1995. 24 first ask you some questions about the time The class period in Craft, So I want to Thompson Court Reporters, Inc 312-421-3377 3990537749 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537749 152 1 period up through the early 1990's, just to 2 so that you're grounded in where I'm asking. 3 Up to 1392 or '93 did Philip Morris have 4 any understanding of a message that — 5 do that, let me go back. 6 before I Did Philip Morris have a marketing 1 department inside Philip Morris? 8 MR. SWEDLOW: 9 — Objection, form, foundation. 10 THE WITNESS: 11 BY MR. WAGNER: 12 Q. Yes, we did and we do. And did the marketing department 13 involve itself with compliance with the 14 regulatory processes that you were describing in 15 your prior answer? 16 17 18 MR. SWEDLOW: Objection, same objection. THE WITNESS: Yes. We have and have 19 had for some time policies and procedures 20 designed to ensure compliance with the laws that 21 govern our marketing activities of particular 22 relevance going back to the early '70s and 23 continuing over time what have been the health 24 warning requirements as well as compliance with Thompson Court Reporters, Inc 312-421-3377 3990537750 3990537750 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 153 1 the Federal Trade Commission agreement. 2 BY MR. WAGNER: 3 Q. 4 5 Okay. MR. SWEDLOW: the scope. 6 I meant to say beyond I apologize for that. MR. WAGNER: I'm going to mark as 7 Exhibit 12 a copy of a binder called Advertising 8 Compliance and ask you to identify that for the 9 record. 10 11 (Exhibit No. 12 marked for identification.) 12 THE WITNESS: This document is a 13 document that was relied upon by those involved 14 in our marketing and advertising compliance 15 processes that outlines the various elements of 16 the law that needed to be reviewed prior to 17 placing any type of advertising, and those were 18 reviewed to ensure compliance with the various 19 provisions that governed our business. 20 MR. SWEDLOW: 21 to form and foundation. 22 BY MR. WAGNER: 23 Q. 24 Exhibit And i s number the I'm going to object as next demonstrative 7 some e x a m p l e s Thompson C o u r t R e p o r t e r s , 312-421-3377 of things in that Inc 3990537751 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537751 154 1 you wanted to highlight for us from Exhibit 12? 2 A. Yes. I pulled out, while there are 3 many requirements that we need to abide by, I 4 think the two that are most visible to — 5 advertising are the inclusion of the cigarette 6 warning labels that are required by Congress. 7 So I outlined — in the I included a page from 8 this document that showed how we communicate to 9 folks and guide them. On here are the 10 statements that Congress requires. 11 a rotation plan so that those warnings appear on 12 a — 13 plan with the government and they approve how we 14 plan to rotate those warnings. 15 roughly a quarterly basis. It requires So we share our So on the left side sort of towards the 16 middle of the document that's one of the items I 17 pulled here. 18 an overview of the procedures that we use 19 related to tar and nicotine requirements. 20 BY MR. WAGNER: 21 Q. And then to the right I included Okay. Thank you. So I want to come 22 back now to the question I was asking before I 23 interrupted myself, and I want to ask you some 24 questions about the period leading up through Thompson Court Reporters, Inc. 312-421-3377 3990537752 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537752 155 1 the early 1990's, up to about 1992 or 1993, and 2 ask whether or not Philip Morris had any 3 understanding of a message that the public 4 health community or the government wanted to 5 communicate to the public about low-tar 6 cigarettes? 7 8 MR. SWEDLOW: I'm going to object, form, foundation, beyond the scope. 9 THE WITNESS: The government was 10 communicating over — 11 public health community — 12 over a period of time their view that lower-tar 13 cigarettes were less harmful than brands with 14 higher tar and nicotine. 15 BY MR. WAGNER: 16 Q. 17 were communicating Did Philip Morris USA keep track of those communications? 18 19 and other entities in the MR. SWEDLOW: Objection, form, foundation, beyond the scope. 20 THE WITNESS: Yes. Many of those 21 communications were made in very public ways and 22 we monitored those pretty closely. 23 BY MR. WAGNER: 24 Q. Did you bring some examples today of Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 156 1 the communications that Philip Morris was seeing 2 with viewing and monitoring regarding low-tar 3 cigarettes into the 1980's and 1990's? 4 A. 5 I did. MR. SWEDLOW: 6 BY MR. WAGNER: 7 Q. Same objection. I'm going to show you Exhibit 13 and 8 have you identify that for the record and then 9 explain for us the next demonstrative, which I 10 11 12 believe relates to Exhibit 13. (Exhibit No. 13 marked for identification.) 13 THE WITNESS: This is a document that 14 was prepared by scientists at the Public Health 15 Service. 16 request of the Surgeon General and it's entitled 17 "Technical Report on Tar and Nicotine." 18 pulled and highlighted in my demonstrative some 19 of the conclusions of that group. 20 It's a group that was convened at the I've The pieces that I highlighted are that 21 they state that the preponderance of scientific 22 evidence strongly suggests that the lower the 23 tar and nicotine content of cigarette smoke the 24 less harmful would be the effect. Thompson Court Reporters, Inc. 312-421-3377 3990537754 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537754 157 1 The second piece there states that we 2 recommend to the Surgeon General that action be 3 encouraged which will result in the progressive 4 reduction of the tar and nicotine content of 5 cigarette smoke. 6 speak a little more to the manufacturers and the 7 product development process in terms of the 8 reduction of the content of the smoke. 9 BY MR. WAGNER: 10 Q. That second piece seems to So this memorandum, Exhibit number 13, 11 was something that was put out by United States 12 Public Health Service and not Philip Morris, 13 correct? 14 MR. SWEDLOW: I'm going to object as 15 leading, lacks foundation, and improper opinion 16 testimony. 17 THE WITNESS: This was put out by the 18 United States Public Health Service. 19 BY MR. WAGNER: 20 Q. Okay. Connected to the next slide is 21 Exhibit 14. 22 identify that for the record. 23 24 I'll hand you that and have you (Exhibit No. 14 marked for identification.) Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 158 1 MR. SWEDLOW: Same objections. 2 THE WITNESS: This is a communication 3 that was made by the American Cancer Society in 4 1967. 5 and nicotine you inhale, the better. 6 are disclosing the tar and nicotine levels as 7 determined by the Federal Trade Commission in 8 that communication. 9 BY MR. WAGNER: 10 Q. The primary conclusion is, the less tar And they And what are they recommending to 11 smokers how to interpret those Federal Trade 12 Commission numbers? 13 A. They are stating that, if you do smoke 14 cigarettes, you should know the relative amounts 15 of nicotine and tar in your cigarettes as 16 determined by the Federal Trade Commission, and 1? their boldfaced — 18 is the less tar and nicotine you inhale the 19 better. 20 move to the lower-tar versions of those brands. 21 bold type — conclusion here So they seem to be directing people to MR. SWEDLOW: I'll object, lacks 22 foundation, calls for improper opinion testimony 23 and beyond the scope for that answer. 24 BY MR. WAGNER: Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 3990537756 3990537756 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 159 1 Q. I'm going to hand you Exhibit 15, 2 which ties to the next slide in your 3 demonstratives. 4 (Exhibit No. 15 marked for 5 identification.) 6 BY MR. WAGNER: 7 Q. 8 I'm going to have you identify that for the record. 9 MR. SWEDLOW: Same objections. 10 THE WITNESS: This is a publication 11 that was put out by the United States Public 12 Health Service. 13 to Reduce the Risks of Smoking." 14 The title of it is "Five Ways The first recommendation that they make is 15 to choose a cigarette with less tar and 16 nicotine. 17 BY MR. WAGNER: 18 Q. And this document is from 1970. /And is there any reference in there to 19 whether or not smokers who have decided that 20 they can't or won't quit to switch? 21 MR. SWEDLOW: Same objections. 22 THE WITNESS: As I mentioned, the bold 23 conclusion on number 1, the first recommendation 24 is to choose a cigarette with less tar and Thompson Court Reporters, Inc. 312-421-3377 3990537757 3990537757 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 160 1 nicotine, that is one of five steps that they 2 recommend to — 3 BY MR. WAGNER: 4 Q. to reduce the risk of smoking. And did you highlight another sentence 5 on your demonstrative? 6 MR. SWEDLOW: 7 objections as before. 8 9 Objection, leading, same THE WITNESS: I highlighted a sentence that says, one way to cut down on your smoking 10 is to switch to a cigarette with less tar and 11 nicotine. 12 BY MR. WAGNER: 13 Q. As we move forward into the mid 14 1970' s, now Marlboro Lights is on the market, 15 and I'm going to show you Exhibit 16, which ties 16 to the next slide in your demonstratives, and 17 ask you to identify that for the record. 18 19 (Exhibit No. 16 marked for identification.) 20 MR. SWEDLOW: Same objections. 21 THE WITNESS: This is a copy of a 22 publication that was put out by the United 23 States Department of Health, Education and 24 Welfare. It includes listings of the tar and Thompson Court Reporters, Inc. 312-421-3377 3990537758 3990537758 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 161 1 nicotine yields as measured by the Federal Trade 2 Commission test. 3 states "The Cigarette World is Divided Into the 4 Bad and the Worse." 5 milligrams of tar in a cigarette or as little as 6 2." 7 It states, in conclusion, "if you must smoke, at 8 least bad is better than worse." 9 BY MR. WAGNER: 10 Q. The headline on this document "You can buy as much as 3 4 And then it goes on to reference the list. Do you know and did Philip Morris 11 track whether or not there were public service 12 announcements that accompanied the publication 13 of the poster advertisement that we marked as 14 Exhibit 16? 15 16 MR. SWEDLOW: Objection, leading, beyond the scope, lacks foundation. 17 THE WITNESS: This brochure was 18 publicized with television advertising, which 19 concluded by including an address where smokers 20 or anybody else could write to receive this 21 brochure from the Public Health Service. 22 BY MR. WAGNER: 23 Q. 24 And d i d y o u b r i n g t h a t advertisement w i t h you television today? Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537759 3990537759 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 162 1 A. 2 I did. MR. WAGNER: We're going to play that, 3 I'm not sure how technologically, but it's just 4 part of the presentation. 5 6 Should I go like this and have you zoom in on it? 7 MR. SWEDLOW: I'm going to object as 8 to lack of foundation, beyond the scope of the 9 designated deposition notice, and leading. 10 (Digital audio recording played.) 11 MR. SWEDLOW: 12 a copy of that to me? 13 MR. WAGNER: 14 MR. SWEDLOW: 15 MR. WAGNER: 16 MR. SWEDLOW: on 19 20 21 22 23 24 Yeah, I will. When? I can email it to you. How's that? 17 18 Are you going to produce Depends — MR. SNAPP: it. I don't know. You should already have It's actually on our exhibit list, I think. MR. SWEDLOW: The video is on the exhibit list? MR. WAGNER: Yes, but I can send you another copy, if you'd like. Thompson Court Reporters, Inc 312-421-3377 3990537760 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537760 163 1 2 MR. SWEDLOW: Or tell me where it is in the exhibit list. 3 MR. WAGNER: 4 BY MR. WAGNER: 5 Q. Okay. I've marked as Exhibit 17 a document 6 that corresponds with the next demonstrative you 7 brought with you today. 8 that and have you identify that for the record. 9 10 I'm going to hand you (Exhibit No. 17 marked for identification.) 11 THE WITNESS: This is the introduction 12 and summary to the 19 81 Surgeon General's Report 13 on the health consequences of smoking. 14 15 MR. SWEDLOW: I was just going to assert my same objections, if I may. 16 MR. WAGNER: 17 BY MR. WAGNER: 18 Q. 19 Sorry. That's fine. What is it you wanted to highlight for us from the 1981 Surgeon General report? 20 MR. SWEDLOW: Same objections. 21 THE WITNESS: The piece that I thought 22 was relevant to share here is in this report the 23 Surgeon General has consistent language with 24 what the public health community has been saying Thompson Court Reporters, Inc. 312-421-3377 3990537761 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537761 164 1 in advising smokers who were unwilling or as yet 2 unable to quit are well advised to switch to 3 cigarettes yielding less tar and nicotine 4 provided they do not increase their smoking or 5 change their smoking in other ways. 6 It goes on elsewhere to say, today's 7 filter-tipped, lower tar and nicotine cigarettes 8 produce lower rates of lung cancer than do their 9 higher tar and nicotine predecessors. 10 BY MR. WAGNER: 11 Q. And Philip Morris received the 1981 12 Surgeon General report at about the time that it 13 was published? 14 MR. SWEDLOW: Same objections. 15 THE WITNESS: Yes. 16 BY MR. WAGNER: 17 Q. I'm going to mark as the next document 18 which corresponds to the next slide in your 19 demonstratives Exhibit 18 and have you identify 20 that for the record. 21 22 23 24 (Exhibit No. 18 marked for identification.) THE WITNESS: the Public Health This Service of is a document the U.S. Thompson C o u r t R e p o r t e r s , 312-421-3377 from Department Inc. 3990537762 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537762 165 1 of Health and Human Services. 2 mid-decade review of objectives they had sent 3 for — 4 midterm assessment of health objectives they had 5 set for 1990. it's a 1985 document. 6 MR. SWEDLOW: 7 BY MR. WAGNER: 8 Q. 9 It's a kind of Same objections. Sorry. And what is it about Exhibit 18 that you wanted to highlight for us? 10 11 It is a MR. SWEDLOW: Same objections and THE WITNESS: In this document the leading. 12 13 Department of Health and Human Services says 14 that accepted medical practice suggests that, if 15 smokers are unwilling or unable to quit smoking, 16 they should be advised to switch to a lower-tar 17 cigarette. 18 BY MR. WAGNER: 19 Q. As we move forward to the end of the 20 1980's and we get into 1989, I'm going to show 21 you Exhibit 19, which corresponds to the next 22 demonstrative you've brought with you, and ask 23 you to identify that for the record. 24 (Exhibit No. 19 marked for Thompson Court Reporters, Inc. 312-421-3377 3990537763 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537763 166 1 identification.) 2 THE WITNESS: This is a publication 3 from the /American Cancer Society entitled 4 "Cancer Facts and Figures, 1989." 5 BY MR. WAGNER: 6 Q. 7 And what is it about that publication that you wanted to highlight for us? 8 MR. SWEDLOW: Same objections. 9 THE WITNESS: It was another example 10 of a public health agency stating that research 11 has shown that there is no such thing as a safe 12 cigarette, but that those who are not yet able 13 to quit would be well-advised to switch to 14 brands with the lowest possible tar and nicotine 15 content. 16 BY MR. WAGNER: 17 Q. Okay. Next, corresponding to the next 18 slide, I'm going to show you Exhibit 20 and have 19 you identify that for the record. 20 21 22 23 24 MR. SWEDLOW: Same objections. (Exhibit No. 20 marked for identification.) THE WITNESS: This is a 1991 publication that was done for the International Thompson Court Reporters, Inc. 312-421-3377 3990537764 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537764 167 I 1 Agency for Research on Cancer. 2 with the World Health Organization. 3 written by three scientists that were involved 4 in the discussions around tar and nicotine for a 5 number of years as well as the health — 6 research related to the development of cancer in 7 smokers. 8 It's associated It's health The piece that I wanted to highlight here 9 is their conclusion that there is a strong — 10 thus, a strong social case is made for further 11 developments in the low-yield cigarette. 12 BY MR. WAGNER: 13 Q. As we get into the 1990' s, did public 14 health community and government statements 15 continue their support for low-tar cigarettes? 16 17 MR. SWEDLOW: Objection, same objections, and leading obviously. 18 THE WITNESS: They did. There 19 continued to be other communications from the 20 public health community that were consistent 21 with these communications that we've reviewed so 22 far. 23 BY MR. WAGNER: 24 Q. Okay. I ' m h a n d i n g you E x h i b i t Thompson C o u r t R e p o r t e r s , 312-421-3377 21, Inc 3990537765 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537765 168 1 which corresponds to the next slide in your 2 demonstratives. 3 MR. SWEDLOW: 4 BY MR. WAGNER: 5 Q. 6 If you would identify that for the record. 7 8 9 Same objection. MR. SWEDLOW: Sorry. Same objections. (Exhibit No. 21 marked for identification.) 10 THE WITNESS: This is a 1992 document 11 from the American Cancer Society entitled, 12 "Cancer Facts For Men," "What You Can Do to 13 Protect Yourself Against Cancer." 14 Contained in this document is a reminder 15 that no cigarette is safe and also the language 16 that states, "Can't quit yet? 17 especially low tar and nicotine cigarettes." 18 BY MR. WAGNER: 19 Q. Smoke less, And when I reference the block of time 20 that I wanted to talk about in these questions, 21 I wanted to get to the mid 1990's. 22 last document, which corresponds to the next 23 slide, I'll hand you Exhibit 22, which is from 24 1996, and ask you to identify that for the So for the Thompson Court Reporters, Inc. 312-421-3377 3990537766 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537766 169 1 2 3 record. (Exhibit No. 22 marked for identification.) 4 MR. SWEDLOW: Same objections. 5 THE WITNESS: This is the 6 introduction, a summary of a National Cancer 7 Institute report, that was put out in 1996 that 8 looked at the FTC cigarette test method for 9 determining tar and nicotine and carbon monoxide 10 yields on U.S. cigarettes. 11 contains the statement that more recent evidence 12 confirms that today's filter-tipped, lower tar 13 and nicotine cigarettes produce lower rates of 14 lung cancer. 15 BY MR. WAGNER: 16 Q. Okay. This document We've looked at a number of 17 public health community and government 18 statements regarding low tar. 19 them for the record, highlighted various pieces 2C of each one in your demonstratives. 21 Morris USA an author of any of those documents? 22 A. No. 23 Q. And c a n y o u s u m m a r i z e 24 You've identified for P h i l i p M o r r i s u n d e r s t o o d t o be t h e Thompson C o u r t R e p o r t e r s , 312-421-3377 Was Philip us what low-tar Inc 3990537767 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537767 170 1 message that the government and public health 2 community were communicating from the 1960's, 3 '70s, '80s and all the way up through 1996 as 4 you've identified in these exhibits? 5 6 MR. SWEDLOW: Same objection and beyond the scope. 7 THE WITNESS: In the communications 3 that we've reviewed, the U.S. government and 9 public health agencies are sending the message 10 that, for smokers who cannot quit, it would be 11 better for them, from a health perspective, to switch to lower-tar cigarettes. 13 BY MR. WAGNER: 14 Q. Did Philip Morris USA ever advertise 15 or make any public statement that said any of 16 its cigarettes are safer than any other brand? 17 18 MR. SWEDLOW: Same objections, form, foundation, beyond the scope. 19 THE WITNESS: 20 BY MR. WAGNER: 21 Q. No. Did there come a time that Philip 22 Morris started to become aware of public health 23 community and Public Health Service suggestions 24 that the low-tar message that you've identified Thompson Court Reporters, Inc. 312-421-3377 3990537768 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537768 171 1 for us might need to be changed? 2 MR. SWEDLOW: 3 Objection, form, foundation, beyond the scope. 4 THE WITNESS: In the — in the late 5 1990's there were increasing discussions at the 6 Federal Trade Commission and with members of the 7 public health community about the reliability of 8 the information that was provided to consumers, 9 and people were calling into question whether 10 that information was useful to consumers. That 11 was something that the Federal Trade Commission 12 and others held hearings on and looked into. 13 And, again, those conversations continued 14 into — 15 probably through the next decade, with various 16 conclusions evolving, particularly the National 17 Cancer Institute report in 2001 was really the 18 first major report that came out that seemed to 19 contradict what some of those conclusions of the 20 public health community had in a very 21 comprehensive report. 22 BY MR. WAGNER: 23 Q. Prior 24 National Cancer continued for a long period of time, to the introduction Institute's of the 2001 monograph Thompson C o u r t R e p o r t e r s , 312-421-3377 that Inc. 3990537769 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537769 172 1 you just referred to in or about 1997, did 2 Philip Morris have or develop any official 3 policy with respect to communicating to the 4 public about smoking and health issues 5 MR. SWEDLOW: 6 BY MR. WAGNER: 7 Q. — — Same objection. including low tar? 8 MR. SWEDLOW: Same objections. 9 THE WITNESS: Yes, we did. In 1997 we 10 had received inquiries from members of the 11 public, but particularly in the context of 12 conversations that were taking place with 13 members of Congress around legislation, 14 Attorneys General and others, there were a lot 15 of discussions going on in an attempt to reach a 16 legislative resolution to some of the tobacco 17 issues that had been going on and enact 18 legislation to regulate tobacco more 19 comprehensively in Washington, and we were asked 20 by members of Congress to state our position on 21 certain health issues, including the health 22 effects of cigarette smoking, including 23 addiction, and we responded by sending a letter 24 to Senator Hatch, who was the chairman of the Thompson Court Reporters, Inc. 312-421-3377 3990537770 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537770 173 1 Judiciary Committee in the Senate. In that 2 letter we acknowledged that there may be 3 differences that exist between our views and 4 those of the public health community, but that, 5 in order to ensure that there would be a single 6 consistent public health message on these 7 issues, we agreed to refrain from debating the 8 issue in public forums. 9 to defend ourselves in regulatory environments We reserved the right 10 and in the courtrooms. But we indicated that we 11 would really defer to the judgment of public 12 health authorities as to what health warnings 13 would best serve the public interest and agreed 14 not to dispute those so there would be a single, 15 consistent public health message that was shared 16 with consumers on those issues. 17 BY MR. WAGNER: 18 Q. I'm going to hand you Exhibit 23 and 19 ask you if that is the statement of position 20 that was sent by the company in October of 19 9 7 21 to Senator Hatch? 22 23 24 MR. SWEDLOW: Same objection. (Exhibit No. 23 marked for identification.) Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537771 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537771 174 j 1 2 MR. SWEDLOW: Same objections, to be THE WITNESS: Yes, it is. clear. 3 4 BY MR. WAGNER: 5 Q. Now, you highlighted for us that 6 Philip Morris had made a policy to defer to the 7 judgment of public health authorities as to what 8 health warning messages would best serve the 9 public interest and to not debate those issues 10 11 in messages to consumers. Did that mean that Philip Morris was going 12 to stop conducting scientific research into 13 cigarettes and smoking and health issues? 14 MR. SWEDLOW: Same objections. 15 THE WITNESS: No. We continued to 16 conduct scientific research. We continued to 17 publish scientific research and share that 18 information primarily in scientific and 19 regulatory forums. 20 BY MR. WAGNER: 21 Q. Did this commitment regarding the 22 judgment of the public health authorities as to 23 what health warning messages would best serve 24 the public interest mean that Philip Morris Thompson Court Reporters, Inc. 312-421-3377 3990537772 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537772 175 ) 1 would stop interacting with the public health 2 community and with regulators? 3 4 j MR. SWEDLOW: Same objections and THE WITNESS: No, not at all. leading. 5 6 BY MR. WAGNER: 7 Q. How did — inside Philip Morris how 8 did this policy get implemented and become part 9 of the culture of Philip Morris? 10 11 12 MR. SWEDLOW: Same objections and THE WITNESS: When we issued this leading. 13 statement, this is something that was shared 14 with our employees, and around the same time, 15 about a month after this position was shared 16 with the Senate, we got a new chief executive 17 officer at Philip Morris USA, and the first 18 thing he did to help shape the actions of the 19 company under his management was develop what we 20 referred to as the Mission Statement, and that 21 was developed in late 1997, early 1998. 22 while it's evolved over time, since that time it 23 has continued to really form the foundation of 24 and provide guidance of how we guide our And Thompson Court Reporters, Inc. 312-421-3377 3990537773 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537773 176 1 employees in terms of the things that are most 2 important when they conduct business. f 3 BY MR. WAGNER: 4 Q. I'm going to show you Exhibit 2 4 and 5 have you identify that for the record. 6 (Exhibit No. 2 4 marked for 7 identification.) 8 9 f j THE WITNESS: This is an example of j the Philip Morris USA Mission Statement that was I 10 in place over time. 11 particular issue, I think it's worth noting that I 12 there are, in terms of the priorities that we j 13 lay out and the goals that we are focused on to j 14 achieve our mission, it contains a focus on 15 complying with legal and regulatory j 16 requirements, supporting reasonable regulation, j 17 and also communicating the health effects of our f 18 products. 19 As it relates to this MR. SWEDLOW: I'm sorry. Same j 20 objections to form and foundation and beyond the I 21 scope for this. 22 23 24 j Does it have a Bates number on it? MR. WAGNER: I may have made a copy of j one without it, but I know that we have j Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537774 177 Bates-stamped versions of the Mission Statement. MR. SWEDLOW: Okay. BY MR. WAGNER: Q. You were mentioning communicating the health effects of our products, and I see that that's something you wanted to highlight. What 7 is it, what was the Philip Morris mission 8 regarding communicating the health effects of 9 its products? 10 MR. SWEDLOW: Same objections. 11 THE WITNESS: As we look at all of 12 these goals, those are things that really guided 13 our employees, and I think that they are 14 important to understand as we — 15 mission goal of communicating the health effects 16 of our products. 17 communicating openly, honestly and effectively 18 about the health effects of our products, and 19 that would have been one of the priorities that 20 we laid out for our employees and certainly one 21 of the factors that we would have used in 22 approaching our planning around and strategies 23 around communicating about certain health issues 24 through our website and through some of our that we had a We described that as Thompson Court Reporters, Inc 312-421-3377 3990537775 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537775 178 1 other communications vehicles. 2 BY MR. WAGNER: 3 Q. 4 And does this mission remain in effect today? 5 MR. SWEDLOW: Same objections. 6 THE WITNESS: While the mission has 7 evolved, employees of Philip Morris USA are 8 still guided by a mission statement that 9 contains many of these same priorities. 10 BY MR. WAGNER: 11 Q. Including one to communicate openly, 12 honestly and effectively about the health 13 effects of our products? 14 15 MR. SWEDLOW: Same objections and THE WITNESS: Including one to leading. 16 17 communicate about the health effects of the 18 products, that's right. 19 BY MR. WAGNER: 20 Q. Mr. McCormick, you testified earlier 21 today about the Philip Morris corporate website, 22 which was launched in October of 1999. 23 takes place after the Hatch statement that we 24 talked about, after the adoption of the Mission So that Thompson Court Reporters, Inc 312-421-3377 3990537776 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537776 179 1 Statement that you just explained to us, and \ 2 it's during the class period in the Craft case. I 3 We put together an exhibit of pages from 4 the website from 1999. 5 identify those for the record. 5 as Exhibit 25. 7 8 MR. SWEDLOW: I just want you to I've marked them j Same objections and leading. 9 (Exhibit No. 25 marked for 10 identification.) 11 BY MR. WAGNER: 12 Q. 13 Do you recognize these as pages from the 1999 Philip Morris corporate website? 14 A. Yes, I do. 15 Q. Now, what were Philip Morris's goals 16 with respect to including information about 17 smoking and health issues on its website? 18 \ A. When we launched our website — 19 MR. SWEDLOW: Same objections. 20 THE WITNESS: — at Philip Morris USA, 21 we wanted to do a couple of things. One is, we 22 recognized that the public didn't necessarily 23 have — 24 some of the actions we were taking on certain may not have a complete understanding of Thompson Court Reporters, Inc. 312-421-3377 3990537777 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537777 180 1 issues or our positions, and the website 2 provided a place to put comprehensive 3 information about the company for members of the 4 general public. 5 provide information for smokers or those who 6 were considering smoking for information about 7 the health effects of the products. 8 could find cigarette ingredient information. 9 They could find information about tar and It gave us an opportunity to Smokers 10 nicotine numbers. And the website was used in a 11 way that enabled us to include information on 12 our own website but also link directly to 13 information that was available via the public 14 health communities' websites and their own 15 communications. 16 BY MR. WAGNER: 17 Q. And is the next demonstrative, the one 18 with the picture of the computer on it, your IS effort to sort of emphasize exactly what you 20 were just testifying to about the goals of the 21 Philip Morris website? 22 MR. SWEDLOW: Same objections. 23 THE WITNESS: Yes. 24 This is a snapshot of our home page, and we had a press release on Thompson Court Reporters, Inc. 312-421-3377 3990537778 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537778 181 1 there when we launched this to expand our 2 efforts to communicate more openly with the 3 public, and we launched that. 4 just a headline that I put on there to summarize 5 what we were trying to accomplish broadly with 6 the website. 7 BY MR. WAGNER: 8 Q. 9 Okay. So we — that was Well, let's look more closely at some of the statements that Philip Morris 10 made on its website at that time in 1999. 11 there a place on the website that consumers 12 could go to to get information about the FTC 13 test and machine-measured tar and nicotine 14 numbers? 15 MR. SWEDLOW: Same objections. 16 THE WITNESS: Yes. Was We had several 17 pages related to tar and nicotine numbers and 18 the FTC testing methodology. 19 BY MR. WAGNER: 20 Q. 21 Included within Exhibit 25, is that correct, those pages that you just referred to? 22 MR. SWEDLOW: Same objections. 23 THE WITNESS: They are included in 24 both Exhibit 25 as well as my demonstrative. Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537779 182 1 BY MR. WAGNER: 2 Q. Okay. And so in the demonstrative, 3 then, you just tried to highlight some of the 4 excerpts from those web pages. 5 take us through the next slide, which is titled 6 "Understanding Tar and Nicotine Numbers, " what 7 they mean and what they don't mean. 8 9 Why don't you MR. SWEDLOW: Same objections and THE WITNESS: When we launched this leading. 10 11 website — I'll give you some examples of some 12 of the information that was included — 13 smokers smoke cigarettes exactly the same way. 14 The tar and nicotine yield numbers that are 15 reported for cigarette brands are not meant and 16 were never intended to communicate the precise 17 amount of tar and nicotine inhaled by any 18 individual smoker from any particular cigarette. 19 We describe that they were based on a no two 20 standardized testing method and that they show 21 the relative differences in yields among brands, 22 assuming that each brand is held and smoked the 23 same way it is in the machine. 24 page also includes — And then that that section of the page Thompson Court Reporters, Inc 312-421-3377 3990537780 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537780 183 1 also includes additional links to other portions 2 of the website but also links to the Federal 3 Trade Commission itself. 4 BY MR. WAGNER: 5 Q. Did Philip Morris also address smokers 6 who might think that FTC Method numbers 7 represent exact amounts of tar and nicotine 8 delivery? 9 10 MR. SWEDLOW: Same objections and THE WITNESS: Yes, we did. leading. 11 12 BY MR. WAGNER: 13 Q. 14 Is that what you've highlighted on the next demonstrative slide? 15 THE REPORTER: 16 MR. SWEDLOW: 17 18 chance to object. Wait a minute. You have to give me a Same objections. THE WITNESS: Yes. I think that 19 information is both on the page — addressed on 20 the page before, and then on the next page of 21 the demonstrative I've highlighted language that 22 says, the FTC recently told smokers that, quote, 23 in looking at tar and nicotine numbers, you need 24 to know that the amount of tar and nicotine you Thompson Court Reporters, Inc 312-421-3377 3990537781 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537781 184 1 get will vary significantly depending on how you 2 smoke the cigarette. 3 section provide links to the view of Tobacco 4 Control Advocates, the National Cancer 5 Institute, and others on that for more 6 information on that issue. 7 BY MR. WAGNER: 8 Q. 9 And we also in that And did Philip Morris on its website pages in this section also directly address the 10 possibility that some smokers would compensate 11 for reduced tar and nicotine yields if they 12 smoke them differently than smokers of 13 higher-yield brands? 14 MR. SWEDLOW: Same objections. 15 THE WITNESS: Yes, we did. We address 16 and mention the issue of the potential for 17 smokers to compensate by smoking their brands 18 these brands — 19 brands. 20 include taking more or larger puffs, smoking 21 more of the cigarette or blocking ventilation 22 holes that contribute to the lower reported 23 yields of some brands. 24 speaking, the more intensely a smoker smokes a — differently than higher-yield We give examples of that that may We state that, generally Thompson Court Reporters, Inc. 312-421-3377 3990537782 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537782 185 1 cigarette, the more tar and nicotine he or she 2 will inhale from that cigarette. 3 provide a diagram of the typical location of 4 ventilation holes on our brands that use them. 5 BY MR. WAGNER: 6 Q. And we also Is the diagram what's referenced at 7 the bottom of the slide that you were just 8 reading from or referring to? 9 MR. SWEDLOW: Same objections. 10 THE WITNESS: It is. The language 11 says, "view a diagram," pointing out the typical 12 location, and there is a hyperlink there that 13 you would click on and the diagram that appears 14 and the language that's with it is on page 24 of 15 my demonstrative that's on the next page. 16 BY MR. WAGNER: 17 Q. And so if somebody were to click on 18 what you just mentioned about the diagram, then 19 the slide that you have up at slide 24 is 20 exactly what would have appeared on their 21 computer screen? 22 23 24 A. I t p u l l s up a graphic as well as a b r i e f e x p l a n a t i o n below i t , MR. SWEDLOW: that's correct. Same o b j e c t i o n s . Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 3990537783 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537783 186 1 1 BY MR. WAGNER: 2 Q. And it has obviously a pictorial 3 diagram and shows where the vent holes are and 4 how far away they are from the end of the 5 cigarette? 6 A. 7 That's right. MR. SWEDLOW: 8 BY MR. WAGNER: 9 Q. Same objections. Now, did Philip Morris also make 10 information about brand descriptors like 11 "Lights" available to consumers on its October 12 1999 website? 13 A. Yes, we did. We had a section on 14 entitled "Philip Morris's use of brand 15 descriptors." 16 17 Q. And is that what you've highlighted in the next demonstrative slide? 18 MR. SWEDLOW: Same objections. 19 THE WITNESS: It is. We mention our 20 use of certain terms to describe the brands. We 21 mention our belief that it facilitates 22 consumers' ability to distinguish among 23 different product offerings, that it's generally 24 used as a point of comparison with respect to Thompson Court Reporters, Inc 312-421-3377 3990537784 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537784 187 1 attributes such as strength of taste and flavor 2 and tar and nicotine yield as measured by a 3 machine method. 4 reminded people that brand descriptors don't 5 indicate with precision the actual amount of tar 6 and nicotine that they will inhale from any 7 particular cigarette or the relative amount as 8 compared to competing cigarette brands. 9 BY MR. WAGNER: 10 Q. And it's another place where we And as consumers scroll down, which is 11 the next demonstrative you've prepared, did 12 Philip Morris address the concept of whether or 13 not Lights and Ultra Lights means safer than 14 other brands? 15 MR. SWEDLOW: Same objections. 16 THE WITNESS: We do. We remind them 17 in part of the website here that we do not imply 18 in our marketing and smokers should not assume 19 that Lights or Ultra Lights brands are safe or 20 are safer than the full-flavored brands and we 21 provide additional links to public health 22 authorities and others. 23 BY MR. WAGNER: 24 Q. Okay. Philip Morris Thompson C o u r t R e p o r t e r s , 312-421-3377 launched its Inc. 3990537785 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537785 188 1 website in October of 1999. Did Philip Morris 2 take any steps to try to make consumers aware of 3 this new source of information? 4 MR. SWEDLOW: Same objections. 5 THE WITNESS: Yes, we did. We ran 6 one of the first things we did was to send a 7 direct mail piece to 29 million adult smokers 8 who were on our database to introduce them to 9 the fact that we had a website, give them a — 10 snapshot, an overview, of some of the 11 information they would find on our website, 12 encourage them to visit it, and for those that 13 may not have had home Internet access, to give 14 them suggestions on places they could go to to 15 look at that, as well as providing an 800 number 16 for those who didn't have computer access to 17 call and get what we referred to as a web kit, 18 which is really a printed version of the pages, 19 the primary pages, of the website. 20 (Exhibit No. 26 marked for 21 identification.) 22 BY MR. WAGNER: 23 Q. 24 I'm going to show you Exhibit 26 and have you identify that for the record. Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537786 189 1 2 3 4 A. This is a copy of the direct mail piece that we sent in 1999. Q. That's what you've highlighted on the next slide, then? 5 A. That's correct. 6 Q. Okay. And I'm going to show you a 7 couple of other exhibits and ask if these were 8 also — 9 whether or not they were additional efforts to have you identify them and tell us 10 make consumers aware of the Philip Morris USA 11 corporate website. 12 (Exhibit No. 27 marked for 13 identification.) 14 BY MR. WAGNER: 15 Q. 16 This is Exhibit 27. I'll have you identify that for the record. 17 MR. SWEDLOW: Same objections. 18 THE WITNESS: This is an excerpt from 19 the web kit that we provided that would have 20 been followed by pages that were featured from 21 our Internet website. 22 BY MR. WAGNER: 23 Q. 24 So if a consumer called the 877-PMUSA web number, they would have gotten the printed Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537787 190 I 1 copy of Exhibit 2 7? 2 MR. SWEDLOW: Same objections. j 3 THE WITNESS: That included these f 4 pages. This doesn't appear to be the complete 5 web kit in the version that I have. j 6 BY MR. WAGNER: 7 Q. Okay. j Marked as Exhibit 28 is another I 8 example of a marketing piece, and I'll have you j 9 identify that for the record. ;! 10 MR. SWEDLOW: 11 12 Same objections. ) (Exhibit No. 28 marked for identification.) 13 j THE WITNESS: I believe that this is 14 an example of one of the other ways that we 15 communicated about this is with a "take one 16 card" that we put at retailers where smokers 17 were purchasing their cigarettes. 18 another means by which we promoted and announced j 19 the availability of this information on our 20 website. 21 BY MR. WAGNER: 22 Q. Now, 23 specifically 24 these was t h e r e relating communications So it was information to low-tar pieces that Thompson C o u r t R e p o r t e r s , 312-421-3377 cigarettes were on calling Inc. 3990537788 3990537788 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 191 j 1 I attention to the Philip Morris website? 2 MR. SWEDLOW: Same objections. j 3 THE WITNESS: We provided a snapshot 4 of the website, which was really designed to 5 give people an understanding of what they would 6 see when they visited the website. 7 front page it's clear to people that they will j 8 see — j 9 in cigarettes, tar and nicotine numbers, health On that they can find information on ingredients f 10 issues for smokers quitting smoking, but that j 11 tar and nicotine number section is highlighted j 12 in each of these pieces. f 13 BY MR. WAGNER: 14 Q. 15 16 11 29. We've got one more, which is Exhibit I'll just have you identify that. j (Exhibit No. 29 marked for j identification.) f 18 MR. SWEDLOW: Same objections. \ 19 THE WITNESS: This is another example j 20 of one of the promotional pieces that we would 21 have been using at the time. 22 think, actually dates 2001, so it's a little bit I 23 later, but from time to time we used — 24 promotional cards at retail to draw attention to \ This piece, I used j Thompson Court Reporters, Inc. 312-421-3377 3990537789 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537789 192 1 and remind people that we had that — that we 2 had the website. 3 the many means that we used to promote the 4 availability of this information on our website. 5 BY MR. WAGNER: 6 Q. This is an example of one of Did Philip Morris do anything on the 7 packs of cigarettes in order to direct consumers 8 to the website? 9 A. We did. When we launched the website, 10 it was October of 1999, and beginning in late 11 1999, I believe it was December, we began to 12 include our website address on Philip Morris 13 USA's packs of cigarettes. 14 Q. And did you prepare a demonstrative 15 that shows what went onto the packs to call 16 attention to the website? 17 A. I did. I used a sample pack here just 18 to show an example of where that information 19 appeared on the side of the pack. 20 Q. Now, when we talked about the 21 advertisements — 22 MR. SWEDLOW: 23 MR. WAGNER: 24 MR. SWEDLOW: Can I — Go ahead. I guess I'll object to Thompson Court Reporters, Inc 312-421-3377 3990537730 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537790 193 1 this as — in addition to my other objections 2 as an inaccurate depiction, but — 3 the pack looked like in 1999, Jeff? — is that what 4 MR. WAGNER: 5 MR. SWEDLOW: 6 MR. WAGNER: 7 MR. SWEDLOW: It says 1999 in the THE WITNESS: It is not what the pack 8 I think so. Really? Oh, it's not 1999. corner. 9 10 looked like in 1999. 11 there went on beginning in 1999. 12 BY MR. WAGNER: 13 Q. 14 And is that what you're trying to represent in this demonstrative? 15 16 The information that's on A. That's what I was trying to represent here. 17 MR. WAGNER: I think we didn't have a 18 1999 pack when we made the demonstrative. 19 BY MR. WAGNER: 20 Q. I'm going to mark as the next exhibit 21 an advertisement that ran about the same time 22 and ask you to identify that for the record and 23 tell us how Philip Morris used its print 24 advertising to help make consumers aware of its Thompson Court Reporters, Inc, 312-421-3377 3990537791 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 194 website. (Exhibit No. 30 marked for identification.) MR. SWEDLOW: Same objections. THE WITNESS: Beginning in the year 6 2000, we added language to our print advertising 7 that provided our web address and the 800 number 8 as a resource where people can call for 9 information about the company and its products. 10 This ad that's here is an ad that ran in 2001 11 that included that information. 12 BY MR. WAGNER: 13 Q. So in the demonstrative that you 14 brought with you with this advertisement, there 15 was an expansion of what we saw before with the 16 FTC Method numbers and Philip Morris added 17 additional language; is that right? 18 MR. SWEDLOW: Same objections. 19 THE WITNESS: That's correct. The FTC 20 disclosure continued to run in those ads. 21 added additional information that, again, stated 22 the language that I just ran through. 23 BY MR. WAGNER: 24 Q. We Now, at about this time in 2000 when Thompson Court Reporters, Inc. 312-421-3377 3990537732 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537792 195 I 1 Philip Morris has gone live with its website, 2 it's engaged in all of these different vehicles 3 to drive people to the website or alert them to 4 the existence of the website, was there a 5 communication from the Federal Trade Commission 6 regarding FTC Method numbers that went out to 7 the public? 8 MR. SWEDLOW: Same objections. 9 THE WITNESS: In May of 2002 the 10 Federal Trade Commission published what they 11 referred to as an FTC Consumer Alert. 12 entitled, "Up in Smoke, the Truth About Tar and 13 Nicotine Ratings." 14 BY MR. WAGNER: 15 Q. We'll mark as Exhibit 31 — It was I think 16 you said 2002, but when was the FTC consumer 17 alert actually published? 18 MR. SWEDLOW: Same objections. 19 THE WITNESS: May of 2000. 20 Sorry. (Exhibit No. 31 marked for 21 identification.) 22 BY MR. WAGNER: 23 Q. 24 of Very good. t h e FTC c o n s u m e r And i s Exhibit 31 a copy alert? Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537733 3990537793 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 196 1 A. It is. 2 Q. And what is it about — I know you've 3 brought a couple of demonstratives to highlight 4 some points from the FTC consumer alert. 5 don't you tell us what it is you wanted to 6 highlight about the consumer alert that was 7 published by the FTC in May of 2 0 00. 8 9 A. Why The alert has several key bullet points about what the FTC wanted the public to 10 know on this issue. 11 these numbers are determined using a smoking 12 machine that smokes every brand of cigarettes 13 the same way. 14 numbers do not represent the amount of tar and 15 nicotine a particular smoker may get and remind 16 them that that's because people don't smoke 17 cigarettes the same way a machine does and that 18 no two people smoke the same way. 19 Q. They remind the public that the Was this information new to the FTC to 20 your knowledge — 21 knowledge — 22 23 24 They remind the public that Philip Morris USA's as of 2000? MR. SWEDLOW: Same objections, beyond THE WITNESS: The i n f o r m a t i o n the scope. Thompson C o u r t R e p o r t e r s , 312-421-3377 that's Inc 3990537734 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537794 197 1 contained in this alert is very similar to 2 language that the Federal Trade Commission 3 published in the press release that they issued 4 in 196 7 in communicating to the public about 5 their testing methodology. 6 language is very similar to the language they 7 used in that press release back in 1967. 8 BY MR. WAGNER: 9 Q. Okay. So much of this The next demonstrative that you 10 brought highlighted another point from the 11 consumer alert. 12 highlight? 13 A. What was it that you wanted to They provide — 14 MR. SWEDLOW: Same objections. 15 THE WITNESS: — provide some 16 information in this alert regarding that the 17 filters have very small vent holes that allow 18 air to dilute the smoke in each puff. 19 for smokers to cover the holes unknowingly, that 20 results in them getting more tar and nicotine. 21 They state that it's impossible to tell from the 22 ratings the amount of tar and nicotine a smoker 23 will get from any cigarette. 24 reference to compensation and indicate that It's easy They also include Thompson Court Reporters, Inc. 312-421-3377 3990537735 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537795 198 I 1 smokers may take deeper and more frequent puffs 2 than they would from a regular cigarette. 3 BY MR. WAGNER: 4 Q. So after those details did the FTC j j 5 have a sort of bottom line that you wanted to { 6 highlight for us? { 7 MR. SWEDLOW: I'll object, same j 8 objections, lack of foundation, improper expert j 9 testimony. f 10 THE WITNESS: At the conclusion — f 11 MR. SWEDLOW: But if this witness \ 12 knows what FTC's bottom line is somehow, then I 13 he's obviously free to offer that. I 14 BY MR. WAGNER: ) 15 Q. 1 What does FTC express in its consumer 16 alert about the amount of tar and nicotine \ 17 smokers would actually get? f 18 MR. SWEDLOW: Same objections. 19 THE WITNESS: At the conclusion of l 20 this alert, the FTC states that the amount of j 21 tar and nicotine you get from your cigarette j 22 depends on how you smoke your cigarette. \ 23 remind people that there is no safe smoke and 24 they direct them to the Federal Trade Commission j They f Thompson Court Reporters, Inc. 312-421-3377 3990537796 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 199 1 for additional information. 2 BY MR. WAGNER: 3 Q. I Did Philip Morris become aware that I 4 the FTC released this information in or about I 5 May of 2000? j 6 A. We did. 7 MR. SWEDLOW: Same objections. j 8 THE WITNESS: And we responded by f 9 making that information available via our j 10 website. i 11 BY MR. WAGNER: [ 12 Q. j Did Philip Morris make any changes to 13 its print advertising in the wake of the FTC 14 consumer alert? j 15 MR. SWEDLOW: Same objections. 16 THE WITNESS: In the wake of the FTC 17 consumer alert and as part of our ongoing 18 efforts to review some of our communications on 19 these issues, we added some language that 20 mirrors the language in the Federal Trade 21 Commission alert to our print advertising, to 22 all of our low-tar advertising. 23 our advertising states the amount of tar and 24 nicotine you inhale will vary depending on how j j The language in I Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 j 200 1 you smoke the cigarette. 2 BY MR. WAGNER: 3 Q. And the next demonstrative is a repeat 4 of Exhibit 9, but is that the language that you 5 highlighted in the red box in that 6 demonstrative? 7 MR. SWEDLOW: Same objections. 8 THE WITNESS: It is. 9 that language so it would be easier to see on 10 this slide. 11 BY MR. WAGNER: 12 Q. 13 14 I pulled out And how did Philip Morris decide on this particular language? A. What we tried to do is really capture 15 the essence of the FTC's communications and pull 16 out what we saw as one of their key messages. 17 So we relied on their consumer alert and used 18 that really as a key input into us determining 19 what we thought we should put in our own 20 advertising. 21 Q. We've moved forward now to 2001, and 22 you mentioned earlier in your testimony that in 23 2001 the National Cancer Institute published a 24 new monograph, Monogram 13. Wee have also Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537798 201 1 discussed prior to that time the public health 2 community and government messages to smokers who 3 cannot or would not quit smoking. 4 From Philip Morris' perspective, what was 5 the significance about Monogram 13 in terms of 6 Philip Morris' decisions about public 7 communications relating to low-tar cigarettes 8 from that point forward? 9 A. The Federal Trade Commission had asked 10 some of the U.S. government public health 11 agencies to provide them with a view on some of 12 the issues as they were considering their 13 testing methodology. 14 Cancer Institute came back with their report, 15 one of their primary conclusions that conflicted 16 with where the government agencies had been over 17 the years was that they were questioning whether 18 or not low-tar cigarettes offered any health 19 benefit compared to higher-yield cigarettes. 20 They also were questioning some of the And when the National — 21 whether or not the information that was being 22 provided to consumers was in fact useful. 23 had been something that was questioned in other 24 forums as well. That So I think, as we looked at Thompson Court Reporters, Inc. 312-421-3377 3990537739 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537799 202 1 primarily that first conclusion, because it 2 represented such a significant difference from 3 what the public health community had been 4 communicating and advertising and brochures and 5 other publications to smokers, it caused us to 6 look closely at — 7 this issue, but we realized that the playing 8 field had changed a little bit, and it caused us 9 to look for additional things we could do to continue to look closely at 10 enhance our own communications. 11 engage with the Federal Trade Commission and 12 suggest things that they might do in response to 13 this report,. 14 It caused us to So I think we really viewed that as being 15 a significant departure from where the public 16 health people had been in the past on this 17 issue. 13 VIDEOGRAPHER: This is the end of tape 19 2 in the videotaped deposition of Brendan 20 McCormick. 21 22 We are now off the record at 14:22. (Proceedings recessed.) VIDEOGRAPHER: This begins tape 3 in 23 the videotaped deposition of Brendan McCormick. 24 We're now going on the record at 14:30. Thompson Court Reporters, Inc. 312-421-3377 3990537800 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537800 203 1 BY MR. WAGNER: 2 Q. Mr. McCormick, when we broke we were 3 talking about the publication of the National 4 Cancer Institute's Monogram 13 and Philip 5 Morris's response. 6 32 and have you identify this for the record. 7 8 I'm going to mark as Exhibit (Exhibit No. 32 marked for identification.) 9 THE WITNESS: This is a copy of the 10 press release that the company issued following 11 the release of the National Cancer Institute 12 report. 13 BY MR. WAGNER: 14 Q. /And in this press release did Philip 15 Morris dispute the conclusions of the National 16 Cancer Institute and public health community? 17 A. We did not. While there were 18 certainly aspects to that report with which we 19 disagreed, I think, consistent with our policies 20 on some of these issues and consistent with our 21 overall approach, we really emphasized the areas 22 where we had agreement. 23 opportunity to remind people of some of the 24 communications we were making on these issues. We used it as an Thompson Court Reporters, Inc. 312-421-3377 3990537801 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537801 204 1 We explained our use of descriptors, we provided 2 links to the National Cancer Institute press 3 release and report, and we suggested that people 4 visit our website where they could find and note 5 the similarities between some of the issues 6 raised in the report and some of our 7 communications on our website. 8 BY MR. WAGNER: 9 Q. 10 Philip Morris' website? 11 12 A. It was and it was released in other ways to the media. 13 14 And was this press release posted on Q. And did Philip Morris provide a link on its website to Monogram 13? 15 A. Yes, we did. 16 Q. Now, we've discussed to this point a 17 number of communications vehicles. 18 print advertising, the website, direct mail, 19 some point of sale materials. 20 onsert? 21 22 23 24 MR. SWEDLOW: of We've had What is an Objection, leading, lack foundation. THE WITNESS: We u s e d t h e term " o n s e r t " t o d e s c r i b e m i n i a t u r e b r o c h u r e s t h a t we Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537802 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537802 205 1 put on the cigarette pack. 2 we use to refer when we put those packs between 3 the outside of the package, the cardboard 4 package, and the inside of the cellophane. 5 BY MR. WAGNER: 6 Q. Okay. Onsert is the term And when did Philip Morris 7 start using onserts as a vehicle to communicate 8 messages to smokers? 9 A. We began using onserts as a 10 communications vehicle on our packs to directly 11 reach smokers beginning in November of 2002. 12 used that over a period of time to communicate 13 about primarily a range of corporate issues and 14 policy issues and provide information to smokers 15 during the period of 2002 through 2008. From 16 time to time we used it for marketing 17 communications in the later years. 18 first communication, issue communication, that 19 we did with onserts was focused on low-tar 20 cigarettes in November of 2002. 21 22 23 24 Q. We But the I'm going to have you identify for the record Exhibit 33. (Exhibit No. 33 marked for identification.) Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537803 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537803 206 1 THE WITNESS: This is a copy of the 2 onsert that we included in 2002. 3 in my demonstratives some kind of key sections 4 of the onsert. 5 "there is no such thing as a safe cigarette." 6 It reminds smokers that the terms Ultra Light, 7 Light, Medium and Mild are used as descriptors 8 of the strength of taste and flavor, that these 9 terms as well as terms like low tar and lower I've included The onsert leads with the line, 10 tar and nicotine also serve as a relative 11 indication of the average tar and nicotine yield 12 per cigarette as measured by standard government 13 test method. 14 BY MR. WAGNER: 15 Q. What's the next message in the next A. The next panel and paragraph state 16 17 panel? 18 that the tar and nicotine yield numbers are not 19 meant to communicate the amount of tar and 20 nicotine actually inhaled by any smoker as 21 individuals do not smoke like the machine used 22 in the government test method. 23 state that the amount of tar and nicotine you 24 inhale will be higher than the stated tar and It goes on to Thompson Court Reporters, Inc. 312-421-3377 3990537804 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537804 207 1 nicotine yield numbers, if, for example, you 2 block ventilation holes, inhale more deeply, 3 take more puffs, or smoke more cigarettes. 4 It goes on to state that, if you smoke 5 brands with descriptors such as Ultra Lights, 6 Light, Medium or Mild, you may not inhale less 7 tar and nicotine that you would from other 8 brands and it depends on how you smoke. 9 And then the final paragraph in that 10 onsert says, you should not assume that 11 cigarette brands using descriptors like Ultra 12 Light, Light, Medium or Mild are less harmful 13 than full-flavor cigarette brands or that 14 smoking such brands, such cigarette brands, will 15 help you quit smoking. 16 BY MR. WAGNER: 17 Q. Was there a suggestion or an IS indication of where people could go to get more 19 information? 20 A. We directed people that, for more 21 information about the numbers, brand descriptors 22 or quitting smoking, we suggested they go to 23 pmusa.com or to call us at an 800 number. 24 Q. November of 2002 was the first time Thompson Court Reporters, Inc. 312-421-3377 P.QC, 390537805 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537805 208 1 that this onsert ran; is that right? 2 A. That's right. 3 Q. Was that the first time that the 4 onsert technology was available to Philip 5 Morris? 6 7 MR. SWEDLOW: foundation. 8 9 Objection, lack of THE WITNESS: It was the first time that we used onserts as a communication to 10 smokers. 11 previously not figured out a way to incorporate 12 the use of those brochures into our cigarette 13 manufacturing process, which is a very 14 high-speed process. 15 equipment. 16 those hurdles. 17 used onserts as a communications vehicle at the 18 company. 19 BY MR. WAGNER: 20 Q. 21 22 We had previously not been — we had We had invested in new We had run some tests and overcame And this was the first time we How broadly was the onsert distributed in November of 2002? A. In November of 2002 we included it on 23 approximately 130 million packs. That 24 represented about a week's worth of production Thompson Court Reporters, Inc. 312-421-3377 3990537806 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537806 209 volume. And according to our estimates we believe that putting it on that level of volume would allow us to reach about 86% of the smokers of our company's low-tar brands. Q. I want to ask you to explain to us how Philip Morris decided on the one week's volume figure. In order to do that, the first thing I'm going to ask you to do is identify for us 9 10 Exhibit 34 — (Exhibit No. 3 4 marked for 11 identification.) 12 BY MR. WAGNER: 13 Q. 14 15 — which kind of ties to the next demonstrative in your set of demonstratives. A. The first thing we did — before I get 16 to this document, I'll tell you the first thing 17 that we did is really start from a manufacturing 18 and production standpoint and we wanted to 19 this was the first time we had done this. 20 thought that placing onserts on from time to 21 time periodically was the best approach to 22 generate interest from adult smokers so it 23 wasn't a message that they would think that they 24 had seen before. — We So we did it for a limited Thompson Court Reporters, Inc 312-421-3377 3990537807 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537807 210 1 period of time. We started on the manufacturing 2 end and said, okay, we think — 3 think about a week's worth of volume. Again, 4 the manufacturing side of things handled that. 5 And then in order to provide further insight, 6 there was an additional analysis that was 7 conducted, and that is the analysis in Exhibit 8 34, where we looked a little bit deeper to say, 9 how many smokers do we think, of these brands, what do you 10 do we think we would reach during this period of 11 time. 12 13 Q. Is that what you highlighted for us on the next demonstrative? 14 A. It is, and I can summarize some of the 15 key points of the analysis. It's addressed more 16 completely in the document. But the essence of 17 how we looked at this is we had research that 18 looked into and publicly available information 19 that gave us estimates for the amount of the 20 average cigarette consumption per day of 21 smokers. 22 little bit less than a pack of cigarettes per 23 day. 24 consumption habits or purchasing habits of Smokers at the time were smoking a We had research that looked into the Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 211 1 smokers in different trade classes. So we were 2 able — 3 went into a convenience store and how often they 4 purchased their cigarettes. 5 the vast majority of smokers at the time were 6 purchasing their cigarettes by the pack and that 7 they were purchasing — 8 convenience stores at least once a week. 9 there were also a smaller percentage of smokers we had estimates for how often smokers That told us that they were showing up in 10 that we thought we could reach who were 11 purchasing by the carton. 12 And So what we did is we considered all of 13 that information, and together it told us that 14 we thought we could reach 86% of the low-tar 15 smokers of Philip Morris USA brand on which this 16 onsert was running. 17 million smokers out of a total of, I believe, 14 18 and a half, 19 BY MR. WAGNER: 20 Q. So that was 12 and a half And the bottom bullet point on the 21 demonstrative says a total of 12.5 million, 86%, 22 PM low tar. 23 A. 24 Q. What does AS stand for? AS stands for adult smokers. And that's the target that Philip Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 212 1 Morris thought it would reach, then, through 2 this onsert? 3 A. That's correct. 4 Q. Now, can you quantity for us how many 5 6 packs had the onsert? A. Yes. During the fourth quarter of 7 2002 the precise number was close to — it was 2 over 130 million. 9 131,836,500 is the number I've included in my It was closer to 131. 10 demonstrative here, but it was more than 130 11 million packs of cigarettes in the fourth 12 quarter of 2002. 13 14 Q. (Exhibit No. 35 marked for identification.) 17 18 I'm going to show you Exhibit 35 and have you identify that for the record. 15 16 Okay. (Exhibit No. 36 marked for identification.) 19 THE WITNESS: This is — the front 20 page is an overview of our efforts at that time 21 from — 22 includes both the total national packs that were 23 offered as well as the estimated packs that were 24 shipped to the state of Missouri, based on our on low-tar communications efforts. It Thompson Court Reporters, Inc. 312-421-3377 3990537810 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537810 213 1 estimates of and our knowledge of how many total 2 cigarettes got shipped into Missouri and what 3 percentage of our volume that represented. 4 BY MR. WAGNER: 5 Q. So you mentioned that the low-tar 6 onsert ran — 1 number of other times, and is that what's 8 reflected on this summary demonstrative? 9 A. began in 2002 but then ran a In the summary what I did is I added a 10 total column to the piece that is the chart on 11 the front page of Exhibit 35. 12 quarter of 2002 through the second quarter of 13 2008 the low-tar onsert ran on more than one 14 billion cigarette packs nationally and close to 15 36 million packs in the state of Missouri during 16 that period of time. 17 Q. Okay. From fourth I think just — I helped make 18 this demonstrative and I think I made a 19 transcription error. 20 If you look at the second quarter of 2005, 21 the Missouri packs, the number would be 22 4,798,556, and I think on the demonstrative I 23 hit number 4 instead of number 7. 24 A. That's correct. Thompson Court Reporters, Inc. 312-421-3377 3990537811 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537811 214 1 Q. 2 is off — 3 that right? 4 5 Which would mean that our total then A. understates Missouri by 300,000; is So it would just be — it would be just over 36 million. MR. SWEDLOW: 6 7 as leading on that one. 8 BY MR. WAGNER: 9 Q. I would have to object So we'll substitute a corrected slide 10 for that, but so — 11 record, then, the estimated is how many packs of 12 cigarettes, Philip Morris cigarettes, in 13 Missouri between the fourth quarter of 2002 and 14 the second quarter of 2008 had the low-tar 15 onsert attached to them? 16 17 A. just so it's clear in the It was just around 36 million cigarettes. 18 Q. Okay. 19 A. Packs of cigarettes. 20 Q. Now, why didn't Philip Morris just 21 leave this onsert on or put it on and leave it 22 on consistently? 23 twice a year? 24 A. Why did it only appear once or We were using onserts for multiple Thompson Court Reporters, Inc 312-421-3377 3QC, 990537812 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537812 215 1 messages. 2 message, the look of some of those brochures, 3 and the frequency or — 4 nature with which they would appear would make 5 it more likely for smokers to actually open the 6 brochure and read it and be exposed to its 7 content. 8 So we believe that varying both the and kind of the periodic So we believed that if we had a brochure 9 on the pack for an extended period of time or 10 all the time a smoker would read it once and 11 then think it was the same information they had 12 read before and not be as likely to read it when 13 they came across it again. 14 So by mixing both the — having a periodic 15 nature to the timing of the communications as 16 well as varying the messages, we thought that 17 would be a more effective way to communicate 13 those messages. 19 BY MR. WAGNER: 20 Q. Did any of the other messages, the 21 non-low-tar messages that you mentioned, 22 reference the website? 23 24 A. Yes. There was — the primary — there was one communication in 2004 that was Thompson Court Reporters, Inc 312-421-3377 3990537813 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537813 216 1 primarily focused on the website. 2 the website address was provided in the low-tar 3 onserts, but there was a dedicated onsert in 4 2004 that was highlighting the information that 5 smokers would find on our website, and that 6 included information on low-tar cigarettes and 7 included information on health issues, quitting 8 smoking, tar and nicotine numbers, and facts 9 about the product as well as youth smoking 10 11 12 As I noted, prevention information. Q. And is that 2004 website onsert what's reflected in Exhibit 36? 13 MR. SWEDLOW: Same objection and 14 beyond the scope for this website onsert 15 question. 16 THE WITNESS: Exhibit 36 is a correct 17 copy of that onsert that was done in 2004. 18 BY MR. WAGNER: 19 Q. 20 21 22 23 24 And that's what you've highlighted in the next demonstrative slide? A. It's highlighted on slide 41 of my demonstrative, yes. Q. And there is an express reference in the bottom panel, health issues to low-tar Thompson Court Reporters, Inc 312-421-3377 3990537814 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537814 217 1 cigarettes? j 2 MR. SWEDLOW: Leading. 3 THE WITNESS: As I noted, there are j 4 references to both low-tar cigarettes and tar \ 5 and nicotine numbers on the onsert. \ 6 BY MR. WAGNER: 7 Q. f 8 9 10 11 What brands did this 2004 website onsert appear on in 2004? A. f That had a broader distribution across j all of our brands. Q. So we've now talked about the website, f 12 print advertising, point of sale materials, j 13 direct mail pieces, the onsert. In addition to 14 those communications efforts, did Philip Morris i 15 make use of television and radio advertising — 15 MR. SWEDLOW: 17 BY MR. WAGNER: 18 Q. 19 20 21 — Same — \ with respect to low-tar cigarettes? MR. SWEDLOW: Same objection, obviously leading. THE WITNESS: j From 2003 through 2006 j 22 Philip Morris used television and radio 23 advertising to highlight its website and to [ 24 share some of the positions that people would \ Thompson Court Reporters, Inc. 312-421-3377 3990537815 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537815 218 find on our website, and that included information related to low-tar cigarettes. BY MR. WAGNER: Q. And did you bring one of the television ads with you today for us to see? A. Yes. I've embedded a copy of one of the ads that focused on low-tar cigarettes in the PowerPoint copy of this presentation. MR. SWEDLOW: 9 Okay. We will turn our 10 trusty computer this way and see if we can get 11 it to play. 12 (Video clip played.) 13 BY MR. WAGNER: 14 Q. 15 16 17 18 19 20 And is that the low-tar advertisement that you were referring to a moment ago? A. That is one of the low-tar ads that ran during that period of time, yes. Q. Can you give us a sense of what kinds of programs these commercials would run on? A. The campaign was designed to really 21 have broad reach. 22 run, for example, starting on the evening news, 23 they would have run on the nightly news 24 broadcasts, they would have run on leading prime So ads like this would be Thompson Court Reporters, Inc. 312-421-3377 3990537816 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537816 219 1 time programs at the time, so programs like Fear 2 Factor, Who Wants to be a Millionaire, the Movie 3 of the Week, on one of the major networks, ran 4 on some cable programming, it would have been 5 run on the nightly evening news, the late night 6 news, and then the following morning people 7 could have seen these ads on programs like Good 8 Morning, America or The Today Show. 9 Q. And did Philip Morris USA track the 10 coverage — 11 and frequency of the ads — 12 Morris do in order to track the viewership of 13 the television ads? 14 A. I think it's referred to as reach but what did Philip In developing the advertising plan, we 15 worked with our advertising agency to develop a 16 placement plan, and the sum of that plan really 17 adds up to estimates for what percentage of the 18 television-viewing population of a certain age 19 you're estimated to reach, and, based on our 20 placement plans, estimates for how often those 21 individuals could potentially see these — 22 estimated to see these ads. 23 BY MR. WAGNER: 24 Q. were I'm going to show you Exhibit 37 and Thompson Court Reporters, Inc. 312-421-3377 3990537817 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537817 220 1 have you identify that for the record. 2 (Exhibit No. 3 7 marked for 3 identification.) 4 THE WITNESS: This document is a 5 summary document of our television and radio and 6 print advertising estimates and estimates of 7 their — 8 prepared by our advertising agency, and this 9 document highlights our results from 2003 the scope of their reach. 10 through the end of 2006. 11 BY MR. WAGNER: 12 Q. It was Did you prepare a demonstrative that 13 further summarizes breaking it down to the "no 14 safe low-tar" ads that ran in 2003 and 2004? 15 that the demonstrative you have next in your 16 slides? 17 MR. SWEDLOW: Objection, leading. 13 THE WITNESS: I did. Is Before we get on 19 to that question, I would just note that this 20 double-sided document is actually two documents, 21 each a single page, one running through November 22 of 2005, and then the second page appears to be 23 the same information updated through the end of 24 2006. Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537818 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537818 221 BY MR. WAGNER: Q. Right. That was something that was used at your deposition in Maine so we just used the same document. That's why it happened that way. A. And we raised the same clarification at that point in time. So in the demonstrative what I did is I just pulled some examples of the ad that we just 10 saw in November and December of 2003. 11 low-tar ad was estimated to reach 82% of those 12 who were 18 and over who were watching TV at the 13 time. 14 which the average person would have seen those 15 ads was more than seven times. The And we estimated that the frequency with 16 Similar numbers when the ad ran in October 17 and November, late October and November of 2004, 18 83% of total TV watchers over the age of 18 were 19 estimated to have seen the ad, and the frequency 20 at that point in time was estimated to be about 21 nine times that they would have seen that ad. 22 Q. Television advertising began in 2003. 23 At about the same time did Philip Morris make 24 any changes to its Marlboro Lights packs? Thompson Court Reporters, Inc. 312-421-3377 3990537819 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537819 22 2 I 1 A. Yes, we did. In April of 2003 we 2 removed the phrase "lower tar and nicotine" from 3 all of our Marlboro Lights packs. 4 5 Q. And is that what the next demonstrative is designed to show? 6 A. It does. 7 Q. Why did Philip Morris decide to remove 8 the phrase "lower tar and nicotine" from the 9 packs of its cigarettes? 10 A. That was done as part of this overall 11 effort we were making to carefully consider our 12 communications around these issues, to look for 13 opportunities, to communicate proactively, but 14 also to look at other ways in which we were 15 communicating to see if anything needed to 16 change in the wake of the National Cancer 17 Institute report that was put out in 2001. 18 So removing that phrase from the pack was 19 part of that effort that had begun in the late 20 '90s but really accelerated in the wake of the 21 National Cancer Institute report in 2001. 22 Q. But at that time Philip Morris kept 23 the descriptor of "Lights" on the packs; is that 24 correct? Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. ^QC 990537820 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537820 223 1 A. That's correct. We continued to 2 believe that the term "Lights" was a term that 3 was a term that was useful to consumers. 4 recognized that there had been some concerns 5 raised about what the consumer take-away might 6 be from some of those terms. 7 which we decided to address that was to continue f 8 to look for a range of different ways and 9 execute communications that shared information 10 with consumers about what those terms mean and 11 what they don't mean. 12 continued to do it via our website. 13 included in our television advertising. 14 it on pack through the onserts. 15 range of communications efforts that were 16 communicating that information to consumers. 17 We also went to the Federal Trade We And the way in So we did that. We It was We did So we had a 18 Commission and asked them for — to develop 19 rules, and we asked that they continue to permit j 20 the use of those terms but require additional 21 disclaimers to be used across the industry. 22 we asked for additional regulatory guidance on 23 that in addition to undertaking our own 24 voluntary communications about those terms and So Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 224 1 what they mean and don't mean. 2 Q. The onserts you testified began in 3 2002 and ran all the way through some period in 4 2008. 5 quarters. 6 resulted in Philip Morris no longer using the 7 onserts? 8 9 Periodically they would run in different What happened after 2008 that MR. SWEDLOW: Objection, leading. Is there a question on the first part? 10 MR. WAGNER: No. 11 MR. SWEDLOW: Okay. 12 THE WITNESS: We — we had run the 13 onserts through 2008. Beginning in 2009 we 14 pursued a new method of on-pack communication 15 where we put a message on the tear tape, which 16 is the first thing the cigarette smoker reaches 17 for as they are opening the cellophane on the 18 cigarette pack. 19 communicate a relatively short message, about 85 20 characters or so, on that tear tape, and that 21 was an additional means that we pursued to 22 communicate about this issue. 23 method that was used from mid 2009 through mid 24 2010. That gave us the ability to Thompson C o u r t R e p o r t e r s , 312-421-3377 That was the Inc 3990537822 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537822 225 I BY MR. WAGNER: Q. 85 characters means, what, you literally have 85 letters you can use and after that you've used the entire tape? Just explain to us what 85 characters means. MR. SWEDLOW: Objection. THE WITNESS: 85 characters would be both letters and space. limited — So the tear tape was a it was a finite size because it 10 started at one end of the pack and went around 11 to the other side, and after that there was no 12 more space available. 13 So what we worked to do would be within 14 the space that typically worked its way around 15 the cigarette pack is to include a complete 16 message. 17 BY MR. WAGNER: 18 Q. And does your next demonstrative 19 explain and highlight the tear tape that went on 20 cigarette packs in 2009 and ran until mid 2010? 21 22 23 24 MR. SWEDLOW: Objection, leading, assumes facts not in evidence. THE WITNESS: The demonstrative shows the tear tape and the complete message, which Thompson Court Reporters, Inc 312-421-3377 3990537823 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537823 226 1 for Lights stated that "Lights does not mean 2 safer. 3 you quit smoking." 4 for other brands that used descriptors such as 5 Ultra Lights or Mediums, for example, where the 6 descriptor word would be the one difference in 1 that message. 8 BY MR. WAGNER: 9 Q. 10 11 It refers to taste. Lights won't help We used a similar message Do you know how this particular language was selected? A. The language here is consistent, I 12 believe, with the other communications we have 13 made on this issue. 14 focus on that term "Lights" in particular and 15 what it means and what it doesn't mean. 16 consistent with our other communications and it 17 was tailored to — 18 space than you do, for example, on a website, so 19 it's an 85-character version and tailored to 20 that space just as you would tailor your other 21 messages to the communication vehicles that you 22 have and the time constraints or space 23 constraints that you have. 24 BY MR. WAGNER: It was really designed to So it's obviously you've got less Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537824 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537824 227 1 Q. The phrase, the sentence, "Lights does 2 not mean safer," was that a statement as to the 3 science regarding low-tar cigarettes? MR. SWEDLOW: 4 5 I'm going to object, lacks foundation and improper opinion testimony. THE WITNESS: 6 What we are doing here 7 is really explaining our use of brand 8 descriptors, and the language that's here is 9 similar to language we use elsewhere where we 10 explain our use of brand descriptors. 11 BY MR. WAGNER: 12 Q. 13 14 On which Philip Morris packs did this tear tape appear beginning in 2009? A. The tear tape would have appeared on 15 any pack that had a brand descriptor. 16 example, packs like Marlboro Lights or other 17 brands that had "Lights" in their — 18 packaging, Ultra Lights, Medium, Mild, those 19 would each be examples of brands that included 20 those descriptors would have a tear tape that 21 referred to that descriptor. 22 Q. So, for on their Was the tear tape rotated like the 23 onserts so it only appeared on Marlboro Lights 24 and other Lights cigarette packs only in certain Thompson Court Reporters, Inc 312-421-3377 P.QC, 390537825 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537825 228 I 1 quarters — 2 MR. SWEDLOW: 3 BY MR. WAGNER: 4 Q. — 5 A. No. Objection, leading. of the year? During the period of time from 6 the second quarter of 2009 through the second 7 quarter of 2010 it would have appeared on all of 8 those packs during that period of time. 9 10 11 Q. Does the "Lights" descriptor remain on Philip Morris packs even today? A. The descriptor "Lights" was removed in 12 June of 2010 according to the requirements of a 13 federal law that gave the Food and Drug 14 Administration authority to regulate tobacco 15 products. 16 17 Q. And is that timeline what you've depicted on the next demonstrative? 18 A. It is. 19 Q. Now, did the Act that you're referring 20 to, the Family Smoking Prevention and Tobacco 21 Control Act, require that Philip Morris stop 22 selling the actual cigarettes that used to be 23 known as Marlboro Lights? 24 MR. SWEDLOW: T'm going to object as Thompson Court Reporters, Inc 312-421-3377 P.Qq 390537826 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537826 229 1 lack of foundation, but, if you know, go ahead. 2 THE WITNESS: No. The legislation 3 required and prohibited companies from using 4 certain types of brand descriptors, including 5 the phrase "Lights" in their packaging or 6 advertising or marketing materials for those 7 cigarettes, but it did not require any changes 8 to the cigarettes themselves. 9 BY MR. WAGNER: 10 Q. Now, the Act became law on June 22nd, 11 2009. Did it require that the "Lights" 12 descriptors come off immediately? 13 MR. SWEDLOW: Objection, leading. 14 THE WITNESS: It did not. The law 15 provided the manufacturers to stop manufacturing 16 those products by June 22nd of 2010, which was 17 basically one year following, and then there 18 were some additional provisions there that 19 governed the transition of those products 20 post-manufacture and in wholesale and retail. 21 MR. SWEDLOW: I would also object as 22 calls for legal conclusion, but I don't know if 23 this — 24 this, Jeff, so I don't know if I have to I don't know what your purpose is for Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537827 230 1 preserve those objections or not. So I'm going 2 to assume I don't, but it just struck me when he 3 says here's what the law requires that I should 4 object as calling for legal conclusion. 5 BY MR. WAGNER: 6 Q. Given that "Lights" no longer appears 7 on any of its packs, has Philip Morris stopped 8 communicating with the public about the relative 9 risks of the different brands of cigarettes it 10 sells? 11 MR. SWEDLOW: Objection, form. 12 THE WITNESS: The company has 13 continued to look for ways to communicate that 14 there is no safe cigarette and that none of the 15 cigarettes that we sell are any safer than any 16 other cigarette. 17 So in my demonstrative on page 47 I've 18 included an example of a pack insert. This is a 19 piece that was inserted between the cardboard 20 and the foil within our cigarette packs. It 21 provides, again, a link to our website, but the 22 language that we have used there — 23 appeared in all of our cigarette brands — 24 nothing about this cigarette or packaging and this Thompson Court Reporters, Inc 312-421-3377 3990537828 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537828 231 I 1 including color should be interpreted to mean j 2 that any cigarette is safer than any other f 3 cigarette. f 4 help you quit smoking. f 5 BY MR. WAGNER: ) 6 7 8 9 1C 11 Nothing about this cigarette will Q. . And this ran in late 2010 or was inserted into packs in 2010? A. j It was inserted in November and December 2010, again, across all of our cigarette brands. Q. You testified earlier that Philip 12 Morris was using the tear tape to tell smokers 13 about what "Lights" means and what it doesn't 14 mean up until June of 2010 when "Lights" came 15 off the packs. 16 tear tape then as a communications vehicle? 17 j A. No. Did Philip Morris stop using the j We have — we have broadened the 18 use of tear tape to contain a similar message to \ 19 what I just outlined for the onsert and used 20 that across all of our cigarette brands. 21 So this notion that nothing about — we 22 included the message that nothing about this 23 cigarette packaging or color should be 24 interpreted to mean safer. Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537829 232 1 Q, And is that the next demonstrative 2 that you brought of what the tear tape looks 3 like on packs today? 4 A. It is. 5 Q. And on what packs does this new tear 6 tape appear on? 7 8 It appears on all of our cigarette Q. So that now includes full-flavor packs packs. 9 10 A. like Marlboro Reds? 11 A. It does. 12 Q. Have you brought with you a 13 demonstrative today to show what information 14 about low-tar cigarettes consumers can obtain if 15 they visit the Philip Morris website today? 16 17 MR. SWEDLOW: Object as — THE WITNESS: The — object to form. 18 we do not 19 communicate about or use the phrase "low-tar 20 cigarettes" in our communications, but when 21 the — 22 changes, based on our historical experience, 23 whenever we make packaging changes, we know that 24 generates a lot of questions from our consumers. when we were required to make packaging Thompson Court Reporters, Inc. 312-421-3377 3990537830 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537830 233 1 So we put some information on our website 2 related to those packaging changes. 3 49 4 BY MR. WAGNER: 5 Q. And on page — Let me have you identify Exhibit 38 6 for the record and then you can tell us about 7 what you've pulled out of it to highlight in the 8 demonstratives. 9 10 11 12 MR. SWEDLOW: Objection, form. (Exhibit No. 38 marked for identification.) THE WITNESS: The Exhibit 38 is a 13 snapshot of the home page of the Philip Morris 14 USA website and then the relevant pages related 15 to -- some of the relevant pages are attached, 16 including information related to low-tar 17 cigarettes. 18 communications that follow. 19 That is included in the On page 49 I just highlighted and pulled 20 out something that we referred to as a featured 21 content area, which is basically a headline on 22 the front page of our website whereas I said we 23 try to make it easy for people to find 24 information, that they may be looking for. We Thompson Court Reporters, Inc 312-421-3377 3990537831 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537831 234 knew there was going to be great interest in the 2 packaging and advertising changes, so we created 3 a section where individuals could click and 4 learn more. 5 BY MR. WAGNER: 6 Q. And if they click there they see some 7 information, including a few bullet points, and 8 is that what you've highlighted in the next 9 slide, 50? 10 A. I did. And the page that this takes 11 people to provides a short description of what 12 the law required, and what it does is include 13 similar information, and, you know, we evolved 14 our language there, again, to say nothing about 15 our cigarettes packaging or colors should be 16 interpreted to mean that any cigarette is less 17 risky or results in less exposure to harmful 18 compounds than any other cigarette. 19 reiterate that the amount of tar and nicotine or 20 other constituents in smoke a smoker inhales can 21 vary depending on how they smoke. 22 to provide links to a diagram of the ventilation 23 holes. 24 there is no safe cigarette, and, if they are We again We continued And we continue to remind smokers that Thompson Court Reporters, Inc 312-421-3377 3990537832 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537832 235 1 concerned about the risks of cigarette smoking, 2 the best thing to do is quit. 3 BY MR. WAGNER: 4 Q. Other than the website, the tear tape 5 and the package inserts, are there any other * 6 message — methods -- that Philip Morris has 7 been using to communicate this new disclaimer 8 language since removing the "Lights" descriptors 9 from its packs? 10 A. Similar versions of this language will 11 appear in our direct mail communications. We 12 have a website for Marlboro smokers called 13 marlboro.com that's accessible to those that are 14 21 and older where we can verify their age and 15 they identify that they are smokers. 16 information is included on that website. And 17 it's included in our other advertising 18 communications, including some point-of-sale 19 materials. 20 This Q. in incorporating these updated public 21 communications, what has been Philip Morris's 22 goal? 23 24 A. I t h i n k t h e g o a l t h a t we have h e r e i s similar to the goal we set out to achieve and Thompson C o u r t R e p o r t e r s , I n c . 312-421-3377 3990537833 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537833 236 1 really evolve the nature of our communications 2 as the external environment has evolved. 3 have been concerns raised about the information 4 that's available to cigarette smokers about 5 testing and there's been concerns' raised that 6 people believe that smokers may be confused 7 about what some of those terms mean. 8 we've tried to do is continue to communicate our 9 point of view and continue to relay the public There And what 10 health message through the various 11 communications vehicles that are available to 12 us. 13 Q. Okay. Well, we've covered a number of 14 different public communications vehicles that 15 Philip Morris has used since 1999 about low-tar 16 cigarettes, and to help summarize that 17 information have you brought with you today a 18 timeline that places those communications in 19 some sort of context? 20 21 22 MR. SWEDLOW: Same, objection, THE WITNESS: What I did in this final leading. 23 slide here is really just tried to lay out the 24 scope of the communications and put it in a Thompson Court Reporters, Inc. 312-421-3377 3990537834 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537834 237 1 visual form that really begins with the website, 2 which was launched in October of 1999 and has 3 remained available through the present, to 4 highlight the range of actions that we took, in 5 particular following the National Cancer 6 Institute report in 2001, give examples of the 7 pack onserts and when they ran, and give 8 examples of the television and radio advertising 9 as well as a visual depiction of when the 10 11 various tear-tape communications have run. So this is, you know, what I would really 12 describe as a simplified visual version that 13 tries to capture on one page the extent and 14 nature of our communications during that period 15 of time. 16 17 MR. WAGNER: Thank you very much. I have no further questions. 18 EXAMINATION (resumed) 19 BY MR. WAGNER: 20 Q. Mr. McCormick, on the very last thing 21 you were looking at you have a bunch of boxes 22 inside TV screens, old-school TV screens with 23 little knobs. 24 graphic. I don't know where you got that These boxes say "no safer." We Thompson Court Reporters, Inc 312-421-3377 3QC, 390537835 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537835 238 1 watched a commercial. 2 that Light cigarettes are no safer than regular 3 cigarettes? 4 A. Did the commercial say These are, on this page, is a — this 5 is just a simplified overview of some of the 6 language we have used over time. 7 in specific language from each of those, those 8 clips, and tailor it to the box that's here. 9 Q. We didn't lay The clip that we saw said that there 10 is no safe cigarette and Light cigarettes are no 11 exception, but it didn't say anything about the 12 relative risk or safety or delivery of Light 13 cigarettes; isn't that right? 14 A. I would have to go back through the 15 script for that. 16 me. 11 have it all captured on memory. 18 19 20 I don't have it in front of I listened to it the first time and don't Q. I thought you said you embedded it on your lawyer's computer. A. And I've reviewed it several times. 21 have not committed it to memory nor do I have 22 the script in front of me to be able to go word 23 by word with everything that's in there. 24 Q. I The commercial was 12 seconds long, Thompson Court Reporters, Inc. 312-421-3377 3990537836 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537836 239 1 correct? 2 A. It was 30 seconds long. 3 Q. Thirty seconds long. I'm sorry. In 4 that commercial is it your testimony that, even 5 though you've reviewed it several times and 6 embedded it on your lawyer's computer and played 7 it here today, you don't know whether it made 8 any statements about the relative safety of 9 Light cigarettes? 10 MR. WAGNER: 11 THE WITNESS: Object to form. What I'm saying is, if 12 you were going to ask me specific questions 13 about the content of that advertising, I would 14 like to go back and look at that advertising to 15 make sure I'm answering it correctly. 16 the context of all of the communications that I 17 reviewed here, if you're asking specific 18 questions about the content of any one of those 19 communications, I would like the opportunity to 20 review that communication so that I have the 21 opportunity to answer you correctly given that 22 there is a wide range of things we've talked 23 about today. 24 Q. And in Well, I showed up today and didn't Thompson Court Reporters, Inc. 312-421-3377 3990537837 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537837 240 1 have your 51-page PowerPoint, didn't get it this 2 morning and just saw it for the first time when 3 you showed it to me. 4 I'm going to ask you to do the best that you can 5 with the only tools that I have — 6 Mr. Wagner will open up that computer and play 7 the ad again. 8 9 MR. WAGNER: MR. SWEDLOW: 11 MR. WAGNER: 13 14 15 16 unless If you would like me to, I will. 10 12 So I don't have that ad. I would like you to. The ad that we played, for the record, is Defense Exhibit 312. MR. SWEDLOW: Is that the 1974 one or the 2004 one? MR. WAGNER: The 2003 television ad that I'm about to play. 17 MR. SWEDLOW: 18 MR. WAGNER: Okay. And the 1974 public 19 service announcement is Defense Exhibit 3251 on 20 the exhibit list, and the Philip Morris USA 21 Mission Statement is Defense Exhibit 3452, just 22 so that you have those. 23 24 MR. SWEDLOW: Will you play it, please, so we can see it on the screen too. Thompson Court Reporters, Inc. 312-421-3377 3990537838 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537838 241 1 2 THE WITNESS: watch it. 3 4 I'll come around and MR. WAGNER: Sure. (Video clip played.) 5 BY MR. SWEDLOW: 6 Q. Does the ad that you included in your 7 presentation make any statement about the 8 relative safety or relative risk of Light 9 cigarettes compared to regular cigarettes? 10 A. The ad states there is no safe 11 cigarette and Lights and Ultra Lights are no 12 exception. 13 Q. Does the commercial that you just put 14 in your presentation make any statement about 15 the relative safety of Light cigarettes compared 16 to regular cigarettes? 17 A. It does not. 18 Q. In your box you say "no safer." Is 19 that referring to a relative assessment or the 20 fact that Light cigarettes are not safe? 21 A. The box is a visual depiction. It is 22 just a shorthand for some of the communications 23 we have made over time. 24 to each of these communications. We did not tailor that As I — as I Thompson Court Reporters, Inc. 312-421-3377 3990537839 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537839 242 1 indicated, what this is is an effort to simplify 2 and depict in a visual form in terms of the 3 types of communications rather than the content 4 of the communications that were taking place 5 during that time. 6 Q. Did those TV ads, the one we just saw 7 and however many time it ran — 8 times it ran — 9 Lights does not mean safer? 10 A. however many did that tell smokers that That communication was focused on 11 communicating that there was no safe cigarette, 12 Lights and Ultra Lights are no exceptions, and 13 it referred people back to our website. 14 15 15 17 18 Q. Did it define specifically that Lights does not mean safer? A. The television ad itself did not do that, no. Q. Does the television ad tell people 19 that cigarettes are not safe and then in the 20 next sentence identify Lights as no exception to 21 that rule? 22 MR. WAGNER: 23 THE WITNESS: 24 articulated, which i s , Objection to the It it form. s a y s e x a c t l y what I s a y s t h a t t h e r e i s no Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537840 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537840 243 1 safe cigarette and it highlights Lights as not 2 being an exception to that. 3 BY MR. SWEDLOW: Q. 4 I'm looking at the document, which is 5 actually two documents — 6 seems to just be bigger than the other one, 7 right? 8 I think it goes — one One goes to 2006 and one goes to 2005? A. I believe that the 2006 document — in 9 my comparison of this it appears that that is 10 updating that previous information, and when I 11 reviewed it, it appears to be consistent through 12 2005. So the 2006 document is more complete. 13 Q. Can you tell me what number it is? 14 A. It's Exhibit 37. 15 Q. On the more-complete version through 15 December 2006, does this document identify when 17 that "no safe low-tar" commercial appeared? 18 19 A. It does. It ran from November 17th through December 21st, 2003. 20 Q. Did it run any other time? 21 A. There were several versions that 22 referenced this. 23 types of communications that ran during that 24 period of time. This is an example of the This i s one example of those. Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537841 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537841 244 1 The ads mentioning either the "no-safe 2 cigarette" message or the "low-tar" message, 3 some of those are highlighted with reference to 4 "no safe." 5 that we just saw. 6 are embedded, low-tar messages, are embedded in 7 other versions of these ads, including one 8 called Health Effects. 9 "No safe low-tar" refers to the one There are other messages that So these are — what this document is, is 10 basically — 11 title that, at its very highest level, 12 summarizes the message and in some ways just 13 distinguishes it from the other ads, but it is 14 not a complete summary of all the messages that 15 are in that ad necessarily. 16 Q. the title of the ad is an internal When I looked at this today for the 17 first time, it looks like "no safe low-tar" ran 18 for a little over a month at the end of 2003 and 19 a little over a month towards the end of 2 0 04 20 but nowhere else, is that correct, for the "no 21 safe low-tar" commercial? 22 A . For that specific commercial it ran 23 during that period of time. However, similar 24 messages are included in subsequent ads. Thompson Court Reporters, Inc. 312-421-3377 3990537842 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537842 245 ; Q. 1 Do any of these television ads contain 2 the statement or the effect of the statement 3 that Lights does not mean safer? 4 5 A. I don't know for sure with the other Q. That ad does not contain the statement j ads. 6 7 or the effect of the statement that Lights does 8 not mean safer, though, correct? \ 0 A. That's correct. 10 Q. When you identified the percentage of 11 people, the document with the reach of the 12 television ads 13 A. Yes. 14 Q. — — it had a percentage in the '70s or 15 '80s and then a frequency of seven or eight 16 times. 17 18 Do you recall that? A. I do. Let me just pull it up and I'll give you the exact — 19 MR. WAGNER: 20 THE WITNESS: 21 80's on both. 22 and 2004. 23 BY MR. SWEDLOW: 24 Q. Should be 43, I think. I think it was above the It was 82 and 83 for those 2003 • • 82 and 83% of what? Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 3990537843 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537843 246 \ 1 2 3 4 5 A. It was estimated to reach 82% of those j 18 and older who were watching television. Q. What percentage of people were watching television? A. I I don't know that, but television at 6 the time was, you know, the lead medium, so it 7 would have been pretty extensive. 8 9 Q. Is that 82 or 83% of people who watch TV at all? 10 A. It is. 11 Q. And if you watched TV at all, you'd 12 13 see it seven or eight times? A. Estimated based on the range of 14 programming on which you are running and based 15 on the ratings for those programs and the 16 estimates that are used within the television 17 advertising and programming industry. 18 estimating that we reach 82% of those who are 19 watching television and that, based on the range 20 of programming on which we are running, on 21 average the estimated frequency is that folks 22 would see that — 23 see it about 7.4 times in the case of the first 24 by or nine times in the case of the second by. We are those folks who saw it would Thompson Court Reporters, Inc. 312-421-3377 3990537844 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537844 247 1 Q. So for that month you're saying that 2 somebody would see it on average 7.4 times. 3 thing that doesn't make any sense to me is it 4 can't be 80 something percent of America saw an 5 ad 7.4 times because not everybody watches TV 6 and not everybody watches TV even seven times in 7 a month. £ 9 So what I'm trying to figure out is what percent of /America saw those commercials. 10 11 12 13 14 The MR. WAGNER: Object to form. BY MR. SWEDLOW: Q. Do you know what percentage of 7America saw those commercials? A. The process that — what this is based 15 on is standard practice in the television 16 advertising industry, and the only thing they 17 can tell you is — 18 because — 19 placing this ad in a particular medium. 20 those who are watching that medium, what 21 percentage are we estimated to reach. 22 on the places we were running this advertising, 23 the shows on which we were placing this 24 advertising, we estimated that we would reach and I didn't look at it here the way we looked at it is we're Of And based Thompson Court Reporters, Inc. 312-421-3377 3990537845 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537845 248 \ 1 2 82% of those who were watching television. So we didn't look at how many people are 3 watching television. This wasn't the only 4 vehicle that we were using, but I think, if you 5 compare it to other communications vehicles that I 6 we were using, television plus radio plus print, 7 television is by far the broadest in its reach, 8 and, compared to onserts, which is a very 9 effective way to reach directly to adult 10 smokers, television is running very broadly, and f 11 compared to those other communications tools, 12 the overall audience on television is 13 significantly higher than you're going to get on l 14 any of those other communications vehicles. 15 It's complemented by radio. 16 by print. 17 It's complemented It's complemented by onserts. So I think, when we looked at it, we knew 18 that television was the — 19 broadest communications tool that we could use, 20 and of those who were watching television we had j 21 very broad percentage distribution and very good \ 22 frequency during the period of time that we were I 23 running those ads. 24 Q. was probably the What I'm trying to understand, though, Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 j 249 1 is what those numbers actually mean, and can you 2 tell me what the 82 and 83% are of? 3 everything that you said and I processed 4 everything that you said, but it is not possible 5 that it's 83% of 7America, is it? 6 MR. WAGNER: 7 THE WITNESS: 8 MR. WAGNER: 9 THE WITNESS: I heard Objection to the form. That's not what — Go ahead. That's not what I said. 10 What I said is it's 82% of the people who are 11 watching television. 12 BY MR. SWEDLOW: 13 Q. Watching television at all? 14 A. 15 Q. 16 17 Yes. And if you watch TV at all, then you'll see it 7.4 times? A. That is an average based on ratings 18 estimates for the television programs on which 19 we were placing those ads and it's based on 20 standard measurements within the television 21 industry. 22 i a l s o t o l d y o u t h a t I d i d n ' t h a v e an 23 estimate for how many people in total watch 24 television. Thompson C o u r t R e p o r t e r s , I n c . 312-421-3377 ^QC 990537847 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537847 250 j 1 2 Q. When was Exhibit 35 made, if you know, j specifically the first page? 3 A. I don't know. 4 Q. Did you make it? 5 A. I did not. The numbers here — 6 because this is specific to Missouri, I am not 7 sure when that was pulled together, but the 8 numbers down the total pack size are consistent 9 with the numbers that are in my affidavit. 10 Q. In fact, I recognize these numbers j 11 from your affidavit, but I didn't recognize the 12 percentage of total program estimated to 13 Missouri and was wondering how those were 14 calculated and who calculated them. 15 know? 16 j Do you j A. I do not know who calculated them. I 17 can give you a sense based on my past experience j 18 looking at things like this as to how we would 19 calculate those and some of the documents I 20 reviewed had some background information that 21 looked at this, and there were information 22 plugged in there on wholesalers in the state of 23 Missouri and shipments to those wholesalers. 24 Q. Is that the rest of this document? I Thompson Court Reporters, Inc. 312-421-3377 3990537848 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537848 251 A. 1 That is the document that I reviewed 2 in — 3 you get into some of the later pages. 4 me... if you look on page 2, and that continues 5 through the next couple of pages, you have a 6 list of brand estimates. 7 what period of time the individuals are using 8 here. 9 that contains the list down the side as Just let It's not clear to me And then you have what they refer to as 10 ship-to parties, and I understand those, based 11 on the names of some of those customers, they 12 appear to be wholesalers. 13 term "distribution" in there, in their title 14 (indicating). 15 Q. What page is that? A. That begins, I believe, on page 5. 16 17 Most of them have the Oh, I see. I'm sorry. So 18 that is — 19 prepared that. 20 prepared that, but based on kind of the 21 estimates down this side, what I have seen 22 before in the course of doing business at the 23 company is that we have calculated estimates as 24 to what percentage of our volume goes to a I did not speak to the individual who I don't know specifically who Thompson Court Reporters, Inc 312-421-3377 3990537849 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537849 252 1 specific state. This information here is 2 consistent with how I've seen that information 3 depicted previously in terms of a percentage 4 that went into there. 5 behind it, again, I did not dig into the 6 numbers, but the material is depicted in a way 7 that was consistent with that. And then looking quickly 8 Q. Where did you get this first page? 9 A. This was provided to me as part of 10 our — 11 summarize some of this information, with 12 assistance from counsel in summarizing the 13 information, they also had additional 14 information related to Missouri. 15 16 I asked for information about — Q. to You didn't create this or any part of it yourself; is that correct? 17 A. I did not. The information here is 18 based on materials that were previously used in 19 my deposition, but I did not create this 20 document nor do I know who did. 21 22 Q. 2000. You referred to an FTC statement in Do you recall that? 23 A. I do. 24 Q. How d o y o u know w h e n P h i l i p M o r r i s Thompson C o u r t R e p o r t e r s , 312-421-3377 got Inc. 3990537850 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537850 253 1 2 that? A. I was involved with media 3 communications related to issues like this. I 4 worked closely with the team that managed the 5 corporate websites. 6 was focused on monitoring regulatory 7 environments. 8 material from the time is that we received that 9 shortly after it was released — I know we had a group that And my recollection of that it was released 10 on their website, so it was released in a very 11 public way. 12 13 Q. Did Philip Morris agree with the statements in that FTC 2000 publication? 14 MR. WAGNER: 15 THE WITNESS: Object to the form. I don't recall having 16 discussions about whether or not we agreed with 17 it, but consistent with the approach we've taken 18 on health issues, we made that information 19 available to consumers through a link on our 20 website. 21 BY MR. SWEDLOW: 22 Q. I think you said that this was similar 23 to the FTC press release in 1967; is that 24 correct? Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537851 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537851 254 1 2 A. There are aspects that were similar to their press release. 3 4 It is. Q. Could you read the first two sentences into the record? 5 A. "Why do some smokers choose low tar 6 and Light cigarettes? Because they think these 7 cigarettes may be less harmful to their health 8 than regular cigarettes." 9 Q. Was that in the 1967 press release? 10 A. It was not. The government was, 11 again, as we mentioned in our communications 12 here, a very different — 13 very different position on that issue at the 14 time. 15 16 Q. they were taking a Does Philip Morris agree with that first statement? 17 A. The statement or the question? 18 Q. The statement. 19 MR. WAGNER: Object to form and it's 20 beyond the scope of the notice. 21 MR. SWEDLOW: 22 MR. SNAPP: 23 THE WITNESS: 24 Well done, Erik. Thanks. I haven't seen independent research on that. I think the Thompson Court Reporters, Inc 312-421-3377 3990537852 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537852 255 1 company recognizes that there may be smokers who 2 hold that, that belief. 3 BY MR. SWEDLOW: 4 Q. You also indicated that in 1998 Philip 5 Morris continued to do scientific research. 6 you recall saying that? 7 MR. WAGNER: 8 THE WITNESS: 9 Do Object to form. I recall saying that Philip Morris continued to do scientific 10 research and it was in the context of in the 11 wake of the — 12 in the wake of the October 199 7 statement, did 13 you stop doing scientific research. 14 i recall. 15 BY MR. SWEDLOW: 15 Q. I believe the question was asked, That's what Is that what you're referring to? Yes. Do you have any responsibilities 17 or personal knowledge of Philip Morris's 13 scientific research prior to 1997? 19 20 21 MR. WAGNER: Objection, beyond the scope. THE WITNESS: I have had no 22 responsibility for our scientific research. I 23 discuss certain aspects of our scientific views 24 on issues from time to time with members of our Thompson Court Reporters, Inc. 312-421-3377 3990537853 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537853 256 1 research and development department and those 2 with scientific expertise as it relates to my 3 job responsibilities, but I have no scientific 4 background or view on — 5 responsibility for science. 6 BY MR. SWEDLOW: 7 Q. or direct business What scientific research specifically 8 did Philip Morris continue to do after the 1997 9 submission to Congress? 10 MR. WAGNER: 11 THE WITNESS: Object to form. The types of research 12 that I am aware of — 13 was actively engaged in publishing research 14 specifically related to its efforts to reduce 15 the harm associated with its cigarette brands. 16 We conducted research and published research on 17 information related to things like biomarkers of 18 harm, potential biomarkers of harm. 19 conducted a study of individual smokers, a very 20 comprehensive study, that we called the Total 21 Exposure Study. 22 different product research. 23 24 I know that the company We The scientists do all sorts of And the reason I'm familiar with these is they made that information available throuah a Thompson Court Reporters, Inc. 312-421-3377 3990537854 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537854 257 1 public website that was intended for the 2 scientific community. 3 examples of the types of research that was 4 directly — 5 was conducted by our scientists. 6 that we had an external research program where 7 we funded other scientists and encouraged them 8 to publish on a range of issues. 9 basis for my answer to the question. 10 Q. So those would be primarily scientific research that I also know So that's the What scientific research are you aware 11 of that Philip Morris did to assess the accuracy 12 or predictive nature of the FTC machine 13 measurement for human delivery prior to 199 7? 14 15 MR. WAGNER: Object to form, beyond the scope. 16 THE WITNESS: I'm not aware of the 17 specifics of our research in that area. 18 BY MR. SWEDLOW: 19 Q. Are you aware of any of the 20 generalities or specifics of your — 21 Morris's research in that area? 22 MR. WAGNER: 23 THE WITNESS: 24 of Philip Same objections. No, I'm not. BY MR. SWEDLOW: Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537855 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537855 258 1 Q. You stated that Philip Morris received 2 the 1981 Surgeon General's Report at the time it 3 was published. 4 A. 5 6 Do you recall that? I believe the question was around the time it was published. Q. How do you know that? 7 A. Because we had a process to monitor 8 and — monitor external authorities on this, on 9 this issue and their publications. When the 10 Surgeon General reports are released, they are 11 typically released with a press conference and 12 widespread public communication. 13 experience in dealing with the release of 14 Surgeon General's reports and my knowledge of 15 the measures we had in place to expect those, to 16 be aware that those types of things were coming, 17 and the manner in which they had historically 18 been released, that's the approach on which I 19 base my answer. 20 Q. How old were you in 1981? 21 A. In 1981? So based on my I'm not here to speak — I 22 was ten years old, but, again, I'm here to speak 23 on behalf of the company and its perspective. 24 was not here at the time, but I gave you the I Thompson Court Reporters, Inc. 312-421-3377 3990537856 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537856 259 1 experiences upon which I base my answer and the 2 fact that that would have been a document that 3 was released in a very public manner. 4 Q. Right. I understand that in 1981 you 5 were ten and you weren't working there, but 6 and I understand even the generalities of what 7 you just discussed, but how do you know even on 8 behalf of Philip Morris whether Philip Morris 9 received the Surgeon General's Report about the 10 time it was published or not? 11 12 — MR. WAGNER: Objection, asked and answered. 13 THE WITNESS: Based on the experience 14 I have had with the release of every single 15 Surgeon General's Report in the 18 years I've 16 been with the company, based on my knowledge as 17 to how the Surgeon General's office historically 18 release those reports, those reports were 19 typically released with extensive media coverage 20 and media promotion, so based on my knowledge of 21 both — 22 release of Surgeon General's Report from a 23 company standpoint, my knowledge and 24 understanding of how those were released with and experience — in both managing the Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537857 260 1 great — 2 on that, I feel comfortable that the 1981 report 3 was released and reviewed by the company in a 4 similar fashion. 5 6 with a great push to the media, based Q. Do you recall talking about this Marlboro Lights ad? 7 A. Yes. 8 Q. How do you know that this was 9 10 published in a magazine? A. It was pulled from — we have an 11 advertising database, and the database 12 distinguishes between the types of different ads 13 that we are looking at. 14 and it distinguishes between the types of ads 15 that we're looking at. 16 17 18 Q. We've got an archive What do you mean? Distinguishes between what and what? A. Points-of-sale material, magazine 19 advertising material. 20 differences in how those materials look. 21 Q. There would be I don't mean how do you know this is a 22 magazine ad versus a point-of-sale ad. 23 how do you know it ever appeared in a magazine? 24 A. I mean, It's pulled from an archive of Thompson Court Reporters, Inc. 312-421-3377 3990537858 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537858 261 materials that we ran. Q. But this says, "Leo Burnett USA, a division of Leo Burnett Company," on the top, so how do you know it ever appeared in a magazine? MR. WAGNER: Objection, asked and answered. THE WITNESS: It was pulled from an 8 archive of materials that ran. 9 BY MR. SWEDLOW: 10 11 12 Q. What archive of materials that ran? What's the name of the archive? A. I don't know what the archive is. I 13 asked for a copy of an ad that ran in a 14 publication and it was pulled from that archive 15 is my understanding. 16 Q. Who gave you the ad? 17 A. It was given to me as part of my 18 preparation for this. 19 an example of an ad that ran. 20 is it was pulled — 21 database of ads that ran. 22 23 24 Q. I asked counsel to pull My understanding it was pulled from that But your attorney gave you this ad when you asked for an ad; is that correct? A. That's correct. Thompson Court Reporters, Inc. 312-421-3377 3990537859 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537859 262 1 2 Q. But you didn't pull it from the database yourself. 3 A. I did not. 4 Q. And a Philip Morris employee did not 5 6 pull this for you; is that correct? A. I don't know who originally pulled it. 7 I know I asked for it and incorporated it into 8 the presentation. 9 Q. Who did you ask for it? 10 A. I asked counsel for a copy of the ad. 11 Q. And who did you get it from? 12 A. Counsel. 13 Q. And what is the name of the database 14 that counsel used? 15 16 MR. WAGNER: Objection, asked and answered. 17 THE WITNESS: 13 to that. 19 BY MR. SWEDLOW: 20 Q. I don't know the answer Earlier today you were discussing what 21 the FTC — 22 respect to Lights and low-tar descriptors. 23 you recall that? 24 A. excuse me — FDA law requires with Do Which part of our conversation are you Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 3990537860 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537860 263 1 2 referring to? Q. The part where I objected as calls for 3 legal conclusion. 4 recollection? 5 A. Does that refresh your I wasn't sure if you were talking 6 about that or when you asked me similar 7 questions earlier. 8 clarify. 9 Q. Oh. That's what I was trying to The part where you were speaking 10 to your counsel and testified about what the FDA 11 law required. 12 A. Yes. 13 Q. What does the FDA law require in order Do you recall that? 14 for Philip Morris to be allowed to use the 15 descriptors "Lights" in the future? 16 17 18 MR. WAGNER: Object to form, beyond the scope of the notice. THE WITNESS: I believe what it 19 requires is that the FDA will set up a process 20 related to evaluating modified-risk tobacco 21 products, and should the FDA specifically 22 authorize the use of those descriptors, it's my 23 understanding that it would probably — 24 probably have to make an application similar to we would Thompson Court Reporters, Inc. 312-421-3377 3990537861 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537861 264 1 that or that FDA would specifically authorize 2 the use of those descriptors based on some other 3 information. 4 BY MR. SWEDLOW: 5 Q. Do you know if the law states why 6 tobacco companies are net allowed to use the 7 descriptors now? 8 9 MR. WAGNER: form — Objection, beyond the beyond the scope of the notice. 10 THE WITNESS: I know that there is a 11 significant preamble to the law. 12 remember if it's addressed specifically in the 13 section that we were just going through. 14 BY MR. SWEDLOW: 15 Q. I don't Whether it's in the preamble or the 16 section, do you know why it is that Philip 17 Morris and other tobacco companies are not 18 allowed to label products as "Lights" today? 19 MR. WAGNER: Objection to the form, 20 beyond the scope, and it was asked and answered 21 this morning. 22 THE WITNESS: Again, I think that I'm 23 not familiar with specifically how it's 24 addressed in that piece of legislation. I Thompson Court Reporters, Inc 312-421-3377 3990537862 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537862 265 1 think, you know, from our standpoint, we are 2 complying with the law and that's really where 3 our focus has been. 4 BY MR. SWEDLOW: 5 6 Q. How many weeks did the website onsert run? 7 MR. WAGNER: 8 BY MR. SWEDLOW: 9 Q. Object to form. Can you identify the exhibit number 10 that is the website onsert for me since I don't 11 have a numbered set? 12 A. That's Exhibit 36. 13 Q. How many weeks did Exhibit 36 run on 14 15 packages of cigarettes? A. I believe that all of the 16 issue-related onserts were running for one week 17 worth of volume. 18 to the approach that we took. 19 there may have been lower-volume brands. 20 mentioned earlier, I don't remember exactly what 21 year we began to run that on two weeks of 22 volume. 23 the same amount of time as the other 24 issue-related communications, including the So it would have been similar At that point As I But the web onsert would have run for Thompson Court Reporters, Inc. 312-421-3377 3990537863 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537863 266 1 low-tar onsert. 2 3 Q. How many different issue-related onserts did Philip Morris run total? 4 A. I don't have all of them committed to 5 memory. 6 ones. 7 include the website. 8 on quitting smoking, on youth smoking prevention 9 related issues. 10 11 I gave you the frequency of the low-tar We ran ones on other topics that would We ran topics on an onsert Those are the primary ones that I recall. That's probably not a comprehensive list, 12 but I believe that we ran — 13 much on a quarterly basis during the period of 14 time that I outlined, so from 2002 through the 15 middle of 2008. 16 the other — 17 outside of it. 18 Lights one, for example, was the last 19 issue-related communication we ran or not. 20 those are examples of the types of issue-related 21 communications that would have been running 22 around that same multi-year time frame. 23 24 Q. ran those pretty I didn't look specifically at there may be some others that ran I don't remember whether the But I'm handing you what is marked as Exhibit 39. This is a fact sheet from a Thompson Court Reporters, Inc. 312-421-3377 3990537864 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537864 267 1 government agency 2 (Exhibit No. 39 marked for 3 identification.) 4 BY MR. SWEDLOW: 5 Q. 6 — — the FDA specifically. Have you ever seen that fact sheet before? 7 A. Let me take a look and read it to make 8 sure. I believe this is the fact sheet, if this 9 is the same fact sheet that the Food and Drug 10 Administration has posted on their tobacco 11 website, I believe I have seen this before. 12 13 14 15 16 Q. Can you read the first paragraph into the record? MR. WAGNER: Objection, beyond the scope of the notice. THE WITNESS: The Family Smoking 17 Prevention and Tobacco Control Act includes 18 restrictions on tobacco products labeled or 19 advertised with the terms Light, Low, Mild, or 20 similar descriptors. 21 smokers mistakenly believe that these products 22 cause fewer health problems than other 23 cigarettes. 24 BY MR. SWEDLOW: This is because many Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537865 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537865 268 1 2 Q. Does Philip Morris agree with the last sentence of that statement? 3 MR. WAGNER: Objection, that's beyond 4 the scope of the notice. 5 here to testify as Philip Morris' representative 6 about consumer perceptions. 7 THE WITNESS: Mr. McCormick is not I think I answered — I 8 think this is similar to language that was in 9 the Federal Trade Commission consumer alert that 10 you asked me to read as well, and my answer is 11 the same as it is there. 12 you know, particularly in light of the consumer 13 advertising that was run by the government and 14 others, you know, we acknowledge that there are 15 certainly some smokers out there that may hold 16 those beliefs. 17 BY MR. SWEDLOW: 18 Q. I think we recognize, I'm handing you what is marked as 19 Exhibit 40, which is another regulatory agency 20 publication, I believe from the FDA. 21 (Exhibit No. 40 marked for 22 identification.) 23 BY MR. SWEDLOW: 24 Q. Have you e v e r seen t h a t Thompson C o u r t R e p o r t e r s , 312-421-3377 before? Inc. 3990537866 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537866 269 1 A. Let me take a look. I'm not sure. 2 don't recall whether I've seen this specific 3 piece or not. 4 Q. I Was the reason that Philip Morris 5 ultimately removed the term "Lights" from 6 Marlboro Lights because the FDA required it to 7 do so? 8 A. Yes. 9 Q. If the FDA had not required Philip 10 Morris to remove "Lights" from the pack of 11 Marlboro Lights, would Philip Morris have 12 removed the term "Lights"? 13 14 MR. WAGNER: Objection, beyond the scope of the notice. 15 THE WITNESS: We were working — we 16 believed that a better approach than banning the 17 use of those terms was that we should be — 18 companies should be continued to be able to use 19 those terms because we thought, they were 20 meaningful to consumers. 21 from the FTC, the Federal Trade Commission, and 22 asked them to issue a rule and regulation to 23 allow — 24 continued to be used but to require additional that We had sought guidance specifically allow those terms to be Thompson Court Reporters, Inc 312-421-3377 P.Qq 390537867 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537867 270 I 1 information to be — 2 consumers. 3 description of what our preferred approach was. 4 It's a more complete description of how we 1 5 conducted things from a voluntary standpoint. j 6 We would have continued to use those if we were j 7 permitted to do so and we would have continued 8 to communicate additional information to f 9 consumers about the use of those terms. j 10 BY MR. SWEDLOW: j 11 Q. j to be communicated to So that's a more complete Philip Morris had no plans to remove f j 12 the term "Lights" from the packages of Marlboro 13 Lights prior to being required to do so by the 14 FDA, did they? 15 A. 16 17 No. MR. SWEDLOW: MR. WAGNER: 19 VIDEOGRAPHER: 21 22 Could we just take a j minute so I can look through these notes? 18 20 Sure. Off the record at 15:48. (Proceedings recessed.) VIDEOGRAPHER: 23 record at 15:53. 24 BY MR. SWEDLOW: We're now back on the Thompson C o u r t R e p o r t e r s , 312-421-3377 I Inc 3990537868 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537868 271 1 Q. Earlier we were discussing a Marlboro 2 Lights ad from 2001 that you indicated you 3 received from your counsel. Do you recall that? 4 A. I do. 5 Q. Did you specifically gather any of the 6 advertisements that are included in your 7 presentation materials yourself? 8 9 10 A. I did not pull those myself. I asked that they be pulled for me. Q. If I understand correctly, all of the 11 ads were pulled by your counsel; is that 12 correct? 13 MR. WAGNER: 14 THE WITNESS: Object to form. I requested the ads from 15 my counsel. I don't know where — 16 specific pulling of those advertisements. 17 BY MR. SWEDLOW: 18 Q. As far as you know — who did the well, not as far 19 as you know. You requested them from your 20 counsel and received them from your counsel, and 21 beyond that you don't know precisely where they 22 came from; is that correct? 23 MR. WAGNER: 24 THE WITNESS: Object to form. I do not know where my Thompson Court Reporters, Inc. 312-421-3377 3990537869 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537869 272 1 counsel grabbed the ads from. What I asked for 2 was copies of ads that ran during the periods of 3 time that we were looking for and counsel 4 provided those ads to me. 5 MR. SWEDLOW: 6 I don't have any more questions. 7 8 MR. WAGNER: Thank you for your time. I just have a couple of follow-up questions. 9 EXAMINATION 10 BY MR. WAGNER: 11 Q. (resumed) Mr. Swedlow asked you some questions 12 about the low-tar television ads. 13 that? Do you recall 14 A. I do. 15 Q. The television advertising about no 16 safe cigarette and low-tar and Light cigarettes 17 or Lights and Ultra Lights are no exception, did 18 that television ad direct viewers of the ad to 19 Philip Morris's website? 20 MR. SWEDLOW: Objection, form. 21 THE WITNESS: Yes, it did. 22 BY MR. WAGNER: 23 Q. 24 about And d i d t h e w e b s i t e whether or not smokers have information should or Thompson C o u r t R e p o r t e r s , 312-421-3377 should Inc. 3990537870 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537870 273 1 not assume that low-tar cigarettes or Light 2 cigarettes are safer than any other brand? 3 MR. SWEDLOW: Same objection. 4 THE WITNESS: An example of the 5 language that we had on our website beginning in 6 1999 stated that smokers should not assume that 7 Light or Ultra Light brands are safe or are 8 safer than full-flavored brands. 9 be an example of the type of communication that, So that would 10 while it was not contained in the 30-second 11 television advertisement, it was contained in 12 the website that those ads directed people to 13 visit. 14 BY MR. WAGNER: 15 Q. 16 And did these same ads also run on radio although you couldn't see them? 17 A. Similar ads ran on radio. 18 Q. During the same time period that the 19 television ads ran between 2003 and 2006? 20 MR. SWEDLOW: Objection to form. 21 THE WITNESS: Let me just — I'd like 22 to pull my overview document here. It looks 23 like radio ran from 2003 through 2006 and there 24 were — there was a no safe, low-tar spot that Thompson Court Reporters, Inc. 312-421-3377 3990537871 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537871 274 1 was running in December of 2 003 and November of 2 2004. 3 BY MR. WAGNER: 4 Q. j So the timing would be that at the 5 same time the ads are running on television 6 similar ads would be running on the radio? 7 A. That's correct. 8 MR. SWEDLOW: 9 MR. WAGNER: 10 MR. SWEDLOW: 11 12 13 another hour. That's all I have. All right. No, I'm just kidding. MR. WAGNER: I've got I'm done. That concludes, then, the Craft portion of the deposition, correct? 14 MR. SWEDLOW: 15 MR. WAGNER: 16 Same objection. Correct. Okay. Then pursuant to the order that you obtained from Judge David 17 MR. SWEDLOW: 18 MR. WAGNER: — Somebody obtained. — somebody obtained from 19 Judge David either earlier this week or last 20 week, the remaining part of the deposition is 21 for use in the Brown case and is not usable in 22 the Craft case. 23 24 Is that your understanding? MR. SWEDLOW: understanding. That is my Is that your understanding as Thompson Court Reporters, Inc. 312-421-3377 3990537872 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537872 275 1 well? 2 3 MR. WAGNER: That is my understanding as well. 4 MR. SWEDLOW: Because I'm going to 5 leave and leave the Craft class unrepresented 6 for the rest of this deposition. 7 understand why there were so many references to 8 California in that presentation. 9 perfect sense. 10 11 MR. WAGNER: And now I That makes Why don't we take a break, then, and you can pack up and take off. 12 VIDEOGRAPHER: This is the end of tape 13 3 in the videotaped deposition of Brendan 14 McCormick. We're now off the record at 15:57. 15 (Proceedings recessed.) 16 (Counsel for plaintiffs exited the 17 conference room.) 18 VIDEOGRAPHER: This begins tape 4 in 19 the videotaped deposition of Brendan McCormick. 20 We're now on the record at 16:03. 21 EXAMINATION 22 BY MR. WAGNER: 23 Q. 24 Mr. McCormick, Okay. We a r e now continuing, with your d e p o s i t i o n Thompson C o u r t R e p o r t e r s , 312-421-3377 that was Inc. 3990537873 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537873 276 1 cross-noticed in In re Tobacco Cases II with 2 Brown, et al. v. /American Tobacco Company, and 3 this portion — 4 by the court's order in the Brown case, but 5 there is an additional portion of the deposition 6 that is not usable in Craft but is usable in 7 Brown. 8 9 the entire deposition is usable And we'll be pretty quick. I'm just going to mark here as Exhibit 41 the amended cross-notice of deposition of Philip 10 Morris USA. There is really nothing that you 11 need to do with that document. 12 make it crystal clear that we are proceeding in 13 the Brown case from this point forward and that 14 there was formal process that was served on the 15 parties in the case. 16 (Exhibit No. 41 marked for 17 identification.) 18 BY MR. WAGNER: 19 Q. 20 It's just to What I'd like to do is — I've already handed you Exhibit 42 to the deposition 21 A. Yes. 22 (Exhibit No. 42 marked for 23 identification.) 24 BY MR. WAGNER: Thompson C o u r t R e p o r t e r s , 312-421-3377 — Inc. 3990537874 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537874 277 1 Q- — which is a four-page document. The 2 first page, I just put the caption of the Brown 3 case on it. 4 that you wanted to bring with you today to help 5 explain one more of Philip Morris USA's 6 communications vehicles that we didn't cover 7 earlier in yours and my examination? 8 9 A. Can you — Yes. are these demonstratives This is an example of what's referred to in kind of the newspaper trade as a 10 freestanding insert. 11 of a brochure that is slid into the newspaper 12 itself. 13 example, in your Sunday newspaper there is 14 information in circulars that are slid into that 15 newspaper. 16 paper in that it's not an advertisement that's 17 embedded on pages but is slid into the contents 18 of the newspaper itself. 19 What it is is an example So the way to think about it is, for Q. This would be freestanding from the So like on a Sunday paper when I have 20 a bunch of things falling out, like the comics 21 and a bunch of ad circulars, this is an example 22 of that kind of an insert that would go in the 23 Sunday 24 paper? A. That's correct. Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 3990537875 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537875 278 1 Q. And in the first demonstrative, which 2 I guess is slide number 2, what is it that you 3 are trying to highlight for us about the 4 freestanding insert that Philip Morris placed? 5 A. This specific communication was a 6 multi-page brochure that went into newspapers. 7 The focus of our efforts were to make people 8 aware of the information that they would find on 9 the Philip Morris USA website, highlight some of 10 that information, and within that document 11 really share pages from our website so that, for 12 those who didn't look beyond the freestanding 13 insert itself, they could see the information on 14 the primary pages that we had but hopefully 15 would also be encouraged to comment and visit 16 the site. 17 Q. And what were some of the major 18 newspapers into which Philip Morris placed the 19 freestanding insert in November 2002? 20 A. We ran this insert and placed it in 28 21 major newspapers. Examples of some of the 22 larger circulation newspapers in which this was 23 included would be USA Today, New York Times, The 24 Washington Post, Los Angeles Times, Chicago Thompson Court Reporters, Inc. 312-421-3377 3990537876 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537876 279 1 Tribune. 2 newspapers with a national reach and some of 3 them — 4 mentioned in the demonstrative — 5 leading local newspapers in markets throughout 6 the country. 7 So some of those newspapers are in addition to the others that are not Q. would be Now, at the bottom of this slide there 8 is a box that says, total circulation, that 9 really is total general circulation. 10 11 What does that number mean? A. That number — we distributed 16.7 12 million of these, and that's based on 13 distribution in newspapers with kind of general 14 circulation, newspapers like the ones that I 15 mentioned. 16 also ran in Spanish-language owned newspapers or 17 Spanish-language newspapers, African-American 18 owned newspapers. 19 bit of that that was distributed to the 20 newspapers that factors in that they may have a 21 larger distribution, maybe their circulation 22 requests, and indicates at a given point in 23 time, and that's just a little extra to ensure 24 that they can adequately fill demand should they There was a portion of this that And then there is a little Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 280 1 have that. 2 of kits that were sent out for distribution in 3 newspapers around the country. 4 Q. So 16.7 million is the total number And that's the number that appears in 5 your affidavit that we looked at earlier this 6 morning; is that correct? 7 A. That's correct. 8 Q. Okay. 9 Now let's focus specifically on California, which is where the Brcwn case is 10 pending, and why don't you explain to us on the 11 next slide what it is you wanted to highlight 12 for us about California and the freestanding 13 insert. 14 A. Within California we placed this 15 insert in many of the major newspapers 16 throughout the state — 17 San Diego Union-Tribune, the Fresno Bee, the 18 Sacramento Bee, the San Francisco Chronicle. 19 total the circulation for those newspapers that 20 were used in California to carry this insert was 21 a little bit less than 2.4 million. 22 Q. the Los Angeles Times, In I'm going to show you Exhibit 43 and 23 ask you to identify this as the freestanding 24 insert that we've been talking about. Thompson Court Reporters, Inc 312-421-3377 3990537878 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537878 281 1 2 (Exhibit No. 43 marked for identification.) 3 THE WITNESS: 4 freestanding insert. 5 BY MR. WAGNER: 6 Q. Okay. This is a copy of the And in the next demonstrative 7 have you highlighted some things from the 8 freestanding insert that you wanted to call our 9 attention to today? 10 A. Yes. One of the pages from our 11 website that was depicted in this freestanding 12 insert focused on low-tar cigarettes, and I 13 wanted to highlight in the demonstrative some of 14 the language that appeared in the freestanding 15 insert and appeared on our website. 16 The language states that Philip Morris USA 17 does not imply in its marketing and smokers 18 should not assume that lower-yield brands are 19 safe or safer than full-flavor brands. 20 indicate that, if smokers are concerned about 21 the health risks of smoking, they should quit 22 smoking. 23 smoke. 24 safe cigarette and that low-tar and ultra We There is no such thing as a safe We indicate there is no such thing as a Thompson Court Reporters, Inc. 312-421-3377 3990537879 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537879 282 I 1 low-tar cigarettes are no exception. 2 There are other features in the 3 communication, including a visual that — an 4 indication that what they will see on here is 5 in the document itself — 6 National Cancer Institute's conclusions about 7 low-tar cigarettes, and there is also an 8 indication in the hard-copy insert that went 9 into the newspapers that visitors to the website is a summary of the 10 would be able to click to directly access this 11 report on the National Cancer Institute's 12 website. 13 MR. WAGNER: Okay. Thank you very 14 much. 15 Thank you for your time, Mr. McCormick. Those are all the questions that I had. 16 VIDEOGRAPHER: This is the end of tape 17 4 in the videotaped deposition of Brendan 18 McCormick. 19 — The deposition concludes at 16:11. (Proceedings concluded.) 20 21 // 22 (Signature having not been waived, the 23 deposition of BRENDAN MCCORMICK concluded at 24 4:11 p.m.) Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537880 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537880 283 1 CERTIFICATE OF SHORTHAND REPORTER NOTARY PUBLIC 2 3 I, Linda S. Kinkade, RDR, CRR, RMR, 4 5 CSR, the notarial officer before whom the 6 foregoing proceedings were taken, do hereby 7 certify that the foregoing transcript is a true 8 and correct record of the proceedings; that said 9 proceedings were taken by me stencgraphically, 10 to the best of my ability, and thereafter 11 reduced to typewriting; and that I am neither 12 counsel for or related to, nor employed by any 13 of the parties to this case and have no 14 interest, financial or otherwise, in its 15 outcome. 16 IN WITNESS WHEREOF, I have hereunto set my 17 hand and affixed my notarial seal this 30th day 18 of August 2011. 19 My commission expires: December 31, 2011 20 21 NOTARY PUBLIC IN AND FOR 22 THE COMMONWEALTH OF VIRGINIA 23 24 Thompson Court Reporters, Inc. 312-421-3377 3990537881 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537881 234 j 1 ACKNOWLEDGMENT OF DEPONENT 2 ) 3 I, BRENDAN MCCORMICK, do hereby j 4 acknowledge that I have read and examined the j 5 foregoing testimony, and the same is a true, j 6 correct and complete transcription of the 1 testimony given by me, with the exception of the j 8 noted corrections, if any, appearing on the l 9 attached errata sheet signed by me, to the best j of my knowledge and belief. [ 10 11 12 13 14 15 (Date) (Signature) 16 17 18 Subscribed and sworn to before me this 19 day of 20 My commission expires 21 Notary Public , 20 . . 22 23 24 Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc. 3990537882 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537882 285 j E R R A T A Craft v. S H E E T Philip Morris 1 RETURN BY: 6 PAGE LINE CORRECTION a n d REASON j 7 8 9 \ 10 \ 11 12 13 14 15 16 17 18 19 20 21 22 23 24 (DATE) (SIGNATURE) Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 990537883 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537883 286 E R R A T A Craft v. S H E E T Philip Morris RETURN BY: PAGE LINE CORRECTION a n d REASON 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 (DATE (SIGNATURE) Thompson C o u r t R e p o r t e r s , 312-421-3377 Inc 3990537884 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537884 Page 1 AC500©9164026:14 218:21 219:7,11,13 219:22 220:14 ad 7:3,5,7,9 9:18 abbreviated 140:3 221:15 242:6 244:1 137:14 138:2,6 abide 154:3 244:7,13,24 245:1,5 139:11,18,21 140:3 ability 73:2 97:11 245:12 248:23 140:14,22,22 141:8 99:21 102:10 249:19 260:12,14 141:15,18 148:13 186:22 224:18 261:21 271:11,14 148:13,23 149:1,6 283:10 272:1,2,4,12 273:12 149:13 194:10,10 able 35:5 59:8 166:12 273:15,17,19 274:5 221:9,11,16,19,21 211:2 238:22 274:6 240:3,7,11,15 241:6 269:18 282:10 241:10 242:16,18 adult 85:2 188:7 Abshaw 79:24 244:10,15 245:6 209:22 211:23 abstract 108:2 247:5,19 260:6,22 248:9 accelerated 76; 14 260:22 261:13,16 advances 100:12 222:20 261:19,22,23 advertise 75:2 170:14 accelerating 94:23 262:10 271:2 advertised 267:19 accepted 165:14 272:18,18 277:21 advertisement access 188:13,16 add 103:14 143:1 136:13 137:8 282:10 added 36:18 106:16 138:14,19,22 accessible 235:13 106:20121:3 139:14 140:8 accompanied 161:12 125:10 194:6,16,21 150:11 151:3,11 accomplish 181:5 199:19 213:9 161:13,24 193:21 accountability addiction 60:20 62:1 194:14 218:14 112:22 172:23 273:11 277:16 accuracy 257:11 advertisements 74:22 accurate 17:23 27:14 addictive 61:1,6,13 62:14151:6 142:3 144:4 150:10 95:20 150:10192:21 addition 28:9 97:2 achieve 176:14 271:6,16 102:18 108:21 235:24 193:1217:13 advertising 6:19 7:11 acknowledge 268:14 223:23 279:3 17:18 70:8,11,17,19 284:4 71:3,11,16,2172:7 acknowledged 52:13 additional 26:15 28:7 28:14 32:19 73:8 72:14,20,24 73:11 58:6 59:19 61:5,13 78:8,16,16 91:4 73:12,15,24 74:14 129:6,15 173:2 95:5 120:24 122:9 74:19 75:10,16 acknowledging 60:7 125:10133:12 113:15 114:8,16 acknowledgment 140:19 146:17 137:15,22 139:23 56:14 68:14 284:1 183:1 187:21 189:9 140:9 142:11,19 acquired 31:8 194:17,21 199:1 143:9,18 144:2,7,17 acquisition 19:5 202:9 210:6 223:20 145:21 146:24 Act 109:20 110:2,12 223:22 224:21 147:4,9 148:5,15 110:13 131:7 229:18 252:13 149:19 153:7,14,17 132:17 134:20 269:24 270:8 276:5 154:5 161:18 228:19,21229:10 193:24 194:6 address 80:13 161:19 267:17 199:13,21,22,23 183:5 184:9,15 action 87:13,17 200:20 202:4 187:12 192:12 116:13 125:5 157:2 204:18 217:12,15 194:7 216:2 223:7 actions 73:4 87:8,14 217:23 219:14,15 addressed 68:18 90:12 128:11 220:6,8 221:22 183:19210:15 130:19 132:12 223:13 229:6 234:2 264:12,24 175:18 179:24 235:17 237:8 adds 40:11 219:17 237:4 239:13,14 246:17 adequately 279:24 active 93:18 247:16,22,24 Administration actively 256:13 260:11,19 268:13 228:14 267:10 activities 71:18,19 272:15 adopted 143:22 81:6 146:16 152:21 adoption 178:24 advised 164:2 165:16 actual 101:3 187:5 ads 71:4 74:16 140:1 advising 164:1 228:22 194:20 218:5,7,16 advisory 63:17,22,23 AC500 inaccurate 193:2 I include 14:3 18:12 23:142:144:2 46:12 57:5 63:14 I 71:23 91:16,24 117:3 126:14 \ 127:13 130:22 \ 134:22 143:17 \ 144:7,17147:15 \ 180:11 184:20 \ 192:12 197:23 \ 225:15 234:12 \ 266:7 : included 17:13 22:3,5 [ 33:4,23 39:23,24 \ 43:20,24 47:11 48:2 51:17 80:17 98:8,10119:8 144:13 147:11,20 \ 154:7,17 181:20,23 \ 182:12 190:3 [ 194:11 206:2,2 208:22 212:9 216:6 1 216:7 218:1223:13 : 227:19 230:18 231:22 233:17 I 235:16,17241:6 244:24 271:6 278:23 includes 160:24 182:24 183:1 212:22 232:9 j Thompson Court R e p o r t e r s , I n c . 312-421-3377 3990537834 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537894 Page 11 267:17 including 19:2 87:10 88:19 93:4 116:14 118:15 145:3 161:19 172:7,21,22 178:11,16 179:16 229:4 231:1233:16 234:7 235:18 244:7 265:24 282:3 inclusion 154:5 inclusive 14:22 91:17 111:9 incomplete 86:12 incorporate 97:8 99:5 208:11 incorporated 1:9 3:15 4:5 15:20,21 16:4 262:7 incorporating 235:20 increase 164:4 increased 46:9 increasing 46:4 171:5 independent 35:21 115:3 254:24 INDEX 5:1 6:17:1 8:19:1 10:1 11:1 indicate 83:7 87:7 90:11 187:5 197:24 281:20,23 indicated 25:2 44:3 57:17 63:6 75:15 98:5,20 115:22 125:4 128:5 135:7 173:10 242:1255:4 271:2 indicates 279:22 indicating 55:15 82:17 251:14 indication 206:11 207:18 282:4,8 individual 43:3,7 134:10,13 142:23 182:18 251:18 256:19 individually 1:5 3:4 45:21 individuals 206:21 219:21234:3 251:7 industry 52:2 70:19 223:21 246:17 247:16 249:21 information 9:12 10:7,13 11:12 22:19 31:6,7,15 32:20 36:5 39:15 39:19,22 65:12 78:12,17 82:19 85:18,19 91:4 94:15 95:11 115:3 115:19 117:20,23 118:9,12 119:18,19 120:24 122:9 126:22 130:23 133:5,7,14 144:2,14 144:17 145:7 146:13 171:8,10 174:18 179:16 180:3,5,6,8,9,11,13 181:12 182:12 183:19 184:6 186:10188:3,11 190:19,22 191:8 192:4,18 193:10 194:9,11,21 196:19 196:24 197:16 199:1,4,9 201:21 205:14 207:19,21 210:18211:13 215:11216:4,6,7,10 218:2 220:23 223:9 223:16 232:13 233:1,16,24 234:7 234:13 235:16 236:3,17 243:10 250:20,21252:1,2 252:10,11,13,14,17 253:18 256:17,24 264:3 270:1,8 272:23 277:14 278:8,10,13 ingredient 180:8 ingredients 191:8 inhale 158:5,18 185:2 187:6 199:24 206:24 207:2,6 inhaled 182:17 206:20 inhales 234:20 input 23:5 78:8 200:18 inquiries 21:15 90:12 172:10 insert 47:11,17,22 56:1160:23 230:18 277:10,22 278:4,13 278:19,20 280:13 280:15,20,24 281:4 281:8,12,15 282:8 inserted 230:19 231:7 231:8 inserts 235:5 inside 152:7 175:7 205:4 237:22 insight 115:3,7 128:10 210:5 instance 82:21 128:13 instances 21:20 67:4 69:14 109:1 Institute 10:5 76:8 88:3,16 94:23 169:7 171:17 184:5 200:23 201:14 203:11,16 204:2 222:17,21 237:6 Institute's 66:18 87:11 171:24 203:4 282:6,11 integrate 99:21 103:7 integrated 103:3 integrating 109:3,9 integration 99:21 103:6 intended 119:5 138:7 182:16 257:1 intending 118:1 intensely 184:24 interacting 175:1 interest 52:19 59:1 173:13 174:9,24 209:22 234:1 283:14 interested 30:3 45:15 64:3 105:1 intern 19:23,24 46:3 57:3 60:1 internal 19:4 244:10 internally 16:2 42:13 International 166:24 Internet 188:13 189:21 internship 21:5 interpret 158:11 interpreted 231:1,24 234:16 interrogatories 6:7 54:9 interrupted 154:23 intervening 29:9 Intranet 111:4 introduce 12:17 137:16 188:8 introduced 131:14,18 introduction 163:11 169:6 171:23 introductions 146:16 invest 71:13 invested 208:14 investigations 150:6 investment 17:6 investor 14:1,7,13,14 14:16 17:3,4 19:2 involve 152:13 involved 18:22 27:10 28:14 78:7 86:3 103:12112:24 127:7 149:23 153:13167:3 253:2 issue 22:4,18 30:16 39:7 48:23 50:24 51:9 53:15 56:21 57:19,23 58:12,17 58:23 59:5 66:18 67:8,13 69:1,5 76:7 82:16 83:9 88:17 97:5 123:24 128:3 130:10133:22 135:21 173:8 176:11 184:6,16 196:10 202:7,17 205:18 224:22 226:13 254:13 258:9 269:22 issued 66:14 175:12 197:3 203:10 issues 10:14 17:18 21:5,18 22:5,7,16 28:2130:3 38:23 39:9,14 40:3 45:16 45:17,20 46:8,14,16 48:6 49:10 50:2,4 53:16 60:5 61:23 62:7,18,22 67:3,23 68:18 69:8,9,14 73:3,21 76:6,17 77:181:15,24 86:4 86:9 88:6 111:7 172:4,17,21 173:7 173:16 174:9,13 177:23 179:17 180:1 191:10 199:19 201:12 203:20,24 204:5 205:13,14 216:7,24 222:12 253:3,18 255:24 257:8 266:9 issue-related 265:16 265:24 266:2,19,20 items 154:16 job 13:23 16:21 17:8 ^ 17:10,23 18:7,19,21 j 18:22 19:12,20 [ 20:13,1421:13 i 30:2 69:12 256:3 h Joe 80:5,14 joined 15:5 19:21 59:21 joining 20:1 Jones 80:24 81:3 > journalists 82:4,8,20 Judge 274:16,19 • judgment 173:11 174:7,22 JUDICIAL 1:1 Judiciary 61:21 62:4 173:1 July 21:8,8 24:15,18 26:13,18,24 29:5,11 June 14:17 19:21 97:20,24100:14,22 112:6 113:7 121:10 131:5 228:12 229:10,16 231:14 jurisdiction 112:17 K KA YE 3:17 keep 78:13 125:17 155:16 keeping 43:2 kept 36:19 222:22 key 18:16 76:9 102:9 104:3 136:23 137:3 196:8 200:16,18 206:3 210:15 kidding 274:11 kind 21:5 45:6,11 46:171:5 76:4,16 95:10165:3 206:3 209:13 215:3 251:20 277:9,22 279:13 kinds 218:18 Kinkade 2:10,22 12:14 283:4 kit 188:17 189:19 190:5 kits 280:2 J knew 234:1 248:17 January 55:1 knobs 237:23 JCCP 1:14 12:8 know 9:16 15:13 Jeff 193:3 229:24 35:24 36:3 38:5,8 Jeffrey 3:16 5:5,7 38:13,14 40:14,16 12:21 40:24 41:2,2,4,5,7 Jeffrey, wagner @ ka... 41:10,13,16 42:3 3:22 43:22 48:13,17,20 Thompson C o u r t R e p o r t e r s , I n c . 312-421-3377 3990537835 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537895 12 51:2 52:24 55:3 56:3,13 57:19 61:9 61:12 63:9 64:9,11 67:16 73:17 82:9 82:10 83:4 86:3 88:3 91:23 92:7 98:9,11,15,21 104:7 105:14,16 106:10 107:5,10,12,24 108:7,13,14 109:10 109:17 112:4 113:5 113:10,13 114:9,12 114:14 127:1,2 131:23 132:10 136:19 137:22 158:14 161:10 162:17 176:24 183:24 196:2,10 226:9 229:1,22,23 229:24 232:23 234:13 237:11,23 239:7 245:4 246:5 246:6 247:12 250:1 250:3,15,16 251:19 252:20,24 253:5 256:12 257:5 258:6 259:7 260:8,21,23 261:4,12 262:6,7,17 264:5,10,16 265:1 268:12,14 271:15 271:18,19,21,24 knowledge 27:8 35:22 107:22 144:10 148:1 196:20,21213:1 255:17 258:14 259:16,20,23 284:10 known 228:23 knows 198:12 Korein 3:7 Krishna 2:23 12:13 L LA 80:23 81:2 label 264:18 labeled 67:18 267:18 labeling 113:14 labels 154:6 laboratory 142:23 lack 139:16 140:12 162:8 198:8 204:21 208:6 229:1 lacking 139:6 lacks 144:11 157:15 158:21 161:16 227:5 laid 177:20 language 48:18 52:18 59:11,14 63:10 94:3 95:12,16,17 114:24 116:14 119:22,23 120:6,9 120:12,14,23 121:1 135:10 138:5,9 140:18 142:6,10 144:5,7,19 145:19 163:23 168:1.5 183:21 185:10,14 194:6,17,22 197:2,6 197:6 199:19,20,22 200:4,9,13 226:10 226:11227:8,9 230:22 234:14 235:8,10 238:6,7 268:8 273:5 281:14 281:16 larger 184:20 278:22 279:21 LARSEN1:4 late 24:15,18 29:5,11 75:24 94:22112:18 116:18 137:16 171:4 175:21 192:10219:5 221:17 222:19 231:6 latest 87:14 116:19 123:24 125:5 launch 52:9 launched 30:24 44:21 44:2247:148:18 51:5,14 52:6 148:6 178:22 179:18 181:1,3 182:10 187:24 192:9 237:2 launching 150:21 law 2:3 112:3,5 130:16,18 153:16 228:13 229:10,14 230:3 234:12 262:21263:11,13 264:5,11 265:2 laws 152:20 lawyer's 238:19 239:6 lay 147:16 176:13 236:23 238:6 lead 90:23 246:6 leadership 134:11 leading 70:17,24 71:7 139:16140:12 145:9146:2 147:18 154:24 157:15 160:6 161:15 162:9 165:11 167:17 175:4,11 178:15 179:8 182:9 183:10 204:21 214:7 217:2 217:20 218:24 220:17 224:8 225:21 228:2 229:13 236:21 279:5 leads 206:4 learn 234:4 leave 214:21,21 275:5 275:5 led 108:16 left 140:18,20 154:15 legacy .library 9:9 legal 23:2,4 73:24 142:12 176:15 229:22 230:4 263:3 legend 141:9,14,17 147:4,20,21 148:2 legends 147:12 legislation 114:2,3,5 114:20 115:4,22 116:1 117:13,14 126:24 130:14,15 131:14,17 172:13 172:18 229:2 264:24 legislative 110:23 131:20134:7 172:16 Leo 261:2,3 letter 134:12 147:5 172:23 173:2 letters 134:9,10 225:3 225:8 let's 27:19 65:20 127:23 181:8 280:8 level 35:6 50:1,8 51:2 102:21 109:21 209:2 244:11 levels 158:6 Lewis 54:5 light 10:19,21 33:14 33:14 35:15,15 36:1,137:6,8 43:18 43:19 83:24 84:19 86:5 95:7 113:15 131:2 147:1206:6 206:7 207:6,12,12 238:2,10,12 239:9 241:8,15,20 254:6 267:19 268:12 272:16 273:1,7,7 lighter 138:10 139:10 Lights 6:21 7:4,10 33:14,18,18,19 34:6 34:6,6,11,1136:22 37:1,3,9 42:1,1,6,7 42:20,20 70:8 72:20 74:2075:22 77:7,20,21 78:3,22 83:6,7 88:18 89:15 90:8,24 91:1,7,16 93:9 96:22,23,24 98:2,5,6 105:8,24 114:7,15 115:12 116:4,9,11 117:9 118:2,4 119:9,11,12 119:20,23,24120:2 120:15,20,22121:2 121:7,9,17,18,19 122:5,15,20,23 123:4 124:4,5,7,22 124:24 126:13,15 127:12,14 128:20 128:21 129:19,21 132:18 134:22 135:15 136:14 137:8,10,16,20 138:2,20 139:12 140:5 141:9143:8 143:15 14B:5,24 149:13 150:10,12 150:21 151:4,12 160:14 186:11 187:13,13,19,19 207:5 221:24 222:3 222:23 223:2 226:1 226:1,2,5,14 227:1 227:16,17,18,23,24 228:9,11,23 229:5 229:11230:6 231:13,14 235:8 241:11,11242:9,12 242:12,14,20 243:1 245:3,7 260:6 262:22 263:15 264:18 266:18 269:5,6,10,11,12 270:12,13 271:2 272:17,17 limitations 85:18 97:13 105:6 133:6 limited 71:2,14 75:15 209:24 225:9 Linda 2:10,22 12:14 283:4 line 34:12 38:2,9 126:16 198:5,12 206:4 285:6 286:6 lines 21:3 34:21 Thompson C o u r t R e p o r t e r s , 312-421-3377 133:7 link 180:12 204:13 230:21253:19 links 11:11 183:1,2 184:3 187:21204:2 234:22 list 22:9 43:14,24 71:15 80:13 111:9 161:6 162:20,22 163:2 240:20 251:2 251:6 266:11 listed 39:21 listened 238:16 listing 89:9 listings 160:24 literally 225:3 litigation 6:12 16:6 16:12 29:20 53:2 55:11,12,14 81:24 87:20 88:5,6,19,20 little 18:11 19:5 21:9 39:13 54:16 93:19 157:6 161:5 191:22 202:8 210:8,22 237:23 244:18,19 279:18,23 280:21 live 195:1 LLP 3:17 4:7 local 279:5 location 185:3,12 long 15:3 122:1 126:24 127:5 171:14 238:24 239:2,3 longer 62:10 71:4 120:19,23 123:15 139:9 224:6 230:6 look 11:10 16:14 23:8 36:4 37:16 47:16 47:19 54:17 60:19 67:3,22 70:2 72:3 85:16 91:5 93:16 94:7 95:6,15,21 128:6,7 130:12 177:11 181:8 188:15 202:6,6,9 213:20 215:2 222:12,14 223:8 230:13 239:14 247:17 248:2 251:4 260:20 266:15 267:7 269:1270:17 278:12 looked 31:5 33:8 35:1 35:20,20 36:6 42:11 67:7 71:11 77:22 106:13 113:3 \ \ I ! ! \ I ; Inc. 3990537836 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537896 Page 13 213:5,13 214:14 150:9169:8,16 216:2,6,24 217:4,18 171:12 193:3,10 201:24 210:8,17,18 218:2,7,14,16 210:23 244:16 220:14 221:11 227:3 232:14,19 247:18 248:17 233:16 236:15 250:21 280:5 243:17 244:2,4,6,17 looking 20:16 27:1 76:5 80:2 94:20,24 244:21 262:22 266:1,5 272:12,16 99:1 100:16 102:14 273:1,24 281:12,24 106:9 112:20 282:1,7 136:20 183:23 233:24 237:21 low-tar-focused 40:7 243:4 250:18 252:4 low-tar-related 38:20 260:13,15 272:3 low-yield 87:10 90:17 looks 28:5,24 232:2 167:11 lunch 96:13,18 244:17 273:22 LoriUard 64:1 Lund 80:4,14 Los 278:24 280:16 lung 8:13 48:9 50:12 68:7 164:8 169:14 lot 27:15 93:6 172:14 232:24 M LOUIS 12 M 3:16 5:5,7 low 10:8,19 33:14 machine 123:12 39:9,13 113:16 182:23 187:3 116:4 138:7,10 143:10 168:17 196:12,17 206:21 169:18 172:7 206:9 257:12 211:22 254:5 machine-measured 181:13 267:19 Madison 3:19 lower 75:20 76:19 77:3 83:19,24 84:4 magazine 70:16,19 84:9,14,22 86:23 71:3,4 72:14 74:14 87:21 88:21 89:14 260:9,18,22,23 90:6,19 94:16 261:4 magazines 71:5 72:14 105:24 122:14 156:22 164:7,8 73:174:16 169:12,13 184:22 mail 71:23 188:7 206:9 222:2,8 189:1204:18 lowered 6:17 80:15 217:13 235:11 88:18 main 88:13 Maine 27:23 28:24 lower-tar 155:12 158:20 165:16 29:19 221:3 170:12 major 88:2 109:22 lower-volume 36:19 115:23 171:18 37:10,11 265:19 219:3 278:17,21 lower-yield 281:18 280:15 lowest 166:14 majority 37:6,8 211:5 low-tar 38:23 39:1,4 making 55:10 75:18 39:7 40:1,10,22 88:11 115:16 128:6 41:1168:13,16 130:9 132:7 143:9 102:15 103:9 105:3 199:9203:24 106:24 128:3 222:11 130:10 155:5 156:2 managed 253:4 167:15 169:24 management 17:14 170:24 190:23 17:18 18:13 21:6 199:22 201:7,18 175:19 205:19 209:4 manager 19:17,19 211:14212:21 20:18 93:9 96:22119:12 managing 259:21 manner 71:22 258:17 120:15 121:7,19 259:3 126:15 127:14 manufacturers 64:5 128:21 129:20 103:5 146:17,19 136:14137:8,10,16 150:5 157:6 229:15 137:20138:19 manufacturing 32:16 139:13,22,24 140:2 99:5,7,11,22 103:14 140:4,5 141:9 105:21 107:18,21 143:8,15 147:1 108:4,5,20 109:4,7 148:4,24,24 149:4 109:9 208:13 149:13 150:9,12,21 209:17 210:1,4 151:4,12 160:14 229:15 221:24 222:3 mark 136:15 149:7 227:16,23 228:23 153:6 164:17 232:10 235:12 260:6 269:6,11 193:20 195:15 203:5 276:8 270:12 271:1 marked 14:18,20,23 marIboro.com 16:7 29:154:17 235:13 65:3 79:2,4136:16 Master 54:20 55:5,18 136:21 137:5,7 55:24 56:16 61:14 138:17 144:20,23 70:20 72:7,12 73:5 149:10 153:10 material 30:22 31:12 156:11 157:23 31:13 252:6 253:8 159:4 160:18 260:18,19 161:13 163:5,9 materials 21:20 23:3 164:21 165:24 23:5,14 28:3,7,9,10 166:21 168:8 169:2 30:5,9,1063:6 173:23 176:6 179:5 204:19 217:12 179:9 188:20 229:6 235:19 189:12 190:7,11 252:18 260:20 191:16 194:2 261:1,8,10 271:7 195:20 203:7 math 94:2 205:23 209:10 matter 12:4 28:19 212:15,17 220:2 29:13 109:8 113:1 233:10 266:23 matters 21:23 53:9 267:2 268:18,21 53:12 276:16,22 281:1 Max 79:14 market 37:16 71:20 McCormick 1:21 2:2 160:14 5:2 6:9,11 12:4 marketed 137:20 13:1,21 53:7,13 marketing 22:6 56:6 96:5,9,12 110:5,15 71:12,17,18,19 136:12 148:1 152:6,12,21 153:14 178:20 202:20,23 187:18 190:8 203:2 237:20 268:4 205:16 229:6 275:14,19,24 281:17 282:15,18,23 284:3 marketplace 79:1 MDL 27:23 28:24 markets 279:5 mean 15:24 30:10 marking 148:21 41:22,24 43:23 Marlboro 6:20 7:3,6 53:17 58:16 78:10 7:9 33:18 34:4,6 78:11,18,20 83:23 36:22 37:1,3,6,8,9 84:16 85:21,21 37:23 70:8,11 91:5 92:1196:23 71:12 72:20 74:20 98:24 116:9 117:21 75:3,21 77:20 117:21 118:3 119:6 89:15 90:7 91:1,16 119:13,20,24 120:3 121:24 122:9 124:4 127:18,19 129:2,8 129:22,22 131:3 } 133:6 139:12 \ 174:11,24 182:7,7 1 214:1223:10,11 \ 224:1,1226:1,15 \ 227:2 231:1,14,24 [ 234:16 236:7 242:9 [ 242:15 245:3,8 \ 249:1260:16,21,22 [ 279:10 I meaning 84:12 86:13 j 122:23 124:22 j 127:23 139:18 meaningful 269:20 means 22:20 29:22 33:13 119:20 120:3 ! 121:17 131:3 187:13 190:18 192:3 224:21 225:2 225:5 226:15 231:13 meant 78:18 91:5 118:2 119:5,13 121:24 122:8 123:4 133:5 153:4 182:15 206:19 [ measured 161:1 187:2 206:12 measurement 257:13 measurements 249:20 measures 258:15 media 17:14 19:9,15 19:17,2120:5,7,9 20:11,14 21:12,13 21:14,2145:14 46:1,13,17 51:20,21 51:22 52:157:5,10 57:13 59:17 70:9 70:12 72:7,20 74:4 74:20 75:3 81:7,19 f 82:23 83:12 90:9 90:11 110:21 111:1 204:12 253:2 259:19,20260:1 medical 48:8 60:24 165:14 medium43:19 98:7 206:7 207:6,12 227:18 246:6 247:19,20 Mediums 33:21 34:7 34:1142:1,7,20 98:7 226:5 meeting 71:23 —: Thompson C o u r t R e p o r t e r s , I n c 312-421-3377 3990537837 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537897 Page 14 meetings 134:13 members 19:15 21:14 61:20 76:11 115:2 115:7 134:10,13 171:6 172:10,13,20 180:3 255:24 memo 82:24 90:2 memorandum 157:10 memory 2:6:10 30:21 31:1,6 238:17,21 266:5 Men 8:18 168:12 mention 184:16 186:19,21 mentioned 22:16 33:16 49:14 51:13 51:16 56:2,22 57:23 59:6 66:8 72:22 85:20 89:18 98:1 100:17 117:17 130:6,21 131:11 146:21 149:2 159:22 185:18 200:22 213:5 215:21 254:11 265:20 279:4,15 mentioning 177:4 244:1 merger 19:5 Merit 2:12 message 39:240:10 40:22 62:22 82:2 97:12,24 98:8,10 100:5,8 101:24 102:9 103:10,17 105:1,2,3,24 107:14 152:4 155:3 170:1 170:9,24 173:6,15 206:15 209:23 215:2 224:15,19 225:16,24 226:3,7 231:18,22 235:6 236:10 244:2,2,12 messages 39:14 82:3 82:19 97:15 102:15 174:8,10,23 200:16 201:2205:8 215:1 215:16,18,20,21 226:21 244:5,6,14 244:24 messaging 39:5 41:11 method 8:20 64:18 140:24 141:5,11,20 142:2,7 143:9,17,21 143:21 146:10,20 148:4 169:8 182:20 183:6 187:3 194:16 195:6 206:13,22 224:14,23 methodology 64:17 76:3 181:18 197:5 201:13 methods 235:6 Michael 79:19 80:5,5 80:15 Michigan 3:8 mid 160:13 168:21 224:23.23 225:20 Midcourse 8:9 middle 154:16 266:15 midterm 165:4 mid-decade 165:2 Mike 80:14 mild 10:19 34:11 43:19 113:15 114:7 114:15 206:7 207:6 207:12 227:18 267:19 Milds 33:21 34:7 42:1,7,20 83:6 Miles 85:23 86:1,2,17 86:24 87:5,20 88:19 89:16 milestones 132:3 milligram 141:10 milligrams 141:9,19 141:19 146:6,6,7 148:2,3 161:5 million 32:1,6,7,8,9 32:12 33:1,9 34:12 34:15 36:7,8,8 42:18 188:7 208:23 211:17,21212:8,11 213:15 214:5,16 279:12280:1,21 Millionaire 219:2 mind 68:4 80:7 95:23 miniature 204:24 minute 65:21 183:15 270:17 minutes 79:7 80:7 mirrors 199:20 missing 126:4 mission 9:5 175:20 176:9,14 177:1,7,15 178:3,6,8,24 240:21 Missouri 1:1 12:6 13:7 212:24 213:2 213:15,21 214:2,13 250:6,13,23 252:14 mistaken 64:8 mistakenly 267:21 mix 97:2 125:10 mixing 215:14 niodifled-ilsk 263:20 moment 76:10 218:15 money 71:13 monitor 12:1288:4 149:17 258:7,8 monitored 155:22 monitoring 76:4 156:2 253:6 Monogram 87:11,16 90:15 200:24 201:5 203:4 204:14 monograph 8:19 171:24 200:24 monographs 66:19 monoxide 169:9 month 19:8 98:17 101:8 175:15 244:18,19 247:1,7 months 86:15 87:4 100:22 more-complete 243:15 morning 12:2 13:19 219:6,8 240:2 264:21 280:6 Morris 1:9 3:14 4:4 6:12 9:3,6,10,13 10:18 11:5 12:5,22 14:3 15:4,5,7,13,15 15:16,18,19,21,22 16:1,3,4,6,12 17:15 18:17 19:3,9 29:16 35:16 36:2 37:20 38:9,15 39:20 40:20 41:144:14 44:18,2045:1 48:14 52:13 54:8 54:22 55:16 56:14 57:2,3,13 58:6 59:18,1961:5,12 70:5,7 72:17,19 74:7 75:20 77:3,6 77:18,19 83:8,14 86:14 87:19 90:6 90:24 91:23 93:8 96:14,2198:23 99:24 103:19 105:10,23 106:23 108:5,8 109:10,24 110:10,11 111:16 112:10 113:5,20,24 115:10,15 117:2 118:1 119:12 120:19 121:8,16 122:13,15,19 124:3 124:7 128:1 129:20 129:23 131:5 132:16 134:1,5,22 135:13 137:19 139:12 143:20 144:7 145:3 146:24 149:17 150:12,20 151:5,13 152:3,6,7 155:2,16 156:1 157:12 161:10 164:11 169:21,24 170:14,22 172:2 174:6,11,24175:7,9 175:17 176:9 177:7 178:7,21 179:13,20 180:21 181:9183:5 184:8 186:9 187:12 187:24 188:1 189:10 191:1 192:6 192:12 193:23 194:16 195:1 196:20 199:3,12 200:12 201:4,6 203:15 204:10,13 205:6 208:5 209:6 211:15 212:1 214:12,20 217:14 217:22 219:9,12 221:23 222:722 224:6 227:12 228:10,21 230:7 231:12,15 232:15 233:13 235:6 236:15 240:20 252:24 253:12 254:15 255:5,9 256:8 257:11258:1 259:8,8 262:4 263:14 264:17 266:3 268:1,5 269:4,10,11 270:11 276:10 277:5 278:4 278:9,18 281:16 285:2 286:2 Morris's 41:17 72:6 77:17 83:8 84:18 90:20 91:15 100:13 101:21 116:7 124:20 126:14 127:12 128:20 179:15 186:14 203:5 235:21 255:17 257:21 272:19 move 102:18 105:20 125:15 130:14 138:13 142:12 158:20160:13 165:19 Thompson C o u r t R e p o r t e r s , 312-421-3377 moved 15:11 131:19 200:21 Movie 219:2 moving 20:4 130:16 f multiple 30:18 40:3 1 119:16 129:3 1 130:24 214:24 j multi-district 29:20 I multi-page 278:6 multi-year 127:4 1 134:7 266:22 Murillo 80:5,14 M-C-C-O-R-M-I-... ! 13:22 i N N12:1 name 12:12 13:20,21 15:17,22,24 20:23 261:11262:13 named 20:18 names251:ll Nancy 80:4,14 narrow 18:11 Nation 8:8 national 3:18 10:4 66:17 76:8 87:10 88:2,15 94:23 169:6171:16,24 184:4 200:23 201:13 203:3,11,15 204:2 212:22 222:16,21237:5 279:2 282:6,11 nationally 213:14 nature 215:4,15 236:1237:14 257:12 necessarily 21:19 34:24 179:22 244:15 necessary 105:20 need 84:24 99:8,8 104:18 107:20 144:23 154:3 171:1 183:23 276:11 needed 102:6,19 153:16 222:15 needs 104:6 108:3 neither 283:11 networks 219:3 never 92:24 102:22 182:16 new 51:11 93:5 99:4 99:7 104:15 106:16 106:20 146:16 175:16 188:3 \ j s ? j \ 1 I 1 1 I I j I 1 [ j \ j I \ j Inc. 3990537838 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537898 Fage 15 196:19 200:24 208:14 224:14 232:5 235:7 278:23 news 10:3 50:23 51:8 51:10 52:11218:22 218:23 219:5,6 newspaper 47:23 48:4 52:8 277:9,11 277:13.15,18 newspapers 278:6,18 278:2122 279:1,2,5 279:13,14,16,17,18 279:20 280:3,15,19 282:9 nicotine 7:15 9:8,21 49:7 50:5 64:15 66:15 67:23 75:21 76:3,9,1.8,19 77:4 83:14,16,20,24 84:3 84:4,8,9,20,22 85:7 85:9 86:23 87:21 88:19,2189:14 90:7,19 91:9,19 93:1194:16 106:1 122:14,17 123:6,16 138:8,11 140:23 141:4,10,19 142:20 143:10 146:7 148:3 154:19 155:14 156:17,23 157:4 158:5,6,15,18 159:16 160:1,11 161:1 1(54:3,7,9 166:14 167:4 168:17 169:9,13 180:10 181:13,17 182:6,14,17 183:7 183:23,24 184:11 185:1 187:2,6 191:9,11 195:13 196:15 197:20,22 198:16,21 199:24 206:10,11,18,20,23 207:1,7 216:8 217:5 222:2,8 234:19 night 71:24 219:5 nightly 218:23 219:5 nine 57:5,1159:17 131:15 221:21 246:24 nine-year 58:5 non-full-flavor 33:11 43:15,20 44:1 97:21 98:2 non -ful 1-flavored 33:13 34:21 non-low-tar 215:21 60:9 61:7,15 65:17 204:17 207:23 non-regular 35:14 72:10,21 92:1,2,4,6 212:7,9 213:7,21,23 36:138:16 40:21 213:23 236:13 92:8 93:1,15 98:18 41:17,22 43:9 243:13 265:9 278:2 104:1 106:3 107:2 North 3:8 279:10,11280:1,4 109:14110:3,6,19 Nos 14:22 numbered 265:11 111:18 112:12 notarial 283:5,17 numbers 9:8 30:19 113:8 114:17 Notary 2:14 283:2,21 32:23 49:7 50:5 115:13 118:7 284:21 71:10 83:15 85:7 121:11,20 124:11 note 13:5 82:15 204:4 91:4 133:5 137:24 125:1 126:17 220:19 141:14 143:17 127:15 128:23 noted 52:19 62:6 158:12 180:10 130:1 132:19134:3 216:1217:3 284:8 181:14,17 182:6,14 135:1,16 137:12 notes 270:17 183:6,23 191:9 139:16 141:6142:4 notice 6:4 14:19 194:16 195:6 142:16 143:2,23 28:16 48:16 50:3 196:11,14206:18 144:8 145:9,17 50:17 52:16 53:6,9 207:1,21 216:8 147:7,18 148:8,17 53:24 55:21 56:2 217:5 221:16 249:1 149:20 151:8,16 56:18,22 57:23 250:5,8,9,10 252:6 152:8,16,17 155:18 60:10 61:8,16 69:1 N/A 6:4,5,8,18 7:3,5 156:5 160:6 161:15 91:14 110:4 113:2 7:7,9,18,20 8:3,7,13 167:16 168:3 170:5 113:9 114:18 135:2 8:19 9:5,6,19 10:7 171:2172:5 173:22 135:17 137:13 10:18,19,21 11:3,7 204:21 208:6 143:4 147:8 148:11 216:13 217:19 O 220:17 224:8 225:6 162:9 254:20 012:1 263:17 264:9 225:21 228:2 267:15 268:4 Obama 134:12 229:13 230:11 269:14 object 24:20 25:6 233:9 236:20 noticed 139:4,17 34:14,23 35:10,18 242:22 249:6 140:13 143:14 37:21 38:3,11,17 255:19 259:11 noting 176:11 44:10,16 48:15 261:5 262:15 264:8 notion 231:21 49:11,22 50:16 264:19 267:14 novel 104:14 53:3 55:20 56:17 268:3 269:13 November 31:21 58:19 65:15 68:23 272:20 273:3,20 32:13 42:15 47:14 73:16 74:8,2477:9 274:8 54:21205:11,20 87:188:23 89:17 objections 141:16 207:24208:21,22 105:12 114:10 149:9 150:24 158:1 220:21221:10,17 128:4 131:9 138:3 159:9,21 160:7,20 221:17231:8 139:2,3,5,15,17 163:15,20 164:14 243:18 274:1 140:11 143:12 165:6,10166:8,20 278:19 150:15 153:20 167:17 168:7 169:4 no-safe 244:1 155:7 157:14 170:17 172:8 174:1 number 12:5,8 15:1,2 158:21 162:7 174:14 175:3,10 15:2 17:7 19:1,24 183:17 192:24 176:20177:10 30:12 32:16 33:1 198:7 214:6 227:4 178:5,14 179:7,19 34:19 35:14,20,21 228:24 229:21 180:22 181:15,22 40:7,14,1842:3,17 230:4 232:16,16 182:8 183:9,17 51:1070:23 71:1,2 239:10 247:10 184:14 185:9,24 71:14 75:9,15 78:6 253:14 254:19 186:7,18 187:15 88:7 98:11,2199:1 255:7 255:10 188:4189:17 190:2 130:11 134:9,13 257:14 263:16 190:10191:2,18 145:13 150:9 265:7 271:13,23 193:1 194:4,18 153:24157:10 objected 263:2 195:8,18 196:22 159:23 167:5 objecting 92:16 197:14 198:8,18 169:16176:22 objection 24:12 41:19 199:7,15 200:7 188:15 189:24 42:22 52:15 53:18 230:1 257:22 191:11 194:7 53:23 57:8,15 58:8 objectives 8:8 75:6 Thompson Court R e p o r t e r s , 312-421-3377 165:2,4 obtain 232:14 obtained 274:16,17 274:18 obviously 130:17 167:17 186:2 198:13 217:20 226:17 occurred 70:14 132:4 October 30:2444:4,8 44:12,2245:9 46:18,23 47:1 48:19 49:5,20,23 50:15,18 51:5 95:17 118:11 173:20 178:22 186:11 188:1 192:10 221:16,17 237:2 255:12 offer 198:13 offered 201:18 212:23 offering 78:24 offerings 78:24 186:23 office 259:17 officer 134:8 175:17 283:5 offices 2:3 official 15:22,24 22:21 172:2 Oh 59:24 79:10,18,24 115:6 119:3 193:6 251:15 263:9 Ohlemeyer 81:21,22 82:3,10 okay 16:5,14,18 27:4 27:7,19 29:14 65:9 65:20 69:18,19 80:11 83:13 92:20 92:23 100:20 129:11 135:23 137:7 149:5 153:3 154:21 157:20 163:3 166:17 167:24 169:16 177:2 181:8 182:2 187:24 189:6 190:7 197:9 205:6 210:2 212:13 213:17 214:18 218:9 224:11236:13 240:17 274:15 275:23 280:8 281:6 282:13 old 93:7 258:20,22 older 31:3 235:14 Inc. Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Page 16 246:2 old-school 237:22 omits 123:2 once 104:16 110:24 130:17 143:21 211:8 214:22 215:10 ones 33:15 266:6,6,9 279:14 one-to-one 71:22 one-year 117:14 ongoing 76:4,16,22 88:13 199:17 onsert 31:24 33:4,12 34:21 36:6 39:19 39:23 42:7,8 43:4,7 43:11 204:20,24 205:1 206:2,4,4 207:10 208:1,4,20 211:16 212:2,5 213:6,13 214:15,21 216:3,11,14,17 217:5,8,13 231:19 265:5,10,22 266:1,7 onserts 30:12 38:15 38:20,23 39:1,5,6,8 39:12,16 40:8 42:2 42:15 97:6,16 99:3 103:9 108:20 116:20 120:7 205:7 205:9,19 208:9,17 209:20 214:24 216:3 223:14 224:2 224:7,13 227:23 237:7 248:8,16 265:16 266:3 on-pack 116:21 224:14 open 150:1 215:5 240:6 opening 97:10 224:17 openly 177:17 178:11 181:2 operating; 14:6,12 15:18 17:16 operations 108:20 opinion 63:18,22,23 143:3,13 144:11 157:15 158:22 227:5 opportunities 222:13 opportunity 97:7 98:24,24 99:19 100:11 103:10 133:4 180:4 203:23 239:19,21 order 26:3 27:6 69:3 69:9 104:5,20,21 108:12 151:19 173:5 192:7 209:7 210:5 219:12 263:13 274:16 276:4 orders 13:6 organization 32:16 167:2 organize 151:19 original 6:20 30:15 32:15,17,22 54:23 137:15 originally 47:1 262:6 originated 116:23,24 outcome 283:15 outlet 59:17 outlets 82:23 outline 47:13 outlined 27:24 104:20 115:23 146:5,10 154:7 231:19 266:14 outlines 153:15 outside 53:12 143:4,5 205:3 266:17 overall 41:17 119:1 203:21 222:10 248:12 overcame 208:15 overseeing 81:24 111:6 oversight 18:13 overview 27:24 154:18 188:10 212:20 238:5 273:22 overwhelming 48:7 60:24 owned 15:17 279:16 279:18 0'Rourke6:15 P P12:1 pack 30:12 37:4,10 37:14,14,18 76:20 77:4,7 78:22 87:21 89:15 97:6,11 98:12 104:8 108:23 117:16,24 120:7 121:19 122:14 130:23 140:5 192:17,19 193:3,9 193:18 205:1 210:22 211:6 215:9 222:18 223:14 224:18 225:10,15 227:15 230:18 237:7 250:8 269:10 275:11 package 118:5 119:14 205:3,4 235:5 packages 77:20 88:22 90:7 91:1,17 93:9 116:5120:4,18 265:14 270:12 packaging 86:16 98:2 98:3 113:21 114:8 114:16 115:17,18 118:13 120:23 122:2,6 227:18 229:5 230:24 231:23 232:21,23 233:2 234:2,15 packing 37:11 99:13 packings 37:1,3 42:21 packs 32:1,6,7,8,9,13 33:1,2,4,9 34:13,15 34:19 35:15,17,24 37:17 39:10 40:7,9 40:12,17,2141:24 42:6,17 75:21 96:22 97:18 98:9 98:12,16 120:15 126:15,23 192:7,13 192:15 205:2,10 208:23 212:5,11,22 212:23 213:14,15 213:21214:11,19 221:24 222:3,9,23 225:20 227:12,16 227:24 228:8,10 230:7,20 231:7,15 232:3,5,8,9 235:9 page 5:2 6:3,12 7:2 8:2 9:2 10:2,1B 11:216:5,7,11,11 24:5,5 47:2149:15 49:17,20 50:2 54:17,17 79:14 80:13 138:23 154:7 180:24 182:24,24 183:19,20,20 185:14,15 191:7 212:20213:11 220:21,22 230:17 233:2,13,19,22 234:10 237:13 238:4 250:2 251:4 251:15,17 252:8 277:2 285:6 286:6 pages 2:21 30:23 46:22,24 47:12 49:4,6,15,24 50:7 179:3,12 181:17,21 182:4 184:9 188:18 188:19 189:20 190:4 233:14,15 251:3,5 277:17 278:11,14281:10 paid 150:2,7 panel 206:16,17 216:24 paper 22:12,20,22 54:6 J 277:16,19,23 papers 21:18,24 paragraph 31:18,19 32:24 38:14,19 47:8 54:19 85:1 86:22 87:2 206:17 207:9 267:12 parameters 142:22 parent 15:17 part 50:22 51:19 54:14 63:16 66:11 69:12 72:18 73:6 74:18 76:22 80:12 80:19 81:8,12 86:13 91:7 93:4 97:4 102:12 104:8 114:21116:14 119:13 122:16 123:2125:18 126:23 144:19 162:4 175:8 187:17 199:17 222:10,19 224:9 252:9,15 261:17 262:24 263:2,9 274:20 Partially 91:12 participated 110:14 110:1821 111:2,5,5 150:1 particular 48:23 73:20 98:17 114:20 114:24115:1 138:2 152:21 176:11 182:18 187:7 196:15 200:13 226:9,14 237:5 247:19 particularly 85:5 88:15 99:11 171:16 172:11268:12 parties 251:10 276:15 283:13 pass 131:7,22 passage 117:7,9,11 Thompson C o u r t R e p o r t e r s , 312-421-3377 117:14 121:9 127:2 132:1,2134:17 135:9 passed 110:24 112:4 117:4 118:4 130:18 132:9 passing 112:3 path 20:10 pending 280:10 people 39:22 40:4 48:3 68:12,15 73:24 121:17 158:19171:9 187:4 191:5,7 192:1 194:8 195:3 196:16 196:18 198:23 202:16 203:23 204:3 207:18,20 217:24 219:6 233:23 234:11 236:6 242:13,18 245:11246:3,8 248:2 249:10,23 273:12 278:7 percent 111:9 247:4 247:9 percentage 41:16 42:5 211:9 213:3 219:17 245:10,14 246:3 247:12,21 248:21 250:12 251:24 252:3 perceptions 268:6 perfect 275:9 period 20:19 28:15 29:3,10 36:10 38:22 39:11 40:19 57:18 60:17 68:9 70:24 76:14 93:22 94:197:17 98:13 99:17 100:5,9 101:11 105:16,17 112:21 117:14 118:3 127:4 138:14 148:7 151:22 152:1 154:24 155:12 171:14 179:2 205:12,15 210:1,10 213:16 215:9 218:17 224:3 228:5 228:8 237:14 243:24 244:23 248:22 251:7 266:13 273:18 periodic 215:3,14 periodically 209:21 224:4 Inc. 3990537900 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537900 Page 17 periods 272:2 permit 223:19 permitted 70:20 72:7 72:13 133:12 270:7 person 51:20,21,22 221:14 personal 29:8 46:10 144:10 255:17 personally 110:18 perspective 45:24 170:11201:4 258:23 petition 133:11 Pfeil 80:5,15 Philip 1:9 3:144:4 6:12 9:3,6,10,13 10:18 11:4 12:5,22 14:3 15:3,5,7,13,15 15:16,17,19,21,22 16:1,3,4,6,12 17:15 18:17 19:2,9 29:16 35:16 36:2 37:20 38:9,15 39:20 40:20 41:1,16 44:14,18,20 45:1 48:13 52:13 54:8 54:22 55:16 56:13 57:2,3,13 58:6 59:18,19 61:4,12 70:5,7 72:6,17,19 74:6 75:20 77:3,6 77:17,18,19 83:7,8 83:13 84:18 86:14 87:19 90:5,19,23 91:15,23 93:8 96:14,2198:23 99:23 100:13 101:21 103:19 105:9,23 106:23 108:5,8 109:10,24 110:10,11 111:16 112:10 113:5,20,24 115:10,15 116:7 117:1 118:1 119:12 120:19 121:8,16 122:13,15,19 124:3 124:6,20 126:14 127:12 128:1,20 129:20,23 131:5 132:16 134:1,5,22 135:13 137:19 139:11 143:20 144:6 145:3 146:24 149:17 150-12,20 151:5,13 152:3,6,7 155:2,16 156:1 157:12 161:10 164:11 169:20,24 170:14,21 172:2 174:6,11,24 175:7,9 175:17 176:9 177:7 178:7,21 179:13,15 179:20 180:21 181:9 183:5 184:8 186:9,14 187:12,24 188:1 189:10191:1 192:6,12 193:23 194:16 195:1 196:20 199:3,12 200:12 201:4,6 203:4,14 204:10,13 205:6 208:4 209:6 211:15,24 214:12 214:20 217:14,22 219:9,11221:23 222:7,22 224:6 227:12 228:10,21 230:7 231:11,15 232:15 233:13 235:6,21 236:15 240:20 252:24 253:12 254:15 255:4,9,17 256:8 257:11,20 258:1 259:8,8 262:4 263:14264:16 266:3 268:1,5 269:4,9,11270:11 272:19 276:9 277:5 278:4,9,18 281:16 285:2 286:2 philipmorrisusa.com 40:5 44:2045:2 phrase 76:19 78:22 84:3 98:5 222:2,8 222:18 227:1229:5 232:19 phrased 94:12 phrases 8 3:22 84:15 pick 26:22 95:11 pictorial 186:2 picture 180:18 piece 59:23 126:3 129:12 157:1,5 163:21 167:8 188:7 189:2190:8 191:21 213:10 230:19 264:24 269:3 pieces 66:17 68:4 104:4 156:20 169:19 190:24 191:12,20 217:13 place 12:15 13:8,15 42:14 71:4,10,15 72:13 75:10,16 89:6,15 96:21 99:24 101:23 103:17 105:15 107:13 108:22 119:2123:23 124:2 132:13 172:12 176:10 178:23 180:2 181:11 187:3 242:4 258:15 placed 33:17,18,20 34:4,5 39:10,16 73:1197:19 103:18 120:3 278:4,18,20 280:14 placement 219:16,20 places 51:12 71:15 75:9,15 79:13 97:16 188:14 236:18 247:22 placing 33:12 71:3 93:9 153:17 209:20 247:19,23 249:19 Plaintiff 3:3 plaintiffs 1:7 6:6 12:20 275:16 plan 154:11,13,14 219:14,16,16 planning 18:20,22 19:17,19 20:15 177:22 plans 86:14,17 87:3,4 219:20 270:11 plant 35:3 play 162:2 218:11 240:6,16,23 played 162:10 218:12 239:6 240:11241:4 playing 202:7 Plaza 3:18 please 12:17,24 240:24 plugged 250:22 plus 248:6,6 PM 10:3 11:8 211:22 pmusa.com 207:23 PM30070865617:11 PM3007086633 7:11 point 14:4 15:11 18:12 22:131:2 45:4,23 50:21 57:20 61:19 63:1 71:24 78:4 80:10 85:14 89:8 90:5 97:1,9 105:7 107:7 123:19 132:7 147:2 151:20 186:24 197:10 201:8 204:16,19 211:20 217:12 221:7,20 236:9265:18 276:13 279:22 pointed 144:4 pointing 185:11 points 6:17 27:17 30:13 80:16,22 132:8,11 136:24 137:3 196:4,9 210:15 234:7 Points-of-sale 260:18 point-of-sale 235:18 260:22 policies 152:19 203:19 policy 20:3,20 71:1 172:3 174:6 175:8 205:14 population 219:18 portion 123:3,5 132:16 134:20,23 274:13 276:3,5 279:15 portions 110:17 135:7 183:1 Pose 10:21 position 9:4 20:4,11 20:18 21:5 22:21 22:23 30:3,7 45:16 57:2161:23 72:6 76:24 83:8,11 84:19,23,24 85:11 110:22,24 132:22 133:1,15,22 135:20 172:20 173:19 175:15 254:13 positioning 21:18 positions 17:9 19:7 20:2,6 22:15,19 51:24 52:5 111:13 180:1 217:24 possibility 184:10 possible 37:9 143:6 166:14 249:4 Post 278:24 posted 204:9 267:10 poster 161:13 post-manufacture 229:20 potential 68:6 73:23 74:3,4,15,23 104:12 104:17 143:6 184:16 256:18 potentially 59:3 219:21 Thompson C o u r t R e p o r t e r s , 312-421-3377 PowerPoint 6:18 11:7 137:4 218:8 240:1 practical 109:8 practice 72:24 165:14 247:15 practices 21:16 70:17 preamble 264:11,15 preceding 57:11 precise 40:14 42:16 67:19 182:16 212:7 precisely 271:21 precision 35:6 187:5 predecessors 164:9 predicted 132:9 predictive 257:12 preempted 92:16 preemption 92:2,5,10 92:1293:1,14 prefer 37:13 135:21 138:7,10 preferred 270:3 premise 139:23 preparation 23:1521 25:4 26:2,15 27:8 29:4 48:24 49:21 56:24 58:163:21 145:1261:18 prepare 44:8 65:13 66:5 96:13 192:14 220:12 prepared 30:14 137:24 145:6 149:6 156:14 187:11 220:8 251:19,20 preparing 24:23 28:3 137:1 preponderance 156:21 prescribed 140:24 142:7 present 15:12 113:7 237:3 presentation 6:19 11:8 162:4 218:8 241:7,14 262:8 271:7 275:8 presentations 111:4 presented 53:8 preserve 230:1 president 13:24 16:19,24 17:1,2,3 18:9 111:12132:14 134:12 press 63:15 115:21 180:24 197:3,7 203:10,14 204:2,9 \ \ j j \ \ j \ \ ; j f ! ; Inc. 3990537901 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537901 Page 18 253:23 254:2,9 258:11 pretty 51:1 133:23 155:22 246:7 266:12 276:7 preventing 53:13 prevention 109:20 110:1 216:10 228:20 266:8 267:17 previous 58:11 89:1 130:21 243:10 previously 30:6 44:3 103:12 149:3 208:10,11 252:3,18 price 72:3 primarily 18:23 174:18 202:1 205:13 216:1 257:4 primary 14:7 22:7 34:2 67:11 68:8,18 71:20 87:23,23 88:10,1189:4,5 90:15,18 111:7,10 134:15 158:4 188:19 201:15 215:23 266:9 278:14 prime 218:24 print 7:3,5,7,9 9:18 10:16 70:8,12 72:6 72:14,20 73:23 74:3,14,20 75:3 137:15 138:19 140:9 148:23 149:13 150:10,11 193:23 194:6 199:13,21204:18 217:12 220:6 248:6 248:16 printed 188:18 189:24 prior 19:20 24:1,2 26:7,9 29:7 44:8,12 44:24 45:9,19 49:14 54:9 56:15 58:5 59:18 61:14 61:18 69:12 86:17 87:5 91:24 95:18 100:4 102:9 105:7 105:10 106:2,24 107:7,14,22 108:9 108:11,15 112:1,3 113:3 117:11 127:2 131:5 152:15 153:16 171:23 201:1255:18 programs 9:15 257:13 270:13 priorities 176:12 218:19 219:1,1,7 246:15 249:18 177:19 178:9 proactively 222:13 progressive 157:3 probably 19:20 21:2 prohibited 229:3 21:9 22:1,7 24:15 prohibiting 114:6 62:24 67:1175:24 prohibits 114:14 101:17 136:1 project 42:13 171:15 248:18 promote 192:3 263:23,24 266:11 promoted 190:18 problems 267:22 promotion 71:24 Procedure 2:10 72:3 259:20 procedures 152:19 promotional 191:20 154:18 191:24 proceeding 276:12 proposed 22:6 proceedings 1:14 prospects 131:24 65:24 69:22 96:7 Protect 168:13 136:7 202:21 provide 14:5,12 270:21 275:15 21:21 78:12 83:15 282:19 283:6,8,9 85:2,8 91:8 117:19 process 26:2 27:9 122:9 133:4,14 36:16 63:16 74:19 146:13 175:24 90:20 99:6,7,11,22 180:5 184:3 185:3 105:19,21 108:22 187:21 197:13,15 109:4,9 110:23 201:11204:13 126:23 130:17 205:14 210:5 131:20134:7 157:7 234:22 208:13,14 247:14 provided 18:24 24:18 258:7 263:19 78:15 133:13 276:14 146:18 164:4 171:8 processed 249:3 180:2 189:19 191:3 processes 66:12 194:7 201:22 204:1 103:14150:2 216:2 229:15 252:9 272:4 152:14153:15 produce 162:11 provides 230:21 164:8 169:13 234:11 producing 21:24 providing 78:16 91:3 product 10:10 78:23 188:15 78:24138:6 146:16 provision 133:16 157:7 186:23 216:9 provisions 56:3,5,7 256:22 109:22 110:12 production 33:9,10 111:1 114:6 115:20 34:17,20 35:2 36:9 115:24 133:18 208:24 209:18 153:19 229:18 products 10:21 71:21 public 2:14 7:13,16 112:17 176:18 20:3,2021:3,12,16 177:5,9,16,18 45:1046:8,17 178:13,18 180:7 48:21 52:20 54:23 194:9 228:15 55:10,17 56:9,11,14 229:16,19 263:21 56:20 57:12 58:4 264:18 267:18,21 58:13,17,22 60:3,4 Professional 2:11 60:7,13 62:11,15,17 proffered 110:5 62:2167:2,10 68:6 program 250:12 68:9 69:8 76:12,15 257:6 77:178:7 88:16 prograinming 219:4 89:8 90:15 109:24 246:14,17,20 110:12 112:11 115:11116:17 121:6 125:8 150:4 150:4,5,19 151:4,12 155:3,5,1121 156:14157:12,18 159:11 161:11,21 163:24 164:24 166:10167:13,20 169:17 170:1,9,15 170:22,23 171:7,20 172:4,11 173:4,6,8 173:11,13,15 174:7 174:9,2224 175:1 179:22 180:4,13 181:3 187:21 195:7 196:9,10,13 197:4 201:1,6,10 202:3,15 203:16 230:8 235:20 236:9,14 240:18 253:11 257:1258:12 259:3 283:2,21 284:21 publication 73:12 76:8 159:10160:22 161:12 166:2,6,24 203:3 253:13 261:14 268:20 publications 71:2,14 202:5 258:9 publicized 161:18 publicly 48:14 52:13 58:6 59:16,19 61:5 61:12 62:1174:12 90:6 210:18 public-facing 45:3,7 publish 174:17 257:8 published 63:14 164:13 195:10,17 196:7 197:3 200:23 256:16 258:3,5 259:10 260:9 publishing 64:3 256:13 puff 197:18 puffs 184:20 198:1 207:3 pull 23:9 30:18 200:15 245:17 261:18 262:1,5 271:8 273:22 pulled 145:20 154:2 154:17 156:18 200:8 221:9 233:7 233:19 250:7 260:10,24 261:7,14 261:20,20 262:6 271:9,11 pulling 271:16 pulls 185:22 purchased 211:4 purchasing 85:3 190:17 210:24 211:6,7,11 pure 114:21 purported 92:15 purpose 30:6 229:23 purposes 147:15 pursuant 2:9 13:6 54:19 55:4 120:20 123:13 274:15 pursue 102:13 104:5 pursued 224:14,21 pursuing 102:19 push 260:1 put 31:6 71:9 97:21 108:18 118:24 119:14 125:4,12,23 126:9,22 157:11,17 159:11 160:22 169:7 179:3 180:2 181:4190:16 200:19 205:1,2 214:21 222:17 224:15 233:1 236:24 241:13 277:2 putting 99:12 209:2 p.m 282:24 j jj j 1 f j 1 1 I 1 1 1 1 i O 1 quality 99:10 102:21 quantity 212:4 quarter 32:5 75:22 76:20 77:4 100:1 100:21,23 101:1,7,9 101:22 105:8 112:7 112:8,18 117:4 119:15 120:4,16 124:21212:6,12 213:12,12,20 214:13,14228:6,7 quarterly 154:12 266:13 quarters 224:5 228:1 question 16:10 24:21 26:5 35:5 42:10 43:13 49:12 53:21 58:4 59:8 61:10,19 77:10,16 80:12 82:15 92:3,5,7,13 93:6,7,17,20 95:19 110:8 112:1113:11 113:18 118:17,23 120:5 124:14,18,18 Thompson Court Reporters, Inc. 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 f 1 1 1 1 I [ 1 I \ f I l Page 19 125:12,17,18,23 126:2 127:18 128:15,16 129:9,13 135:3 139:5 154:22 171:9 216:15 220:19 224:9 254:17 255:11 257:9 258:4 questioned 201:23 questioning 13:9,10 13:12,1492:17 135:24 201:17,20 questions 53:14 63:2 69:2 70:21,22 73:2 76:2 81:14 95:13 111:2 139:6 151:20 151:22,24 154:24 168:20 232:24 237:17 239:12,18 263:7 272:6,8,11 282:14 quick 276:7 quickly 252:4 quiet 131:23 quit 68:12 96:24 120:1 124:6 151:14 159:20 164:2 165:15 166:13 168:16 170:10 201:3 207:15 226:3 231:4 235:2 281:21 quite 95:20 124:17 125:19 132:7 quitting 40:1 191:10 207:22 216:7 266:8 quote91:8,17 183:22 R R 1:16 12:1,6 285:1,1 286:1,1 radar 104:7 105:10 radio 10:1.7 217:15 217:22 220:5 237:8 248:6,15 273:16,17 273:23 274:6 raised 28:22 50:3 53:9 70:18 86:4,9 106:12 108:13 113:2 204:6 221:6 223:5 236:3,5 raising 73:22 76:2 ran 43:14,17 51:11 73:1197:22 100:15 138:14,19 149:1,13 188:5 193:21 194:10,22 208:1 213:6,6,13 218:17 219:3 220:14 221:16 224:3 225:20 231:6 237:7 242:7,8 243:18,23 244:17,22 261:1,8 261:10,13,19,21 266:6,7,12,12,16,19 272:2 273:17,19,23 278:20 279:16 range 6:3 7:2 8:2 9:2 10:2 11:2 23:6 27:10 46:13,13 56:6 59:173:3 75:4 85:16 95:2 102:14 106:9118:9122:3 128:8 205:13 223:8 223:15 237:4 239:22 246:13,19 257:8 ranking 83:16 84:2,7 84:14,15,20 85:8 91:8 122:16 123:5 123:16 rankings 123:12 rates 164:8 169:13 ratings 9:22 195:13 197:22 246:15 249:17 RDR 2:22 283:4 reach 172:15 205:11 209:3 210:10 211:10,14212:1 218:21219:10,19 220:7 221:11 245:11246:1,18 247:21,24 248:7,9 279:2 reached 68:5 76:10 144:14,15 145:3 reaches 224:16 read 43:18 53:20,22 118:16,18 119:21 119:22 120:9,14 123:7 140:19 215:6 215:10,12,12 254:3 267:7,12 268:10 284:4 readers 74:15 readership 71:9 reading 80:1 120:11 120:12 123:1 185:8 reads 141:9 realize 50:22 realized 202:7 reallocate 72:2 really 27:22 36:5 71:22 75:24 78:1,6 158:10 88:2 89:4,9 97:3 99:19 104:3,9,14,16 record 13:5,20 53:19 106:13 116:23 53:22 65:21,23 117:22 122:2 66:2 69:21,24 96:5 171:17 173:11 96:10 118:18 175:23 177:12 120:10136:6,9,15 188:18 191:4 193:5 137:11 138:16 200:14,18 202:14 148:22 149:8 153:9 203:21 209:17 156:8 157:22 159:8 218:20 219:16 160:17 163:8 222:20 226:13 164:20165:23 227:7 236:1,23 166:19168:6 169:1 237:1,11265:2 169:19176:5 179:5 276:10 278:11 188:24 189:16 279:9 190:9 193:22 Realtime 2:13 202:20,24 203:6 reason 26:5 72:19 205:22 212:14 87:16 89:10101:14 214:11220:1233:6 102:23 116:14 240:12 254:4 128:10 256:23 267:13 270:19,23 269:4 285:6 286:6 275:14,20 283:8 reasonable 176:16 recording 162:10 reasons 89:9 red 34:4 148:24 recall 21:7 22:3 25:11 200:5 25:15 26:3 46:10 Reds 232:10 52:1156:8 58:4,13 reduce 7:18 159:13 58:23 59:4,15 63:8 160:2 256:14 68:181:2,4 82:9 reduced 91:18 93:11 101:7 119:6 245:16 184:11283:11 252:22 253:15 reduction 157:4,8 255:6,8,14 258:3 reductions 68:5 260:5 262:23 refer 44:19 146:11,20 263:11266:10 151:21205:2251:9 269:2 271:3 272:12 reference 49:3 receive 161:20 139:10159:18 received 25:2 164:11 161:6168:19 172:10 253:8 258:1 197:24 215:22 259:9 271:3,20 216:23 244:3 recessed 65:24 69:22 referenced 28:16 96:7 136:7 202:21 39:1447:6 69:15 270:21 275:15 142:3 185:6 243:22 recitation 77:14 references 39:23,24 recognize 106:19 40:151:17 54:18 179:12 250:10,11 217:4 275:7 268:11 referencing 47:23 recognized 146:15 82:11 145:15 179:22 223:4 referred 16:2,4 30:9 recognizes 255:1 47:17 55:9 56:13 recollection 29:2 172:1 175:20 181:21 188:17 50:20,2151:152:3 52:7 89:20 253:7 195:11219:10 263:4 227:21 233:20 recommend 157:2 242:13 252:21 160:2 277:9 recommendation referring 16:13 55:4 159:14,23 63:5 134:19146:19 recommending 185:8 218:15 Thompson Court R e p o r t e r s , 312-421-3377 228:19 241:19 255:14 263:1 refers 19:22 31:17 47:7 55:8,13,14 80:17 84:13 87:14 91:15 96:23 116:9 119:24 122:20 123:9 124:5 142:6 146:5 226:2 244:4 reflect 118:12 123:24 reflected 213:8 216:12 refrain 173:7 refresh 30:21 31:1,5 263:3 regarding 49:9 50:11 53:155:17 56:12 124:22 128:19 156:2 169:18 174:21 177:8 195:6 197:16 227:3 regardless 45:1 62:9 Registered 2:11,12 2:13 Regs 7:12 regular 198:2 238:2 241:9,16 254:8 regularly 52:1 88:4 regulate 172:18 228:14 regulating 124:9 regulation 124:23 125:16,24 126:10 126:12,13 176:16 269:22 regulators 175:2 regulatory 28:14 63:7,16,20 65:6,7 65:11,12,19 66:4,11 75:8 76:5 88:1 89:7 94:2195:8 112:24 116:16 125:8 126:11127:11 128:19 129:18 150:2 152:14 173:9 174:19 176:15 223:22 253:6 268:19 reiterate 234:19 related 20:8 24:19 28:8,18 30:16 60:14 62:12 63:3 64:2 66:14,19 67:23 70:16,21 72:23,24 73:3,23 74:20 75:5 76:6,9 76:18 78:9 82:16 Inc. Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 1 I f i 1 f f f 1 1 I j I 1 f j I I I I I I l I I t \ 1 i \ I I Page 20 82:21,22 86:5,24 88:15 106:7 108:20 110:22 112:15 115:19 123:20 127:11 145:20 154:19 167:6 181:17 218:2 233:2 233:14.16 252:14 253:3 256:14,17 263:20 266:9 283:12 relates 31:14 56:21 68:7,10 85:1190:9 112:2 128:2 129:18 132:22 156:10 176:10 256:2 relating 45:11 69:2 131:6 190:23 201:7 relation 24:23 107:16 relations 14:1,7,13,15 14:17 17:3,420:7,9 21:12,13,22 46:1 51:20,21,22 relationship 85:22 relative 83:16 84:2,7 84:13,14,20 85:8 91:8 122:16 123:5 123:9,12,16 158:14 182:21 187:7 206:10230:8 238:12 239:8 241:8 241:8,15,19 relatively 224:19 relay 236:9 release 10:3 63:15 180:24 197:3,7 203:10,11,14 204:3 204:9 253:23 254:2 254:9 258:13 259:14,1822 released 199:4 204:11 253:9,9,10 258:10,11,18 259:3 259:19,24 260:3 releases 115:21 relevance 152:22 relevant 46:22 63:2 85:13 163:22 233:14,15 reliability 171:7 reliable 99:14 relied 101:16 153:13 200:17 remain 178:3 228:9 remained 120:18 237:3 remaining 274:20 remember 36:17 45:23 50:23 51:10 52:17 57:20 58:11 58:2159:9 60:3,6 60:11,13,15 67:19 82:13 86:6 89:19 89:22,23 101:6 123:18 124:1 131:16 132:1 264:12 265:20 266:17 remembered 59:13 remind 187:16 192:1 196:10,13,15 198:23 203:23 234:23 reminded 187:4 reminder 168:14 reminds 206:6 removal 8 6:23 89:14 117:8,15 remove 75:20 76:19 77:2,3 87:21 88:21 90:24 121:8 122:14 222:7 269:10 270:11 removed 113:20 118:5 120:22 121:18 222:2 228:11269:5,12 removing 77:7,19 90:6,19 94:16 222:18 235:8 rendered 89:16,22 repeat 130:5 200:3 replaced 116:20 report 7:14 8:5 10:6 66:13 67:15,16,19 67:20 68:1,2,19 76:9,10 88:3,16 94:24 146:12,14,18 146:21 156:17 163:12,19,22 164:12169:7 171:17,18,21 201:14 202:13 203:12,18 204:3,6 222:17,21 237:6 258:2 259:9,15,22 260:2 282:11 reported 182:15 184:22 reporter 2:11,12,12 2:13,14,2212:13,23 183:15 283:1 Reporters 12:14 reports 30:15,19,20 32:15,17,18,22,22 63:15 66:18 258:10 258:14 259:18,18 represent 12:18 183:7 193:14,15 196:14 representative 268:5 represented 202:2 208:24 213:3 representing 81:23 represents 33:9 34:16 38:18,24 request 64:1 66:12 67:22 156:16 requested 9:12 271:14,19 requests 67:1 279:22 require 117:8 121:8 223:20 228:21 229:7,11263:13 269:24 required 55:1623 64:5,18 73:9 103:17 114:1,3 118:4 154:6 229:3 232:21 234:12 263:11269:6,9 270:13 requirements 152:24 154:3,19 176:16 228:12 requires 104:11 154:10,10 230:3 262:21 263:19 requiring 56:8 rescinded 123:20 research 21:17 22:17 166:10 167:1,6 174:12,16,17 210:17,23 254:24 255:5,10,13,18,22 256:1,7,11,13,16,16 256:22 257:3,4,6,10 257:17,21 reserved 173:8 resolution 172:16 resolved 53:15 resource 194:8 Resources 11:11 respect 113:14 139:12 172:3 179:16 186:24 217:18 262:22 responded 62:2 172:23 199:8 Responds 10:4 response 6:5 54:8 64:167:180:23 87:9,15 125:7 202:12 203:5 responses 54:18 responsibilities 14:2 14:8 17:8,10,13,17 17:19 18:7,15,21 19:12 20:8 46:5,11 46:14255:16 256:3 responsibility 10:15 17:5 45:12,13 46:4 69:13 109:7 255:22 256:5 responsible 45:9,19 111:11 responsive 42:10 93:21 rest 20:5 250:24 275:6 restate 62:20 77:16 restrictions 22:6 56:6 71:8 73:1075:14 267:18 result 53:2 55:18 73:9 125:16 157:3 resulted 52:8 64:14 224:6 results 14:9 107:24 197:20 220:9 234:17 resumed 237:18 272:9 retail 71:24 191:24 229:20 retailers 190:16 RETURN 285:3 286:3 returned 29:6 review 8:9 26:18 27:10,15,21 30:5 44:7 49:19 50:1 54:15 55:24 59:7 61:18 76:17,22 84:24 96:12,17 145:2 165:2 199:18 239:20 reviewed 23:15,21 24:18,23 25:4 26:1 26:8,11,13,14 27:2 27:13,15 28:1,2.7 28:12,13,16,20,22 29:3,5,6 30:15,20 30:22,23 32:16,21 36:15 43:23 44:4 48:2249:23,24 50:7,19 51:19 54:13,14,15 56:20 Thompson C o u r t R e p o r t e r s , 312-421-3377 62:23,24 63:6,7,10 1 63:11,2165:13 66:5,16,20 67:14 f 68:24 69:11,12 1 80:11 137:1 153:16 I 153:18 167:21 170:8 238:20 239:5 239:17 243:11 1 250:20 251:1260:3 reviewing 52:1 68:21 j revisiting 76:2 1 Rice 54:5 j Richmond 1:22 2:7 I 12:16 80:23 81:3 1 right 20:13,14,16 1 43:6 60:2 79:17 1 84:7 93:5 114:4 I 119:21 154:17 j 173:8 178:18 186:6 § 194:17 208:1,2 f 214:3 221:2 238:13 243:7 259:4 274:10 I risk 160:2 238:12 I 241:8 \ risks 7:19 10:22 45:11 159:13 230:9 I 235:1281:21 } risky 234:17 RMR 2:22 283:4 role 14:3,5,7,11,13,14 \ 14:15,16,17 21:4 46:351:19 111:11 \ roles 20:7 46:1 roll 32:20 \ rolled 101:18 room 275:17 1 rotate 154:14 \ rotated 227:22 \ rotation 154:11 roughly 154:12 ! rule 1:14 48:16 1 242:21 269:22 rules 2:9 223:19 ruling 89:24 £ run 79:6 140:9,14 j 194:20 208:15 1 218:19,22,23,24 \ 219:5 224:4,12 I 237:10 243:20 265:6,13,2122 I 266:3 268:13 1 273:15 I running 35:3 72:24 211:16 220:21 \ 246:14,20 247:22 248:10,23 265:16 \ 266:21 274:1,5,6 Inc 3390537904 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537904 Page 21 230:3 242:23,24 261:2 279:8 S scheme 127:11 S 2:10,22 12:1 283:4 128:19 129:18 285:1286:1 SCHOLER3:17 Sacramento 280:18 science 227:3 256:5 scientific 48:8 60:24 safe 166:11 168:15 87:9 90:16 156:21 187:19 198:23 174:12,16,17,18 206:5 220:14 255:5,9,13,18,22,23 230:14 234:24 238:10 241:10,20 256:2,3,7 257:2,4 242:11,19 243:1,17 257:10 244:4,4,17,21 scientists 66:14 67:21 272:16 273:7,24 156:14 167:3 281:19,22,24 256:21 257:5,7 safer 96:23 105:9 scope 17:19 22:2 116:9 119:24 124:4 37:22 38:441:20 150:1322 170:16 48:16 50:1752:16 187:1320 226:2 53:4,6,12,24 55:21 227:2 230:15 231:2 56:18 57:16 58:9 231:24 237:24 58:20 60:1061:8 238:2 241:18 242:9 61:16 72:1174:9 242:15 245:3,8 110:4 111:19 113:9 273:2,8 281:19 115:14 132:20 safety 238:12 239:8 134:4 135:2,17 241:8,15 137:13 138:4 139:3 sale 72:1204:19 139:4,17140:12 217:12 141:7 142:5 143:4 sales 34:10 41:17 143:5,14 144:9,9 sample 192:17 147:8 148:9 149:21 San 1:12,18 12:10 153:5 155:8,19 280:17,18 158:23 161:16 satisfied 107:23 162:8 170:6,18 125:20 171:3 176:21 saw23:18 24:1,11 196:23 216:14 25:9,14,17,22,22 220:7 236:24 139:10140:17 254:20255:20 194:15 200:16 257:15 263:17 221:10 238:9 240:2 264:9,20 267:15 242:6 214:5 246:22 268:4 269:14 247:4,9,13 scratch 18:2 saying 31:2 53:7 63:8 screen 104:7 105:10 79:8 84:10,11 145:18 185:21 90:18 92:19 93:5 240:24 101:4,5 105:8 screens 237:22,22 127:22 1.40:4 script 238:15,22 163:24 239:11 scroll 187:10 247:1 255:6,8 seal 283:17 says 16:18 18:3 31:24 second 47:5 100:1,18 32:5 47:19 54:4 100:2122,24 101:7 60:20 82:2,24 84:7 101:9,22 102:12 84:9 85:1,22 86:13 105:7112:7,8,18 87:2,7 93:10 117:4 119:15 120:4 141:18 149:6 160:9 120:15 124:21 165:13 183:22 127:24157:1,5 185:11 193:7 213:12,20 214:14 207:10 211:21 220:22 228:6,6 runs 35:8 94:18 246:24 seconds 238:24 239:2 239:3 section 54:19 55:4 123:2 182:24 184:3 184:9 186:13 191:11 234:3 264:13,16 sections 54:14 206:3 see 22:17 23:13.17 32:1,3,15 40:15 47:20,2148:11 54:12 55:160:20 61:1 79:15 80:24 82:4 83:2,17 85:23 86:18,2191:21,22 100:17 104:24 177:5 191:6,8 200:9 218:5,10 219:21,22 222:15 234:6 240:24 246:12,22,23 247:2 249:16 251:15 273:16 278:13 282:4 seeing 156:1 seeking 73:15,18 78:8 seen 16:5,11,15 18:1 23:10 24:3,7 26:4 48:4 54:8 74:22 148:13 209:24 219:7 221:14,19,21 251:21 252:2 254:23 267:6,11 268:24 269:2 selected 226:10 selecting 85:3 sell 230:15 selUng 228:22 sells 230:10 Senate 61:21 62:3 132:13 134:11 173:1 175:16 Senator 62:2 172:24 173:21 send 81:8 162:23 188:6 sending 170:9 172:23 senior 16:24 18:3,8 20:17 sense 27:13 73:21 94:18 218:18 247:3 250:17 275:9 sent 6:15 38:15 79:13 79:13,18 80:3 81:11 134:9,10,12 165:2 173:20 189:2 280:2 sentence 87:6 91:22 160:4,8 227:1 242:20 268:2 sentences 254:3 separate 16:10 31:12 sequencing 132:2 serious 48:10 50:13 serve 173:13 174:8 174:23 206:10 served 276:14 serves 123:11 service 7:13,16 24:5 67:10156:15 157:12,18 159:12 161:11,21 164:24 170:23 240:19 services 14:1,5,12 15:11 16:20 17:21 67:12165:1,13 set 6:7 54:9 136:4 165:5 209:14 235:24 263:19 265:11283:16 settlement 53:2 54:20 55:5,18 56:1,16 61:14 70:20 72:8 72:12 73:5 seven 221:15 245:15 246:12 247:6 shape 175:18 share 23:4 154:12 163:22 174:17 217:24 278:11 shared 27:23 28:6 59:3 173:15 175:13 175:15 223:9 sharing 82:19 Sharma 2:23 12:13 sheet 54:6,7 266:24 267:6,8,9 284:9 shipments 250:23 shipped 212:24 213:2 shipping 101:8 ship-to 251:10 short 20:3,19 95:24 224:19 234:11 shorter 97:12 shorthand 2:11 241:22 283:1 shortly 26:21,23 253:9 shot 145:18 show 147:21 156:7 160:15 165:20 166:18 176:4 182:20 188:23 189:6192:18 \ 212:13 219:8,24 \ 222:5 232:13 1 280:22 1 showed 154:8 239:24 1 240:3 \ showing 211:7 shown 166:11 % shows 186:3 192:15 f 225:23 247:23 side 54:7 154:15 192:19 210:4 1 225:11251:2,21 I Sieja 79:19,20 80:5 80:15 1 Signature 282:22 \ 284:15 285:24 1 286:24 signed 130:16 284:9 significance 201:5 % significant 202:2,15 264:11 significantly 184:1 248:13 similar 10:20 18:7 48:18 50:1185:14 \ 86:4,9 94:19 \ 113:16 120:6 121:1 \ 126:16 13223 I 133:15 135:10 \ 139:5 141:18 149:2 X 197:1,6 221:16 j 226:3 227:9 231:18 \ 234:13 235:10,24 \ 244:23 253:22 I 254:2 260:4 263:6 \ 263:24 265:17 I 267:20 268:8 \ 273:17 274:6 similarities 204:5 \ Similarly 1:5 3:5 simplified 237:12 1 238:5 \ simplify 242:1 \ simultaneous 26:7,9 26:23 l simultaneously 26:21 ; single 32:20 62:21 85:6 91:10 142:20 173:5,14 220:21 259:14 • site 6:13 16:6 278:16 ! Situated 1:6 3:5 size 225:9 250:8 ? SKUs 43:2,10 slid 277:11,14,17 slide 141:3 145:7,12 Thompson Court R e p o r t e r s , I n c . 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Page 22 148:20 149:5 157:20 159:2 160:16 164:18 166:18 168:1,23 182:5 183:14 185:7 185:19,19 186:17 189:4 200:10 214:9 216:20,21 234:9 236:23 278:2 279:7 280:11 slides 136:18,22 220:16 slightly 48:19,20 58:3 115:9 slogan 139:21 140:6 149:1,14 slower-moving 37:5 small 197:17 smaller 211:9 smoke 9:20 59:20 68:16 156:23 157:5 157:8 158:13 161:7 168:16 182:13 184:2,12 195:12 196:16,18 197:18 198:22,23 200:1 206:21 207:3,4,8 234:20,21281:23 smoked 182:22 smoker 182:18 184:24 196:15 197:22 206:20 215:10 224:16 234:20 smokers 10:7,12 37:13 48:10 50:14 62:1,13 71:24 74:5 74:23 85:3 91:9,18 91:20 93:8,10,12 138:7,10 158:11 159:19 161:19 164:1 165:15 167:7 170:10 180:5,7 182:13 183:5,22 184:10,12,17 187:18 188:7 190:16 191:10 197:19 198:1,17 201:2 202:5 205:8 205:11,14 206:6 208:10 209:3,22 210:9,21,21211:1,2 211:5,9,15,1723 215:5 216:5 231:12 234:23 235:12,15 236:4,6 242:8 248:10 254:5 255:1 256:19 267:21 268:15 272:24 273:6 281:17,20 smokes 184:24 196:12 smoking 7:19 8:4 22:5 39:2440:2 48:9 49:10 50:12 51:4,18 52:14,21 53:155:17 56:12 56:15 57:14 58:7 58:24 60:8,15 61:1 61:6,13,24 62:13,14 68:1074:191:19 93:12 96:24 109:20 110:1 120:1 124:6 159:13 160:2,9 163:13 164:4,5 165:15 172:4,22 174:13 179:17 180:6 184:17,20 191:10 196:11 201:3 207:14,15,22 210:21 216:8,9 226:3 228:20 231:4 235:1266:8,8 267:16 281:21,22 Snapp4:6 12:22 162:19 254:22 snapshot 180:23 188:10 191:3 233:13 snapshots 30:23 social 167:10 Society 7:17 8:11,17 158:3 166:3 168:11 soft 37:4,10,14,18 sold 33:2 35:15 36:2 37:17 98:17 solely 18:17 39:7 solutions 104:24 somebody 185:17 247:2 274:17,18 sorry 54:7 79:10,18 80:2 119:3 163:14 165:6 168:7 176:19 195:19 239:3 251:16 sort 154:15 180:19 198:5 236:19 sorts 256:21 sought 269:20 source 28:2,10 30:9 30:10 31:12,13 188:3 space 63:20 97:12 146:6 225:8,12,14 226:18,20,22 Spanish-language 279:16,17 speak 53:9,11 73:19 157:6 251:18 258:21,22 speaking 184:24 263:9 Special 1:14 specific 22:12,24 41:1149:5 52:18 56:21 58:3 59:10 59:14 81:4 89:19 89:23 95:11,12 97:24 98:21 100:23 101:2,8,17 102:4 104:5 120:5,23 138:8 238:7 239:12 239:17 244:22 250:6 252:1269:2 271:16 278:5 specifically 22:3 60:16 68:7 73:18 82:11 106:11,21 108:4,6,13 113:3 131:17 132:10 134:19 135:14 190:23 242:14 250:2 251:19 256:7 256:14 263:21 264:1,12,23 266:15 267:5 269:23 271:5 280:8 specificity 59:10 specifics 57:21 58:14 82:13 106:6 107:24 257:17,20 speculation 114:18 114:21 speeches 19:3 spell 13:19 spent 19:16 spokesperson 46:6 spot 273:24 Spreadsheet 10:11 sswedlo w @ koreint... 3:12 ST 1:2 stack 23:9 staff 109:7 134:14 stand 141:23 211:22 standard 81:5,9 206:12 247:15 249:20 standardized 64:4 142:15 182:20 standpoint 36:6 71:21 102:7,11 112:19 209:18 259:23 265:1270:5 stands 141:24 211:23 start 18:127:19 57:2 100:16,17,19 205:7 209:17 started 19:22,23 27:2133:6 36:12 46:3 76:186:7 124:21 170:22 210:1225:10 starting 118:10 218:22 starts 104:16 state 1:12 12:18 13:19 156:21 172:20184:23 197:21206:17,23 207:4 212:24 213:15 250:22 252:1280:16 stated 96:23 107:9 194:21 206:24 226:1258:1273:6 statement 9:3 32:5 48:1449:9,14 50:1156:11 113:13 113:18 150:19 151:4,12169:11 170:15 173:19 175:13,20 176:9 177:1 178:8,23 179:1227:2 240:21 241:7,14 245:2,2,6 245:7 252:21 254:16,17,18 255:12 268:2 statements 48:21,23 55:17,23 56:4,9,20 57:12 58:4,22 60:4 60:7,13 143:10 154:10 167:14 169:18 181:9 239:8 253:13 states 48:7 60:23 80:21 157:1,11,18 159:11 160:23 161:3,7 168:16 198:20 199:23 241:10 264:5 281:16 stating 87:22 158:13 166:10 stenographically 283:9 Stephen 3:6 5:3 12:19 Thompson C o u r t R e p o r t e r s , 312-421-3377 steps 73:6 85:17 95:21 160:1 188:2 1 Steve 53:5 stint 20:3 58:5 stock 43:2 stop 70:8,1174:19 I 174:12 175:1 228:21229:15 231:15 255:13 1 stopped 72:19 230:7 store 211:3 stores 101:4 211:8 stories 52:3 strategies 177:22 strategy 18:20 Strawn 4:7 Street 2:6 3:19 strength 85:4 91:13 f 123:9,10,10 187:1 1 206:8 j stricter 71:9 strike 142:12 j strong 167:9,10 strongly 156:22 struck 230:2 j structure 15:14 struggling 93:19 study 256:19,20,21 f style 85:4 j! styles 85:6 91:10 subject 6:16 21:23 28:19 58:12,17 j submission 256:9 Subpart 91:14 Subscribed 284:18 j subsection 70:3,3 subsequent 32:22 146:18 147:10 f 244:24 \ substantive 40:10 \ 50:8 substitute 214:9 suggest 202:12 Suggested 204:3 % 207:22 f suggestion 207:17 1 suggestions 170:23 I 188:14 suggests 156:22 165:14 j: suing 92:11 Suite 3:9,18 sum 32:23 219:16 \ summaries 66:20 summarize 136:23 1 169:23 181:4 1 210:14 236:16 Inc 3390537906 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537906 Page 23 252:11 summarized 30:17,17 32:21 62:6 summarizes 220:13 244:12 summarizing 22:15 252:12 summary 38:19,24 163:12 169:6 213:8 213:9 220:5 244:14 282:5 summer 19:23,24 60:1 Sunday 277:13,19,23 Superior 1:12,18 12:8 supplemental 6:6 54:9 support 18:24 21:21 28:11 115:21 134:1 134:23 135:4,8 167:15 supported 133:19 134:17 135:6,13 supporting 21:4,17 134:24 135:19 176:16 supports 103:22 sure 16:13 27:12 41:2173:19 86:2 96:2 99:14 100:15 105:13 113:17 124:13,16,17 125:19 126:1,2,4 132:8 162:3 239:15 241:3 245:4 250:7 263:5 267:8 269:1 270:18 Surgeon 8:6 66:13 67:22 156:16 157:2 163:12,19,23 164:12 258:2,10,14 259:9,15,17,22 swear 12:24 Swedlow 3:6 5:3 12:19,1913:4,18 14:24 24:16 25:1,8 34:18 35:7,13,23 36:21 38:1,7,12 39:3 41:23 43:5 44:13,23 47:15 49:1,18 50:951:7 52:10,23 53:20 54:3 56:10 57:1,9 58:2,15 59:12 60:18 61:11 63:4 65:1620 66:3 68:20 69:19 70:1 72:16 73:13 74:2 74:17 75:19 77:10 77:15 78:19 79:3 79:11 87:18 89:12 90:192:4,11,18,21 92:24 93:2,23 95:24 96:1198:22 105:4,22 106:18 107:11 109:18 110:9 111:15,23 113:12 114:13,22 116:2118:16,19 121:15 122:12 124:19 126:7 127:9 127:20 128:14 129:10 131:4 132:15 133:24 134:18 135:12,23 137:12 138:3 139:2 139:15 140:11 141:6,16 142:4,12 142:16 143:1,12,23 144:8 145:9,17 146:2 147:7,18 148:8,11,17 149:9 149:20 150:15,24 151:8,16 152:8,16 153:4,20 155:7,18 156:5 157:14158:1 158:21 159:9,21 160:6,20 161:15 162:7,11,14,17,21 163:1,14,20164:14 165:6,10 166:8,20 167:16168:3,7 169:4 170:5,17 171:2 172:5.8 173:22174:1,14 175:3,10 176:19 177:2,10 178:5,14 179:7,19 180:22 181:15,22 182:8 183:9,16 184:14 185:9,24 186:7,18 187:15 188:4 189:17 190:2,10 191:2,18 192:22,24 193:5,7 194:4,18 195:8,18 196:22 197:14 198:7,11,18 199:7,15 200:7 204:21 208:6 214:6 216:13 217:2,16,19 218:9 220:17 224:8 224:11225:6,21 227:4 228:2,24 107:14108:21 113:6 116:8,19 117:3,10118:15 119:4,14,16,23 120:6 121:7 124:21 125:5 126:15 127:13 128:22 129:21 130:7,15,23 202:18,22 224:15 224:20 225:4,8,19 225:24 227:13,14 227:20,22 231:12 231:16,18 232:2,6 235:4 275:12,18 282:16 tapes 96:21 tar 7:15 8:21 9:7,21 10:8 33:14 39:9,13 49:6 50:5 66:15 67:23 68:6 75:21 76:3,9,18,19 77:3 83:14,16,20,24 84:3 84:4,8,9,20,22 85:6 T 85:8 86:23 87:21 T 285:1,1 286:1,1 88:18,2189:14 table 47:18 90:7,19 91:9,18 tailor 226:20 238:8 93:1194:16 106:1 241:23 116:5 122:14,16 tailored 97:14 226:17 123:5,16 138:8,11 226:19 140:23 141:4,10,19 take 13:8,15 16:14 142:19 143:10,11 70:2 73:6 85:17 146:6,7 148:2 95:21,24 136:3 154:19155:14 182:5 188:2 190:15 156:17,23 157:4 198:1 207:3 267:7 158:4,6,15,18 269:1 270:16 159:15,24 160:10 275:10,11 160:24161:5 164:3 taken 46:5 87:8,15 164:7,9 166:14 125:6 128:10 167:4 168:17 169:9 253:17 283:6,9 169:12,18 172:7 takes 86:15 178:23 180:9 181:13,17 234:10 182:6,14,17 183:7 take-away 223:5 183:23,24 184:11 talk 94:5,10 136:1 185:1 187:2,5 168:20 191:9,11 195:12 talked 42:12,12 43:13 196:14 197:20,22 57:20 94:14,15 198:16,21 199:23 100:11 137:9 206:9,10,11,18,19 178:24 192:20 206:23,24 207:7 217:11 239:22 211:22 216:8 217:4 talking 75:13 93:21 222:2,8 234:19 99:12 114:4 203:3 254:5 260:5 263:5 280:24 target 211:24 tape 12:4 79:6 96:3,8 targeted 33:8 97:2,8,18 100:1,4 taste 85:4 91:13 101:24 102:8 104:7 96:24116:10 105:9,18 106:1,7,23 119:24 122:20 229:13,21230:11 232:16 233:9 236:20 240:10,13 240:17,23 241:5 243:3 245:23 247:11 249:12 253:21 254:21 255:3,15 256:6 257:18,24 261:9 262:19 264:4,14 265:4,8 267:4,24 268:17,23 270:10 270:16,24 271:17 272:5,11,20 273:3 273:20 274:8,10,14 274:17,23 275:4 switch 159:20 160:10 164:2 165:16 166:13 170:12 switching 68:12 sworn 13:2 284:18 system 103:8 123:3,4,9,10124:5 138:10139:10 187:1206:8 226:2 taxes 22:5 team 19:1 253:4 tear 96:21 97:2,8,18 100:1,4 101:24 102:8 104:7 105:9 105:18 106:1,7,23 107:14 108:21 113:6 116:8,19 117:3,10118:15 119:4,14,16,23 120:5 121:7 124:21 125:5 126:15 127:13 128:22 129:21 130:7,15,23 224:15,20 225:8,19 225:24 227:13,14 227:20,22 231:12 231:16,18 232:2,5 235:4 tear-tape 98:10 108:8 108:16 109:12 112:11,15 120:9,13 237:10 technical 7:14 66:13 67:15,18 68:1 156:17 technological 99:20 100:12 102:7,11,24 103:13 104:18,23 105:6,19107:19 108:2 109:5,11 technologically 99:24 101:23 102:20 103:20 107:13 108:15 162:3 technology 99:4,16 102:3,16103:8 208:4 Telephone 3:11,21 4:10 television 10:16 161:18,23 217:15 217:22 218:5 219:13 220:5 221:22 223:13 237:8 240:15 242:16,18 245:1,12 246:2,4,5,16,19 247:15 248:1,3,6,7 248:10,12,18,20 249:11,13,18,20,24 272:12,15,18 273:11,19 274:5 television-viewing Thompson Court Reporters, Inc 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 [ j I ' \ [ : Page 24 219:18 tell 23:10 27:14 47:3 95:13 121:17 163:1 189:8 193:23 196:5 197:21 209:16 231:12 233:6 242:8 242:18 243:13 247:17 249:2 ten 258:22 259:5 tendered 53:10 term 22:1220 43:8 43:15 44:19 77:20 78:3 118:2 119:11 121:2 122:5,8 131:2,3 204:23 205:1223:2,2,3 226:14 251:13 269:5,12 270:12 terms 16:234:19 44:18 71:9,10 78:10,17 91:3 109:3 114:19,23,24 117:8,15,16,19,21 117:24119:5,8 121:24 123:11 140:1 142:9 147:11 157:7 176:1,12 186:20 201:5 206:6 206:9,9 223:6,10,20 223:24 236:7 242:2 252:3 267:19 269:17,19,23 270:9 test 8 20 64:13 107:20 123:21 142:1520,24 144:1 161:2 169:8 181:13 206:13,22 tested 99:8 143:8,16 143:21 testified 13:2 108:7 134:5,8 178:20 224:2 231:11 263:10 testify 70:4 110:6 268:5 testifying 127:7 147:6 180:20 testimony 50:11 77:14 99:23 100:13 101:21 105:5 117:1 124:20 139:7 143:3 144:11 157:16 158:22 198:9 200:22 227:5 239:4 284:5,7 testing 64:17 76:3 107:21 133:7 142:7 142:19 146:17 181:18 182:20 197:5 201:13 236:5 tests 64:4 85:19 123:12 208:15 text 80:16,21 86:13 text-oriented 100:5 thank 13:16 47:9 136:2 154:21 237:16 272:5 282:13,15 thanks 94:2 254:22 theme 94:18 thing 16:2122:13 62:8,19 80:1 122:7 128:2 166:11 175:18 206:5 209:7 209:15,16 224:16 235:2 237:20 247:3 247:16 281:22,23 things 18:23 19:1 31:2,5 33:17 36:16 51:13,15 62:5 63:13 71:6,23 72:3 73:8 77:12,23 78:2 78:6 84:17 95:3,10 104:19 106:11 128:8 131:23 150:6 153:24 176:1 177:12 179:21 188:6 202:9,12 210:4 239:22 250:18 256:17 258:16 270:5 277:20 281:7 think 23:23,24 24:7 24:1125:13 31:17 34:2 35:2 36:16 37:5 42:9 62:24 63:171:7 75:2 76:7 76:13 77:22,23 78:2 79:16 83:21 84:13,16,23 85:10 86:13 87:6,22 88:24 92:2193:16 94:7,13,17 95:2,9 95:15,19 104:3,13 106:7,22 107:4,17 109:16 112:19 117:18 119:22 121:13 124:14 125:18 126:6 129:3 129:11130:3 131:13 132:5 141:3 147:15 154:4 162:20 176:11 177:13 183:6.18 191:22 193:4,17 195:15 201:24 202:14 203:19 209:23 210:2,3,9,10 213:17,18,22 215:11 219:10 235:23 243:5 245:19,20 248:4,17 253:22 254:6,24 264:22 265:1 268:7 268:8,11277:12 thinking 123:24 132:10 third 54:6,7 138:23 Thirty 93:24 94:1 239:3 Thompson 12:14 thought 31:1143:8 122:7 131:21,23 137:1 163:21 200:19 209:20 211:10,14212:1 215:16 238:18 269:19 three 82:22 107:9 119:3 167:3 ties 159:2 160:15 209:13 Tillery 3:7 time 12:12 15:23 18:12 20:20 21:2 21:22 22:1,8,10 23:18 24:3,7,8,11 27:2,9,18 28:15 29:3 30:13 31:2 32:14,18 36:11,14 38:22 39:1145:4 45:24 46:9 48:13 48:22 50:20,21,23 51:1,20,21 52:4,12 57:19,2158:14,22 59:11 60:2,17 61:4 61:22 62:4 67:6 68:9 69:17 70:24 76:14 78:15 82:1 83:12 84:19 85:15 86:6,10,16 88:12 89:16 93:22 94:2 95:20 97:17,22 98:14 99:17 100:6 100:6,9101:6,11,13 101:20,22 102:2 105:11,16,17 106:16,19 107:1 109:12 111:22 112:16,21 116:11 116:13 118:3 119:17 122:3,11 123:19 126:24 127:5 128:17 129:12 132:7 142:21 150:20 151:21,24 152:19 152:23 155:12 164:12 168:19 170:21 171:14 175:14,22,22 176:10 181:10 191:21,23,23 193:21 194:24 201:1205:12,16,16 207:24 208:3,8,16 209:19,20,21210:1 210:11,21211:5 212:20 213:16 215:9,10 218:17 219:1,1221:7,13,20 221:23 222:22 226:22 228:5,8 237:15 238:6,16 240:2 241:23 242:5 242:7 243:20,24 244:17,23 246:6 248:22 251:7 253:8 254:14 255:24,24 258:2,5,24 259:10 265:23 266:14,22 272:3,5 273:18 274:5 279:23 282:15 timeline 228:16 236:18 times 51:11 60:3,12 80:23,24 81:3,3 107:5 117:17129:4 130:7 131:20,22 134:9 213:7 221:15 221:21 238:20 239:5 242:8 245:16 246:12,23,24247:2 247:5,6 249:16 278:23,24 280:16 timing 86:7 89:19 112:19 215:15 274:4 Tina 80:4,14 tide 1:14 13:2324 16:2120:13,14 67:16,19 159:12 244:10,11251:13 titled 63:18 80:15 182:5 titles 17:23 tobacco 1:15,17 Thompson C o u r t R e p o r t e r s , 312-421-3377 10:13,21 12:6,7 64:1109:20 110:1 112:17 131:7 132:17 134:20 144:15 172:16,18 184:3 228:14,20 263:20 264:6,17 267:10,17,18 276:1 276:2 today 12:13 23:16,22 26:16 37:20 44:9 54:10 56:24 63:21 64:20,23 65:1,14 66:5 96:15 113:4 117:17 118:12 155:24161:24 163:7 178:4,21 218:5 219:8 228:10 232:3,13,15 236:17 239:7,23,24 244:16 262:20 264:18 277:4 278:23 281:9 today's 12:11,15 164:6169:12 told 82:3 183:22 211:4,13 249:22 tool 85:2 103:3,15 116:20 125:10 248:19 tools 99:7 118:14 125:11240:5 248:11 top 36:3 40:18 42:3 54:5 261:3 topics 11:6 140:13 266:6,7 total 35:14 211:17,21 212:22 213:1,10 214:1221:18 249:23 250:8,12 256:20 266:3 279:8 279:9 280:1,19 touched 28:21 town 29:9 track 32:23 82:3 155:16 161:11 219:9,12 tracked 48:22 trade 63:11 64:4,16 66:23 67:2,10 69:7 76:178:9 85:15 116:16 123:13,19 132:24 133:10 141:1,24142:8 144:16 146:4,12 149:24 153:1 158:7 158:11,16 161:1 1 1 1 1 1 I 1 1 1 I 1 I 1 1 1 { \ \ \ \ f 1 l \ \ I \ j 1 \ \ \ I Inc 3390537908 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537908 Page 25 171:6,11 183:3 195:5,10 197:2 198:24 199:20 201:9 2(32:11 211:1 223:17 268:9 269:21 277:9 traditionally 42:11 transcript 6:2,10 93:4 283:7 transcription 213:19 284:6 transition 229:19 trial 86:7,18 87:5 89:19 Tribune 279:1 tried 26:19 125:22 126:1 128:9 182:3 200:14 236:8,23 tries 237:13 true 120:6 283:7 284:5 trusty 218:10 Truth 9:20 195:12 try 128:17 151:21 188:2 233:23 trying 26:17 31:10 43:6,9 65:7 92:14 100:12 181:5 193:13,15 247:8 248:24 263:7 278:3 turn 24:4 31:18 54:4 54:5 70:3 135:23 145:12 218:9 TV 221:12,18 237:22 237:22 242:6 246:9 246:11 247:5,6 249:15 TWENTY-SECOND 1:1 twice 32:7 214:23 two 17:8 36:18 55:12 78:1 104:4 107:5 146:4,9 147:21 154:4 182:12 196:18 220:20 243:5 254:3 265:21 twofold 78:1 type 22:13 30:22 95:22 99:17 102:8 104:5 153:17 158:17 273:9 types 31:5,14 33:17 33:20 39:22 52:7 63:19 66:22 74:12 106:15 111:8,10 229:4 242:3 243:23 256:11257:3 258:16 260:12,14 266:20 typewriting 283:11 typical 185:3,11 typically 225:14 258:11259:19 T&N6:17 80:16 unrelated 124:8,23 unrepresented 275:5 unwilling 164:1 165:15 updated 220:23 235:20 updating 243:10 upward 20:10 U USA 6:12 9:6,10,13 10:3,18 11:5,8 ucsf.edu 9:9 ultimately 269:5 12:22 14:3 15:5,7 ultra 33:14,19 34:6 15:15,18,23 16:1,4 34:1135:15 36:1 16:6,12 17:15 42:1,6,20 43:18 18:17 19:3,9 29:17 83:7 187:13,19 37:20 45:1 155:16 206:6 207:5,11 169:21 170:14 226:5 227:18 175:17 176:9 178:7 241:11242:12 179:20 189:10 272:17 273:7 211:15 219:9 281:24 233:14 240:20 unable 99:24 164:2 261:2 276:10 278:9 165:15 278:23 281:16 underage 74:4,4,22 usable 13:12 274:21 underneath 86:11 276:3,6,6 understand 27:12 USA's 39:20 54:8 30:166:10,24 70:4 192:13 196:20 72:5 74:10 84:18 277:5 84:23 90:17 92:6 use 26:19 43:16 44:18 92:18 103:16 71:11,16,17 78:3,14 104:15 105:5 81:9,18 84:16 91:3 111:21 113:17 94:4 99:17 102:4 114:11 127:17 103:10 114:6,15 129:1 177:14 115:11 116:1120 248:24 251:10 117:10,19 118:14 259:4,6 271:10 121:6 122:1,5 275:7 123:21 124:9,23 understanding 9:7 126:13 128:19 29:21,24 36:12 130:7 132:17 50:5 69:4102:1,16 133:11 134:21 135:20 152:4 155:3 135:14 138:9 140:1 179:23 182:6 191:5 154:18 185:4 259:24 261:15,19 186:14,20 204:1 263:23 274:22,24 205:2 208:12 274:24 275:2 217:15 223:20 understates 214:2 225:3 227:7,9,10 understood 169:24 231:18 232:19 undertaking 223:23 248:19 263:14,22 undertook 54:22 264:26 269:17,18 underway 86:17 87:5 270:6,9 274:21 130:1 f useful 78:4,15,20 Union-Tribune 83:15 85:2,8 91:7 280:17 91:12 122:16 United 157:11,18 123:11 133:2,4 159:11 160:22 171:10 201:22 units 43:2 223:3 universe 39:4,6 user 21:19 unknowingly 197:19 uses 139:21 140:3 U.S 164:24 169:10 170:8 201:10 218:12 241:4 Videographer 2:23 12:2,23 65:22 66:1 ; 69:20,23 79:8 96:3 96:8 136:5,8 1 202:18,22 270:19 270:22 275:12,18 \ 282:16 videotaped 1:20 2:2 12:3 96:4,9202:19 \ 202:23 275:13,19 282:17 f view 85:14 89:8 125:8 155:12 184:3 185:11201:11 236:9 256:4 \ viewed 26:6 27:8 202:14 viewers 272:18 [ viewership 219:12 viewing 156:2 views 59:3 62:6,10 69:4 76:15 88:17 116:18 173:3 255:23 Virginia 1:22 2:7,15 12:16 283:22 visibility 73:23 74:3 74:15 visible 118:10 134:16 154:4 visit 188:12 204:4 232:15 273:13 278:15 visited 191:6 visitors 282:9 visual 237:1,9,12 241:21242:2 282:3 volume 34:17,20 35:2 36:13,18 37:6,8 42:16,1943:1,1 209:1,2,6 210:3 213:3 251:24 265:17,22 voluntarily 75:9 voluntary 223:24 270:5 V v 1:8,16 12:7 276:2 285:2 286:2 vacation 29:9 Values 9:14 variations 64:2 varied 36:10 various 30:13 43:14 43:17 66:1194:13 110:12 111:1 122:10 131:20 132:3,8,11 153:15 153:18 169:19 171:15 236:10 237:10 vary 184:1 199:24 234:21 varying 20:8 215:1 215:16 vast 37:5,7 211:5 vehicle 99:15 102:4,5 102:13 104:6,11,13 104:18,23 106:16 106:20 130:8 205:7 205:10 208:17 231:16 248:4 vehicles 11:994:14 95:6 106:10107:17 122:4,10,11 130:24 133:9 178:1 195:2 204:17 226:21 236:11,14 248:5,14 277:6 vent 186:3 197:17 ventilation 184:21 185:4 207:2 234:22 verdict 89:16,21 verify 235:14 version 31:3 46:18 47:2 48:1949:20 140:3 188:18 190:5 226:19 237:12 243:15 versions 158:20 177:1 235:10 — -— .— W 243:21 244:7 versus 12:4 37:14 W4:6 42:8 49:13 260:22 Wacker4:8 viable 104:24 Wagner 3:16 5:5,7 vice 13:24 16:19,23 12:21,21 13:4 17:1,2,3 18:9 24:12,20 25:6 111:11 34:14,23 35:10,18 vicinity 97:23 37:21 38:3,11,17 video 12:12 162:21 41:19 42:22 44:10 Thompson Court R e p o r t e r s , I n c 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Page 26 44:16 47:8 48:15 49:11,22 50:16 52:15 53:3,23 55:20 56:17 57:8 57:15 58:8,19 60:9 61:7,15 65:15,18 68:23 69:18 72:10 72:21 73:16 74:8 74:24 77:9,12 79:6 79:10 87:1 88:23 89:17 92:1,9,14,20 92:23 93:14 96:2 98:18 1104:1 105:12 106:3 107:2 109:14 110:3,19 111:18 112:12113:8 114:10,17 115:13 118:7 121:11,20 124:11 125:1 126:17 127:15 128:4,23 130:1 131:9 132:19 134:3 135:1,16,24 136:3 136:11 137:6,18 138:12,21 139:8 140:7,16 141:12,21 142:14 143:7,19 144:3,22145:1122 146:23 147:13,24 148:12,19 149:16 150:8,18 151:2,10 151:18 152:11 153:2,6,22 154:20 155:15,23 156:6 157:9,19 158:9,24 159:6,17 160:3,12 161:9,22 162:2,13 162:15,23 163:3,4 163:16,17 164:10 164:16 165:7,18 166:5,16 167:12,23 168:4,18 169:15 170:13,20 171:22 172:6173:17 174:4 174:20 175:6 176:3 176:23 177:3 178:2 178:10,19 179:11 180:16 181:7,19 182:1 183:4,12 184:7 185:5,16 186:1,8 187:9,23 188:22 189:14,22 190:6,21 191:13 192:5,23 193:4,6,12 193:17,19 194:12 194:23 195:1422 197:8 198:3,14 199:2,11200:2,11 203:1,13 204:8 205:5 206:14 207:16 208:19 209:12 211:19 213:4 214:8 215:19 216:18 217:6,17 218:3,13 219:23 220:11221:1 224:10 225:1,17 226:8,24 227:11 228:3 229:9 230:5 231:5 233:4 234:5 235:3 237:16,19 239:10 240:6,8,11 240:15,18 241:3 242:22 245:19 247:10 249:6,8 253:14 254:19 255:7,19 256:10 257:14,22 259:11 261:5 262:15 263:16 264:8,19 265:7 267:14 268:3 269:13 270:18 271:13,23 272:7,10 272:22 273:14 274:3,9,12,15,18 275:2,10,22 276:18 276:24 281:5 282:13 Wait 183:15 waived 282:22 wake 71:8 199:13,16 222:16,20 255:11 255:12 Walls 80:4,14 want 9:16 17:22 18:1 26:22 27:12 53:16 69:16 86:12 94:9 94:10 99:14136:12 138:1 151:2021,23 154:21,23 179:4 209:5 wanted 13:5 53:18 64:12,13 145:24 154:1 155:4163:18 165:9 166:7 167:8 168:20,21 177:6 179:21 196:5,9 197:11 198:5 209:18 277:4 280:11281:8,13 Wants 219:2 warn 92:10,12,15 93:8 warning 91:16,24 93:10 152:24 154:6 174:8,23 warnings 62:16 154:11,14173:12 Washington 69:6 172:19 278:24 wasn't 57:23 59:13 88:9 103:19 124:17 127:22 131:7 209:23 248:3 263:5 watch 241:2 246:8 249:15,23 watched 238:1 246:11 watchers 221:18 watches 247:5,6 watching 221:12 246:2,4,19 247:20 248:1,3,20 249:11 249:13 way 26:5 33:6 42:9 42:10,11,12 64:14 68:16 72:1 78:22 81:5,9 94:11,12 95:4,9 104:24 107:15,16,17 110:23 115:5,9 118:13 127:8 129:17 132:6 135:21 146:19 150:4 160:9 170:3 180:11 182:13,23 196:13,17,18 208:11215:17 218:10 221:5 223:6 224:3 225:14 247:18 248:9 252:6 253:11277:12 ways 7:18 59:2 71:20 72:2 91:6 93:18 94:20,24 95:7 99:2 99:4102:14 118:9 134:15,16146:4 155:21 159:12 164:5 190:14 204:12 222:14 223:8 230:13 244:12 web 30:23 182:4 188:17 189:19,24 190:5 194:7 265:22 website 18:14 30:24 31:4 39:2144:4,7 44:12,15,15,1921 45:1,4,6,8 46:19,23 46:24 47:3,1219,23 48:18 49:2,5,16,21 49:24 50:2,14,20 51:5,14,17,24 52:6 52:9,22 54:24 55:3 55:9,15 60:20 94:15 95:16 111:6 115:20118:10,15 133:8 177:24 178:21 179:4,13,17 179:18 180:1,10,12 180:21 181:6,10,11 182:11 183:2184:8 186:12 187:17 188:1,9,11,19 189:11,21 190:20 191:1,4,6 192:2,4,8 192:9,12,16 194:1 195:1,3,4 199:10 204:4,7,10,14,18 215:22 216:1,2,5,11 216:14 217:7,11,23 218:1223:12 226:18 230:21 232:15 233:1,14,22 235:4,12,16 237:1 242:13 253:10,20 257:1265:5,10 266:7 267:11 272:19,23 273:5,12 278:9,11 281:11,15 282:9,12 websites 17:14 28:13 31:12 52:1955:13 180:14 253:5 Wee 200:24 week 23:19 25:10,18 26:16 29:7 33:2,4 36:19 37:7 54:13 54:16 98:17 211:8 219:3 265:16 274:19,20 weeks 24:2 25:3,14 26:13 35:4,8 36:18 265:5,13,21 week's 33:8,10 34:9 34:10,16 36:8,13 42:16,19,2443:1 208:24 209:6210:3 weigh 129:19,21 welcome 136:12 Welfare 160:24 well-advised 166:13 WENDI 1:4 went 2121 30:14,19 31:3 36:14 54:15 69:11 79:7 108:22 146:17 192:15 193:11 195:6 211:3 Thompson Court R e p o r t e r s , 312-421-3377 223:17 225:10,19 252:4 278:6 282:8 weren't 73:9 103:12 107:23 259:5 West 3:19 4:8 we'll 13:9 195:15 214:9 276:7 we're53:5 65:22 66:1 69:20,23 87:22 93:2196:5 114:3 136:5,8,20 138:13 141:22162:2 202:24 247:18 260:15 270:22 275:14,20 we've 87:3 94:12,14 94:15 115:22,23 128:10129:11 133:8 140:8 148:13 150:9167:21 169:16 170:8 191:14 200:21 204:16,17 217:11 236:8,13 239:22 253:17 260:13 280:24 WHEREOF 283:16 white 21:18,24 22:11 22:20,22 wholesale 229:20 wholesalers 250:22 250:23 251:12 wide 239:22 widespread 258:12 Willard 1:16 12:6 Williams 2:5 12:16 Winston 4:7 witness 12:24 24:14 24:2125:7 29:16 29:23 34:15,24 35:11,19 37:23 38:5,18 41:21 42:24 44:11,17 47:9 48:17 49:12 49:23 50:18 52:17 53:8,1154:155:22 56:19 57:17 58:10 58:2160:1161:9 61:17 68:24 69:16 72:12,22 73:17 74:10 75:187:2 88:24 89:18 93:16 98:20 104:3 105:13 106:5 107:4 109:16 110:7,20 111:20 112:13 113:10 114:11,19 115:15 Inc. Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 1 1 f 1 1 ! I f 1 1 f 1 f I 1 f f \ I 1 j \ f i \ \ \ \ \ I \ \ \ \ I \ \ \ I \ \ I Page 27 201:17 205:17 144:10 34:12,15 36:7 118:8 121:13,22 wondering 250:13 258:22 259:15 42:17 208:23 212:8 124:13 125:3 126:19127:17 word 65:8 86:19 98:6 year-long 21:4 212:10 128:5 129:1 130:3 98:7 116:4 119:8 yesterday 80:22 131212:8 226:6 238:22,23 yield 91:20 93:13 131^36,500 212:9 131:10 132:21 134:5 135:3,18 words 26:20,22 83:23 182:14 187:2 135 32:9 84:6,10 206:11,18 207:1 1365:5 6:18 136:22 137:14 138:5,18 139:21 word-by-word 50:6 yielding 164:3 1377:3 140:14 141:8,17 work 17:24 19:6,6 yields 83:17 84:3,8,21 1387.5 142:6,18 143:15,24 22:14 23:4,5 32:19 85:9 91:9,19 93:11 14 6:4,5,8,10,12 7:16 144:13 145:10,18 93:20 99:9 103:7 122:17 123:6,17 19:16 141:9 157:21 104:18,23 141:4143:10161:1 157:23 211:17 146:3 147:9,19 worked 15:3 19:1,5 169:10 182:21 14:22202:20 148:10,18 149:12 149:22 150:17 19:24 20:2 21:3 184:11,23 14:30202:24 22:4 57:3 59:18 York 51:11278:23 1447:7 151:1,9,17 152:10 152:18 153:12 219:15 225:13,14 young 74:15 1497:9 155:9,20156:13 253:4 youth 216:9 266:8 15 7:18 79:7 83:9,13 157:17 158:2 working 19:3 86:14 159:1,4 Z 87:3 109:8 110:23 15th 80:4 90:4,13 159:10,22 160:8,21 zoom 162:5 15:48270:20 259:5 269:15 161:17 163:11,21 world 7:20 161:3 15:53 270:23 164:15,23 165:12 0 15:57275:14 167:2 166:2,9,23 167:18 0.8141:19 150 32:8 168:10 169:5 170:7 worse 7:22 161:4,8 002-00406-02 1:5 153 7:11 170:19 173:4 172:9 worth 33:8,10 34:9 174:3,15 175:5,12 34:10 36:9,13 12:5 1550(b)) 1:14 176:8 177:11 178:6 42:16,19,24 43:1 156 7:13 1 157 7:16 176:11 208:24 178:16 179:20 16:4,12 12:4 14:19 1597:18 210:3 265:17 180:23 181:16,23 wouldn't 127:7 14:22 23:9 70:2 16 7:20 160:15,18 182:10 183:11,18 79:14 96:4 159:23 161:14 write 161:20 184:15 185:10 186:19 187:16 writing 140:19,20 1-286 2:21 16th 24:6 1.1 141:10 16.7279:11280:1 188:5 189:18 190:3 written 81:18 167:3 wrong 77:11 80:1,10 10 7:7 31:18,19 32:24 16:03 275:20 190:13 191:3,19 wrote 81:16,17 38:14,19 144:20,23 16:11282:18 193:9 194:5,19 195:9,19 196:24 Wynder8:15 148:21 160 7:20 10:2565:23 197:15 198:10,11 163 8:3 Y 198:19 199:8,16 10:26 66:2 164 8:7 10:31 69:21 165 8:10 200:8 203:9 204:23 yeah 29:13 46:19 80:9 121:13 123:7 10:50 69:24 166 8:13 206:1208:8 212:19 126:8 162:13 100% 103:5 168 8:16 216:16 217:3,21 year 19:8 20:4 21:7 109 32:6 36:7 220:4,18 224:12 169 8:19 21:1036:2,17 117:9 141:18 149:7 17 8:3 163:5,9 225:7,23 227:6 229:2,14 230:12 39:18 46:1164:6 149:10 17th 144:24 145:14 93:22 97:23 98:17 11:26 96:6 147:5 243:18 232:18 233:12 117:9 118:5 121:9 118 32:7 36:8 173 9:3 236:22 239:11 121:18 124:6 12 7:11 153:7,10 176 9:5 241:1242:23 138:20 194:5 154:1211:16 179 9:6 245:20 249:7,9 214:23 228:4 238:24 18 8:7 164:19,21 253:15 254:23 255:8,21256:11 229:17 265:21 12.5 211:21 165:8 221:12,18 257:16,23 259:13 years 19:16,24 20:6 12:2196:10 246:2 259:15 28:1341:857:5,11 13 5:3 7:13 87:11,16 261:7 262:17 1889:9 263:18 264:10,22 59:17 70:17,23 90:15 156:7,10,11 189 9:11 76:12 88:7 99:2 157:10 200:24 19 8:10 165:21,24 267:16 268:7 269:15 271:14,24 127:1 130:11 201:5 203:4 204:14 19th 19:22 131:12,16 133:23 13:09 136:6 1909:14 272:21 273:4,21 281:3 283:16 134:6 139:23 13:17 136:9 1919:16 149:24 167:5 130 32:1,12 33:1,9 1949:18 witness's 143:6 1940 3:9 \ 195 9:19 1960's 170:2 1966 66:14 67:16 I 1967 158:4 197:4,7 253:23 254:9 \ 1970 145:4,14 147:5 \ 147:23 159:16 1970's 94:8 160:14 197169:3 91:17 \ 95:14 137:16 \ 140:22 141:8 148:6 1 148:13 150:21 \ 1972 137:17 1974 240:13,18 1978 64:7 [ 1980's 148:15 156:3 \ 165:20 \ 1981 163:12,19 j 164:11258:2,20,21 \ 259:4 260:2 j 1984 149:1 I 1985 165:3 \ 1989 8:12 19:22 57:3 \ 57:4 165:20 166:4 [ 1990 8:7 165:5 1990's 94:22 148:16 152:1 155:1 156:3 167:13 168:21 171:5 j 1991 166:23 I 1992 152:3 155:1 168:10 1 1993 15:6,8,13 20:2 21:9 59:22 155:1 = 1994 20:6 21:10 • 1995 151:23 1996 168:24 169:7 170:3 = 1997 61:22 149:6,13 \ 172:1,9 173:20 175:21 255:12,18 256:8 257:13 1998 54:22 57:4,12 58:5 59:18 175:21 255:4 1999 30:2444:5,8,12 44:22 45:10,13,19 46:18,23 47:1 48:19 49:5,24 50:15,18 51:6 52:12 55:1 95:17 118:11,20178:22 179:4,13 181:10 186:12 188:1 189:2 192:10,11 193:3,6,7 193:10,11,18 Thompson Court Reporters, Inc 312-421-3377 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 28 236:15 237:2 273:6 2 26:5 14:2154:17 80:14 96:8 161:6 202:19 251:4 278:2 2% 34:22 35:9,12 24280:21 20 8:13 166:18,21 284:19 20-something 93:22 2000 15:10 194:6,24 195:19 196:7,21 199:5 252:22 253:13 200176:7,15 131:16 138:15,20139:18 140:10,14,22 141:13,15,18 147:22 148:14 171:17,24 191:22 194:10 200:21,23 222:17,21 237:6 271:2 2002 31:2132:13 34:20 35:16 36:11 36:12 38:21 40:19 42:15 47:14 70:7 70:10,18 97:6 120:7 195:9,16 205:11,1520 206:2 207:24 208:21,22 212:7,12 213:6,12 214:13 224:3 266:14 278:19 2003 20:12 32:6 75:22 76:21 77:5,8 77:21 80:4 83:9,13 89:23 90:2,4,13 91:17,24 94:24 95:14 122:13,24 123:4 148:7 217:21 220:9,14 221:10,22 222:1240:15 243:19 244:18 245:21 273:19,23 274:1 2004 32:6 39:18 215:24 216:4,11,17 217:7,8 220:14 221:17 240:14 244:19 245:22 274:2 2005 32:8 213:20 220:22 243:7,12 2006 18:4217:21 220:10,24 243:7,8 243:12,16 273:19 273:23 2008 15:10 18:5 36:1138:2140:19 97:7 111:24 120:8 205:15 213:13 214:14 224:4,5,13 266:15 2009 49:20,20 96:22 97:2,17 100:2,14,21 101:1,1022 105:8 105:16 106:2,15 107:14 108:9,12 109:13 111:24 112:6,7,8 113:7 117:5 119:15 120:4 120:16 121:10 122:19,24 123:15 124:22 131:6 132:2 132:14 224:13,23 225:20 227:13 228:6 229:11 201097:24 121:4 224:24 225:20 228:7,12 229:16 231:6,7,9,14 20111:23 12:11 283:18,19 203 10:3 205 3:8 10:7 2061161376 9:18 2073565099 9:9 2073565101 9:9 2074407060 9:3 2074407061 9:3 2079137965 9:14 2079137966 9:14 2085126846 9:16 2085126847 9:16 208558649210:3 2085586493 10:3 209 10:8 218:16 167:24 168:8 235:14 21st 243:19 21210:10,12 22 8:19168:23 169:2 22nd 112:6 229:10,16 220 10:15 23 9:3 54:22 173:18 173:23 23219 2:7 233 10:18 237 5:4 24 9:5 176:4,6 185:14 185:19 25 9:6 179:6,9 181:20 Thompson 181:24 267:2 26 1:23 9:9188:20,23 _4 26th 12:11 4 6:10 15:2 29:1 267 10:19 54:19 55:4 213:23 268 10:21 275:18 282:17 27 9:11 189:11,12 4,798,556 213:22 190:1 4:11 282:24 272 5:6 40 10:21 268:19,21 275 5:7 40421:14 12:8 27611:3,7 28 9:14190:7,11 41 11:3 216:21276:8 278:20 276:16 28011:10 4100 3:18 283205931 8:10 42 11:7 276:20,22 283205962 8:10 43 11:10 245:19 29 9:16 188:7191:15 280:22 281:1 191:16 47 230:17 4760 2:20 3 49 233:3,19 3 3:18 6:8 15:128:6 5 202:22 275:13 5 6:12 7:18 14:22 30 9:18 194:2 239:2 15:2 16:8,15 70:3 30th 283:17 251:17 30-second 273:10 5-0 79:9 300,000 214:2 3000155619 11:10 50 35:8,11 234:9 3000155638 11:10 5012623039 10:8 30001793719:11 5012623047 10:8 3000179374 9:11 5012623233 6:10 5012623274 6:10 3000184661 10:12 51-page 240:1 3000184662 10:12 514263587 7:16 3007287612 10:16 52 35:3 3034014029 10:15 319:19195:15,20,23 57.03 48:16 283:19 312 240:12 312.558.7488 4:10 312.583.2391 3:21 312.899.5063 3:11 32 10:3 203:6,7 32-year 94:195:20 3251240:19 33 10:7 205:22,23 3410:8 161:4 209:9 209:10 210:8 3452 240:21 354:8 10:10212:14 212:15213:11 250:1 36 10:12 212:17 213:15 214:5,16 216:12,16 265:12 265:13 37 10:15 219:24 220:2 243:14 38 10:18 233:5,10,12 3910:19 266:24 139:11 140:17 141:2 80 247:4 80s 170:3 245:15 80's 245:21 800 188:15 194:7 207:23 82 245:21,24 246:8 249:2 82% 221:11 246:1,18 248:1249:10 83 245:21 83% 221:18 245:24 246:8 249:2,5 85 224:19 225:2,3,5,7 85-character 226:19 86% 209:3 211:14,21 877-PMUSA 189:23 9 9 7:5 138:15,17 140:9 140:17 147:16 200:4 9:00 1:24 9:21 12:12 90s 75:24 116:19 131:13 222:20 93 152:3 951 2:6 951000012910:10 9510000163 10:10 955024807 7:13 955024810 7:13 6 6 1:6 6:14 79:2,5 606013:10 4:9 60602 3:20 67 6:12 7 76:18 8:19 47:8 55:1 136:17,21 138:24 141:3 145:13 153:24 213:23 7.4 246:23 247:2,5 249:16 70 3:19 70s 152:22 170:3 245:14 711400 1:19 7252005 6:16 79 6:14 8 87:3 35:16 137:5,8 Court Reporters, 312-421-3377 Inc. Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 92 3390537913 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537913 Highly Confidential - Subject to Protective Order 1 MISSOURI CIRCUIT COURT 2 TWENTY-SECOND JUDICIAL CIRCUIT 3 (CITY OF ST. LOUIS) 4 ***************************************************** 5 DAYNA CRAFT, DEBORAH LARSEN, ) 6 WENDI ALPER-PRESSMAN, ) 7 Individually and on Behalf of ) 8 All Others Similarly Situated, ) 9 10 Plaintiffs, } v. ) Case No. 11 PHILIP MORRIS INCORPORATED, ) 002-00406-02 12 a corporation, ) Division No. 6 13 1/ Defendant. ) ***************************************************** 15 16 SUPERIOR COURT OF THE STATE OF CALIFORNIA 17 CITY AND COUNTY OF SAN DIEGO ^_g ***************************************************** 19 Coordination Proceedings ) 20 Special Title (Rule 1550(b)) ) 21 In Re TOBACCO CASES II ) 22 JCCP No. 4042 } 23 24 Golkow Technologies, Inc. - 1.877.370.DEPS Page 287 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 2 3 WILLARD R. BROWNr et al., Plaintiffs, San Diego v. 4 THE AMERICAN TOBACCO CO., Superior Court 5 INC., et al., Case No. 711400 5 n Defendants. ***************************************************** Videotaped deposition of BRENDAN McCORMICK 9 Richmond, Virginia 10 Volume II of II 11 Friday, October 7, 2011 12 9:35 a.m. to 11:53 a.m. 13 14 VIDEOTAPED DEPOSITION OF CORPORATE DESIGNEE 15 DEPOSITION CONTAINS HIGHLY CONFIDENTIAL 16 INFORMATION OF PHILIP MORRIS USA INC. 17 SUBJECT TO PROTECTIVE ORDER IN DAYNA CRAFT, 18 et al., v. PHILIP MORRIS USA INC., et al. 19 20 21 22 23 Reported by: 24 Videographer; Katherine S. Hruneni Ron Benton Golkow Technologies, Inc. - 1.877.370.DEPS Page 288 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm01903990537915 • , mibnect to P r o t e c t i v e O r d e £ Deposition of BRENDAN McCORMICK, held at the law offices of: HUNTON & WILLIAMS LLP Riverfront Plaza, East Tower 951 East Byrd Street, 20th Floor 804.788.8200 10 11 12 13 14 15 16 17 Pursuant to Notice, before Katherine S. 18 19 . o t a r v public in and for the Commonwealth of Hruneni, NNotary ruuu. 20 • • • at »*- Large, T.rae- duu and Ron Benton, Videogr cipher. Virginia 21 22 23 24 Go lkow Technologies, Inc. - 1.877.370.DEPS Page 289 3390537916 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537916 Highly Confidential - Subject to Protective Order 1 2 A P P E A R A N C E S ON BEHALF OF THE PLAINTIFFS: 3 DOUGLAS W. REDFEARN, ESQUIRE 4 Simon, Peragine, Smith & Redfearn, L.L.P. 5 30th Floor, Energy Centre 6 1100 Poydras Street 7 New Orleans, Louisiana 8 504.569.2030 70163-3000 9 10 ON BEHALF OF THE DEFENDANT 11 R.J. REYNOLDS TOBACCO COMPANY: 12 RACHEL TESSA GEZERSEH, ESQUIRE 13 Jones Day 14 555 South Flower Street, Fiftieth Floor 15 Los Angeles, California 16 213.489.3939 90071-2300 17 18 ON BEHALF OF THE DEFENDANT 19 LORILARD TOBACCO COMPANY (via telephone): 20 RICHARD B. BULL, ESQUIRE 21 DLA Piper US, LLP 22 401 B Street, Suite 1700 23 San Diego, California 24 619.699.2736 92101-4297 Golkow Technologies, Inc. - 1.877.370.DEPS Page 290 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order A P P E A R A N C E S (Cont'd) 1 ON BEHALF OF THE DEFENDANT 2 PHILIP MORRIS USA: 3 JEFFREY M. WAGNER, ESQUIRE 4 Kaye Scholer LLP 5 3 First National Plaza, Suite 4100 6 70 West Madison Street 7 Chicago, Illinois 60602-4231 313.583.2391 10 * * * * * 11 12 13 14 15 16 17 18 19 20 21 22 23 24 ^ ^ " T e c h n o l o g i e s , Inc. - 1 - 877 .370 .DEPS Page 291 3390537918 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537918 H i g h l y _Con fidential - Subject_t^Pr^te^tiy^rder_ C O N T E N T S 1 2 EXAMINATION OF BRENDAN McCORMICK 3 By Mr. Redfearn 4 By Mr. Wagner PAGE 294 399 8 E X H I B I T S 9 (Attached to transcript) 10 McCORMICK DEPOSITION EXHIBIT 11 Ex. 44 12 Ex. 45 Notice of Deposition PAGE 301 399 California Onsert Chart 13 * * * ** 14 15 16 17 18 19 20 21 22 23 24 ^^^BclunTlTa^sT^^- " 1.877.370.DEPS Page 292 3390537919 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537919 Highly C o n f i d e n t i a l - S u b j e c t t o P r o t e c t i v e Order 1 (9:35 a.m., Friday, October 7, 2011) 2 3 P R O C E E D I N G S 4 5 THE VIDEOGRAPHER: We are now on the 6 record. 7 videographer for Golkow Technologies. 8 9 My name is Ron Benton. I am the Today's date is October 7, 2011, and the time is 9:35. This video deposition is being 10 held in Richmond, Virginia, in the matter of the 11 case regarding Tobacco Case No. II, for the 12 Superior Court of the State of California, City 13 and County of San Diego. The deponent is Brendan 14 McCormick. 15 Would counsel please introduce 16 themselves, indicating who you represent. 17 then the court reporter, Kari Hruneni, will then 18 swear in the witness. 19 20 21 22 23 24 MR. REDFEARN: And Douglas Redfearn, for the plaintiffs. MR. WAGNER: Jeffrey Wagner, on behalf of Philip Morris USA. MS. GEZERSEH: Rachel Gezerseh, on behalf of R.J. Reynolds. Golkow Technologies, Inc. - 1. 877.370.DEPS Page 293 3390537920 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537920 Highly Confidential - Subject to Protective Order 1 MR. BULL: 2 3 Richard Bull with DLA Piper, for Lorillard Tobacco Company. / 4 BRENDAN McCORMICK, 5 called for further examination by counsel on behalf of 6 the plaintiffs, was duly sworn, as hereinafter 7 certified, and testified as follows: 8 E X A M I N A T I O N 9 10 11 BY MR. REDFEARN: Q Good morning, Mr. McCormick. Again, my name is Douglas Redfearn. 12 Before we begin, I just want to make it 13 clear on the record, you understand that this is a 14 continuation of your August 26th deposition; correct? 15 A I do. 16 Q And therefore the caption of your 17 deposition will reference the Missouri case and the 18 Brown case in California; correct? 19 A Okay. 20 Q I know that you've given several 21 depositions. 22 deponent is if at any time I ask you a question that 23 you don't understand, please let me know. 24 But one thing I always like to remind the Because if you answer the question, I'm Golkow Technologies, Inc. - 1.877.370.DEPS Page 294 3390537921 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 going to assume that you heard the question, LliC UUCOUlUUf 3 W11U »_)tJ.V'w ill^ i^j.±v* '-LSrl^ -1- >^ _£"-»- -J- •-<• >- ^ response. Is that all right? 4 5 A Will do. 6 Q Since your last deposition, has your 7 employment changed in any way? 8 A No. 9 Q Same job title? 10 A Yes. 11 Q Same employer? 12 A Yes. 13 Q Are you producing any documents here 14 today? 15 A No. I have asked counsel to make available to 16 17 me a copy of my affidavit from the MDL case. 18 believe that you had that previously. But there's no other documents being 19 20 produced. 21 reference. 22 23 24 I Q I just like to have that handy for Have you reviewed any documents for today's deposition? A I have. Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 295 3390537922 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537922 Highly Confidential - Subject to Protective Order 1 Q And what documents were those? 2 A I reviewed a number of documents in 3 preparation for my last deposition. 4 outlined in my answers to those questions. 5 Those were So I've reviewed previous testimony. 6 I've reviewed a wide range of the company's 7 communications related to light cigarettes. 8 9 10 I've reviewed my previous affidavits. I've reviewed my deposition — transcript of my deposition between my deposition and today. 11 I have reviewed, I believe — I don't 12 know the official title, but whatever notice of 13 deposition and the kind of areas of inquiry that you 14 had for today's deposition. 15 I reviewed a number of documents that 16 were responsive to some of the issues that you raised 17 in that inquiry. 18 I went back and reviewed some of the 19 regulatory communications that members of the Federal 20 Trade Commission and some members of public health 21 community have made related to light cigarettes. 22 Q With respect to today's deposition, as 23 opposed to the very beginning of the August 26th 24 deposition, is the only thing new that you reviewed Golkow Technologies, Inc. - 1.877.370.DEPS Page 296 3390537923 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential -- Subject to Protective Order 1 is your deposition transcript for August 26th and the 2 notice of deposition that we provided? 3 A I reviewed both of those. And in, 4 addition, I did review some additional documents that 5 were responsive to some of the issues that were 6 raised in your notice of deposition. 7 Q Can you estimate for us about how many 8 new documents you would have reviewed in response to 9 our deposition notice? 10 A Probably two or three. 11 Q Can you tell us what those documents are? 12 A I looked at documents related to — some 13 of them were summaries that had captured some of the 14 information that I had looked at previously. 15 As I looked at some of those, I asked for 16 a little bit more detail on -- you know, some back-up 17 documents that were related to those summaries. 18 Most of that information was just 19 additional detail to what I had reviewed before. 20 I looked at some additional information related to 21 inquiries that had come in to the company that may 22 have been responsive to your request related to the 23 onserts. 24 Q And And if I were to make a request for Golkow Technologies, Inc. - 1.877.370.DEPS Page 297 3990537924 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537924 Highly Confidential - Subject to Protective Order 1 production to Philip Morris USA, would you be able to 2 give those documents — 3 you just spoke about to your lawyers to be produced? those specific documents that 4 MR. WAGNER: 5 BY MR. REDFEARN: 6 Q Objection to the form. What I really want to know is, you can 7 identify those documents for your attorneys, should we 8 request those documents; correct? 9 A Yes, I could. 10 Q And you could actually physically hand them 11 12 13 to your attorneys; correct? A I can identify them for my attorneys and review them with my attorneys. 14 MR. WAGNER: Doug, the real — the 15 objection was I think the documents have already 16 been produced. 17 referencing. 18 That was the only thing I was MR. REDFEARN; Right. But if we, later on 19 down the road, want the exact list, to make sure 20 that there's no dispute as to what the documents 21 are — 22 MR. WAGNER: 23 MR. REDFEARN: 24 MR. WAGNER: No problem. — you can tell us? No problem. Golkow Technologies, Inc. - 1.877.370.DEPS 3390537925 Page 298 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537925 Highly Confidential - Subject to Protective Order 1 2 3 BY MR. REDFEARN: Q Aside from lawyers, did you speak to anyone to prepare for your deposition today? 4 A Yes, I did. 5 Q Who did you speak to? 6 A I spoke with Annie Campbell. 7 Q Anyone else? 8 A No. 9 Q Who is Annie Campbell? 10 A Annie works — currently works in our 11 corporate communications group. 12 previously on some of our communications, including our 13 television advertising and other communications, 14 related to light cigarettes, as well as a broad range 15 of other issues. 16 17 18 Q Annie worked Why did you speak to Ms. Campbell in order to prepare for your deposition today? A What I wanted to do with her is — I had a 19 certain understanding of information that was in some 20 of the documents that I had reviewed. 21 confirm that my understanding was correct. 22 Q And I wanted to Now, in response to my earlier questions 23 about what documents you reviewed, you talked about 24 summaries. Golkow Technologies, Inc. - 1.877.370.DEPS Page 299 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 And also, I saw in your very first 2 deposition that you gave in the MDL case you talked 3 about looking at summaries when you prepared your 4 affidavit. 5 In looking back, it appears that you were 6 referring to summaries, at least with respect to your 7 affidavit, about the amount of packs the onserts were 8 on. 9 What I want to know is, was there any other 10 factual summaries that you looked at when you used the 11 term "summaries." 12 A Yeah. And I think the, you know, summaries 13 would be — 14 which would be sheets that totaled up the number of 15 packs on which onserts were distributed. one example would be what you mentioned, 16 I also reviewed documents that had 17 summarized the scope and reach of some of our 18 television and radio advertising. 19 In preparation for my other deposition, I 20 had also reviewed summary documents that looked at the 21 scope of the communication of our freestanding insert, 22 which was something we placed in newspapers to drive 23 people to our website and make them aware that we had a 24 corporate website and the information they would find Golkow Technologies, Inc. - 1.877.370.DEPS Page 300 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537927 Highly Confidential - Subject to Protective Order ! 1 there. 2 So those would be some examples of some of 3 the summaries that I would look at. It would be 4 information that really captured in a single document 5 the scope of our efforts related to a specific 6 initiative. 7 Q And again, if we were to ask the Philip 8 Morris USA lawyers to produce copies of all the 9 summaries that you reviewed to prepare your affidavit 10 and reviewed in preparation for any of your 11 depositions, would you be able to identify those 12 summaries for your — 13 14 15 A Yes. for the Philip Morris attorneys? I would be able to identify those documents. Q I'm going to show you what we're going to 16 mark as Exhibit 44, which is the notice of deposition 17 which was done in the Brown case. 18 19 (Deposition Exhibit No. 44 marked for identification.) 20 21 MR. WAGNER: sent, not our cross-notice; right? 22 23 24 This is. the notice that you BY MR. REDFEARN: Q Correct. Have you seen that document before today? Golkow Technologies, Inc. - 1.877.370.DEPS Page 301 3390537928 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537928 Highly Confidential - Subject to Protective Order 1 2 A of this document. 3 4 I have seen attachment 1, so pages 2 and 3 Q And pages 2 and 3 have the matters upon which examination is requested; correct? 5 A That's correct. 6 Q Do you understand that this deposition 7 today is of the person most knowledgeable at Philip 8 Morris USA regarding the matters identified in Exhibit 9 44? 10 A That's my understanding. Yes. 11 Q Are you currently an officer, director, 12 managing agent, employee, or agent of Philip Morris 13 USA? 14 A I am an officer at Altria Client Services, 15 which provides services to Philip Morris USA, in 16 addition to some of Altria's other companies — 17 Altria's other companies. all of 18 Q Are you currently employed with Philip 19 Morris USA? 20 A No, I'm not. 21 Q Has Philip Morris designated you as the 22 most qualified person to testify on its behalf 23 regarding each matter listed in Exhibit 44? 24 A Yes, it has. Golkow T e c h n o l o g i e s , Inc. - 1.877.370.DEPS P a g e 302 3390537929 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537929 Highly Confidential - Subject to Protective Order 1 2 Q And you consent to testify on Philip Morris's behalf? 3 A Yes, I do. 4 Q Real quick, I just want to get some terms. 5 When I use "Philip Morris," do you understand that I'm 6 talking about Philip Morris USA? 7 A That's how I — that's the — my 8 understanding is that that is the company whose actions 9 are at issue in this request, so that's the way I 10 11 understand that. Q And from time to time, if I say "Philip 12 Morris" generically, and there needs to be a 13 distinction between Philip Morris USA and another 14 Philip Morris company, will you let me know? 15 A I certainly will. 16 Q I appreciate that. 17 Is there any matter listed on Exhibit 44 18 that you believe that some other person would be more 19 qualified than you to testify about? 20 MR. WAGNER: 21 THE WITNESS: 22 I believe I'm qualified to testify to each of these issues. 23 24 Object to the form. BY MR. REDFEARN: Q I understand that. Golkow Technologies, Inc. - 1.877.370.DEPS Page 303 3390537930 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537930 Highly Confidential - Subject to Protective Order 1 But do you think that there's anybody that 2 would be more qualified than you to testify about any 3 matter listed in Exhibit 44? 4 MR. WAGNER: 5 THE WITNESS: Object to the form. Again, I think I'm the person 6 most knowledgeable to cover all of these issues, 7 and I feel prepared to answer your questions in 8 each of these areas. 9 10 BY MR. REDFEARN: Q So is your testimony that there is no 11 person that would be more qualified to talk about any 12 of the matters listed in Exhibit 44? 13 14 15 MR. WAGNER: Object to the form. Asked and answered. THE WITNESS: Again, I think that on any 16 given issue you may find a single individual, 17 depending on — 18 specific question. 19 you know, to answer a very When I look at the sum of all of these 20 issues, the 20 that you've listed here, I have 21 knowledge about each of those, I've gathered 22 knowledge about each of those, and I feel prepared 23 to answer your question on all of the matters 24 which are here, and believe that I'm the person Golkow Technologies, Inc. - 1.877.370.DEPS Page 304 3390537931 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537931 Highly C o n f i d e n t i a l - Subject t o P r o t e c t i v e most knowledgeable to 1 testify about those. BY MR. REDFEARN: 2 Q 3 All right. 4 of your — 5 amended cross-notice. I'd like to show you Exhibit 41 of the August 26 deposition. It's the Counsel, I don't have an extra copy of 6 7 Order that. 8 MR. WAGNER: That's fine. 9 BY MR. REDFEARN: 10 Q Have you had an opportunity to look at 11 Exhibit 41? 12 A I have. 13 Q And you've seen that before; correct? 14 A I'm not sure. What I don't remember is 15 seeing this with a reference to the California case on 16 top. 17 But as I review it, the detail in it looks 18 identical to or very similar to the information that 19 was shared for the Craft case. 20 So I don't know that I've reviewed in 21 detail this specific document. 22 very similar to what was reviewed for the Craft case 23 prior to my prior deposition on these issues. 24 Q But its contents look And with respect to Exhibit 41, same Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a c e 305 3390537932 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537932 Highly Confidential - Subject to Protective Order 1 question that. I asked you about Exhibit 44, the present 2 notice for deposition. 3 Is there any matter listed in Exhibit 44, 4 in that notice, that you believe that some other person 5 would be more qualified than you to testify about? 6 A No, I don't. No, there isn't. 7 Q What about Megan McClain on the 2002 8 freestanding insert highlighting the contents of the 9 Philip Morris USA website? 10 A Megan is certainly — you know, was 11 familiar with those issues from the course of her 12 employment. 13 Q 14 I'm just as familiar with those. Do you think she would have more knowledge than you regarding the 2002 freestanding insert? 15 A I don't believe so. 16 Q Why not? 17 A Because I'm not aware of any information 18 that — 19 understanding is that Megan gave prior depositions on 20 these issues, and I understand she's very familiar with 21 them. 22 about that, that I don't have. Again, my And I believe I'm equally familiar with those. Q Does the cross-notice marked as Exhibit 41 23 include any matter regarding the decision-making 24 process related to the launch of the Philip Morris USA Golkow Technologies, Inc. - 1.877.370.DEPS Page 306 3390537933 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537933 Highly Confidential - Subject to Protective Order 1 2 website in 1999? A None of these items directly mention the 3 website. 4 public statements, comments, and/or disclosures 5 regarding lights and/or low tar cigarettes. 6 The first item here refers to Philip Morris's It says "as set forth in Philip Morris's 7 response to special interrogatory No. 2." 8 haven't seen special interrogatory No. 2, it's 9 certainly possible 10 While I — You know, when I think about Philip 11 Morris's statements on light cigarettes, I think, 12 certainly, our communications via the website, which 13 have been available since we launched that site in 14 1999, would potentially be responsive to that. 15 I also believe that, as you review some of 16 these other issues where there's questions related to 17 the basis for and decision-making process related to 18 certain communications, our website and the 19 communications we have made historically on that and 20 were making simultaneously to these other disclosures, 21 they were certainly part of the communication that 22 part of the discussion that we had in my prior 23 deposition on these issues and, I believe, have bearing 24 on a number of these issues. Golkow Technologies, Inc. - 1.877.370.DEPS — Page 307 3390537934 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537934 Highly Confidential - Subject to Protective Order 1 Q But would you agree that there's nothing in 2 that notice that specifically says the decision-making 3 process related to the launch of the Philip Morris USA 4 website in 1999; correct? 5 6 MR. WAGNER: Objection. Asked and answered. 7 THE WITNESS: That language is not 8 outlined. But again, I think that the first one 9 here seems broad enough to include that. While it 10 may not be there specifically, it seems to 11 certainly be relevant on a number of different 12 issues. 13 14 BY MR. REDFEARN: Q Now, I heard your say earlier in some of 15 our discussion that you read your August 26th 16 deposition transcript; correct? 17 A Correct. 18 Q Did you make any changes to that deposition 19 transcript? 20 A 21 22 I did. I made, maybe, a handful of edits to that and submitted them back through counsel. Q Was there anything that you would consider 23 substantive changes, as opposed to mere typographical 24 errors? Golkow Technologies, Inc. - 1.877.370.DEPS Page 30 8 3390537935 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537935 Highly Confidential - Subject to Protective Order 1 A I think that there were a couple of issues 2 where I may have gotten a year wrong on one issue, a 3 word wrong in one or two places. 4 But those were the types of errors. 5 were a couple of items like that. 6 serious, you know, substantive errors that changed the 7 nature of the conversation, I don't believe there were 8 any related to that. 9 10 Q But the — There as far as Since your last deposition of August 26, 2 011, have you been deposed before today? 11 A No. 12 Q Have given any trial testimony? 13 A No. 14 Q Do you expect to give any trial testimony 15 in the near future? 16 A I don't 17 Q Are you scheduled to give trial testimony 18 19 in the Missouri case? MR. WAGNER: Objection. I'm going to 20 instruct you not to answer. 21 pending, and we're not going to reveal our work 22 product at the moment. 23 24 That trial is He has not been disclosed yet as an upcoming witness, and so — Golkow Technologies, Inc. - 1.877.370.DEPS Page 309 390537936 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537936 Highly Confidential - Subject to Protective Order 1 2: BY MR. REDFEARN: Q 3 I understand. I want to talk to you now about the Philip 4 Morris USA website. 5 know that it was called www.PhilipMorrisUSA.com. 6 7 Now, for ease of reference — I Is it okay if I just use the term "Philip Morris website"? 8 A Yes. 9 Q And we'll understand each other? 10 A We'll understand that that refers to that 11 12 13 PhilipMorrisUSA.com website. Q That's certainly fair. And if there's a distinction that needs to be made, you'll point that out to me? 14 A I will do my best. 15 Q I appreciate that. 15 Who drafted the website pages for the 17 Philip Morris website that was launched in 1999? 18 A Those pages were drafted — the process 19 that was used to finalize that material was that each 20 of those web pages — 21 matters that were launched on that page, information 22 about the company, information related to the health 23 issues, related to our products. 24 and there were various subject There was a cross — there were cross- Golkow Technologies, Inc. - 1. 877.370.DEPS Page 310 3390537937 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537937 Highly Confidential - Subject to Protective Order 1 functional teams that were put together for that 2 website that included individuals from communications, 3 individuals from the law department, individuals with 4 accountability for the various issues that were 5 discussed. 6 So if there were marketing issues that were 7 being discussed, our marketing department would have 8 input into that. 9 If there were government relations issues 10 that were being discussed, those with responsibility 11 for government relations would have input into that. 12 And that's a process that we have used 13 pretty consistently over the time that that website has 14 been made available, to use cross-functional teams with 15 subject matter expertise, communications personnel, and 16 law input into that process to work on that content. 17 18 19 20 21 22 Q When you say "cross-functional teams," are you talking about work by different departments? A Yes. That's what I mean when I use "cross- functional teams." Q And I was trying to take down everything. I heard that the law department was involved; correct? 23 A Correct. 24 Q Okay. And I think you said accountability? Golkow Technologies, Inc. - 1.877.370.DEPS Page 311 3390537938 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537938 Highly Confidential - Subject to Protective Order 1 A I said those with accountability for the 2 subject matter. 3 would use, you know, those with subject matter 4 either — 5 generic term. 6 So you know, one of the phrases we — "subject matter experts" is probably a And that would vary by the issue that you 7 were discussing on the page. 8 individuals potentially from different departments. 9 Q And it would vary with And what I want to know is can you list for 10 us each and every department that had some sort of 11 responsibility for drafting the website pages that were 12 launched in 1999. 13 A I can probably give you a pretty complete 14 list. There would be — 15 available on that website, there would be very few 16 departments that didn't have some input to something on 17 that website. 18 given the scope of information So marketing, sales, research and 19 development and those with scientific expertise. 20 believe, we had information related to tobacco leaf 21 purchases. 22 department weighing in. 23 24 I So for example, you may have our leaf I don't recall specifically whether that information was on the site when it launched, but Golkow Technologies, Inc. - 1.877.370.DEPS Page 312 3390537939 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537939 Highly Confidential - Subject to Protective Order 1 there's certainly information on that site now. 2 I mean, you really would have — nearly 3 every department in the company would have 4 accountability or responsibility for some page there. 5 There may be a handful of smaller 6 departments or more internally focused departments that 7 would have less focus on the content. 8 9 For example, the information services department probably didn't have a lot of — they were 10 helping us build the website, from a technology 11 standpoint, but there wasn't a whole lot of external 12 content that was focused on their issues. 13 But the number of departments that were 14 involved would far outweigh the number of departments 15 who weren't involved, given the scope of information 16 that's available on that site. 17 Q All right. And if I understand the list, 18 you had marketing, sales, research and development, 19 leaf department, law, and information services. 20 21 22 Did I miss any? A Government affairs. I mean, basically, what you're going to — 23 I'm trying to do here is give you a list of all of the 24 departments within the company. Golkow Technologies, Inc. - 1. 877.370.DEPS Page 313 3390537940 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537940 Highly Confidential - Subject to Protective Order 1 2 So Q government affairs, corporate affairs. Would the number of departments involved in 3 the launch of the 1999 website be reduced if all we 4 talked about was the substantive low tar message that 5 was launched in 1999? 6 departments? 7 A Would that be a smaller group of It would be a smaller group of departments 8 that was involved in the drafting of the entire 9 website, because not every department has either 10 11 knowledge or expertise in that area. Q All right. If I wanted to know all the 12 departments involved in drafting the 1999 website pages 13 that contained a substantive low tar message, what 14 departments would those be? 15 A You would have the corporate affairs 16 department, the law department, our — 17 at the time, I believe, was called research and 18 development, which is where much of our scientific 19 expertise resided. 20 the department, And you also would have probably had input 21 from our marketing department, as well. 22 involved, as some of those pages talked about some of 23 their communications. 24 They were And those would be your primary Golkow Technologies, Inc. - 1.877.370.DEPS departments Page 314 3390537941 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537941 Highly Confidential - Subject to Protective Order 1 that had lead accountability and subject matter 2 expertise that was relevant to the issue that was being 3 discussed. 4 Q All right. Would you provide me with the 5 names of the people in the corporate affairs department 6 that would have had some responsibility for drafting 7 the substantive low tar message of the web pages that 8 were launched in 199 9? 9 A I can't give you the names of every 10 individual that was involved with that. 11 you a little bit about the process that was used. 12 I can talk to And this process is similar to how we 13 manage our websites today, where, when we were 14 launching that, the pages of those websites were 15 reviewed by senior level individuals within each of 16 those departments. 17 I don't know, nor do I recall, every 18 individual who may have had input into that content. 19 But it would have been folks at various levels within 20 that — 21 involved and knowledgeable on those issues. within each of those departments who were 22 And then those issues would have been 23 reviewed and discussed with members of the senior 24 management. The senior vice presidents of each of Golkow Technologies, Inc. - 1.877.370.DEPS Page 315 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537942 Highly Confidential - Subject to Protective Order 1 those organizations had input into that process. 2 Q 3 president? 4 So each department would have had a vice Let me back up. What was the structure of 5 each department? 6 was there a president in charge, or how did that work? 7 A Was there a vice president in charge, Each of the departments that I mentioned 8 had a senior vice president or their equivalent. And 9 the reason I say "their equivalent" is because in, you 10 know, the law department, the title may have been 11 senior vice president and general counsel, or it may 12 have been just general counsel. 13 But each of those departments had a senior 14 vice president with accountability for running the 15 day-to-day operations of that department. 16 Q Who would have been the senior vice 17 president for the corporate affairs department who had 18 responsibility for drafting of the 1999 website pages 19 regarding a substantive low tar message? 20 21 A Ellen Merlo was the senior vice president of corporate affairs at that time. 22 Q Could you spell the last name. 23 A M-e-r-1-o. 24 Q And is Ms. — is it Merlo? Golkow Technologies, Inc. - 1.877.370.DEPS Page 316 3390537943 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537943 Highly Confidential - Subject to Protective Order 1 A Yes. 9 Q Is Ms. Merlo still employed with Philip 3 Morris? 4 A No, she's not. 5 Q Where is Ms. Merlo today? 6 A She retired, I believe, in 2003. 7 Q And where does she currently reside? 8 A I believe, she resides in New York. 9 Q Do you know if she was ever deposed? 10 A She has been deposed on a number — 11 12 in a number of cases for the company, I believe. Q Who else in the corporate affairs 13 department below Ms. Merlo would have had 14 responsibi lity for drafting the 1999 website pages? 15 A I don't recall, specifically. 16 Q I'm going to show you a part of Exhibit 12 17 from the deposition. 18 PM3007086565. And it has a Bates number of 19 And I assume that this is a flow chart 20 describing the hierarchy in the legal department. 21 A I don't think I would describe it exactly 22 that way. 23 of members of our law department. 24 This looks like — it is, certainly, a list It appears to be organized by primary Golkow Technologies, Inc. - 1.877.370.DEPS Page 317 3390537944 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537944 Highly Confidential - Subject to Protective Order — 1 accountability for marketing, sales, and purchasing 2 issues; trademark and trade dress; and then patent and 3 IP. 4 What I can't tell you is whether this a 5 complete list of our law department. 6 it's organized, say, top to bottom in a hierarchical 7 fashion entirely. 8 9 10 11 It may be, to some extent. Nor do I believe But it doesn't look like it's done so consistently throughout the — this page. Q Did Philip Morris make flow charts of the 12 various departments where you could identify who was in 13 charge of a particular department and who was under the 14 senior vice president? 15 A 16 chart. 17 our departments are organized. 18 19 20 Q Yeah. We would have an organizational We use organizational charts to demonstrate how And how long has Philip Morris had those organizational charts? A For as long as I've been with the company, 21 which has been about 18 years, I can remember us using 22 some form of organizational chart to organize visually 23 how the departments were organized. 24 Q Going back to the Philip Morris website, Golkow Technologies, Inc. - 1.877.370.DEPS Page 318 3390537945 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537945 Highly Confidential - Subject to Protective Order 1 the launch of it in 1999. 2 3 4 How long had it been on the drawing board before it was actually launched? A I don't know, specifically. It definitely 5 would have been a project that took — 6 time launching a corporate website of that kind. 7 definitely would have been multiple months. 8 potentially, could have been even longer than that. 9 10 11 12 13 it was our first It It, But I don't know specifically when the idea may have originated. Q I don't recall. Would Philip Morris still have organizational charts going back all the way to 1997? A I don't know. That's not an area that I 14 have direct responsibility for, so I'm not sure what's 15 been retained in that area. 16 Q If I were to ask you to go do a search for 17 an organizational chart of the corporate affairs 18 department back in 1997, would you be able to do that? 19 A Personally, no. But I would look to those 20 in our human resources department who would be the ones 21 most likely to have that. 22 23 24 Q So in other words, you would know who to A I would call our human resources call. Golkow Technologies, Inc. - 1.877.370.DEPS Page 319 3390537946 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537946 Highly Confidential - Subject to Protective Order 1 department. 2 expertise, and the ones who would have maintained 3 organizational charts for the company. 4 Q And that would be a department with And let me make sure I understand it. 5 You would have expected that there would 6 have been an organizational chart for the corporate 7 affairs department, the law department, the research 8 and development department, and the marketing 9 department going back from when you first started work 10 11 at the company; correct? A I think that's correct. I would expect 12 that there would be that. 13 organizational charts throughout my term of employment 14 at the company. 15 16 Q And I can recall seeing And whether or not they're still in existence, you just don't know; correct? 17 A That's correct. It's not an area that I 18 have direct responsibility for, so I can't speak to 19 that. 20 Q If I wanted you to find out all the names 21 of everybody that worked in the corporate affairs 22 department in 1997, 1998, and 1999, before the launch 23 of the Philip Morris website, could you do that? 24 A I would — I think your question is similar Golkow Technologies, Inc. - 1.877.370.DEPS Page 320 3390537947 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537947 Highly Confidential - Subject to Protective Order 1 to the one you just asked previously, which is you 2 would go back and 3 — The way in which I would do that would be 4 go back and ask somebody in human resources to either 5 pull payroll records or organizational charts from that 6 time. 7 Q And that would apply to all departments? 8 A Yes. 9 Q The law department, the research and 10 development, the marketing department, and the 11 corporate affairs department? 12 A Yes, it would. It would apply to any 13 department at the company, in terms of historical 14 information about who was in a department at various 15 times. 16 had that information. 17 Q I would go to human resources to see if they All right. Let's go back to the various 18 departments and who was in charge of drafting the 19 substantive low tar message on the website pages that 20 were launched in 1999. 21 22 Who was in charge of the law department at that particular time? 23 A I don't recall, specifically. 24 Q Do you recall any of the names of the Golkow Technologies, Inc. - 1.877.370.DEPS Page 321 3390537948 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537948 Highly Confidential - Subject t o P r o t e c t i v e Order 1 senior level executives in the law department at that 2 particular time? 3 A What I'm not sure of — Denise Keane was 4 Altria's general counsel at a certain point in time. 5 What I don't remember — 6 general counsel prior to Denise. 7 Marty Barrington had been the I do not remember specifically when they 8 may have changed roles. 9 place in late 1998 as general counsel of Philip Morris 10 I believe that Marty was in USA. 11 Denise worked elsewhere in the company. 12 do not remember specific dates when that may have 13 changed. 1.4 that time, but I really don't — 15 specific date. 16 Q I And it would have changed somewhere around I can't give you a So if I understand your testimony, you 17 recall a couple of names. 18 sit here today, who the person was that was in charge 19 of the law department and responsible for the drafting 20 of the substantive low tar message for the website 21 pages that were launched in 1999; is that correct? 22 MR. WAGNER: 23 THE WITNESS: 24 But you do not know, as you Object to the form. What I said is I do not remember who was in charge of the law department Golkow Technologies, Inc. - 1.877.370.DEPS Page 322 3390537949 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537949 Highly Confidential - Subject to Protective Order 1 at that period of time. 2 3 BY MR. REDFEARN: Q Do you know who in the law department was 4 responsible for the substantive low tar message for the 5 website pages that were launched in 1999? 6 A As I said, I described the process that we 7 used. There would have been multiple people who had 8 input into that within the law department. 9 And it would have gone as high as '— for 10 review, as high as the senior vice president and 11 general counsel of that department. 12 Q Can you give me names of the people that 13 were involved in the legal department who were involved 14 in the drafting? 15 A I don't know, specifically, the names of 16 the individuals who were involved in the drafting of 17 that. 18 19 20 Q Let's talk about the research and development department. Who was the senior vice president of that 21 department and responsible for the drafting of the 22 substantive low tar message for the website pages that 23 was launched in 1999? 24 MR. WAGNER: Object to the form. Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 323 3390537950 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537950 Highly Confidential - Subject to Protective Order 1 THE WITNESS: I don't recall who the senior 2 member of the research and development department 3 was in 1999. 4 5 Nor do I recall the names of individuals who may have contributed to that content. 6 7 BY MR. REDFEARN: Q You personally don't recall. But you 8 understand that you're acting as a representative of 9 Philip Morris USA; correct? 10 A Correct. 11 Q And Philip Morris USA should have that 12 13 information; correct? A I believe, again, I've described the 14 process that I would use to gather that information. 15 have not gone to our human resources department to ask 16 for a list. 17 I So the way I would do that would be to go 18 to our human resources department and ask for — 19 whether they had that historical information. 20 ask But as I've said, that's not an area that I 21 have direct management responsibility for, so I haven't 22 done that. 23 Q 24 But you understood that when you came to testify today you were going to be talking about the Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 324 3390537951 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537951 Highly Confidential - Subject to Protective Order 1 Philip Morris website that was launched in 1999, which 2 necessarily involves people; correct? 3 4 5 6 A Absolutely. It involves people and it involves substance. Q Right. individual entity. A corporation doesn't act as a It acts through people; correct? 7 A It acts through people and it acts through 8 processes. And what I am certainly able to tell you, 9 while I can't give you the names of specific 10 individuals, what I can 11 — What I'm very familiar with is the process 12 that we used to gather that information, the 13 information that we relied on to prepare that 14 information, and the process that we used related to 15 our decision-making related to putting that information 16 on our website. 17 And I think that, at the company level — 18 what I was asked to talk to is at the company level. 19 And I'm very familiar with the processes the company 20 used to gather that information and to pull that 21 together. 22 Q But in order to understand exactly how 23 everything was drafted, don't you need to talk to the 24 people that were actually involved in drafting, to Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 325 3390537952 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537952 Highly Confidential - Subject to Protective Order 1 understand what their thought processes were? 2 MR. WAGNER: 3 THE WITNESS: Object to the form. What I have done is to talk 4 to members of the departments that have managed 5 that information over time. 6 I have talked to individuals who have been 7 involved in those issues over multiple years. 8 What I can't do with specificity is to recall, in 9 1999, which individuals were in which roles. 10 But I have delved into this issue with 11 representatives of each of those departments who 12 have had accountability over the years for these 13 issues. 14 In my role prior to the one I am in now, I 15 had accountability for managing our corporate 16 websites. 17 oversee was all of the pages on the Philip Morris 18 USA website, including those with information 19 related to light cigarettes. Part of my accountability was to 20 In my role doing that, I was very familiar 21 with the content that was put on those websites. 22 We regularly reviewed that content. 23 asked questions about it. 24 I regularly In 1999, I was in the corporate Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 326 3390537953 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537953 Highly Confidential - Subject to Protective Order 1 communications department, and had accountability 2 for communicating with the media related to these 3 issues, and was familiar with those issues at the 4 time, as well. 5 6 7 BY MR. REDFEARN: Q Did you actually draft any of the website pages that were launched in 199 9? 8 A I did not. 9 Q Now, you mentioned in your prior response 10 that you talked to a lot of folks who had 11 responsibility for the website pages; correct? 12 A Correct. 13 Q And you did that over time; correct? 14 A Correct. 15 So I — and again, the context in which I 16 would have done that is, in 1999, I was in a position 17 where I was communicating publicly about our positions 18 on certain issues. 19 The process that I used to communicate 20 about those issues and to understand them better is 21 very similar to the process that I described to you 22 that we use to communicate about the issues on the 23 website. 24 It involved working with members of our Golkow Technologies, Inc. - 1.877.370.DEPS Page 3390537954 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 32 7 3990537954 Highly Confidential - Subject to Protective Order 1 research and development team, with members of our law 2 department, with members of marketing. 3 And that process remained the same — you 4 know, it's basically — 5 standard operating procedure when it came to how we 6 communicated about certain issues. 7 I would describe that it was So that process and that cross-functional 8 collaboration has been largely the same during my 9 entire time in the company, in terms of how we manage 10 communicating about these issues, regardless of what 11 the vehicle was. 12 If there was a specific vehicle, you may 13 involve some additional people. 14 created and shaped and evaluated with input from 15 multiple parties. 16 Q But the content was And if I understand, what you're saying is 17 that, in 1999 and subsequently and maybe even a little 18 bit before, you have been the voice of Philip Morris 19 USA in your communications with the media; correct? 20 A I have had communications responsibility. 21 I worked in the communications department at Philip 22 Morris USA beginning in — 23 beginning in 1993. 24 I was in corporate affairs Throughout my time at the company — I Golkow Technologies, Inc. - 1.877.370.DEPS Page 328 3390537955 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537955 Highly Confidential - Subject to Protective Order 1 moved into the media relations department in 1994. And 2 I worked in that communications group and steadily 3 gained increasing responsibility for — 4 spokesperson over time. 5 as a I don't recall the exact year when — 6 know, but that steadily broadened over time. 7 in that department from 1994 through — 8 communications department from 9 believe, 2004, 10 you And I was I was in the 199 4 through, I Left for two years, and then went back into 11 it from 2006 to 2008 at Philip Morris USA. 12 became vice president of communications at Altria 13 Client Services. 14 that role were to provide communications support to 15 Philip Morris USA. 16 In 2008, I And part of my responsibilities in So I had some degree of communications 17 responsibility for the company during that time, and it 18 gradually increased. 19 When I first started, I wasn't doing a 20 whole lot of externally-facing communications with the 21 media. 22 over time. 23 24 Q But that grew as I expanded my responsibilities I understand. And I just want to make sure I have an understanding of what you're testifying to. Golkow Technologies, Inc. - 1.877.3 70.DEPS P a g e 329 3390537956 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537956 Highly Confidential - Subject to Protective Order 1 So if you can answer yes or no when I ask some direct 2 questions, I'd appreciate it, because I have a limited 3 amount of time. 4 If I understand what you're saying, in 5 1999, you had some responsibility for communications 6 relating to the website. 7 important that you understood what was on the website; 8 is that correct? And therefore, it was 9 A That is correct. 10 Q And in order to make sure that you 11 understood the material that was on the website, you 12 spoke to people that actually had input into the 13 information on the website; correct? 14 A That is correct. 15 Q And that would have included people that 16 had input into the substantive low tar message that was 17 on the website pages that were launched in 1999; 18 correct? 19 A That's correct. 20 Q Would you name for me all the people you 21 spoke to that had input into the substantive low tar 22 message that was put on the website in 1999? 23 24 A And what I've told you is I do not recall specifically who I would have spoken to in 1999 related Golkow Technologies, Inc. - 1.877.370.DEPS Page 330 3390537957 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537957 Highly Confidential - Subject to Protective Order 1 to those issues. 2 Q Do you recall one person? 3 A I do not recall specifically who had that 4 accountability. 5 the process that we used, because that process has 6 remained consistent. 7 Again, what I can talk to you about is And while the individuals in those roles 8 over the years have evolved over time — the reason I 9 can't answer your question directly is simply a matter 10 that I do not recall who, specifically, was in those 11 roles at that specific point in time. 12 Q Let's go back to who was in charge of 13 various departments. 14 research and development department, so let me ask you 15 the question. 16 I didn't ask you about the Who was the senior vice president or the 17 person otherwise in charge of the research and 18 development department who was responsible for the 19 substantive low tar message that was incorporated into 20 the website in 1999? 21 22 23 24 MR. WAGNER: Objection. Asked and answered. THE WITNESS: earlier. You did ask me that question And I told you that I did not know Golkow Technologies, Inc. - 1.877.370.DEPS Page 331 3390537958 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537958 Highly Confidential - Subject to Protective Order 1 specifically who was in that role, who was the 2 senior vice president in that department at the 3 t ime. 4 Nor do I recall specifically who may have 5 been involved in the drafting of that content at 6 the time. 7 8 9 10 11 12 BY MR. REDFEARN: Q What about the marketing department? Do recall who the senior vice president was of that? A I believe that Nancy Lund was our senior vice president of marketing at that time. Q Do you agree that somebody had to write the 13 original draft of the substantive low tar message that 14 was incorporated into the Philip Morris website? 15 A Yes. 16 Q For any particular section, it would 17 probably just be one person that would initiate the 18 draft; correct? 19 A One person would sit and write it. But you 20 likely would have had discussions with cross-functional 21 teams, depending on the content. 22 So on an issue like this, you would bring 23 the team together, discuss the type of information and 24 approach that was relevant to put on that website. Golkow Technologies, Inc. - 1. 877.370.DEPS Page 332 3390537959 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537959 Highly Confidential - Subject to Protective Order 1 You would have had — you know, we had a 2 team that was in place that was governing the entire 3 website, with representatives from these organizations, 4 that was insuring that you had at least a consistent 5 approach to how that information was drafted and 6 presented. 7 The — you know, you had a use — how long 8 that content should be, roughly the links that — you 9 know, the approach of using links to public health 10 authorities was something we were going to use through 11 all of those pages. 12 So there was a governing body that was in 13 place to insure consistency across that website that 14 would have provided input to that process before 15 somebody would sit down and draft it. 16 Q 17 Let me get really specific. Who was the person that drafted the section 18 "Understanding Tar and Nicotine Numbers, What They Mean 19 and What They Don't Mean," with respect to the website 20 pages of Philip Morris that was. launched in 1999? 21 A I don't know, specifically. 22 Q Who had the final approval of that section? 23 A That section, as well as all of the 24 sections, would have been reviewed — Golkow Technologies, Inc. - 1.877.370.DEPS were reviewed by Page 333 3390537960 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537960 Highly Confidential - Subject to Protective Order 1 the senior vice presidents in the organizations that I 2 mentioned. 3 They were reviewed by our chief executive 4 officer prior to being launched. 5 also a group that resided in Altria corporate's or 6 Philip Morris Companies' — 7 I believe, there was I'm trying to remember. There was a service organization that 8 resided — it was in — 9 Services. The name of it at the time was, I think, 10 it's similar to Altria Client Philip Morris Management Corporation. 11 They provided services to each of the — 12 the parent company name was Philip Morris Companies, at 13 the time. 14 communications and elsewhere that provided input into 15 that process, as well, and would have been involved in 16 the final review process in that at that time. 17 Q They had members in that group in both Who was the chief executive officer that 18 reviewed the website sections before it was launched in 19 1999 and gave final approval? 20 21 22 23 24 A Mike Szymanczyk was our chief executive officer at Philip Morris USA at that time. Q And let me just back up. This is just a yes or no. Was there one person that had final Golkow Technologies, Inc. - 1.877.370.DEPS Page 334 3390537961 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537961 Highly Confidential - Subject to Protective Order 1 approval of the launch of the website in 1999? 2 A I don't think I would describe it that 3 way. I think the process that we used — 4 was being reviewed at the chief executive officer 5 level. 6 So it was not reviewed — you know, it it was not 7 released prior to review by that individual. But 8 the -- I think, the accurate description of the process 9 is one that involved discussions across members of our 10 senior management team, members of their organization 11 with lead accountability, the senior 12 — The chief executive officer, by virtue of 13 his position, you would not — 14 released until it was approved by him. 15 others who also had input that probably would have been 16 going on simultaneously. 17 Q the site was not But there were If I'm hearing you right, it sounds like 18 there were very senior level people that if any of them 19 said no, the website would not have been launched until 20 that person's concerns were addressed. 21 Am I hearing you correctly? 22 A I think that's a more accurate way to 23 describe it than any single individual. 24 was — Again, it the website was reviewed by multiple members of Golkow Technologies, Inc. - 1.877.370.DEPS Page 335 3390537962 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537962 Highly Confidential - Subject to Protective Order 1 our senior management team. 2 If there were questions that they had, they 3 were raised with the individuals with accountability 4 for that, answers were given, and those issues were 5 sorted out. 6 So it's an accurate description to say that 7 multiple members of our senior management team had the 8 ability to review and weigh in on that website before 9 it was launched. 10 Q Would it be fair for me to say that it 11 sounds like there were certain people that had veto 12 rights, that they could kind of veto the launch? 13 A That's not the word I would use to describe 14 it. Again, I think that the process that we use within 15 our company is more of a consensus-driven approach. 16 If somebody had issues, they would ask 17 questions. 18 wait until those issuers were resolved to their 19 satisfaction before you would move on. 20 And in most instances, you know, you would I wouldn't use the term 21 Q "Veto." 22 A — "veto power." — But I think that the 23 process is one in which the information was reviewed 24 from multiple perspectives, questions were answered Golkow Technologies, Inc. - 1.877.370.DEPS Page 336 3390537963 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537963 Highly Confidential - Subject to Protective Order 1 prior to launch, while, you know, certainly keeping 2 your project on track towards your intended deadline. 3 Q Can you list for us everyone who had what 4 I'll call the final objection rights to the launch of 5 the website besides the chief executive officer? 6 7 8 9 MR. WAGNER: Objection. Asked and answered. THE WITNESS: The member — the chief executive officer and the senior vice presidents 10 at Philip Morris USA worked closely together as a 11 management team and managed the business together. 12 At Philip Morris USA, as I mentioned, 13 that's the team that was comprised of our most 14 senior executives. 15 Those with specific issue areas of 16 expertise, as we discussed, would take the lead in 17 answering questions about the pages that were 18 drafted within their organizations and in their 19 areas of expertise. 20 And then, as I said, there were — I 21 believe, the website was also reviewed on an 22 informational basis and also to get the 23 perspective of those at Philip Morris management 24 Corporation. Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 337 3390537964 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537964 Highly Confidential - Subject to Protective Order 1 And that group was providing government 2 affairs services, certain legal services to Philip 3 Morris USA at the time. 4 BY MR. REDFEARN: 5 Q 6 positions? 7 A Can you give me names, as opposed to I do not remember the names. I remember 8 that Mike Szymanczyk was chief executive officer. 9 was in the corporate affairs department. 10 I And I've given you Ellen's name as the head of that department. 11 I believe that Nancy was senior vice 12 president of marketing at the time. 13 specifically which members were in the various 14 positions within our senior management team at Philip 15 Morris USA in 1999. 16 I do not remember I believe, Harry Steele was probably the 17 head of finance. 18 of input into the lights pages on the website. 19 Q But his group wouldn't have had a lot But Philip Morris USA still would have ways 20 to figure out who those people were; correct? 21 were to ask somebody in human resources? 22 23 24 A It should be — If you it would be similar to the process that we discussed earlier, Q All right. Mike Szymanczyk. Golkow Technologies, Inc. - 1.877.370.DEPS Am I — did I P a g e 338 3390537965 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537965 Highly Confidential - Subject to Protective Order 1 pronounce that correctly? 2 A You did. 3 Q Is he still with the company? 4 A Mike is the chairman and chief executive 5 officer of Altria Group. 6 Q Okay. 7 A Yes. 8 Q Is she still employed with Philip Morris? 9 A Nancy is employed, I believe, by Altria 10 11 12 And Nancy — was it Lund? Client Services. Q And I think you mentioned a gentleman, Harry, who was in charge of financing? I'm sorry. 13 A Harry Steele; and Harry is deceased. 14 Q Do the original drafts of the 1999 website 15 still exist? 16 A 17 there. 18 not sure if there's a draft of the entire website. 19 20 21 22 Q I'm not sure what you're referring to You referred to a draft of the website. I'm Do you know if there's iterations of the website prior to its launch? A My assumption is that there would be draft versions of specific pages that have been retained. 23 Q Have you made a search for those? 24 A I have not. Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 33 9 3390537966 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537966 Highly Confidential - Subject to Protective Order 1 Q Has Philip Morris made a search for those? 2 A I don't know. 3 Q Is there any written document setting forth 4 the basis and decision-making process for the 5 incorporation of a substantive low tar message as part 6 of the launch of the Philip Morris website in 1999? 7 8 9 10 A Would you read that one again? I lost you about halfway through it. Q I apologize. What I'm wondering is was there a memo at 11 any time in the history of Philip Morris that said, "We 12 want to start a website. 13 to include," anything like that. 14 MR. WAGNER: 15 THE WITNESS: And this is what we want it Object to the form. The communications I am most 16 familiar with — 17 believe that I have seen memos that shaped the 18 project and the genesis. 19 I am not aware and I don't 1 can certainly talk to it. The documents 20 that I am most familiar with were documents that I 21 had worked on after that information and 22 simultaneously to when that information was 23 released, as well as my experience in talking 24 about that website and managing it, In terms of Golkow Technologies, Inc. - 1.877.370.DEPS Page 340 3390537967 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537967 Highly Confidential - Subject to Protective Order 1 what we were trying to do. 2 So it's certainly an issue I'm very 3 familiar with. 4 exactly of the type that you've discussed. 5 I do not remember a document But certainly, the substance of why we 6 launched that website is something I'm very 7 comfortable talking about. 8 9 10 And I'm more familiar with documents that were released publicly at the time we launched that website. 11 12 BY MR. REDFEARN: Q And what I'm trying to figure out, is there 13 any document explaining why the launch of the 199 9 14 website included a substantive low tar message. 15 And I'm not talking about a policy 16 statement that, "We want to be more open." 17 a document that specifically states, "We need to 18 include a substantive low tar message in our website 19 when it's launched." 20 A I'm saying Well, I think what you started to refer to 21 there is part of the reason why we included this 22 information. 23 24 So while you're — if you're asking about specific documents, there are a number of documents Golkow Technologies, Inc. - 1.877.370.DEPS Page 341 3390537968 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537968 Highly Confidential - Subject to Protective Order 1 that describe the information that was available on 2 that website and why we included the types of 3 information that were there, including information 4 related to the health issues surrounding our products. 5 And light cigarettes would come under that — 6 category. 7 Q that Is there a specific internal document 8 authorizing the startup of the website in which it 9 discusses the website, including the substantive low 10 11 12 13 tar message? MR. WAGNER: Object to the form, and asked and answered. THE WITNESS: As I said, I haven't seen, to 14 my recollection, project plans related to the 15 website. 16 There are a number of documents that 17 communicate about the website and why we included 18 the information we did. 19 We issued press releases when that website 20 was launched. 21 freestanding inserts in there. 22 pieces. 23 24 We put newspaper advertisements, We did direct mail So there were a number of very public communications related to that website that were Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 342 3390537969 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537969 Highly Confidential - Subject to Protective Order 1 issued at the time that it was put out, and for 2 subsequent years after that, when we were trying 3 to attract visitors to that website. 4 5 BY MR. REDFEARN: Q You talked about the mailing. 6 a step back. 7 mailing -- 8 9 Let me take I understand that there was a mass Was it after the website was launched or immediately before? 10 — 11 Do you know the one I'm talking about? 12 A saying to go to the website. There were a number of different 13 communications. 14 - the dates on this. 15 And if you'll just let me look up my There was a direct mail piece that was 16 sent, I believe, to north of 20 — 17 million adult smokers, when we launched the website. 18 In 1999 I think, it was 29 — 19 Q Is this what you're referring to? 20 A Yes. 21 Q And for the record, I'm showing you page -• 22 A — 23 Q I'm sorry? 24 A — 28. Page — 28. Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 343 3390537970 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537970 Highly Confidential - Subject to Protective Order 1 2 Q — page 28 of your Exhibit 7, which is your PowerPoint presentation. 3 A Yeah. So what — 4 recollection was correct. 5 1999. this confirmed my We sent a direct mail in The website was launched in October 1999. 6 One of the ways in which we communicated 7 about it was with direct mail to 29 million adult 8 smokers with a — 9 One example of what was there was a shot of 10 the website and the information that they would find 11 available there. 12 So this was one of the examples of the 13 communications that we did to make smokers, in that 14 instance, aware of the fact that we had launched the 15 website and the types of information that they would 16 find there. 17 Q Does Philip Morris have a record of to whom 18 they sent this mass mailing to that's referred to at 19 page 28 of your PowerPoint? 20 A The mailing would have been sent — we had 21 and continue to have a database with adult smokers on 22 it. 23 24 We have a record indicating that. I have not — I am not aware of whether or not we have in easy access format of who were those 29 Golkow Technologies, Inc. - 1.877.3 70.DEPS P a g e 344 3390537971 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537971 Highly Confidential - Subject to Protective Order 1 million smokers at the time. 2 I know we've kept records over time. I 3 just -- it's not an area that I am responsible for in 4 my day-to-day job responsibilities. 5 I know that, over time, we have tracked who 6 that — 7 know the form or substance of how that's tracked. 8 who those communications go to. Q Do you know 9 — I'm sorry to interrupt. 10 A Yes. 11 Q I apologize. 12 I just don't Were you done? Do you know if any of the class 13 representatives in the Brown case were sent this 14 mailing in 1999? 15 A I don't personally know that. If the 16 company has that information, the company would be able 17 to likely identify 18 — You know, it would certainly have gone to 19 adult smokers in California. 20 exist, the company would presumably be able match the 21 names of those individuals with our database records. 22 Q And if those records Do you know if that mass mailing went to 23 any of the absent class members who were deposed in the 24 Brown case? Golkow Technologies, Inc. - 1.877.370.DEPS Page 3390537972 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 34o 3990537972 Highly Confidential - Subject to Protective Order 1 2 3 A I don't know who those individuals are. So you're asking a very specific question, and I don't. Q I'm asking you, as a corporate 4 representative of Philip Morris, can you determine 5 whether or not this mass mailing that was sent out in 5 1999 went to all the individuals who were deposed as 7 absent class members, if we were to give Philip Morris 8 those people's names. 9 10 MR. WAGNER: Objection. Asked and answered. 11 THE WITNESS: And I would answer it the 12 same way I just answered it, which is, if the 13 company has the information available for who that 14 went to, you would presumably be able to check 15 that against a list of names that — 16 individuals you're referring to by group. 17 18 for the BY MR. REDFEARN: Q And you just don't know, one way or the 19 other, if they have that information going back to 20 1999; is that correct? 21 A I personally do not know. 22 Q But you could find out. by asking the right 23 24 people; correct? A Yes. Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 346 3390537973 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537973 Highly Confidential - Subject to Protective Order 1 Q All right. Prior to the launch of the 2 Philip Morris USA website in 19 99, were smokers misled 3 in any way by Philip Morris's use of the cigarette 4 brand descriptor 5 "lights"? MR. WAGNER: Objection to the form. And 6 it's outside the scope of the notice and beyond 7 what this witness is being called for in this 8 case. 9 THE WITNESS: As I looked back on our 10 communications on lights, and I've reviewed the 11 history of our communications on that, I believe 12 that the — 13 to the strength of taste and flavor, as well as 14 the relative delivery as measured by the — 15 and nicotine as measured by the Federal Trade 16 Commission test. 17 we have used the term "light" to refer Smokers were also receiving of tar communications 18 from the federal government related to those 19 issues. 20 that were appropriate, in terms of how we managed 21 this issue over time. 22 And I believe that our actions related to BY MR. REDFEARN: 23 Q 24 in any way? So the answer is, no, they were not misled Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 347 3390537974 3990537974 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 A I don't believe that smokers were misled by 2 our communications. 3 by "misled." 4 5 So you know, maybe you can be a little bit more specific, so I can answer it specifically. 6 Q 7 "confused"? 8 A 9 10 I'm not sure exactly what you mean Would your answer change if I used the term If you can give me more context for what it is you're asking about, what they were confused about, that would help me answer the question 11 Q About whether 12 A — 13 Q I'm sorry. 14 — — more precisely. I apologize for interrupting. Prior to the launch of the Philip Morris 15 website in 1999, were smokers misled in any way about 16 light cigarettes being safer than full flavored brands, 17 based upon the brand descriptor "lights"? 18 19 20 MR. WAGNER: Object to the form, and asked and answered already. THE WITNESS: I do not believe — I have 21 not seen any Philip Morris USA communications that 22 would indicate that the company was communicating 23 to consumers that those were safer products. 24 That's — it's simply not information that Golkow Technologies, Inc. - 1.877.370.DEPS Page 341 3390537975 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537975 Highly Confidential - Subject to Protective Order 1 was in any of our advertising. 2 that was in communications from the government and 3 public health agencies throughout the '70s into 4 the late 1990s. 5 It is information But that is not information that I have 6 seen communicated in any of our advertising or 7 marketing materials. 8 9 BY MR. REDFEARN: Q Prior to the launch of the Philip Morris 10 USA website in 1999, were smokers misled in any way by 11 Philip Morris's use of the brand descriptor "lower tar 12 and nicotine" with respect to whether or not light 13 cigarettes were safer than full flavored brands? 14 MR. WAGNER: I have the same objection. 15 It's beyond the scope of the notice and not what 16 this witness is here for. 17 And for this, as well as when you use the 18 word "misleading," it calls for a legal 19 conclusion, as well. 20 BY MR. REDFEARN: 21 Q And I'll give you a continuing objection. 22 A And I think my answer would be similar to 23 24 the answer I just give to the prior question. Q Would your answer with respect to the brand Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 349 3390537976 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537976 Highly Confidential - Subject to Protective Order 1 descriptor "lower tar and nicotine" change if I were to 2 use the term "confused" instead of "misled"? 3 MR. WAGNER: 4 THE WITNESS: 5 BY MR. REDFEARN: 6 Q Okay. Object to the form. No. If your answer is that smokers 7 weren't misled or confused, then why the need for the 8 launch of the substantive low tar message in 1999 on 9 the website? 10 A I think there were a couple of different 11 things that were going on at the time. 12 into two buckets. 13 And I put them The first is the company had made a 14 commitment in 199 7 that the approach it was going to 15 take to communicating about the health issues was going 16 to be not to dispute those issues publicly, but to 17 support the communication of a consistent public health 18 message about the health effects related to our 19 products. 20 That was then reinforced in our company 21 mission, which was created in late 1997, early 1998, 22 which contained a commitment and guidance to our 23 employees that we should be focused on communicating 24 the health effects of our products. Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 350 3390537977 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537977 Highly Confidential - Subject to Protective Order 1 And we began to look for ways to do that 2 beyond just through the health warnings that were 3 required on our cigarette packs that had been there for 4 sometime. 5 So that effort was underway on one track. On a separate track, we recognized that 6 the -- we were monitoring regulatory developments at 7 the Federal Trade Commission, which was the agency 8 responsible for regulating communications about — 9 these types of issues. 10 The agency and other members of the public 11 health community were beginning to question some of 12 their prior communications to and conclusions on 13 these — 14 conclusions on some of these issues. 15 on communications to the public and prior So the Federal Trade Commission, as well as 16 members of the public health community, started to look 17 into these issues, started to question whether the 18 information that was provided by the standardized 19 testing procedures that they had required since the 20 1960s continued to be relevant to consumers. 21 So there was an active regulatory effort 22 underway where the agency was asking these questions. 23 So when you couple our desire to communicate more 24 effectively about the health issues and other issues Golkow Technologies, Inc. - 1.877.370.DEPS Page 351 3390537978 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537978 Highly Confidential - Subject to Protective Order 1 related to our products with an evolving regulatory 2 environment, what we decided to put on our website on 3 this specific issue was information to share that point 4 of view and the views of the public health and 5 regulatory agencies, while providing links to some of 6 the documents that were being shared in that regulatory 7 context. 3 9 So we provided links to the Federal Trade Commission and some of their press releases and 10 communications on this issue. 11 information that the tobacco companies had shared with 12 the agency on some of these issues. 13 So that's the — We provided links to that's a more complete 14 answer on the backdrop that was taking place that led 15 us to put this information on our website. 16 17 18 Q Did Philip Morris track how many people visited the website starting in 1999? A We did. I can't speak to 1999, 19 specifically. 20 tracked that over time. 21 1999, that tracking capability. 22 Q But I believe that — I know we have I believe, it was available in When you say "tracking capability," were 23 you able to actually track individual names of people 24 who visited the website? Golkow Technologies, Inc. - 1.877.370.DEPS Page 352 3390537979 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537979 Highly Confidential - Subject to Protective Order 1 A No. The -- what you are able to track is 2 unique users. You don't have the individual's name. 3 But you have — depending on the technology you're 4 using — 5 And you know, it's cookie technology. You 6 don't track it to an individual name basis, because 7 individuals are not telling you who they are. 8 9 10 11 But you are able to track individual web visits based on the computers that they're coming from. Q Do you know how Philip Morris counted the number of visitors to its website in 1999? 12 A 13 later. 14 know for certain. 15 I can talk to the process a little bit I assume it was the same in 1999, but I don't But we used — what you use is cookies and 16 various external vendors that can help you track that 17 information and track those unique vendors. 18 And you know, while the specific vendor and 19 technology may have evolved over time, my understanding 20 is it's been largely consistent in terms of turning to 21 the best expertise to give you the most accurate read 22 on that over time. 23 24 Q Did Philip Morris do any research or analysis regarding the effectiveness of its website Golkow Technologies, Inc. - 1.877.370.DEPS Page 353 3390537980 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537980 Highly Confidential - Subject to Protective Order 1 beginning in 1999, specifically, convincing smokers 2 that light cigarettes were no safer than full flavored 3 brands? 4 MR. WAGNER: 5 THE WITNESS: Object to the form. I think that the — we did 6 research looking at various measures of the 7 effectiveness of our website. 8 9 Our approach was to communicate the messages of the public health community. And that 10 was the information that we made available on our 11 website. 12 So what we looked to do — we looked to the 13 public health community for guidance on the 14 content of those messages. 15 largely mirrored what they were saying on these 16 issues over time. 17 And our communications What we did measure was how many visitors 18 did you have with regard to the website, how long 19 people were staying on the website. 20 And we looked at similar measures and 21 evaluated individual communications executions 22 that took place subsequent to the launch of the 23 website. 24 So you know, we look at our communicate Golkow Technologies, Inc. - 1.877.370.DEPS — Page 354 3390537981 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 399053798 Highly Confidential - Subject to Protective Order 1 we've had extensive communications on these issues 2 over time. 3 of the reach. 4 We've evaluated some of those in terms But because we were echoing the message of 5 the public health community, we were not doing 6 specific research related to that content. 7 It came from public health. We looked to 8 see how many people we could expose to that 9 information through our efforts. 10 11 BY MR. REDFEARN: Q Did Philip Morris do any research or 12 analysis to determine whether or not the message that 13 was launched in 1999 on its website was actually 14 reaching its customers who smoked light brands of 15 cigarettes? 16 A We did a number of different things. 17 looked at the visitors to the website. 18 number of additional steps. We We took a 19 We know that we made the website available 20 to 29 million adult smokers through a direct mailing. 21 We added our website address to our cigarette packages 22 shortly after it was launched, so that every consumer 23 picking up a pack of cigarettes would know where they 24 could go for more information. Golkow Technologies, Inc. - 1. 877.370.DEPS Page 355 3390537982 3990537982 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 We ran television advertising. We ran 2 print advertising. 3 the onserts on the pack. 4 communications, we have analysis of the reach of those 5 efforts. 6 We ran radio advertising. We put And through various We've done studies related to awareness of 7 those specific messages for some of those efforts over 8 time. 9 case, the visitors who came to that site and those And then we have measures of, in the website's 10 pages. 11 Q Was Philip Morris concerned with just 12 getting the message out there, or was Philip Morris 13 concerned that its smokers got the message and 14 understood the message and appreciated what the message 15 was? 16 MR. WAGNER: 17 THE WITNESS: Object to the form. When we launched our website, 18 our goal was to make that information available to 19 people. 20 And really, that the — consistent with our 21 policy, the — 22 public health community to determine what should 23 be said to people. 24 we turned for guidance to the So we were not in a position where we were Golkow Technologies, Inc. - 1.877.370.DEPS Page 356 3390537983 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537983 Highly Confidential - Subject to Protective Order 1 questioning the messages of the public health 2 community. 3 our communications to the public. We had taken the approach that — 4 What we were focused on was amplifying 5 those messages, giving people access to that 6 information. 7 in And we explored a number of different tools 8 to help do that. 9 was to broaden the reach of those messages. And 10 And I think the effect of that that's really what we were focused on. 11 BY MR. REDFEARN: 12 Q When Philip Morris launched the website In 13 1999 with the substantive low tar message, did Philip 14 Morris believe that the substantive low tar message was 15 true? 16 MR. WAGNER: 17 THE WITNESS: Object to the form. I think that the approach 18 that we took — 19 aspects of that message with which we did not 20 agree 100 percent. 21 I think there were probably However, in the context of the approach we 22 were taking to dealing with the public health 23 community and our belief that the public health 24 community should determine the message that should Golkow Technologies, Inc. - 1.877.370.DEPS Page 357 3390537984 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537984 Highly Confidential - Subject to Protective Order 1 be communicated to consumers and that consumers 2 should rely on the views of the public health 3 community and their conclusions, regardless of 4 what we — 5 presented the public health community's views and 6 made that accessible to the public through our 7 website and through all these other communications 8 I've mentioned. 9 10 our views were on the issues, we BY MR. REDFEARN: Q Prior to the launch of the website in 1999, 11 did Philip Morris ever put out a public statement that 12 says "Lights descriptor does not mean safer. 13 refer to taste"? 14 A I do not recall any public communications 15 on those issues. 16 been communicated in media interviews. 17 for sure. 18 Lights It is possible that it would have I don't recall, I think the benefit that our website had is 19 that it's been in continuous operation since it was 20 launched in October 1999. 21 accessible 24/7. 22 that. 23 24 It was very visible. It's And there's a clear launch date on I do not recall whether or not that message was — potentially been included in media interviews, Golkow Technologies, Inc. - 1.877.370.DEPS Page 358 3390537985 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537985 Highly Confidential - Subject to Protective Order 1 communications with regulators, communications with 2 governments officials. But we didn't have a website prior to that 3 4 date. 5 What I can't tell you is whether it was contained in 6 any of those other conversations, because I haven't 7 gone back to look at that. 8 9 10 So I can't — Q it's just a matter of the form. Well, that's — what I need to know is — you understand you're here to talk about Philip Morris and provide facts; correct? 11 A Correct. 12 Q You're not here to guess about what might 13 have happened and what might not have happened; 14 correct? 15 A That's correct 16 Q Prior to the launch of the website, did 17 Philip Morris ever issue a public statement that, 18 "Lights does not mean safer than full flavored brands"? 19 MR. WAGNER: 20 THE WITNESS: 21 24 I don't know whether we did or we didn't. 22 23 Objection to the form. BY MR. REDFEARN: Q Same question with respect to the phrase, "Lights refer to taste only." Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 359 3390537986 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537986 Highly Confidential - Subject to Protective Order 1 A I don't know whether we did or we did not. 2 Q As a manufacturer of a product, why was 3 Philip Morris, prior to 1999, relying on the public 4 health community to put out statements about its 5 product and the safetiness of it? 5 A We had a — there was a very extensive 7 regulatory regime in place in the United States where 8 the Surgeon General, members of Congress had very 9 specific requirements that they asked us to execute in 10 the form of warning labels on packaging, in the forms 11 of — 12 communications on these issues. you know, they were doing extensive 13 And I think that that had been in place 14 over a number of years. 15 had provided guidance to tobacco manufacturers for some 16 time about the types of communications that it viewed 17 to be appropriate and, more specifically, inappropriate 18 over the years. 19 The Federal Trade Commission So I think we had a history of working 20 closely with government agencies on a lot of these 21 issues. 22 And the government, through various 23 regulations, laws that were passed, regulatory 24 agreements that were reached, I think, sent a very Golkow Technologies, Inc. - 1.877.370.DEPS Page 360 3390537987 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990537987 Highly Confidential - Subject to Protective Order 1 clear message that they wanted to be the ones to decide 2 what should be communicated to the public about the 3 health effects of cigarettes. 4 Q Did any of that prevent Philip Morris from 5 putting the phrase, "Lights means taste," on the side 6 of its pack of cigarettes prior to 1999, the launch of 7 the website? 8 MR. WAGNER: 9 THE WITNESS: Object to the form. I think that some of what — 10 I think it is possible that, you know, based on 11 some of the things that I've seen — 12 a regulatory expert here. 13 and I am not I think the Federal Trade Commission was 14 very careful about the types of communications it 15 permitted to consumers. 16 I think, for part of that time, a good part 17 of that time, that type of communication would 18 have been inconsistent with the message that the 19 government was communicating through advertising. 20 It would have been inconsistent with the 21 message that members of the public health 22 community and the American Cancer Society were 23 communicating to people about the product. 24 So I think the biggest issue would have Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 361 3990537988 3990537988 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 been that that would have been a message that 2 would have been inconsistent with the messages 3 that the public health community were including, 4 and I think that they would have had an issue with 5 that. MR. REDFEARN: 6 We need to take a break to change videos. THE VIDEOGRAPHER; No. 1, and we are off the record at 10:58. 9 10 / (Brief recess.) 11 12 / THE VIDEOGRAPHER: 13 14 tape No. 2. 15 Proceed. This is the beginning of We are back on the record at 11:09. BY MR. REDFEARN: 16 17 This is the end of tape Q Mr. McCormick, I have a limited amount of 18 time, so I'm going to be trying to ask you some very 19 direct questions. 20 If they're yes or no, I'd just ask that you 21 answer yes or no. 22 it, your counsel can help you out with that later. If you feel like you need to explain 23 Also, if I ask you for specific names, if 24 you don't know them, just let me know you don't know Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 362 3990537989 3390537989 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 them, and we'll move on. 2 I want to talk to you about the November 3 2000 freestanding insert highlighting the content of 4 the Philip Morris website. 5 6 7 Do you know who drafted that freestanding insert? A The content of the freestanding insert 8 was — the vast majority of that was based on content 9 that was already available on our website. 10 We used an outside advertising agency — 11 don't remember specifically which one we used — 12 help us deveJop the concept. 13 I to But if you look at the content of that 14 freestanding insert, it was derived from the pages on 15 our website, almost exclusively, with, you know, a 16 brief introduction. 17 Q Essentially, a cut and paste job? 18 MR. WAGNER: 19 THE WITNESS: Object to the form. It is derived from — the 20 vast majority of the content is images of what 21 people would find on our website. 22 23 24 BY MR. REDFEARN: Q Give me the name of the person who decided to use the freestanding insert in November of 2002. Golkow Technologies, Inc. - 1.877.370.DEPS Page 363 3390537930 3990537990 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 MR. WAGNER: 2 THE WITNESS: Object to the form. I think that — I don't think 3 there was a single person who decided to use a 4 freestanding insert. 5 used for that, it was very similar to the process 6 we've used on various things. 7 I think the process that was I believe that that effort was managed out 8 of the corporate affairs department, which ran the 9 — 10 which governed the corporate websites. But I don't think there was a single 11 individual. 12 approval and review process with members of our 13 senior management team prior to being released. 14 BY MR. REDFEARN: 15 16 17 It would have followed a similar Q back. And if you could just lean a little bit The light is shining right on your face. Can you give me the names of any individual 18 who was involved in the November 2002 freestanding 19 insert project? 20 21 22 MR. WAGNER: Object to the form. Asked and answered. THE WITNESS: Again, I don't remember the 23 specifics. But I've laid out kind of what that 24 process would have been, which would have been Golkow Technologies, Inc. - 1.877.370.DEPS Page 364 3390537931 3990537991 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 similar to the process used for the website, in 2 terms of its review by members of our senior 3 management team, along with input from those who 4 had ownership and expertise in the pages that were 5 included. 6 7 BY MR. REDFEARN: Q If Philip Morris was to do research, could 8 it determine the names of the actual individuals who 9 were involved in the November 2002 — 10 11 I'm sorry — the November 2002 freestanding insert? A I think that the process that I described 12 and the process that you asked about earlier, which is 13 who was in leadership positions at that time, that 14 would certainly be a similar process to what we would 15 use here. 16 17 And I assume there's a number of documents related to the — 18 Q 19 of people. to this project. And again, I'm looking for specific names 20 Who are they? 21 MR. WAGNER: 22 23 24 Object to the form. Asked and answered. THE WITNESS: looking for. Golkow T e c h n o l o g i e s , I u n d e r s t a n d what And I t h i n k you're I ' v e t o l d you I I n c . - 1.877.370.DEPS don't P a g e 365 3990537992 3390537932 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 recall specifically all of the individuals that 2 were in various roles nine years ago. 3 4 However, I can speak to the process that was used. 5 6 7 BY MR. REDFEARN: Q But I want Can you tell me that, or can Philip Morris find it? 10 11 I understand about the process. the factual names of the people involved. 8 9 And I think I've done that. MR. WAGNER: Objection. Asked and answered. 12 THE WITNESS: I've told you, specifically, 13 that I do not recall the names of those 14 individuals. 15 I've indicated that it was likely 16 managed — 17 affairs department, is my recollection, with input 18 from a range of different groups. 19 it was managed out of the corporate So I can certainly talk to the process and 20 the departments that were involved. 21 said, I don't recall the specific individuals who 22 may have been in those roles at that point in 23 time. But as I've 24 Golkow Technologies, Inc. - 1.877.370.DEPS P a g e 366 3990537933 3990537993 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 2 BY MR. REDFEARN: Q Was the senior vice president of the 3 corporate affairs department in 2002 when the 4 freestanding insert was used the same as the senior 5 vice president in 1999 for the launch of the website? 6 A Yes. 7 Q And it's the same lady? 8 A Yes. 9 Q Who had final approval of the content of 10 the November 2002 freestanding insert? 11 12 MR. WAGNER: Objection. Asked and answered. 13 THE WITNESS: As I indicated, it would have 14 been very similar to the way we managed our 15 website. 16 It would have been — it was reviewed my 17 members of our senior management team, including 18 our chief executive officer. 19 also would have been shared with folks at Philip 20 Morris Management Corporation. 21 22 And I believe, it BY MR. REDFEARN: Q Can you give me names of some of those 23 people that you just referred to? 24 MR. WAGNER: Same objection. Golkow Technologies, Inc. - 1.877.370.DEPS Page 367 3390537934 3990537994 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 THE WITNESS: I believe that the — I'm not 2 aware of any significant differences from the 3 questions I've answered related to 1999, as to 4 whether or not there were — 5 being any significant changes in position during 6 that — 7 I don't recall there at point in time. But — certainly, at the CEO level, at the 8 corporate affairs level, for the individuals I 9 could recall in 1999, I believe, they were all in 10 similar positions in 2002. 11 Although I am more confident that Denise 12 Keane was general counsel at that time versus 13 October 1999. 14 15 BY MR. REDFEARN: Q So aside from the names that you've just 16 provided and the ones that you told us about earlier, 17 there's no additional names of people who were involved 18 in the 2002 freestanding insert; is that correct? 19 A Not that I can recall. 20 Q Okay. 21 Why — what was the need to publish the freestanding insert in November of 2002? 22 MR. WAGNER: 23 BY MR. REDFEARN: 24 No. Q Object to the form. I'll restate it. Golkow Technologies, Inc. - 1.877.370.DEPS Page 36) 3390537935 3990537995 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 Was there any concern by Philip Morris that 2 the substantive low tar message was not getting out 3 sufficiently by the website and the onserts, such that 4 they needed to publish the freestanding insert in 5 November of 2002? 6 A No. I think there's a couple of important 7 things that I would clarify. 8 was focused on the website in its entirety, of which 9 the low tar message was one piece that was included in 10 The freestanding insert that. 11 We launched our website in October 1999. 12 And we made regular efforts to drive people to that 13 content and to make them aware and remind them that we 14 had the site. 15 I've talked to a number of those. In November 2002, this was just the latest 16 effort and a different way to make people aware of the 17 information that was on our website. 18 message was one of several that were included in that 19 message. 20 And the low tar But the actions were driven by an effort to 21 make people aware of the website as a whole, versus 22 being driven by any issues specific to low tar 23 cigarettes. 24 Q All right. I want to switch topics to the Golkow Technologies, Inc. - 1.877.370.DEPS Page 369 3390537936 3990537996 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 onsert. And in reviewing your first deposition that 2 was taken in the MDL, you mentioned or used the term 3 "onsert program." 4 And what I wanted to know about that is, 5 when you used the term "onsert program," does that mean 6 that there was an onsert program that was limited 7 strictly to the substantive low tar message? 8 what you meant by "onsert program"? 9 A No. Was that I don't recall specifically the term I 10 may have used. 11 little bit more broadly, to give you a sense of what we 12 were doing. 13 But I'll answer your question just a We had, beginning in 2002, started to 14 include on a — 15 communications. 16 roughly, a quarterly basis issues So as I've talked about our efforts to 17 communicate broadly about a range of issues, low tar 18 being one of them, the low tar onsert was launched. 19 It was the first one we did as part of this 20 multi-year program where we communicated regularly 21 using brochures that were attached to the cigarette 22 packs. 23 24 So I've laid out in my affidavit and other communications the timing of the communications that Golkow Technologies, Inc. - 1.877.370.DEPS Page 370 3390537937 3990537997 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 were specific to low tar cigarettes. 2 There were other messages that were pulsed 3 in on roughly a quarterly basis on similar amounts of 4 volume over a multi-year period. 5 So it was — the use of onserts as a tool 6 to communicate directly with smokers was done on 7 multiple issues. 8 9 The information that I've provided in previous communications has really been focused on — 10 primarily, on the low tar communications, as that's the 11 issue that we've been asked directly about here. 12 Q So when they started the onsert program, 13 what you're really talking about is just the ability to 14 put a brochure on a pack of cigarettes. 15 And then whatever communication you want to 16 put on later, you know, that's something else. 17 onsert program, the initial thrust was the focus that 18 you could actually do it; is that correct? 19 A Yes. So as we looked at what we — But the we had 20 done some on smaller amounts of volume, probably — I 21 don't remember the exact timing — 22 two, before this, on smaller amounts of volume, on 23 lower speed machinery, attached this to some cigarette 24 packs on specific issues. maybe a year, maybe Golkow Technologies, Inc. - 1.877.370.DEPS Page 371 3990537998 3990537938 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 In order to give it broader reach, what we 2 were able to do in 2002 was to incorporate that into 3 machines that moved much faster. 4 We broadened the scope across a larger 5 range of brands. 6 onsert in 2002, it was really the first time in which 7 we had used those brochures across a large range of our 8 volume, and then continued to look for ways to do that 9 over time with issues communications running for 10 11 So when we launched the low tar several years after that. Q All right. I want to talk to you about the 12 substantive low tar message that was on an onsert. I 13 understand that started in November — 14 2002. Then there was a little bit of a change for 15 2003. And then there was one 2004. 16 I'm sorry — in But generally, I just want to talk 17 generically about the low tar onsert message, because 18 they were essentially the same; correct? 19 A There was a couple if — the content — I 20 would say the content of the low tar onserts was 21 essentially the same throughout our use of that tool. 22 I would agree with you on that. 23 24 Q Right. And what I want to know is, just like I was Golkow Technologies, Inc. - 1.877.370.DEPS Page 372 3990537939 3990537999 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 asking you before about the website and the 2 freestanding insert, I want names. 3 4 Who actually drafted the low tar onsert message? 5 A I don't know specifically who drafted it in 6 the form of the onsert. 7 information we were already communicating on our 8 corporate websites. 9 The content was derived from And as we did with other communications, 10 you have a different space that you need to tailor the 11 communications to. 12 So this is a brochure that, you know, 13 basically gave you the ability to put three or four 14 paragraphs there. 15 And what was done was, essentially, 16 condensing the message that was already on our website, 17 that was very consistent with what the public health 18 community and the Federal Trade Commission were 19 communicating on those issues. 20 And it was taking existing content and 21 , tailoring it to a different vehicle. 22 Q Who actually, I guess, summarized the 23 content of the website onto the onsert? 24 name. Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS And I want a P a g e 373 3990538000 3990538000 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 A 2 3 Yeah. I don't have — MR. WAGNER: Objection. Asked and answered. 4 THE WITNESS: I don't have a name for you. 5 But the process that we used would have been very 6 similar to the process that was used for all of 7 these communications. 8 9 BY MR. REDFEARN: Q 10 And it started around 2002. Would any of the names have changed that 11 would have been involved in the low tar message that 12 was on the onsert than what you previously told me 13 about? 14 A At the senior management level, again — 15 the period of time you had asked about previously, I 16 believe, was 2002. 17 lower levels of the organization, I just don't recall. 18 Q I've asked that question. All right. And at With respect to the website, 19 you talked about, with respect to the low tar message, 20 corporate affairs, legal, research and development, and 21 marketing were all involved in that message. 22 23 24 Were those same departments involved with the low tar onsert? A The message. Yes. Golkow Technologies, Inc. - 1.877.370.DEPS Page 374 3990538001 3990538001 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 And you would have had additional 2 departments that were involved in the execution of 3 adding the brochure, for example, into your cigarette 4 manufacturing operations, providing estimates as you 5 work it through your cigarette distribution system, 6 doing analyses based on the number of smokers that you 7 think you're going to reach. 8 9 So the execution of it involved different entities, just because it was a different tool. 10 mentioned earlier, the — 11 involved in managing the execution of a specific 12 communications vehicle. 13 As I you get different departments So yes, on your content. There were 14 additional departments that would have been involved in 15 the project to manage the execution of it. 16 17 18 Q Give me the names of the senior people in those additional departments. A I don't know who was managing operations in 19 2 0 02. 20 very tactical level there, you know, people who were 21 involved in making sure the machines could incorporate 22 this, and working on testing the machinery. 23 24 Again, you would have people involved at the And then you would have had senior members of the organization aware that that information was Golkow Technologies, Inc. - 1.877.370.DEPS Page 375 3990538002 3390538002 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 going on. 2 have been different from those who were, you know, down 3 at the — 4 work. 5 But in operations, that level of detail may in the factory level, trying to make this Q All right. I've just handed you a document 6 that came from Exhibit 12. 7 PM3007086578. 8 It's Bates No. It's a legal approval routing stamp. Have you ever seen that stamp before? 9 A I have not seen this specific stamp before. 10 Q Do you know if there was a similar stamp 11 which would have been used for approval of the website 12 pages that were launched in 1999? 13 MR. WAGNER: 14 I'm sorry. What exhibit is this? 15 MR. REDFEARN: Exhibit 12. 16 MR. WAGNER: 17 MR. REDFEARN: Yes. 18 MR. WAGNER: 19 THE WITNESS: It's from Exhibit 12? Okay. What this looks like — we 20 had — 21 processes that we have to approve cigarette brand 22 advertising and communications. 23 24 and I discussed in my prior deposition the This appears to be a — an example of the approval process that we would use for cigarette Golkow Technologies, Inc. - 1.877.370.DEPS Page 376 3990538003 3390538003 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 brand advertising communications. 2 It's consistent — there was a document 3 that was presented in my conversation that gave an 4 overview of some of our compliance policies 5 related to cigarette brand advertising. 6 7 We did not use the same policy or practices as it related to the website. 8 9 BY MR. REDFEARN: Q Did Philip Morris ever do any research or 10 analysis regarding the effectiveness of the low tar 11 onsert, as to whether it adequately convinced smokers 12 that light cigarettes were no safer than full flavored 13 cigarettes? 14 15 MR. WAGNER: 18 19 Asked and answered. 16 17 Objection. THE WITNESS: The research that we did there — the short answer is, no, I don't believe so. What we did do is research on consumer 20 recall of that and other — of the specific 21 message in general. 22 "Did you recall getting this message as 23 part of your communications on your cigarette 24 pack?" Golkow Technologies, Inc. - 1.877.370.DEPS Page 377 3390538004 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990538004 Highly Confidential - Subject to Protective Order 1 Q And where is that research? 2 MR. WAGNER: 3 THE WITNESS: 4 Object to the form. What do you mean, "Where is that research?" 5 BY MR. REDFEARN: 6 Q I would assume that there is some sort of 7 writing that shows what the findings was of that 8 research; correct? 9 A That's correct. 10 Q Where is it? 11 A It's available, I'm assuming, with our 12 other documents. 13 previous depositions that I've done. 14 I believe, it's been discussed in So I think the document's probably either 15 publicly available, or it may be something that — 16 certainly something I've discussed with other 17 attorneys, so — 18 Q And if we were to ask for the production of 19 it, you would be able to direct the Philip Morris 20 attorneys where to get that research; correct? 21 A it's I would be able to look at the research and 22 confirm that it's the research that I have previously 23 discussed in depositions, that I've previously looked 24 at. Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 378 3990538005 3990538005 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 Q Did Philip Morris USA know as early as 1966 2 that promotion of a low tar and nicotine cigarette 3 might lull the consumer into believing that he could 4 smoke that kind of cigarette without any accompanying 5 risk? 6 MR. WAGNER: 7 THE WITNESS: 8 I'm sorry. I'm not really sure what you're referring to. 9 10 Object to the form. BY MR. REDFEARN: Q Well, I'll ask my question again. Did Philip Morris USA know as early as 1966 11 12 that promotion of a low tar and nicotine cigarette 13 might lull the consumer into believing that he could 14 smoke that kind of cigarette without any accompanying 15 risk? 16 MR. WAGNER: 17 THE WITNESS: 18 Object to the form. Again, I'm not sure what you're referring to. 19 BY MR. REDFEARN: 20 Q I'd like to show you page 7 of your 21 PowerPoint. 22 prepared; correct? That is page 7 of your PowerPoint that you 23 A It looks that way. Yes. 24 Q And you actually focused or. some of the Golkow Technologies, Inc. - 1.877.370.DEPS I Page 379 3990538006 3990538006 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential ~ Subject to Protective Order _ _ . . . . __ 1 points raised in a U.S. Public Health Service document, 2 the Technical Report on Tar and Nicotine, dated 3 November 25th, 1966; correct? 4 A That's correct. 5 Q Okay. I think there was some discussions 6 about whether or not Philip Morris was aware of these 7 type documents as they came out In your prior 8 deposition. 9 Do you remember that? 10 A I do. 11 Q And is it your belief that, in 1966 or 12 around that time, Philip Morris would have been aware 13 of this particular document? 14 A That's my understanding. And it's based on 15 the fact that we were involved — 16 monitoring these issues. 17 discussions with multiple parties on these issues. 18 19 Q 22 23 24 We were involved in I'm giving you a copy of Exhibit 13 of your deposition. 20 21 Okay. we were closely Is that the technical report that you referred to at page 7 of your PowerPoint? A Correct. It appears to be the same report -- summary of the same report. Q Would you go to page 3 of that document, Golkow Technologies, Inc. - 1.877.370.DEPS I Page 380 3990538007 3990538007 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 and read the first sentence of paragraph 3. 2 3 MR. WAGNER: Doug, did you mean to give me a highlighted one? 4 BY MR. REDFEARN: 5 Q You can have it. 6 A What this is, is -- as you go down — 7 Q I asked you to read it. 8 A I know you asked me to read it. 9 10 11 I just want to make sure we're on the record in terms of having what it is. Because there's an intro to it that, I 12 think, characterizes it. 13 points that I discussed, which talk about/ "The 14 preponderance of scientific evidence strongly suggests 15 that the lower the tar and nicotine content of 16 cigarette smoke, the less harmful would be the effect." 17 It comes down from the bullet There's a second bullet point about the 18 Surgeon General being "encouraged to take action that 19 would progressive — 20 of the tar and nicotine content of cigarette smoke." 21 lead to the progressive reduction The intro for what you're asking me to read 22 is, "This judgment was arrived at with full recognition 23 of the following." 24 There's two bullets ahead of it. Golkow Technologies, Inc. - 1.877.370.DEPS You've Page 381 3990538008 3990538008 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 asked me to focus on the third. 2 tar and nicotine cigarette might lull the consumer into 3 believing that he could smoke this kind of cigarette 4 without any accompanying risk. 5 "Promotion of a low "The presence of the warning label on the 6 package, control over the advertising statements which 7 are permitted, and the continuing educational efforts 8 of public health agencies on this subject should 9 minimize this likelihood." 10 Q Why did you leave off the first sentence of 11 paragraph 3 that says, "Promotion of a low tar and 12 nicotine cigarette might lull the consumer into 13 believing that he could smoke this kind of cigarette 14 without any accompanying risk," from your PowerPoint 15 presentation? 16 A I think the PowerPoint presentation is 17 designed to capture a piece of this. 18 the entire document, so that that was available. 19 But I do think that — And I reference again, I don't think 20 there's anything here — 21 appears to be saying is that that was something that 22 the federal government and the Public Health Service 23 was fully aware of. 24 I think what this document And I think that they — when you read that : Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 382 3990538009 3390538009 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 second sentence -- the presence of the warning label on 2 the package, that was something that was consistently 3 executed over time. 4 There was control over the advertising 5 statements which are permitted, and the continuing 6 educational efforts of the public health agencies on 7 the subject. 8 there. 9 There was extensive communications So I'm not sure — I think — you know, 10 the short answer is that, in a PowerPoint, you can only 11 fit so much information. 12 I do not believe that there's anything here 13 that, you know, significantly contradicts the 14 information that was included in my PowerPoint 15 presentation. 16 To the contrary, it acknowledges that this 17 judgment was arrived at with full recognition of this 18 and the other two issues that they discuss. 19 Q After the publication of the 1966 technical 20 report, did Philip Morris USA have any responsibility 21 to its customer of low tar brands to insure that they 22 were not lulled into a false sense of security 23 regarding the safety of the those cigarettes, yes or 24 no? Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 383 3990538010 3390538010 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 2 3 MR. WAGNER: Objection, to the extent it calls for a legal conclusion. THE WITNESS: I think that by asking for a 4 yes or no, you're simplifying it way too much. 5 Because what you're looking at here is a situation 6 where the federal -- this information was 7 considered, I believe, as part of the Federal 8 Trade Commission's regulatory process in 9 development of the testing methodology. 10 So we were in a position where we were 11 working very closely with the regulatory agency 12 that was trying to decide what it thought was most 13 important based on input from the public health 14 community. 15 This is one of the pieces of input they got 16 from the public health community. 17 document is saying is that, "We understand this. 18 And we think the best approach is to — 19 preponderance of evidence strongly suggests that 20 the lower the tar and nicotine content of 21 cigarette smoke, the less harmful would be the 22 effect. 23 24 What this that the "We recommend to the Surgeon General that action be encouraged which will result in Golkow Technologies, Inc. - 1.877.370.DEPS Page 384 3990538011 3990538011 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 progressive reduction of the tar and nicotine 2 content of cigarette smoke." 3 We were guided by both of those things. 4 And what this document is saying is that the 5 Public Health Service believed that the most 6 important thing is that if you had the presence of 7 warning label on the package, which we did; you 8 had control over the advertising statements which 9 are permitted, which the Federal Trade Commission 10 did, and did very closely on this issue by 11 providing specific guidance through agreements 12 reached with the company; and the continuing 13 educational efforts of public health agencies on 14 the subject. 15 in the form of television advertising and 16 brochures. 17 There was extensive communications All of those things were done by the 18 federal government. 19 regulations that were required, in the context of 20 the additional recommendations that the public 21 health community was making here, I think that 22 played out exactly as they indicated it would. 23 24 So in the context of the And their communication was, "We fully understand. This judgment was arrived at with Golkow Technologies, Inc. - 1.877.370.DEPS Page 385 3990538012 3990538012 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 full recognition of the following." 2 And believed that if those actions were 3 taken, it would minimize the likelihood. And 4 those actions were taken. 5 Q By whom? 6 A The presence of the warning label on the 7 package was required by Congress, and put on by the 8 tobacco companies. 9 10 The Federal Trade Commission controlled the advertising statements which were permitted. 11 And the continuing education of public 12 health agencies was done by the public health agencies, 13 exactly as it states here. ; 14 And it was done through television 15 advertising, brochures, additional communications 15 groups like the American Cancer Society that 17 communicated information to their stakeholders and 18 people who were interested in those issues. 19 And that's what this document is 20 21 from recommending. Q So are you saying that paragraph 3 only 22 puts the responsibility on Philip Morris to put a 23 warning label on, and that's the sole responsibility? 24 MR. WAGNER: Objection to form. 1 Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 386 3990538013 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order BY MR. REDFEARN: 1 2 Q Pursuant to paragraph 3? 3 MR. WAGNER: 4 BY MR. REDFEARN: 5 Q Yes or no? 6 A I think — Objection to form. I'm running out of time. well, I think the answer is -- I 7 just walked you through exactly what this document just w 8 recommended. 9 And I think those recommendations were 10 executed in a way that was consistent with what the 11 public health community and Public Health Service, in 12 this instance, was asking be done. 13 Q All right. And again, because I'm so short 14 on time, I really have to ask that you answer yes or no 15 to direct questions. 16 And if your counsel wants to come back and 17 have you explain, that's fine. 18 time. 19 20 21 22 A I understand that. But I'm limited in But I also want to make sure I'm not giving you an incomplete answer. Q I understand. Did Philip Morris USA ever do any research 23 or analysis whether promotion of its low tar brands 24 with the brand descriptors "lights" and "lowered tar Golkow Technologies, Inc. - 1.877.370.DEPS Page 387 3990538014 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 and nicotine" might lull consumers into believing that 2 they could smoke that kind of cigarette without any 3 accompanying risk? 4 A I'm not aware of all of the research that 5 we've done over time. 6 asked about in the context of preparing for this 7 deposition, so it's not an issue that I've gone back to 8 look at. 9 That was not an issue that you I have looked at — if you look at the 10 second piece of this communication, I have looked at 11 both our communications over time, as well as the 12 educational efforts of public health agencies on this 13 issue. 14 So I'm much more comfortable answering that 15 question, on the second part of that. 16 and haven't looked into anything specific to research. 17 Q I'm not aware Did Philip Morris ever recognize that some 18 Marlboro Light smokers believed that light cigarettes 19 were safer than full flavored cigarettes because of the 20 phrase "lowered tar and nicotine"? 21 A I think that you're taking a specific 22 communication and ignoring the fact that similar 23 Philip Morris was not making any communications related 24 to light cigarettes of the kind that you described. Golkow Technologies, Inc. - 1.877.370.DEPS — Page 388 3990538015 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990538015 Highly Confidential - Subject to Protective Order 1 2 The government and public health agencies, however, were. 3 Q Prior to the launch of the website, didn't 4 Philip Morris have some responsibility to put out a 5 statement about what was meant by the term "lights" 6 that they placed on their cigarettes? 7 MR. WAGNER: 8 — 9 conclusion. Objection to the form. And it objection to the extent it calls for a legal 10 THE WITNESS: Beginning with our — we had 11 very specific communications about lights that 12 were done when we first introduced Marlboro 13 Lights. 14 the information I shared in my last 15 communication. And that advertisement was included in 16 But as I said, you know, what that term 17 referred to was the strength of the taste and 18 flavor of that product, as well as the relative 19 yields, as measured by the test that was required 20 per — 21 Trade Commission. 22 And those were the only communications that 23 24 according to our agreement with the Federal we made related to this over time. / Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 389 3990538016 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 2 BY MR. REDFEARN: Q Prior to 2002, how long did Philip Morris 3 USA define the terms "lights" as referring to a point 4 of comparison for a relative strength of taste and 5 flavor and tar and nicotine yield as measured by 6 machine method? 7 A As I just mentioned, I believe that our 8 I shared a copy of the early ads that introduced 9 Marlboro Lights in 1971. 10 — And both the tar and nicotine yield 11 information was included, as required per our agreement 12 with the Federal Trade Commission; and we referred to 13 the lighter taste of that product in our advertising. 14 So it was part of the introductory advertisement 15 beginning in 1971. 16 Q When was the first time that Philip Morris 17 actually informed their smokers of that specific 18 definition, that lights refers to a point of comparison 19 of relative strength of taste and flavor and tar and 20 nicotine yields as measured by machine method? 21 22 23 24 MR. WAGNER: Object to the form. Asked and answered. THE WITNESS: I think, when you refer to the advertisement, you're using slightly different Golkow Technologies, Inc. - 1.877.370.DEPS Page 390 3990538017 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 language. 2 But I believe that those messages were very 3 similar to the messages that were included — 4 taste message was included in our original 5 advertising. 6 the And the tar information was done according 7 to the way that the Federal Trade Commission asked 8 that it be done, which is to provide that 9 information to consumers in the form of using 10 their single test and including that disclosure in 11 advertising. 12 13 BY MR. REDFEARN: Q Prior to 1999, was there any product on the 14 market that used the descriptor of "lights" that didn't 15 have a health connotation to it? 16 17 MR. WAGNER: Object to the form, and beyond the scope. 18 THE WITNESS: 19 about Marlboro Lights — 20 Morris USA, on Marlboro or any of its other 21 brands, focused on communicating a health message 22 related to these products. 23 24 And again, if you ask me I'm not aware that Philip The messages that we communicated were the ones that we have just discussed. Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS And as I P a g e 391 3990538018 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 mentioned, they were included in the advertising 2 when Marlboro was first introduced, which helped 3 distinguish the — 4 from the full flavored Marlboro Reds, which 5 communicated that this was a product intended for 6 somebody who was interested in a lighter tasting 7 product and was a little bit different from the 8 product that we already had on the market. 9 And I think that that's the — this lighter tasting product has been the 10 essence of our communications over time. 11 aware that we — 12 communications on Marlboro over the years that 13 focused on the message of the type that you 14 described. 15 I have not seen any BY MR. REDFEARN: 16 17 Q At the bottom of advertisements starting in the 19 70s, the FTC numbers appear; correct? 18 A I believe, it was a little bit earlier than 19 that. 20 reached in, I believe, 1967. 21 22 23 24 I'm not I think, the agreement was released — Q was Did it cost much just to put that statement at the bottom of an ad? A I don't know specifically what the cost would have been. But it would have been similar to Golkow Technologies, Inc. - 1.877.370.DEPS Page 392 3990538019 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990538019 Highly Confidential - Subject to Protective Order 1 adding other text to the advertising. 2 Q Is that very expensive? 3 A Probably not, in the context of the other 4 things. It would roll into the cost of the 5 advertising. 6 Q And in the 199 0s, how much would it have 7 cost to put at the bottom of an ad, "Smokers should not 8 assume that light brands are safer than full flavored 9 brands"? 10 A The — I don't know what the cost is. But 11 I think we discussed the substantive disagreement you 12 would have on that issue with what members of the 13 public health community were sharing with the — 14 consumers on that issue at the time. 15 with So you would have had a content conflict 16 with what the public health community was communicating 17 to consumers at the time. 18 MR. REDFEARN: 19 (Discussion off the record.) 20 MR. REDFEARN: 21 Let's take — let's go off the record. 22 THE VIDEOGRAPHER: 23 24 How are we doing on time? We are off the record at 11:43. / Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 393 3990538020 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 2 (Brief recess.) / 3 4 THE VIDEOGRAPHER: record at 11:45. 5 6 We are back on the Proceed. BY MR. REDFEARN: Q In your August 26th, 2010, deposition, you 7 were asked about Exhibit 31 that specifically, at the 8 very opening, had a question and answer. 9 10 And the question was, "Why do some smokers choose low tar and light cigarettes?" 11 Answer, "Because they think these 12 cigarettes may be less harmful to their health than 13 regular cigarettes." 14 In response, you testified, in part, that 15 you thought that the company recognizes that there may 16 be some smokers who hold that belief. 17 18 19 20 Do you recall that? A I do. I don't remember, specifically, the document that you are referring to. Q 21 Right. But you understand, generally — you recall 22 that testimony, that you recognize that some smokers 23 might have held that type of a belief? 24 A Yes. I do recall that testimony. Golkow Technologies, Inc. - 1.877.370.DEPS Page 394 3990538021 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990538021 Highly Confidential - Subject to Protective Order 1 Q My question is, how long did Philip Morris 2 recognize that some smokers might think that light 3 brand cigarettes are less harmful than regular full 4 flavored brands. 5 A I think that the — again, the context for 6 that answer was recognizing that the government had 7 been communicating that very message through television 8 advertising. 9 American Cancer Society and other groups 10 were communicating that beginning, as I understand it, 11 in the '60s, in the '70s. 12 It echoes the communications — the 13 conclusions that were reached in this public health 14 report. 15 So those messages had been communicated by 16 the government for some time. 17 recognizing there is that that was a message that was 18 broadly communicated. 19 So what I was And that, based on that, it's not 20 surprising that some folks may agree with those — 21 conclusion of those communications. 22 Q the Does Philip Morris agree that the mere fact 23 that it published the website, the onsert, and the 24 freestanding insert with a substantive low tar message, Golkow Technologies, Inc. - 1.877.370.DEPS Page 395 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 that that implied, in and of itself, that there was 2 confusion among smokers regarding the meaning of the 3 brand descriptor "lights"? 4 MR. WAGNER: 5 THE WITNESS: Object to the form. I do not believe the fact 6 that we communicated that indicates that there was 7 confusion. 8 9 10 I think we recognized that the Federal Trade Commission and others in the public health community were looking at these issues. 11 They were indicating that there may be some 12 confusion. 13 what to do about that. 14 in a multi-year period. 15 And they were trying to figure out And they were doing that So we recognized what was going on in the 16 external environment and communicated that, tried 17 to reflect the conversations that were taking 18 place outside. 19 20 BY MR. REDFEARN: Q And did Philip Morris disagree with that 21 idea, that there was confusion among smokers, at least 22 regarding what "lights" meant? 23 24 A I think that we recognized — if we had a view one way or the other. Golkow Technologies, Inc. - 1.877.370.DEPS I don't know I think we P a g e 396 3990538023 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990538023 Highly Confidential - Subject to Protective Order 1 recognized that there was extensive outside discussion 2 going — 3 indicating that there might be. 4 underway with regulatory agencies. They were We communicated some of our views on that. 5 I don't recall all of them. But we would, have shared 6 that with the Federal Trade Commission at the time. 7 We were working with them to try to come up 8 with solutions related to both the testing methodology 9 and what should be communicated to consumers. 10 And as part'of those communications, we 11 indicated that one of the solutions that we would 12 support, which they had proposed, was communicating a 13 legend in advertising and communications to provide 14 additional information to consumers. 15 16 And that was something that we were willing to do as part of that regulatory conversation. 17 MR. REDFEARN: 18 thank you for your time. 19 Mr. McCormick, with that, I And I'm going to put a statement on the 20 record. 21 questions that we would have liked to have 22 discussed with you. 23 24 Plaintiffs still have some additional But we realize we're under a court order and we only have two hours, and we do not want to Golkow Technologies, Inc. - 1.877.370.DEPS Page 397 3390538024 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 3990538024 Highly Confidential - Subject to Protective Order 1 go cross of that order. 2 any more questions. So we're not going to ask 3 But I want you to know we're going to 4 reserve rights to review this transcript and see 5 if we might want to talk to the Judge about 6 possibly having additional questions for you. 7 And so I just felt that it's important that 8 I put that on there. Because at the end, I was 9 trying to speed through and get through some of 10 my outline as best as I could, but I'm under a 11 constraint. 12 And so all I can say is thank you for your 13 time. 14 MR. WAGNER: 15 I'm just going to have a few questions, that will take about a minute. 16 MR. REDFEARN: 17 Can we go off the record for one second then? 18 MR. WAGNER: 19 THE VIDEOGRAPHER: 20 Sure. And we are off the record at 11:49. 21 (Discussion off the record.) 22 THE VIDEOGRAPHER: 23 24 record at 11:50. We are back on the Proceed. / Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 398 3990538025 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 E X A M I N A T I O N 2 3 BY MR. WAGNER: Q Mr. McCormick, when we were here in August, 4 the initial part of the deposition concerned the Craft 5 case which was pending in Missouri. 6 You recall that? 7 A Yes. 8 Q And within Exhibit 7, slide 41 contained a 9 summary chart regarding the onsert that had a column 10 totaling each year and then total for all years the 11 number of packs of Philip Morris cigarettes that 12 carried the onsert. 13 And next to it was a column estimating the 14 packs sold or distributed into Missouri that carried 15 the onsert. 16 Do you recall that? 17 A I do. 18 Q Okay. 19 20 — (Deposition Exhibit No. 45 marked for identification.) 21 22 I've marked as Exhibit 45 a BY MR. WAGNER: Q — basically identical summary chart that 23 you had prepared. And why don't you just explain to us 24 the difference between Exhibit 45 and page 41 of Golkow Technologies, Inc. - 1.877.370.DEPS Page 399 3990538026 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 Exhibit 7. 2 I have that here, in case you need to refer 3 to it. 4 A The only difference on this slide — the 5 number that is the same is the total packs that were 6 shipped nationwide, which are organized by the 7 quarterly distribution nationwide. 8 is over a billion packs of cigarettes. 9 identical. 10 The national number That column is What I did here is I looked for a 11 similar — 12 going into California, which is consistent, with how we 13 measure our business going into that state. 14 took a similar approach to estimating volume The percentage of the national volume going 15 into California, you know, was in the 4 to 6 percent 16 range during these points in time. 17 And this estimates the total percentage of 18 those packs that were shipped into California from 2002 19 for each of our — 20 nationally. 21 the times where we offered it The total amount is over 55 million packs 22 of cigarettes shipped into California that would have 23 had the low tar onsert. 24 Q And this is just the low tar onsert, not Golkow Technologies, Inc. - 1.877.370.DEPS Page 400 3990538027 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 any of the other issues that may have been discussed 2 with any other onsert in other quarters; correct? 3 A 4 5 That's correct. MR. WAGNER: No further questions. Thank you. 6 MR. REDFEARN: Counsel, are you going to 7 be providing the backup for this exhibit? 8 Because I know that, in the prior deposition, 9 there was the backup summary. 10 MR. WAGNER: I believe, it may already 11 have been produced. 12 happy to provide it for you. 13 14 15 16 But if it's not, we'll be MR. REDFEARN: exhibit Shall we mark it as — MR. WAGNER: This is Exhibit 45. I marked it as a separate exhibit. 17 MR. REDFEARN: 18 the backup to that. 19 MR. WAGNER: No. I don't have it with me 20 today. 21 produced in the case. 22 multiplied. 23 And i f 24 But I'm talking about I believe, all the data has already been it's readily identify, Golkow T e c h n o l o g i e s , And so we just s o m e t h i n g t h a t you then j u s t ask u s , I n c . - 1 . 877.370.DEPS can't and w e ' l l be P a g e 401 3390538028 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject t o P r o t e c t i v e Order 1 happy to do that. MR. REDFEARN: 2 3 Okay. Thank you very much. 4 THE VIDEOGRAPHER: Are we done? 5 And we are off the record at 11:53. 6 (Signature having not been waived, the 7 deposition of BRENDAN McCORMICK was concluded at 8 11:53 a.m. ) 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Golkow T e c h n o l o g i e s , I n c . - 1.877.370.DEPS P a g e 402 3990538029 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 2 CERTIFICATE OF COURT REPORTER - NOTARY PUBLIC I, Katherine S. Hruneni, the officer before 3 whom the foregoing proceedings were taken, do hereby 4 certify that the foregoing transcript is a true and 5 correct record of the proceedings; that said 6 proceedings were taken by me stenographically and 7 thereafter reduced to typewriting under my supervision; 8 and that I am neither counsel for, related to, nor 9 employed by any of the parties to this case, and have 10 11 no interest, financial or otherwise, in its outcome. IN WITNESS WHEREOF, I have hereunto set my 12 hand and affixed my notarial seal this 21st day of 13 October, 2011. 14 15 My Commission Expires July 31, 2012 16 Notary Registration No. 113055 17 18 19 20 21 NOTARY PUBLIC IN AND FOR THE 22 COMMONWEALTH OF VIRGINIA AT LARGE 23 24 Golkow Technologies, Inc. - 1 . 877.370.DEPS Page 403 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 _ _ _ _ _ _ _ _ E R R A T A _ 2 _ _ _ 3 4 PAGE LINE CHANGE 5 6 REASON: 7 8 REASON: 9 10 REASON: 11 12 REASON: 13 14 REASON: 15 16 REASON: 17 18 REASON: 19 20 REASON: 21 22 REASON: 23 24 REASON: Golkow Technologies, Inc. - 1.877.370.DEPS Page 404 3990538031 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190 Highly Confidential - Subject to Protective Order 1 2 ACKNOWLEDGMENT OF DEPONENT 3 4 I, , do 5 hereby certify that I have read the 6 foregoing pages, and that the same is 7 a correct transcription of the answers 8 given by me to the questions therein 9 propounded, except for the corrections or 10 changes in form or substance, if any, 11 noted in the attached Errata Sheet. 12 13 14 15 BRENDAN MCCORMICK DATE 16 17 18 Subscribed and sworn to before me this 19 20 day of , 20 . My commission expires: 21 22 Notary Public 23 24 Golkow T e c h n o l o g i e s , Inc. - 1.877.370.DEPS P a g e 405 3990538032 Source: http://industrydocuments.library.ucsf.edu/tobacco/docs/jgvm0190