Wednesday, 19 September 2012

Day 58: Japan Tobacco's Americas President

See note on accessing documents at the end of this post.  

The 17th floor courtroom at Montreal's Palais de Justice was a little less crowded on the second (and last) day of testimony by Japan Tobacco International's Regional President for the Americas, Michel Poirier.

That is to say there were only a dozen or so sharp-suited JTI employees watching their man from the public area at the back of the room!

The defence team's charm offensive

In only the second day of JTI-Macdonald witnesses, the impact of changes at the front of the room are already beginning to be felt. 

Mr. Guy Pratte
JTI-Macdonald Counsel
The lead counsel for JTI-Macdonald, Guy Pratte, has a markedly different style of play than the Imperial Tobacco lawyers who have occupied the front benches for the past six months.

For one thing, Mr. Pratt is very polite. Not polite in the benign Emily Post kind of way, but polite in the professional etiquette of a cold-war diplomat. In a courtroom where good manners have not yet been used much as a weapon, this is beginning to look like a sharp arrow in JTI's courtroom quiver.

One example: At the very beginning of the day, Mr. Pratte offered a humorous explanation of a few issues hanging over from the day before, with visible expressions of good will. He then smilingly followed up with a request for Justice Riordan to reconsider a decision that had not gone his client's way. Et voila! A question whose answer was unhelpful has now been put under reserve!

Extreme Advertising

Today's testimony began more or less where it had left off the day before - with the introduction of promotional material from JTI-Macdonald's Extreme Sports Series. (Exhibit 573 and 573a)

Ad for Export A Extreme Sports
Exhibit 573A
In adding details about the dates of the event, Mr. Pratte put his own spin on the ad. It was for an event in Ontario, he said, suggesting that despite being in French the billboard would not have appeared in Quebec where this trial is based.

The court room is full of lawyers who are veterans to the constitutional challenges on tobacco advertising bans. Justice Riordan may have been the only one in the room who did not know that JTI-Macdonald had gone to 'extreme' lengths to heavily promote otherwise minor local events, and that the ads had appeared in distant places and long after the events were over. The picture of this billboard is very likely from Montreal.

This sponsorship series was the basis for several questions over the day. Mr. Trudel was later able to elicit from Mr. Poirier that "some young people would be interested in motocross or motorbike" and "there is a possibility that these might be appealing to youth, yes." 

Bar promotion for
Another document shown detailed plans for the development of a web-site to promote JTI-Macdonald's branded sponsorships. The profile of those it was intended to reach were described as "living for the day," "having a low attention span," and being of the "nintendo age."

Much more about the document I cannot tell you. Mr. Pratte objected to it because there was no proof that a web-site was ever developed. Again, Justice Riordan is one of the few in the room who was not aware that JTI-Macdonald ran two such sites -- and As a result of Mr. Pratte's objection, the exhibit was put under reserve. (Exhibit 573 AR)

Despite various questions, JTI-Macdonald's president stood firm on the position he had taken yesterday that advertising would not lead young people to smoke, and that sponsorship advertising was even less likely to. He repeated that "advertising does not influence people to use a product category that is already well known... sponsorship even less so." As basis for this, he cited his 32 years' experience marketing consumer goods, but said he had no other research basis to support  his conclusion.

Everybody knows ...

In 2000, Japan Tobacco went to court to try to block the federal government's new health warnings. Mr. Trudel used the affadavit signed by Mr. Poirier in that court action (Exhibit 575) as a spring-board for a number of questions about cigarette package warnings. He began by referring to the first warning that appeared in Canada (WARNING. Health Canada advises that danger to health increases with amount smoked. Avoid inhaling.) and asked the witness whether the warning was sufficient.

For not the first time, Mr. Poirier deflected the issue to the federal government. All I can say is that we must put in context of society at the time. The deputy health minister thought it would be silly to put health risks on packages because everyone knew already that smoking was dangerous. 

As he continued on this vein, Maurice Regnier (who represents the federal government) was on his feet objecting to the 'hearsay' evidence. Justice Riordan raised his eyebrows as he looked at the witness: The question was whether the warning was sufficient. 
I don’t know, said Mr. Poirier.

Ethics vs. Activists: the Tobacco Experience

Another blast-from-his-past was offered to Mr. Poirier in the form of a speech he gave to the Canadian Club in 2002, shortly after becoming president of JTI-Macdonald. (Exhibit 576) The speech is a wideranging defence of the company and attack on public health regulations.

Tobacco control activists will tell you that higher taxes will reduce smoking. But when I look at the historical record in Canada, I see no evidence to support that assertion - and goodness knows we've had lots of tax increases on tobacco products in the past.

Did Mr. Poirier really think that taxes had no effect on consumption, Mr. Trudel wanted to know. The answer was clear. "I can tell you that higher taxes shows no impact on total consumption of cigarettes."  Well, what about advertising? "I do not see an impact of marketing on total consumption" said the witness.

Mr. Trudel showed him that a contrary position had recently been taken by his head office. The 2012 annual report of Japan Tobacco says that in mature markets the industry volumes have been declining mainly due to a number of structural factors, such as demographic changes, tax increases, smoking ban and tightening regulations on promotions and advertisement. (Exhibit 577 - caution large file).

Mr. Poirier did not change his testismony. Other mature markets might be different, said Mr. Poirier, but in Canada neither advertising bans nor taxes could be credited with a fall in smoking rates. He did, however, acknowledge that smoking bans did.

The last inning - and blocked shots

By midday, Mr. Trudel had finished his questions, and after the lunch break his colleague Bruce Johnston took over.

Justice Riordan often looks irritated during Mr. Johnston's clean-up round, and this was particularly the case today. He frequently pushed his chair back from the desk, rubbed his face, scowled or put his head in his hands - not very encouraging feedback for any lawyer standing only a few feet in front of him.

Nonetheless, Mr. Johnston persevered. Before long he began to line up a shot against Mr. Poirier's statement that the company accepted that smoking was addictive in 1998 (when he joined). This assertion seemed inconsistent with the directions that were sent to Mr. Poirier in October of 1998 (Exhibit 569 and 569B) from its head office at RJR International. Among the material in this manual were the opening comments by Reynolds CEO, Jim Johnston, before the 1994 Waxman committee.

Mr. Johnston was heading to contrast Mr. Poirier's view against the more famous position of RJR ("Mr. Congressman, cigarettes and nicotine clearly do not meet the classic definition of addiction. There is no intoxication."), but he never got there.

Mr. Pratte intervened. Mr. Johnston interrupted. Justice Riordon snapped back.
Are you trying to rub the witnesses nose in it? Are you trying to wake up the judge? All you are doing is taking up a lot of time on questions like this. It was a tense moment.

A light assault on too smooth answers  

The topic of light cigarettes surfaced again today, both in the examination by Bruce Johnston, in that of Maurice Regnier and that of Guy Pratte. 

In answers to questions by Mr. Johnston, Mr. Poirier expressed an equivocal view of lower tar cigarettes. "There is a possibility that light and mild may actually be safer," he said, but that the company does "not communicate that to consumers."  

He agreed with Mr. Johnston that it would "be wrong to tell smokers that any particular cigarette is safer than any other," and also wrong to allow smokers to make such an inference - even if such cigarettes actually were safer. Left hanging after these questions was his company's continued marketing of 'smooth' brands, which Mr. Poirier had yesterday testified as being essentially the same in meaning as 'light' or 'mild'.

Yesterday, Mr. Poirier had used the issue of light cigarettes to take a few swipes at the federal government. He had said (twice) that the federal government had research findings showing that consumers believed light/mild cigarettes were safer but that neither Health Canada nor the Competition Bureau had ever given the company copies of the research. He also complained that his request for a meeting with Minister Rock to discuss light cigarettes had gone unanswered.

Today, Maurice Regnier effectively removed these comments from the record. He showed Mr. Poirier a copy of a consumer study on light and mild cigarettes that had been faxed to JTI-Macdonald from Health Canada, and which remained in the company records that were exchanged prior to the trial. He asked Mr. Poirier to substantiate his claim that the Competition Bureau had been asked to provide research (over Mr. Pratte's objections, Justice Riordan directed this to be done). He asked the witness whether or not a meeting meeting had indeed been held amongst the industry, the Minister's staff and departmental officials.

Mr. Regnier could be forgiven for metaphorically dusting his hands off as he returned to his seat.

Guy Pratte also turned to the issue of light and mild cigarettes, asking his client whether the Competition Bureau had ever found that light cigarettes were misleading (the answer was no), asking what the outcome of the Competition Bureau's review had been (a voluntary agreement, now Exhibit 40016).

Most curiously, Mr. Pratt asked whether any regulation or prohibition was ever made to ban words like  light and mild. No, said Mr. Poirier. Yet a year ago, such regulations were published in the Canada Gazette and the Regulatory Impact Assessment for the regulation shows that consultation with the industry included at least three meetings since 2001. It also provides a summary of research findings. A different legal team handled those issues, perhaps. 

Tomorrow, Mr. Ray Howie, a scientist with Macdonald/RJR-Macdonald/JTI-Macdonald is scheduled to appear. 

To access trial documents linked to this site:

The documents are on the web-site maintained by the Plaintiff's lawyers. To access them, it is necessary to gain entry to the web-site. Fortunately, this is easy to do.

Step 1: Click on:

Step 2: Click on the blue bar on the splash-page "Acces direct a l'information/direct access to information" You will then be taken to the document data base.

Step 3: Return to this blog - and click on any links