Monday, 13 January 2014

Day 197: Peter Hoult holds forth

The third calendar year of the Montreal Tobacco Trials opened this morning  --  not with a bang but a whimper.

Any suspicions that the tobacco companies might have chosen today to reveal a new trick up their sleeves were dispelled by the absence from their benches of the team leaders. It sometimes happens that after a prolonged break something seemingly urgent is offered for debate. But when the commanders-in-chief of the legal teams for the three companies on trial are missing from the room, it's a safe bet that there will be little excitement in the day.

True enough, there were references to motions that had been drafted and exchanged during the break (but which were not made public). But there was no appetite to schedule them for a debate this week, let alone to hash them out today. More on these issues as details become available.

The return of Mr. Peter Hoult

With issues going back 50 years or more under review, memory is an important faculty in this trial. I was able to consider my own shortcomings in this area over the past few weeks as I struggled to recall details of the previous appearance of former RJR-Macdonald president, Peter J. Hoult in anticipation for his return today. Mr. Hoult first testified in 2012 on September 27 October 1 October 3 and October 4.

My memory may be good, but it's short! Even the picture from Mr. Hoult's Crunchbase profile didn't trigger a good recall of the man.  (This morning I was able to see that while it is a nice enough photo, it is not a very good likeness).

It was a short scroll through the Legacy database that gave me the reminder I needed. It turns out that after the barbarians at the gate gave Mr. Hoult the heave-ho in 1989 he was considered by BAT for a position within its ranks. Headhunters collected information about Mr. Hoult and met with him before providing  BAT with a description that remains true 23 years later:

Shorter than average height, glasses, energetic and talkative . Considers wide ranging issues before responding to questions, and tends to 'set the scene' for his specific answers. 

How diplomatically put! Soon after Mr. Hoult began to display his capacity to "set the scene" with long-winded, repetitive and boring answers the whimpering truly began. Even the observers from JTI sought their escape well before the day was over.

Peter Hoult vs. Richard Pollay.  

After many months away from this courtroom, JTI-Macdonald counsel Mr. Doug Mitchell returned today to lead the questions to Mr. Hoult.

JTI-Macdonald is principally the client of the law firm Borden Ladner Gervais, but the boutique firm where Mr. Mitchell practices, Irving Mitchell and Kalichman, is called on to handle certain witnesses. There is a certain logic to Mr. Mitchell managing this task with Mr. Hoult and to Catherine McKenzie assisting him in it. Mr. Mitchell was part of a similar presentation by this witness before Justice Jean-Jude Chabot during the industry's constitutional challenge to the Tobacco Products Control Act in 1989, and both were involved in the trial of the Tobacco Act in the following decade.

On that occasion, RJR-Macdonald's lawyers used Mr. Hoult's testimony to rebut the expert views of Richard Pollay. It soon became clear that the same goal was in Mr. Mitchell's mind today.

"If you listen to Richard Pollay, you will think that tobacco company does marketing different than other companies," Mr. Mitchell gave as a reason for Mr. Hoult's long explanations about market research at Unilever and Schlackman International, where he once worked.

"If you go through Richard Pollay's report, only 'big bad tobacco companies' engage in that marketing," he said to justify asking Mr. Hoult his views on the marketing practices of government tobacco monopolies in France and Spain.

A somewhat shortened leash and a disgruntled judge.

The problem for Mr. Mitchell was that today Justice Riordan seemed disinclined to allow this fact witness to play the role of an expert. Quite firmly, the judge reminded him that the industry's own marketing experts would be available to respond to Mr. Pollay, but that Mr. Hoult had not been qualified to do so.

The lawyer might be forgiven for having prepared his questions thinking that he would get away with stretching the boundary as others have been permitted to. (Jeffrey Gentry and Graham Read are two prominent examples of Justice Riordan's latitude in allowing de-facto expert testimony from fact witnesses).

Although he ultimately allowed most questions to flow, Justice Riordan made it clear that he thought Doug Mitchell should do a better job of toeing the line. "You are way into an expert's realm... the objection [of plaintiff lawyer Philippe Trudel] is not without great merit."

As Doug Mitchell plowed on with his line of questions, the judge's body language echoed his impatience. By turns his chin was propped up on his fist, or his body angled back in his chair. Today is the first day in this trial that my notes show the judge stifling a yawn and looking pointedly at the clock mid-afternoon.

Perhaps repetition is not always the soul of persuasion

Although Peter Hoult was once president of RJR-Macdonald (1987-88), it was his role as head of the marketing department (1979-1983) that were the focus of Mr. Mitchell's questions today. He is thus the third JTI-Macdonald witness to be brought in to comment on the marketing practices in the company.

The first two testified two months ago. Robin Robb was a contemporary of Mr. Hoult's at the company, working in the marketing department from 1978-1984. Mr. Lance Newman started at RJR-Macdonald in 1992 and is still there.

These three men tell remarkably similar stories of arriving at the company with backgrounds in consumer product goods and of using a "market-oriented" or "market-driven" approach to try to save the Export A brand from the marketing mistakes of their predecessors. The presence of all three at this trial seems designed to establish that RJR/JTI-Macdonald marketed its cigarettes no differently than it would have done laundry soap or toothpaste.

Coming at the end of this train, Mr. Hoult seems to have little new to offer. If anything his chorus of I came, I saw, I set about fixing the Export A image only drew attention to the conflicts between the three marketers' views about what were good or bad approaches.

Mr. Newman, for example, testified last November 21st about the "sleepless nights" he experienced trying to overcome the working-class trucker image of the Export A brand. Mr. Robb had similarly testified about trying to wrest the brand from the stodgy "traditional and reliable" image his predecessors had given the brand, and how important it had been to remove the truck from the picture.

But today, Mr. Hoult described how his efforts to give the brand its trucker images was a success!

The shift happened as part of his own "last chance" efforts to save the Export A brand from the mistakes of his predecessors. Upon arriving at the company in 1979 he set about "to fix the Export A problem" by applying the marketing approaches he had learned at Unilever and William Schlackman Ltd before joining RJ-Reynolds International.

Mr. Hoult responded to research that found the Export 'A' smoker to be a man without ambition ("does not aspire to be anything other than a blue collar worker,") but with a desire to get out from under his boss. ("the one added dimension that would increase his satisfaction would be if a greater dimension of freedom or independence was super-imposed on his work situation.")  (Exhibit 40247).

Out went depictions of men smoking in quiet contemplation! In came depictions of men at work in independent settings, like logging or trucking.

His successor may have lost sleep over the result, but Mr. Hoult still considers the results to be successful. At the very least, in his imagery the Export A smoker "certainly doesn’t have a dalmation dog!" 

Export A ads before and after Mr. Hoult's influence: 1974 (top), 1979, 1980, 1981 (bottom) - Exhibits 40419, 40420, 40436, 40463

Priority 1: Lowest

In addition to giving life-support to Export A, Mr. Hoult was also tasked in his earlier years with the company with the development of new brand families. Today, he spoke of the work to develop Macdonald Select, which he said was intended to beg the lowest tar offering at the time. (Exhibit 40432).

Unlike Export A and its working-class clientele, this was a brand that would be smoked by "contemporary, highly aware, intelligent, self-assured cosmopolitan" people.

Exhibit 40480
Great attention was paid to the development of the package, which had to reflect that the users would be "introspective, intelligent and proud of their decision." The result was a package that was mostly white - Mr. Hoult explained that "white does communicate in a cigarette market a lighter cigarette than the darker richer hues."

Other package elements, gave the brand "connotations of desirable choice." The crest was identified as a way to symbolize quality and prestige. The cigarettes themselves had designs that were "elaborate and expensive."

 Mr. Hoult was asked to rebut Mr. Pollay's testimony that tobacco advertising essentially contained no real information by describing the informational content of the Macdonald Select advertisement.  (Exhibit 40480, shown above).

He saw a lot of information contained with in it - and for several minutes was able to hold forth on the ways in which the ad provided information about the qualities of the cigarette, the discriminating taste and aspirations of those who buy it, the reputation of the manufacturer. "I think there is an enormous amount of information in here." Oh, my.

Mr. Hoult's testimony will continue on Tuesday and Wednesday. The trial will not sit on Thursday.