Tobacco Documents Online

0 2 3 5 6 7 8 9 10 it 12 13 14 15 16 17 18 19 20 21 22 23 24 25 I M. 0' NEILL, Object to the form of the question. tii'ITiFESS: There is none. Q (By rr. Tilbury) Does the Tobacco Institute distribute or assist in any way with regard to the cigarette advertising code? A i1To. k4 1ias your Company subscribed to the cigarette advertising, code? A At one time - did at one time. Q I take it that it's not at the present time? A 240. Q Z:hy is it no longer? A Well, the og,,aru-ation wasn't viable when it dwindied dokn to two or three members. Q When did that occur, was that last year? A I think last year. Q Now as far as the operations of the cigarette advertisir..g code, how did your company participate in it, what did you do? A I'd have to go back and add something to the' other question too. Q Please do. A The advertising code undertook advice on the ~ . ~ question of television and radio advertising,AmaJor portio ti: c S tL•aS of thc coripsny's budget wer,z in this field with that~pre- GRAHAM ERLACHER d ASSOCIATES OfFIC1AL COURT RlPORT[RS ASHE DRIVE W/NSTON-SALEM-N.C. PHOkE:765-0636

0 0 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 an?, ft"w4 In•Jn fY'lFd empted " by law in April, 3~:vii~ =8ffn~t January the 2nd. Q 1971? A 1971. There was no point in continuing the code unless the whole industry was participating. Q All right. During what period of time did your compo.ny subscribe to the code? A From 1962 or '64, whenever it was established. Q tisas all of your advertising submitted to the code during that period of time? A Yes , sir. Q t.as any of your advertising re3ected by the code A I understood that it was. Q On what grounds, sir? A On the grounds that it violated; , in the opinion of the code it violated the provisions of the.code. G In what respect? A This could be the-using iaodels for example that were twenty-five and seemed to be--and girls look yo=,rcr all the time to me; and I presumed they did to ti1c- yn e ~- I .Mr. r in3r, that's the type of thing, sensuousness, and these are very arbitrary areas of opinion. Ib:EylJc'r'S Q 'I~otit was Governor 'r•;i-nors s decision binding in all cases? A So far as I know, only,clour company; only,, our coMpeny his decisions were binding. We would attempt to GRAHAM ERLACHER & ASSOCIATES OFFICIAL COURT REPORTEkS ASHE DRIVE WINSTON•SALEM, N. C. PHONE: 765-0636

0 x 3 6 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 comply with the wishes of the administrator. Q As I recb.ll, there was provision in the code providing for penalties of up to a Hundred Thousand Dollar for violation of the code? A Yes, sir. 0 Do you Icnow if any companies that were required to pay such pcnaltics? A I do not. Q hll right. You meant no, not just the hundred thousand? A I don't. Q. Did Mr. Thomas Austern, an attorney I believe in Wasriin~;ton, do some work for the Tobacco Institute? A . Yey. Q Af ter t::e tcrainGtion of the cigarette advertis- ing code as you have described it, did your company then cooperate with the National Association of Eroadcasters in some kind of code or formal or in-Lormal code that they utilized? A I do not know, I would presume that it did. Q Did your co:_pany reqTaest' inlormation of the Tobacco ar.sta.tute with rcspect to the plaintiff here, the Pacific TobGcco Company? A t~o . G r.ould they uz:dErtake or did they undertake the GRAHAM ERLACHER a ASSOCIATES OffIClAL COUNT REPORT[RS ASHE DRIVE WINSTON-SALEM. N. C. PNOkE:76S-O636

0 3 6 8 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 investiDation from time to time-of specific request from Tobacco Companies liko that of any other particular companyi, for exaraple? ~ A I have no knowledge. 0 Now wh.ich of your officers besides yourself-- i1r. Wa~.e participated in 'any way in the Tobacco Institute? A The President of our company has always been a member of the Board of Directors and a member of the Exe- cutive Comnittee of the Tobacco Institute; our General Counsel has always participated in what is called the Legal Committee of the Institute, and I have always participated in the Comm. unications Com.^;ittee. 0 There are some records that appears to have been identified as publication has been marked as ExTiibit ?-lo. Cne, vould apply to the ci£arette advertising code, is there only one code that you are familiar with? A . That' s -al l . (The docuwnEnt above-referred-to was rGrked ---:c.hibit I.o. 1 for identification.) Q This particular document which has been marked as P14 intiff's E-x.hibit No.One , has some material w-ritten on the side of it by someone--I'm not sure who did it rcally--showinG a notation of a few provisions were aus- pended in Dece;ii'oer of 1967? A Yes. GRAHAM ERLACHER & ASSOCIATES Ofi.C1AL COVRT REpORTERS ASHE DRIVE WINSTON-SALEM. N. C. P~4or:E. 765•OG36

3 6 a Could you tell me please if those provisions w ere suspcnded about that time? A I do not know. Q Do you know of any provisions that were sus- p-Unded any ti:.,e? A I beard th3t there were provisions that were suspended, but I have no knowledl;e of t':era. Q Do you know why they were suspended? A I do not. 10 11 12 13 14 15 16 17 1s 19 20 21 22 23 24 25 G Are you ~: Yes. KICE'~'~~'r acquainted with a 2f:r. +:itliam -~.:-loeper-? Kleep~ef 0 Did :-Ir, r,i-o~r work with you? A Yes. U In wht:t capacity was I.15•tiytt }e for the '.t,obacco Csmpany rie employed? A Iae was employed as Vice President for Public Relations. C< I:ave 'you in connection with your work for the ~ecvrcy^pu Ic ^eyr.o2cis t;o:.: ;any e7couzitcrtd the t:=Lor Fj-.:*% Corapany at ~ ., .: ~. . G"!S • ~ ~ _f A I'o . C~. Are you pcrsonally a member of any other Associa-I tions other than those you h: ve identified? Q Do you attcnd conventions of one kind or another? GRAHAM ERLACHER 8 ASSOCIATES OFf'ILI.L COURT REPORTERS ASHE DRIVE WINSTON-SALEM. N. C. PNO..E: 765•0686

. A Very seldom. 0 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Q ti'hat sort of conventions would you attend if you--when you have the opportunity to do so? A N;ore meetings than conventions I attend; the raeetin; of the Tobacco Growers Information Committee, I believe that's the only industry connected--tt:e neeting that I attend. 0 Who does that consist of, the Tobacco Growers InforLZatio~j Committee, who are members of that? 1 r i lit(+r. ~ ~ A Prd-mar-j-the agricultural people, warehousemen, - farmers. Q Are there major tobacco companies members? A No. Q V'hat are the associations or trade groups with the Reynolds Conp4ny be a member of insofar as they relate to the Tobacco Industry? A I know of no;ze. Q Did you in connection with your work have any contact in anyway with the subject of cancer cigarettes with Pacific Tobacco Company? A I did not. C Did any ~.~emorandas that were written by any of trie R. J. Reynolds Tobacco Company come to your attention on the subject? A I have seen no mcmorandums written about it. GRAHAM ERLACHER & ASSOCIATES OFf1C1Al COURT REPORTERS ASHE DRIVE . WINSTON•SALEM,N.C. P..Or+E: 7f,5• 0636 (n O ~ ~ do

. 0 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 iR. TILBURY: Off the record. (Discussion off the record.) Q (By iTr. Tilbury) Mr. k'ade, could you identify for us please, the subsidiaries of the R. J. Reynolds - Co:::pany? A Yes. Archer Products, Inc., R. J. R. Foods, Inc, Sea Land, Inc. of r.cLean Industries. No. GRIgSw:" You mean Sea Land is a subsidiary of McLean which is in turn a subsidiary of Reynolds? Wlli~~iSS: Right. R. J. Reynolds Lurope, ;. A. There are some subsidiaries in Archer that are parts of their business--Filaco, Inc., that's the only one I recall. Q (By Xr. Tilbury) Has your company recently acquired--I believe- a"hundred pereent d'"the stock in the American Independent Oil Company? A Vot a hundred percent of the stock. Q What percenta~e of stock do you own? A I think we own more than fifty percent, but I ara not positive. Q Are you in the process of acquiring the remaininf fifty percent? A Not that I know of. Q Is it fifty percent or is it more than fifty? A I think it's more than fifty percent. GRAHAM ERLACHER 6 ASSOCIATES Off,c1A: COUNT REPORTERS ASHE DRIVE WINSTON-SALEM. N C. PHONE 765-0636 f

4 0 3 4 5 6 7 8 9 10 li 12 13 14 15 16 17 18 19' 20 21. 22 23 24 25 Q Is Penick and Ford another subsidiary? A Yes, it is, and you'll have to forgive me for forgetting to mention it to you, but we are having to divest of that and I am apt to keep it out of my mind. Q Docs your co::ipeny license other companies to manufacture ciEarettes? A Ye:~, we do. G And which companies do you license? A In the Philippines. The Philippines is the only liccnsee that comes to my mind right at the moment. Q Do you have some in Holland and Peru, for exa, ple? _ .A I don't think we do in Hollan'd~ because we make ilQUs 11nu£rUurr cigarettes for those countries at i?ou3e= ~tiu~ nb under R. J. Reynolds P. Q Does your company maintain research laboratories for testing tobacco products? A Ye s, we do.'~~.c=-~ontra~t- #s~~nf~=out -z =o1-land~si ~ h~ ~;.~ire==-Com?any -nake s =the:n - for - o s . G I see. Do you maintain a research laboratory-- A In 1/.inston-"alen. C In any place? A Yes. Q And are they equipped and do they analyze cigarette products? GRAHAM ERLACHER & ASSOCIATES O-F/CIAL COURT REf`ORTERS ASHE DRIVE WINSTON•SALEM.N.C. Pr4OnE765-0636 .

A Yes, 3ir. 2 3 4 5 6 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Q Does your company do business to any extent with A. ri. F. , American Machinery and Foundary? A Not to my knowledge. Q From which source do vou acquire your machinery? A Hoeniy, Molins, primarily. Q 1That do you do with your used machinery, how do you dispose of it? A I haven't known us to dispose of any machinery- of consequence in twenty-five years, and I don't know how we disvosed of it and when we do. Q Have you had any dealinGs of your own with any of the distributors or retail accounts in tl:e state of .Oreson within t;ie last ten years? A ivo, sir. .Q Have you made trips in that-area for any rEason. at all? ' A No, sir. a Does your company do business with any other - r:ajor tobacco companies in any respect? A ~:e s---ll--you're talking about doing business with--we supply them with some foil which ve ma.he in the Archer Company. :~ To whicYh other tobacco companies is it sold? A Ve sell some to Lorillard, some to American, GRAHAM ERLACHER & ASSOCIATES OPsIciAL COURT REPOQ7ENt ASHE ORIVE WtNSTON•SALEM. N. C. PMONE: 765-0636 0 0 ~ OD 61

0 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 some to Liggett and rjyers, I believe we sell some to Philip r:orris, and that's all that I recall. Q Do you buy products from any of those.companies? A Not that I know of. 0 Lo you exchange products with any of them? ~* ,o. 0 Do you utilize Turkish tobacco in connection with any of the products that you make? A Yes. • Q Do you buy any of these products from the `?`urtsish State Monopoly? A We have a subsidiary in the near k:ast -P,nd we buy from that company; where they acquire tobaccos, I don 't 1mow. 0 Approximately how long does it take to train your employees to be able to operate the cigarette nar.ufn cturin;; m4chines? A As a cigarette machine operator? Q Yes. A I would think that it could be done in these days in three or four months. Q t:ow about a mechanic to service such a machine? A A year. Q Does your companj mAnufacture any private brand ci.-arettes at any tine? GRAHAM ERLACHER 6 ASSOCIATES O«/.1AL COURT RCPORTERS ASHE DRIVE WINSTON.SALEM. N.C. PMOH[:765-0636 v QD