Tobacco Documents Online

1096 562 i0 15 2O 25 Me BAKER: That's the way I take it. Me IRVING: Yes. Q- Now, may I have the Exhibit AG-10 and the AG-II, please. Now, first of all, Mr. Hoult, would you look at AG-II, which is the bulky document. A- Yes, I have it in front of me. Q- You do? All right. Now, in looking at that document, Mr. Hoult, are you able to say who wrote AG-II? A- This is an original research report produced by the independent research agency. And in this case I see from page seven (7) at the bottom that the research agency was the Creative Research Group Ltd. Q- So is there anything in AG-II which was written by anyone within RJR-Macdonald? A- No, this is an original research report produced by that agency independently. Q- Now, both AG-10 and AG-II relate to the cigarette called Vantage, Mr. Hoult. When was Vantage brought on the market? A- It was introduced into Canada in nineteen seventy-five (1975), nineteen seventy-six (1976). Q- All right. Could you just explain briefly the AUDIOTRANSCRIPT, Divi,ion de Pierre Vilaire & Assoclgs

1097 563 i0 15 20 25 circumstances in which it was brought into the Canadian market? A- Briefly, our company, RJR-Macdonald, at that time was experiencing severe share loss, particularly to our competitor, Imperial Tobacco, and particularly because Imperial Tobacco especially, but also our other competitors, were introducing successfully cigarettes lower in tar and nicotine and cigarettes that were described as light. We had been very tardy, very late in our recognition of this trend, and in order to stem our loss, Vantage was introduced very quickly as an existing brand from the United States. Q- Now, there is a reference in AG-II, and in AG-10 as well, to a series of advertisements which were known as the candid series. And... THE COURT: As the what? Me IRVING: They were called the Candid, C-A-N-D-I-D series. Q- And two (2) or three (3) of those advertisements, in their French version are, in fact, part of AG-II. Where did those advertisements come from, Mr. Hoult? A- The advertisements were, of course, produced in Canada, but the advertisements themselves originated from the campaign in the United States. As I said, the brand was AUDIOTRANSCRIPT, Division de Pierre Vilaire & Associ~s Ltge

1098 564 5 i0 15 2O 25 introduced very hurriedly, and we took both packaging design and name and advertising campaign from the United States for the introduction of the brand. Q- I'm showing you from Exhibit AG-II an advertisement which is headed, "Etes-vous vraiment d~cid~ ~ arr~ter de fumer? Is that the French version of one of the Candid series? A- Yes, it is. THE COURT: At what page is it? Me IRVING: It's the very last page of... THE COURT: It doesn't have a... Me IRVING: The report is about three hundred and fifty (350) pages long. This one is marked four one one three (4113). Me BAKER: From which document, Mr. Irving? Me IRVING: AG-II. It's the last page. May I just hand that up to the Court so you can see what we're... Me IRVING: Q- Now, Mr. Hoult, I know that you were not here in nineteen seventy-five (1975). When you came back to the AUDIOTRANSCRIPT, Division de Pierre Viloire & AssociCs Lt~e

1099 565 A- 15 2O 25 company and came to Canada, were those ads still being run? Yes, they were. And then what happened? We changed the campaign for -- for Vantage to a more visual campaign and we, in fact, at testing did not pursue this candid campaign any longer and indeed it hasn't been -- been run since that time. Now, did you have a view about the candid campaign, Mr. Hoult? Yes, I did. Which was? My view of this campaign was that it was not a campaign that was appropriate to a growing brand. I didn't think it was particularly good advertising. I didn't think it was particularly good advertising in the United States and I was very uncomfortable with --with the fact that it was lifted from the United States and put into Canada without the proper evaluation. The brand, at that time, had clearly developed the profile which I have described and I felt we could develop better advertising, which indeed we did. And the suggestion is made, Mr. Hoult, that that ad and -- was intended to persuade people not to quit. Can you comment on that? AUDIOTRANSCRIPT, Division de Pierre Viloire & Associ4s Lt4e

ii00 566 i0 15 2O 25 A- It's very difficult to comment on -- on something that occured a) when I wasn't there and b) twelve (12), thirteen (13) years ago. But I -- I would say that that could be an interpretation. Certainly I would not run the advertisement today for that reason and -- and I think it was an error to run it at that time. Q- And you say it has not been run since? A- Since nineteen eighty-eight (1988). Me IRVING: And those are all... Those are my questions in re-examination, My Lord. May I take one moment to show something to my friend, Mr. Baker? Me BAKER: May I, My Lord? THE COURT: In re-cross? Me BAKER: Yes. Me IRVING: I have no -- I beg your pardon? THE COURT: Are you finished? Me IRVING: Yes, I'm finished. Thank you, My Lord. AUDIOTRANSCRIPT, Division de Pierre Viloire & Associ~s Lt@~

ii01 567 i0 15 2O 25 THE COURT: YOU have questions arising out of Mr. Irving's questions? Me BAKER: Yes, I do. Me IRVING: My Lord... THE COURT: We'll see what questions. question you had asked... Me IRVING: Yes. It seems to me that that was proper re-examination. I didn't take in any new areas and I don't see why my friend has any basis to begin again. THE COURT: I'll see -- I'll see the question. If it's directed to certain CROSS-EXAMINATION BY Me BAKER: Me BAKER: Q- You were asked by your counsel, Mr. Hoult, in connection with Exhibit AG-II, who the author of the document was. Do you remember? A- Yes, I do. Q- And you were referred to page seven (7)... A- Yes. AUDIOTRANSCRIPT, Division de Pierre Viloire & Associ6, Lt~e

1102 568 5 i0 15 2O 25 Q- ...of the document ... A- Yes. Q- ...and I think you said that this document was authored by the Creative Research Group Limited? A- Yes. Q- Now, is the Creative Research Group Limited a company that's done a lot of work for your company over the years? Me IRVING: My Lord, the case will never end if we don't follow the standard rule which is, there is an examination, a cross-examination and a re-examination. These are all questions Mr. Baker could have put before and it's his own document, which speaks for itself anyway. I object to the resumption of cross-examination when the re-examination is over, because every time it's simply going to lead to an endless toing-and-froing and that's why the rule is that -- that there is the three (3) stages. Now, we've passed the three (3) stages. I object to that. THE COURT: I viewed the question as a clarification of one (i) of the questions asked in re-examination. Although this has been said about three (3) or four (4) times... AUDIOTRANSCRIPT, D~v~,io. d. e~erre Wloi~e & A,,o~i~, U#e

1103 569 i0 15 20 25 Me IRVING: Yes. THE COURT: ...in his previous testimony. Yes, Creative Research Group Limited has done a lot of work for RJR. It's been said before a number of times. Me BAKER: May I continue, My Lord? THE COURT: Well, unless you want to bring something to clarify, you are in re-cross. There is no re-cross. Do you want to clarif~y a point which might have been misleading or improper or -- or left out? Me BAKER: No, I'm not suggesting that there was anything improper or misleading at all. The issue of Creative Research has not yet been highlighted in this case. My friend chose to do it, for some reason, to indicate who the author of this document was and I'm simply exploring what the witness, whether Creative Research has done a lot of work for that company over a period of time. And my last question would be does Creative Research Group continue to do this kind of work for your company? A- I, having left the company in September, I can't say whether it... AUDIOTRANSCRIPT, Divi,ion de Pierre Viloire & A$so¢~4s Lf4e

1104 570 5 l0 15 2O 25 Up until the time you left the company? It continued to be a major supplier of our company, yes. A major supplier? Yes, market research supplier. Me BAKER: No further questions. Me IRVING: My Lord, I would like to ask that Mr. Hoult should now be excused, his examination being over and we have the difficulty of this -- this request for additional information and, at this moment, I'm not in a position to tell the Court whether it is available. We did look for it once before. I am looking at the discovery transcript, which I know the Court doesn't have, and advised Mr. Baker we didn't have it. We will look again and I'll do that at the morning adjournment rather than -- rather than have difficulties that the documents are there. But, I would like to have it clearly understood that Mr. Hoult will be excused now and is not going to have to wait and come back to this Court. If my friend wants to call him as his own witness, that's fine. And we will try to provide him with the information he wants if we have it. I doubt very much we do. THE COURT: Well, Mr. Irving, there is a question that was put to AUDIOTRANSCRIPT, Division de Pierre Viloire & Assoc~s Lt~e

1105 571 5 i0 15 2O 25 the witness whether or not he could provide the breakdown of the brand families in various areas, expecially the line extension marketing expenses. Either you have an objection to provide that or you don't, or the thing exists or it doesn't exist. Me IRVING: My Lord, I'm saying that Mr. Hoult was asked that on the discovery, and said we don't have the information. Me BAKER: My Lord, would you please be good enough to ask Mr. Irving to desist referring to discovery. Number one (I) it has not been filed. Number two (2) he. is referring to a very small part of the request I may or may not have made in the discovery and it is improper for him to suggest to you that everything I've asked for this morning was requested in the discovery. In any event, the discovery is not filed. You have already admonished the witness not to refer to it, more so Mr. Irving should not. He should know better. THE COURT: ' Be that as it may, either it exists or it doesn't exist and for that it is for the witness to say if it -- if it exists or if it doesn't exist. And if he needs time to verify, we'll give him time, whatever time he needs. AUDIOTRANSCRIPT, Divi,ion de Pierre Vilaire & As,od4s tt4e