Tobacco Documents Online

THE STATE OF FLORIDA, et. al., THE AMERICAN TOBACCO COMPANY, et. al., CIVIL ACTION NO. CL95-1466 Plaintiffs, Defendants. DEPOSITION OF RICHARD W. MIZERSKI, PH.D ('COL I) April 30, 1997 TRAVELING TRANSCRIPT" PROFESSIONALS SERVING PROFESSIONALS A. WILLIAM ROBERTS, JR. & ASSOCIATES CIIARLESTON 722-8414 COLUMBIA 731-$224 1-800-743-D EPO

.... • ~,-.,~ o~ r,ol-,u.~ V. RICILARD W. MIZERSKI, Ph Tim American Tobacco Company VGI. a, ~I~.ril 3'0. 15 It] CIRCUIT COURT OF THE 15TH DISTRICT PALM BEACH. FLORIDA THE STATE OF FLORIDA. el ~,, v~. ClV1L ACTION NO. CL95-146~ THE AMERfCAN TOBACCO COMPANY. e~c,, {~l et aL. |to1 DEPOSfflON OF: RICHARD W. [ttJ DATE: Ar~ 30. 1997 [1el TIME: 11:00 AM ~ulll 1700 Page I APPEARANCES OF COUNSEL: ATTORNEYS FOR THE PLAINTIFF STATE OF MISSISSIPPI: SCRUGGS, MILLEI'TE, LAWSON, BOZEMAN & DENT BY: JF~NNIFF.R A, ~ 734 Detma~ Averse Pasca~ou~a, Mbs~sslppl 395~8 (S0f) 672-6068 A1T'ORNEYS FOR THE PLAINTIFF STATE OF FLORIDA: YERRID, ~IOP~K & MUDANO BY: C. STEV~N YERRID 101 ~ Kenneo~ Boulevard Su#e 2160 Tcq~p~ F~ld~ 33602 ATTORNEYS FOR ~ DF.FF..NDANT R. J. ~ TOBAC,~C), CO.: JONES, DAY', REAVI~ & POGUE BY: ROBERT F, Mc~EP, MOTT, 14S0 G, S~¢e~t, N.W. Washa~ton. D.C. [2*2 (INDEX AT REAR OF TRANSCRIPT~ A. WIIJJAMROBERTS, JI~ & ASSOCIATES Mtn-U-Script~ (3) Pagel-Page2

............ • ~.~, r~. The State of Florida v. VoL 1, April 30, 1997 The American Tobacco Company, STIPULATION ~ It is stipulated by and among Counsel ,at this deposition is being taken in accordance .,4th the Federal Rules of Civil Procedure; that ali objecdous as to Notice of this deposition arc hereby waived;that all objections except as to form are reserved until the time of trial; and that the wimess does not waive reading and signing of this deposition. EXAMINATION BY MR.YERRID: Q: Good morulnl~ sir. A: Good morning.. Q: My name is Srevc Ycrrld. I have had the benefit of sitdng here yesterday and also the morning session while my learned colleague fiom Mississippi has directly examined you wi~h regard to your testimony and I assume at the upcoming Mississippi u-tal that's cnsrenfly scheduled for July. I'm here representing the Governor of Florida, the Attorney General of Florida, and the Page 3 Page 4 reoplc of Florida in a case which ~ presc~dy sohcdulcd be.fore His Honor, Judge ~hcn, ~ C~t Co~ for ~ B~ ~W and set for ~c berg ofAu~ of~b ~me y~. Q: ~ ~u ~de~nd ~e~ a~ ~o se~=re ~b, one a nonj~ ~I ~ eq~w ~ M~ippl, ano~cr berg a j~ ~I ~ ~ ~w and ~p¢~ of eq~w ~ Ho~ ~ you a~ of A: Yes, I am. Q: ~d as I ~de~nd it' does ~ur a~ess a~ ~close to you ~a¢ you u~g ~ fo~ as an e~e~ ~me~? A: ~at b my ~dc~n~g. ~: ~d ~u ~ed, I ~, ~ defe~nce to one for Mbsissippi, one for Flod~ A: ~a~ is co~. Q: ~ey'~ ~mcwhat s~r but not idend~l, and I ~ ~at one ~ one ~re ~y be mo~ Wo~d you a~e ~ ~au7 A: ~at's CO~. Q: ~at wo~d be ~e Ho~ ~closu~ s=tement berg ~e mo~ Page 5 A: That is correct." Q: All right, sir, without duplicating your questioning from yesterday and, more particularly, your responses, as I understand it, you did have some direct input in the disclosure statement, you're aware of its content~, and you may have consulted with counsel, bm your disclosure stateroom was authored primarily by you.; A: That's correct. Q: So you're aware of the areas you're scheduled to testify in, and ff I s~ay flora those areas or ff I missile what your expertise is, please correct me because it's not intentional. A: Ail dgh~. Q: If for some rea~ona my quesdona aren't clear or in some way col~nain~ even to me, in some way con~asing, just stop ma, and I'll be glad to rephrase it and reask yea the qaesdon; othezwbe, I'll assume the responses that you 8ire are accu~rely and direcdy in response to the questions asked. A: I understand, yes. ~ O: - pretty much a fair understanding before we commence? Paga 6 A: It is. Q: Let mc stop here and ask, hav~ng given that preamble, how many times have you given any type of sworn testimony, albeit in commktec proceedings, on behalf of the Frc, or in from of regulatury P~ m [9] ~o] (121 rz~j bodies, or in ~ron~ of congressional committees, subcommittees, deposition testimony in civil cases or enforcement cases? Just in general. I'm not going m hold you to the number. I'm nee n-ylng to pm you in stone on that. A: In excess of 10, pethaps 20. Q: Let's jnsz use the range, Between 10 and 20 times you've resdfied before and you've gone under oath and you understand the meaning of the transcript - A: That is currect. MR.YERRID: For the record, I don't believe that we have sworn the wimess for this proceeding, so we need to do that. Page 5 - Page 6 (4) a~h~-u-script~ A. WILLIAM ROBERTS, JR. & .ASSOCIATES

T~,e &m.efic:m Tobacco Company VoL 1, April tLICHARD W. MIZERSKI, Ph.D., being fir~ duly sworn, testified as follows: EXAMINATION (CONTINUING) BY MR,YERRtD: Q: ReaLizing you arc not a stranger to me, Dr. Mizersld. since your vitae was made ava/lablc to ~ in advance of today's proceedings and your deposition in the Mississippi case has already proceeded.what I'm about to engage in, could you s~e, please, kindly, your name for the record and, if )~u will, bale.fly your expertise and what you are going to ge~e=liy cover in terms of your exper~ testimony. A: My mine is Richard William Mlze~ski, and I am an expt~ wimess concerning the issue overall of marketing and i~ ~ on - ~ ~ea or ~e~ on ~ ~ a b~d m~e of pmdu~ ~, ~u~g ~es. My e~e and ~e ~ I ~ ~s ~ pe~aps b~ ~id out ~ ~e ~e~m I ~ve pm~. ~: Yes, ~. I don't ~nt ~u m go ~cr ~t a~, ff gene~y ~u ~ desire - and I Page 7 bound by the specific description, generally describe Page in terms that I can understand what you intend to testify about in the State of Florlda on bcha~ of • c D~en~. • : We~, ~ I ~id b~o~, I ~ it's be~ ~d out ~ ~e e~e~ ~mess ~tement - M~. Me DE~MO~:~t me ~ve ~e ~me~ a copy of ~ you go~g to ~e a copy of~ an .',,! MR. YERRID: You might as well, and it will save :.z~ rime. :,a~ Let's put a clean copy in as F.xhlbh 1. ~,~ O: Let's ju~ assume you've got an :.~ extfibit- MR. MC DERMOI'I':We'II get a clean copy at innch. MR.¥ERRID: Right. O: ! can le~d you, because that's the way it • ..~ ~rks. I~t me try to ask you some leading questions ~0~ and see if we can move the thing along a little bit. ~j As I understand it, Dr. Mizcrski, you have a Ph.D. in ~ economics and business adminJsr~tion from the ~ Ucdversity of Florida? 7=i A: That is correct. ~ O: And .,,'ou have extensive background both in Page writing and in lecturing on advertising and marketing comrauuleafion research and, ! assume, seminars, things such as that? A: That's correct. Q: You also have handson teaching responsibilities both at your present position in Austra/is and, I believe, m clarify it, your other academic situses prior to amtving in Australia? A: That is correct. Q: I understand, sir, that you've also been employed by the federal government in working with the FederalTrade Commission in the iste 1970's up until, I believe you said, '81,into '827 A: That would be with the headquarters in Washington. I also worked with the Adanta regional o~ce in, I bollcve, a period 1990, 1991, perhaps part into 1992. Q: Let's Just say '90 to '92, to be safe, and realizing that that's an estimate. What did you do for the regional office in Atlanta of the FI'C during that time period? A: I was asked to review advertising in terms of an issue concerning telL'marketing fraud. O: It would be totally tmrelated m cigarette manufacturing or dgarette advertising? Page 10 A: It did deal with marketing. In advertising, it did not deal with anything pertaining m cigateRcs. O: Telemarkednf~ I understand that in a generic sense, but not telettutrketittg services that focused on the cigarette indi~xy? A: That is correct, the telemarketing that I dealt with did not deal at all with any tobacco product. G: Taking that work experience aside and going back to your '80s and before, your early '80s and before exposure, how long were you with the FTC in the Washington office? A: I was in the Washington office headquarters from approximately September of 1980 through the end of December of 19-- excuse me, September of 1979 through the end of 1980, In addition, I did continue to do some work when I moved to my position at Florida State University on some projects. Q: And 1 believe you told us that rook you whaL a year or even two years past '80? A: Yes.There would be occasional projects that would come up in which I was constdted and provided guidance, suggestions, comments. A. WILLIAM ROBERTS, JR. & ASSOCIATES MlnoU-ScrlptO¢ (5) Page7-Pagel0

............. , - "~'-'. The State ofFloridz v VoL 1, April 30, 1997 The American Tobacco Compar~y Page 11 0: AB fight, sir.And with regard to - I'll return to that experience, but with regard to tal.,~ case and this hwsuit brought by the State of ida against a number of Defendants, when were you - ~. contacted to render any sergices in cormcction with this case, the Florida case? A: It would be late 1996. Sometime in either late October, early November. ¢t: Give mc an estimate as to the number of hours, days, weeks, or however you wish to express that quantum of time, you have devoted to that task. A: Oh - this is just sort of a guess - somewhere around 200 hours. Q: Would those hours, those 200 hours, include or exclude the commencement of this journey here to the LosAngnles court reporter's ofgtc¢ for phi'posen of giving your tcst~toay? A: I'm sost of including" I'm looking up through today. I may be in error one way or the other, but I was thinking up through this period. {~: Would I be correct in assuming you go portal to portal? In other words, you have to fly back also to Australia in the next few days, you're going to bKI them till you get back to Australia? A: To the extent I'm working on this. I bill just sitting in a seat. Page 12 Q: Approximately at the conclusion of your testimony, which we will hopefully conclude before the scheduled time frame - let's assura¢ tomorrow aRcmooa, tomorrow ¢vculng - and you travel back to .*.ustralia, wiR that be the extent of the activities that you needed to conduct to arrive at your expert ophaious and deliver them to us in the State of Florida in advance - MR. MC DERMOXq':Arc you asking whether he will be doing any work after he arrives back in Australia in the next two or three days? MR.YERRID: In essence. I probably could ask that, and I'll ask that as a follow-up. Q: If you don't understand that question, I'll ask that follow-up question right after you answer my question. A: I understand your questlon. I'm not sure I can estimate how much more time, if any. It would obviously depend on the extent with which I will continue to be an expert wimess, the areas that I wi11 address. ~: If you weren't an expert wimess at an and you stopped and you arrived back inAust~tia, approximately how many hours, in addition to the 200 Page 13 ~l you hat¢ ~Iready spent, would you spend that would bc e] billable ~me.? Ol A: ~11, probably talking about another 20 ~ hours l~ff~aps. ~ Q: A~uming you couttnue in your rolc as an ~ expert witness retained by the defense, have you fq calculated out or projected out your time is! requlreamms out of Australia and away f*om your tz professiat and your family for the Mississippi u'ial pC and theFlodda uial? [1t! Q: ye, aM¢ not made an}" such calculations - A: N~. Q: -tHthregardtoyourtrueJ? A: (~ltlmeas shaken huad f~om ride to side.) Q: ~ you blocked out an}" time, your p~] acadet~c obligations or your pcrsoml ohlisadons, to ~t contet~ate usage o~ your lXeSe.ncc in either og those Im proceeaaga? tm A:N~ ~! Q: As~ou sit here today, can yea give me an t~ eadmatgof what addidottal time you will need to t~ expend on behalf of the tasks you've be-~n assigned t~! betwe~now and the time of trial if yoii were asked ~ to do natldag tar!her? Paga14 A: I baw.n't estimated that, no. Q: As we sit here today, bare you been asked to do nabbing in the next two or three days that would naltdre expenditures of time, once you arrive back in am~alia? A: Notthat I can recall Q: Andwith regard to the expert disclosure statemem, does it fully and completely and, most importm~t}', accuratel}' depict and disclose all of the opi~ns you expect to render at triaR Q: Do!mu anticipate you will alter in any way, chmge, modify or revise any of the opinions or positiom~ou've expressed in your expert disclosure statememwhich was filed here in this proceeding, your d¢l~sition? A: No. MR. MC:DERMOTT:Let me interject here that obviously the statement, to some extent, speaks for itself, and it talks, f(xexample, about Dr. Mizerski commenting about the opinions expressed b}' other exp~rt.s.Tbat is not a settde2ming term.And the descriptions of the opinians are stated in very gene~l terms.While I'm not s~g that Dr. Mizerski is attempting to conceal awthing or the Defendants are attempting to ge 11 - Page 14 (6) Min-U-s¢~ipto A.Ng~.LIAM ROBERTS, JR. & ASSOCIATES

The state of Florida v. The American Tobacco Company RICHARD W. MIZERSKI, PiLl VoL 1, April 50, 195 conceal anything, the testimony at trial which we anticipate he will deliver will be considerably longer than the two pages of this statement. MR. YERRID: And I respect that, Counsel, and I certaiuly appreciate it, but what I'm doing is trying to convey a sense that I have, at least with regard to our Florida judges, that you will pretty much be Page THE WITNESS: There were several work efforts. BY MR.YERRID: Q: I didn't mean to limit those. Please describe in some detail what you did in the '80s and for whom. A: Sometime during the '805 at one period I evaluated a promotion of a brand - I don't remember bound by the disclosure statement and the confines it may or may not represent. Q: So I want to make sure that the statement adequately apprises cmmsel on this side of the table of what areas you are going to delve into and what your intended expert opinions will generally cover, realizing they may be more specific, they may be more ehborate, they may be more detailed. But these are the general confines. Am I safe in assuming that the confines as disclosed in your expert statement are the confines you will retain dwoughout the course of your involvement in this case? ~: Yes, that is correct. Let me note that I'm not sure what your wimesses will say. I~e certainly read their depositions, and I need to see what they say on the stand in the trial. So obviously that's the one area It! where I - Page 16 ~ Q: YOu can't anticipate what hasn't happened t~ yet, so I understand that.But with that t~ exccpdon - and that is, I would suggest a rather R constant exception - with that exception, am I t~ accurate in assuming that you've disclosed adequately r~ to your satisfaction each and every opinion you ~ intend to give in a generalized form? t~ ~: Yes, I have. 0ul {2: With regard to - again, more t11~ background - your prior experience with the I:TC, t~ that ended, let's approximate, 1982. Correct? A: Correct. {2: inthe '80s, as I recollect, you were t1~ retained by a tobacco entity for some purpose or some tl~ work effort? t1~ ~: Correct. t1~ {2: What was that work ¢ffott.~ ~ Off]be record. (Discussion off the record.) M~.YERRID: Please read back the question. (The last question was read by the ~4| reporter as follows: t~ "Q.What was that work effort?") the brand. I don't recall the brand right now - that dealt with a lottery campaign. Q: That dealt with? I'm sorry? A: A lottery eampaign of some son. Q: When you say "brand," what ate you referring to, what type of product? :,~| A: A cigarette brand. I(1~ Q: And do you generally recail what you were !tl~ asked to do? I really don't need you m be that :tl~ specific. 0~ A: I don't - I don't recall really very tl~ much about it. It was- I was - I reviewed the t~l ~tivc and- that would be the advertising, or t2~l perhaps the potential advertising.._. I'm unsttre at ~ Q: Right. "~ i~*l A: - as to whether it was appropriare, ~ given restrictions of that type ofa pn3gram. Page 18 More specifically, various states have different restrictions on how one can do a lottery, whether it's a game of chance or a game of luck. I guess that's u'uc - a game of skill as compared to a game of chance. Q: And you were hired by the dgarettc company to look into what was required or what was prohibited with regard to this game of skiil slash chance? A: I think more so looking at the campaign and did it have an), - would it have been any problems in training with states that had certain restrictions, Q: In other words, was what they intended to do legal or compatible with the state statutes? A: Again, I'm not an attorney, but - {2: From an advertising, marketing aspect. I'm not suggesting you looked at it from a legal aspect. A: Yes, from an advertising viewpoint, from ~,l what was stared in the ad from somebody who had some m expertise and potential in deceptive advertising, ~tr~ et cetera. t2~ Q: As I understand it, you were hired by a m~ cigarette manufacturer? A. XVIIJJ~U~ ROBERTS, JR. & ASSOCIATES

RICtLM~D W. MIZF_.RSI~, Ph.D. The S/ate of Florida v. : eeL 1, April 50, 1997 The American Tobacco Company That's correct. O: Do you recall the name of the ~,'~tanufacturer? RJ. Reynolds. Was !_his your first experience since receiving, let's say, your college degree, not your Page prk~tc enterprise relating to the tobacco industry, the cigarette industry? A: I don't remember the exact next dmc, I can give you some idea about some activities. I don't remember which preceded which. Q: That would be fine. Some activities and Ph.D., that you had been retained or received funding from a private industry group that manufactured tobacco p~oducts? A: Yes. Q: And do you recall the terms of that retention? What did they ask you to do? What was the understanding of your compensation? A: Well I said what I was asked to do, In terms of my compensation - and I don't know what the rate was back at that period. Q: That's kind of what I was asldng. In other words.were you asked to do "XTM fora flat fee, "Y," or wer~ you asked to do'X~ and then bm at an applicable hilling rate? A: Yes. I wns asked to review the campaign, and I simply charged on the hourly basis. Q: And to regress for just a moment, you charge, I believe, $250 an hour at the present O! A: That's correct. g'l Q: - 1997. Pa~ ~0 And have you charged that throughout the course of this latest engagement by the defendant cot]~oration? In other wogd~, in OctobeA', November of '96 was that your hourly rare? A: That's correct. ~: And your hourly rate, ! can assume, was d~fereut in the '80s than this pat~cular A: That's correct. Q: Do you recali the number of hours or the hourly rate? A: No. Q: When was the next ~e that was the first insrance in the '80s you wo~ed for Approximately what year would that he? A: Oh, I could say R was after 1985, ! Q: 9o you know how yon were ~pp~oacbed as opposed to anyone else in the arena of ~ffot~ed persons? A: No. Q: ,~ ~ght, sir.when was the incident when you were retained to do something for a without regard to which procedure, but just gcoexally. A: I was asked to make a presenration, or at [¢~t give a statement and respond f~out of several committees, two committees, congressional committees. Q: In that particular regard, would you be acting as the spokespenon for a Imrdcular entity in appeasing ~ a wime~ for a Imrtinular group? A: I don't remember right offiumd. I ttmember I worked for a law firm. and I don't rememlmr who one would attribute the client to. Q: Do you remember the name of the law firm? A: Womble. Castyle. ~: That', inWashington? A: The)" have an office in O: Did you appear on any patdeula, entity's A: I don't remember what the entity or Page 21 Page 22 entities were. Q: What was the subject matter of your testimony? /u In one instance it was the appropriateness of restrictions placed on domestic tobacco manu~cturen on their marketing in other cotmtrJes. Q: W'ould ~t be fair to say that in summary your testimony w~ that there should not be any tcs~dcdons placed upon those entities in their advertising in for~gn countries? A: Idon't remember ~f I would be that bgoad there should be none, but ! thfi~l~ it would be more in terms of they shoulcin't be any different than what the domestic man~acturets' restrictions were. Q: Certaimy no more stringent than those imposed in America? A: No- MR. MO DERMOTT:That misstates his testimony. THE WITNESS: No.Tbey sho~dn't be any more restrictive than the manufacturers in the foreign BY MR.YERRID: Q: .MI fight.And you were appearing on behatf of the tobacco manufacturer, speaking from •age 19 - Page 22 (8) Min-U-Scrli~t~ A. WILLIAM ROBERTS, JR. & ASSOCIATES

St~zc of Fiori~ta v. RICHARD W. MIZERSKI, Phi American Tobacco Company VoL 1, April 50, 199 Page 23 ~ndpoint. that point of view? ~: I don't reme~er ~e client, whe~er it ~ ~d~ ~up ur- I don't ~me~er ~e ~me ~e cfient;I j~ - to me, ~e c~ent ~s ~e ~: You do ~me~er it ~sn't an an~mok~g ~ and k ~n't a ~m~ur ~up.You ~me~er much, don't yo~ ~ Yes, l do. Q: ~d ~at ~ ~e ~ ~t oft~ony. ~ • Ho~e or Se~te co~ce? ~ Ho~. ~ I don't ~r ~e t~o~.[ ~fi~e it ~ - ~m~g m do ~ ~ ~d Q: ~ ~u mme~ who ~e ~n ~? C~n. ~ me. Q: ~d ~u ~ had any ~mem or d~ ~ ~n~=~ b~om ~ apace at ~t co~ee? ~No. Q: ~d yo~ ~cond ~vo~ement - and I'm ~g now ofyo~ ~ m~ny ep~de - ~ Page 24 ~nd ~vo~cment ~ ~c ~d~, ~ten~i ~d~ of to~c~, w~ ~u ~d by ~e ~w ~ or we~ ~u ~id ~tely ~dcr con~ by ~c cnfi~ ~d ~u to app~ and ~ tc~ony? Page 2~ Page 26 Q: What do you think - A: I think it was the law firm. Q: And they would be paid by the client? A: I presume so. I'm not - but again, that's speculation on my part. Q: [ want to be ~ clear. Q: Do you recall that rate? Realizing you didn't recall the a~ter '85 l~JR ~ episode rote. Do you recall that rate? A: No, I don't. Q: There came a second opportunity for you to appear before a committee, I belinve you testified? A: That's Q: And when was that, approximately? If you can tell me, I would appreciate it. A: This would be the late '80s. Q: Okay, late So the first appearance before Congre~man Waxman's committee would have been between '85 and '90 and the socond appearance would have been sub~quent to that but before 19907 Q: Okay. A: - but I don't Imow flit was- it would be right arotmd 1990,maybe 1989.Maybe earlier. Q: That pa~ is not significant. Excuse me for overtalldng thcrc-(to the reporter). Any~ay, in the late 1980% very early 1990's, can you de,~ribc in general what your second appearance before a committee would be, congressional committee? A: I absolutely don't remember what specifically the i~ue was. It was not international trade, though, h was more in a domestic.And I - I do remember some aspect~ of k.There was a suggestion of changing packaging. I remember that aspect.There may have been some other maflccting activities that were addressed. Q: Now, reallzing we're speaking to a rather clean and young transcript here, so you have to Is it more likely than not it was done tn; engage me when I ask: Suggestion of changing - for compensation as opposed to pro bono or done for t~ packaging what? What product are we talking about? the good of the cansc? [~! A: Cigarettes. gH. MO DE~MOTT:That may be a fair inference, but ttsl ~: I wanted to be clear on-that, that it was you're really asking the wimess to specdiate. He O~I not some other product. I know that you deal with a can tell you what he knows, t~ lot of other products, but we're dealing solely with THE WITNESS: I ~ compensated. 0e! cigarettes in this particular engagement? A: That's right. Q: Tell me a little bit more, if you have any recollection, about the appearance in the late '80s, cady '90s, that you made before Congress. A: As I said, ! don't recollect a great. deal.There was a statement that/s avai/able and a question and answer that has been printed. BY MR.YERRID: Q: Do you recall what the rate of compensation wasp A: No, I don't. O: Would that have been per hour or per appearance? A: Per hour. A. WH.LIAM ROBERTS, JIL & ASSOCIATES Mln-U-Sca'iptO (9) Page 23 - Pa~e 26

RICHARD W. MIZERSKI, Ph.D. The State of Florida v. VoL 1, April 30, 1997 The American Tobacco Compafiy Q: Generally, what does the statement say? A: I - generally - I just don't retail. ~" Q: Do you generally remember what the ,aestion and answer that's been printed or what its use has been over the years? A: I don't remember. I don't recall. Q: Okay. Has your position changed with regard to cigarette labeling since that testimony vras given and the present time? ~: No. Paga 27 Page 29 changed, it would be- it would be hard to comment. I mean, I did send that material to opposing counsel. I suppose if it would be useful for me to gtwtew it. I don't - I haven't changed my position on how advertising works in that particular area - A: - how labeling would work in that patricular area, nor the impact of yearning labels - Q: Let me- A: - so based on that premise, I would say Q: Tell me what your general position is 0tl with regard to cigarette labels and the adequacies of the labels currently in usage in the UMted States of America. [141 MR. MO DERMOTT:Let me interject here. It's a little after noon.Why don't you pick a point sometime in the next few minutes when we can conveniently break for lunch. MR.YERRID: What I'm trying to do is get him to a pq point of background before we break, and if it takes any more than five or ten minutes, I think we just ought to go ahead and break. MR. MC UERMOTT:That will be fine. MR.YERRIO: These are not the most probative questions in the world. Page 28 Q: Go ahead. TRE WITNESS: Would you pltase read the question Imck (to the reporter). BY MR.YERRID: Q: I11 mak¢ it easier. I think I asked - You might want to read the question et back. His position hasn't changed, and then I asked tel what his position is with regard to the present • 1 labeling that's in use in the United States of vol America here in 1997. MR. MC DERMOTF:That's the question? His position on - MR.YERRID: Yes. Why don't you read back the question. ps~ Maybe it would make more sense. tlel MR. MC DERMO'I3": I was actually going to object to 1,71 the form of the question, so why don't you start with ~ MR.YERRID: I'D start fresh. a0t Q: Sir, [ understand your position has not =it changed with regard to the labeling adequacics or ~ terminologies used in the 1990% yourvlew of the ~I terminologies used, and today's date. Ul Is that correctY ~'1 A: Well, to the extent that labeling has I have not changed my opiniom But, of course, packaging has changed and various marketing activities have changed, so I think it would - I'm unsure as to how I could accurately rest~nd to that question. Q: Izt me change the inquiry a little bit. Let's go b~ck to whatever time it was that you gave the congressional testimony with regard to mggesttons of changes in cigarette labeling and wbatevet the state of the world was at that point in ~ne. Did yon have an opinion that whatever the label requlrement~ were they were stffficient? &: Yea. Q: Given that things may have changed Page 30 between that period of time 1989, 1990, whenever that time frame is that we can't quite remember, and today, labeling may have changed, IS it still your opinion that wbatever the labels required on cigarette packages are today, they are nonetheless" adequate? Fil rephrase it. Do today's labels differ from the labels utilized in that first instance we talked about, '89, A: I'm not sure. I'd have to refer back m the labeling- Q: Your best - ~: - that was in - Q: Your best recollection is that ~ome change occur~d? A: I'na nut SgLre. Q: M[ right, sir. In any event, are yo~ sure of what labeling requiremeuts are in force today A: Yes. Q: I'm tagd~g about the United States. I know yon bave worldwide exposure, bat I'm talking about the United States. A: Yes. 'agc 27 - Page 30 (10) Mtn-U-Script~ A. WELLIAMROBERTS, J1L & ASSOCIATES

. ...,.,,. ~,* . .,~,-,-~ V. RICHARD W. M~ZERSI~. PtX i he American Tobacco Company VoL 1, April 30, 19! Q: Do you bellevc those labels are adequate? A: Yes. O: Okay, sir.And that second testimony before Congress, you think it did not involve international trade? A: To the best of my recollection, it did not deal with international wade. Q: Do you recall the committee or the committee chairman? &: It was Waxman. Q: Again, that would be the House of Representatives as opposed to the U.$. Senate? A: That's correct. Page 31 Page 3 Q: Do you recall!he terms of your engagement? Do you remember the first time you told me it was a law firm. you were paid, but you coulcin't reco,cct being paid by the client? A: That is correct. Q: How about the second occasion? A: I would have been paid the same rate and the same procedure, and to the best of my recollectlon, paid by the law firm. Q: Same law firm? A: Yes. Q: ALl right, sir. How long were you with [.~ Page 32 that law firm, if you were ever employed by the law &: I was only employed on an hourly basis. ~: So it would be more or less as a consultaut as opposed to an employee situatinn, a contractor, if you will? A: Right, I did not have a contract with them. Q: But it would be a case-by-ease scenario as opposed to some retention agrecmcut? A: If you mean case - Q: Episode- A: Episode by episode, yes. Q: Did you have a retention agreement with this particular law firm7 Q: Which groups? /~ I've been paid by RJ. Reynolds. Q: For how long? A: On occasional - several episodes. " Q: ~fyou could start with the first one and date it for me, I would appreciate it. A: The first one would have been the mid to late '80s that I reviewed the promotion that involved Q: "that's the one we discussed initially? A: That is correct. Q: Mt right, sir. A: I also rememi~r an tlMsode in which - or a period in which I was asked to review documents subpenaed by the F'fC concerning the Joe Camel campaign, and I- I'm unsure as to what year that would be, but it wotdd be sometime during or after 1988. Q: Again, that would be houri# A: Hourly. G: All right, sir. On a r.mk-by-task basle as opposed to some monOfly ~i'ention? &: Yes. It wouId be iust a table,and I would blil for the number of hours that were requi~ed to complete that task. Page 34 Q: Time, expenses? A: Correct. Q: Okay.That was the ~econd episode. The third? A: Best of my recollection, that would be collecting Infonmtinn - collecting data concerning theJoeCamcl experimem.That was In early 1992 through perhaps July of 1992. Q: Before we go there, because I think, ha fairness to you - and I realize we've droned on a little bit past the lunch point - could it be that you have basically skipped over.things you've already talked to me about, such as the two congressional committee appearances? In other words, you've gone from, I believe, the events or!he mid-'80s into A: No. pe~ 1992, and I think you've already testified in '89, Q: Have you ever been retained by the t1~I '90 you might have appeared before Congressman cigarette Industry or any tobacco manufacturing group [1~ Wa.xman's committee on two occasions? or trade association? A: If you mean a retention agreement? Q: No, I just mean a retention arrangement - A: Paid episodically? Q: Yes. A: Yes, I have. A: Oh, I know I appeared before him. I don't remember the date, MR. MCDERMOTT: I took your question to go m engagements directly by a tobacco company or the tobacco industry rather than by a law firm, the two congressional appearances he previously described. BY MR, YERRID: A.'WHJ.JAMROBERTS, fR. & ASSOCIATES MJn-U-Script~ (113

u~t..ttA~J~ w. ~4~t¢5~, P/3.D. The State of Florida '7. VoL l, April 50, 1997 The American Tobacco Compat~,y Page 12: I think Counsel's point is well taken, and that was the thrust of my question, but we are ~,.~aving the two incidents of coogressinmd testimony |de because in those instances you weren't direcdy retained by tobacco or cigarette concerns, you were retained by the law firm on behalf of some business entity. A: I think I'd have m correct my record, that I think even in the evaluation of the campaign in terms of the lottery that I discussed earlier and the use ofa - Q: Would that be about 1985 you're talking about, m give me some time frame? A: That strikes me as probably in the a: When you reviewed the creative? ~: When I reviewed the creative. Q: Okay. A: - and as I - to the best of my recollection, even the review of the documents Page 37 concerning what was subpenaed by the FTC on the Joe Camel campaign, I believe even in that instance I was hired by the law firm. ~: I want to be real dear. So that in 1985, ffyou were asked the Page 36 quest/on did the cigarette industry hire you to deal |q with their issues on the FI"C investigation concerning ~ Joe Came[, your answer would be "no." ~1 Is that correct? 8l MR, MC DERMOTr:za 19857 ~ MR.YERRID: Yes. R THE WITNESS: '85 ,would not be the Joe C~met p] situation. R qmstiorL BY MR.¥ERRID: ~: You can answer. • : I was, to the best of my recollection, ~ by the law firm and paid by the law firm. - ~, All right, sir. Let's go ahead and pick ~theJoe Came[ 1989 experience. Same question. ~. Hi~ed by the law fh-m; p~fld by the law f~m~To the best of my recollection. ~, I understand. Wkh res~rd to the early 1992,J~ly '92 Camel expeflmant - and I'm speak~ specifically ¢~the collection of data that those months escompassed-,~- same question. ~;: You mean same answer? (l: No.S~n¢ question:Were you hired by d~c~obacco cigarette industry or were you hired by #g I don't recali. It could have been Okay- I did work w/th a law firm, and l'm not ~- I don't recali. ZZR.YERR|D: Almost done. I~ve we covezV.d all the has.rices up BY MR.YERRID: Q: Okay. Sorry. That would be the lottery situation? A: That is correct. Q: Excuse me.Joe Camel's 19927 A: 19- - late 1988, '89 would be theJoe Camel subpenaed documents. Q: And the collection of dam re~'dingJoe Camel would be early '92 through.luly of'927 A: That is correct. Q: Okay. Let's go back to the lottery where yon reviewed the creative. umi[ the present litigation - and I would include in ~t litigation definition Mississippi as weli as Flodd~ - all of the matteta you have dealt with mi~ng your expertise in marketing, advertising, ~ To the best of my recol/ecdon, yes. ~ And with regard to the '89, '90 efforts, do~ou recall your hourly rate at that time? I don't recall. Okay. So the only houdy rate you really z'zxzll is the present hourly rate? That is correct. You don't recall your hourly tatc in '92 through Jnly of '92 that you charged to colect data or you were paid to collect data co~eming Joe Camel? I would be guessing. I mean, I - I don't want you to guess. Yeah. ~k Okay.This is not a memot'y qu/~ l'm jtmtrying ro get an estimate. fan you eadm~te for me, then. in terms of~oss dollars - those are ddngs we can both makrsran6 - how much money you have been paid by Kllfrom the time you left the FTC until the present? If I were to ask you, sir, trader oath, were you hired by the cigarette industry to deal with their issues regarding the tasks assigned, what would your answer be? MR. MC DERMOTT:I object to the form of the Page 38 • age ~55 - Page 58 (12) Mln-U-SCril~l~ A. WILLIAM ROBERTS, JR. & ASSOCIATES

Ine ~taIe el ~lor~(la Vo RIL;klA1CdJ W. MJ.ZEI~KL, The America~x Tobacco Compxny VoL 1, April 30, Page :-: A." ~T. ~ ;Z Q: Have you been paid by any other tobacco ~ intet'~r2 ~. A: .~. MR. MG DERMOI"r: He's already testified he's been .~ paid bT law firtm. ~ MR.Y~RRID: I tmderstand that. I tmderstand the 1~ que~x~m, believe me. ~. THE WITNESS: The only- the o~1¥ thing that I could ~ state spedflcaliy- and I'm - I'd have to - in t~. f~ct, I'm speculating a bit h~'e because I don't ~ remember what ~ on any" cheek that was given to p~ me - that the only diroct txlymemt from ltd-R perhaps t~. would b~ during these trials. I'm not even sure ~ BY MR.YERRID: v~ Q: ~n durin$ these insunees you're not l~I sur~ al~out, ~ou may have been paid by some law firm 1~ as oppesed to the - A: Tuat is correcL Q: - ttal entity? A: ~at i~ eon~ct. ~l I'm unmre of that. ~ Q: Was a law ~ involved, to your ~l recoliecdon - and I just warn a "yes~ or ~no~ to Page 40 i Iq this question.Was a law firm involved ~ coltecting ta the data for your Joe Camel ex~rimem that your ~ acti~'~s involved the period early 1992 to July .=. 19927 .~ A: Yes, there was a law ~rm involved. .~ O: And gcncral/y spearing, without regard to :n what was told you orang di~ctions that came from .~ the law firm. do you have an understanding as to why ~ a law fi~a would be involved in that? [','t A: I - you'd have to talk to the law finn. ~,." O: No, no, I'm talking to you. Do you have ,~ any tmderstanding as to why a law fn-m would be ..--~ involved in the gathering of data concerning the Joe ~. Camel experiment that was the subject of your i-s. publications that you've given us the pages from, ~-~. Jourma of Marketing pages? !~ ~: No. ~. O: How many other entities do you work for t-~. in terms of products and utilize your expertise? ~: A number of manufacro~rs - Q: Approximate. How many? Q: .~md of the 20, how many use law firms to ~g do wilt was done in the tobacco cigarette industry ~ tasks that were assigned to you? [t~ [t q [t~ [t5] [t4] [t~ [1~I A: Quite a few. Q: Okay.That's good.Thank you. Off the record. (The luncheon recess was t,~¢n at 12:20 P.M.) It] APPEARANCES OF COUNSEL: p.~. S~SSlON) [11] JENNtFER A. C.,O~'Y, ESQ. O. STEVEN YERRID, ESQ. ROBERT F. MCOERMO'I'r, JR., ESQ. GEOFFREY I~ BEACH, ESQ. REPORTED BY: HAROLD M. LEIBOVITZ, CSR NO. 290 Page 42 A. WILLLM~I ROBERTS, JR. & ASSOCIATES MJn-U-Script~ (13) Page 39 - Page 42

• ~ w. ~v~, ~'n.D. The State of Florida Vol. 1, April 30, 1997 ~Americtm Tobacco Compa~. y (The deposition of RICHARD W. MIZERSKI, Ph.D. was reconvened after the ~l~inncheon recess.) RICHARD W. MIZERSKI, Ph.D., having been previously duly sworn, testified further as follows: Page43 florida.That is wc will pick up with the first Florida exhibit beingt~e expert disclosure of Dr. Mizerski and it wetS[ bc Exhibit No. 24.The other deposition cxh~/ts will be identical in numeration, that is I I~tough 23. It should bc identical in both deposition transcripts. MR. McDERMOTt: ~ is-correct. ~ MR.YERRID: I was about to resume questioning of the p0] deponem. But I believe my colleague on the other Isq side of the case has some comments and some p~ stipulations that should be recited to expedite the o31 matter and move certain issues into moomess. p41 MR. McDERMOTT: Over lunch I was able m review V8 F.xhibit 8 and that review confirmed what I have been p*a led to believe, and what I think everybody believed, l*~] that this document was produced in connection with Oil this expert deposition by mistake. It is a ttz privileged document dealing with the jury research. t~ It has not been reviewed by Dr. Mizerski. It has t~q nothing whatever to do with the subject matter of ~ this deposition.As I say it was pure inadvertence. ml I believe we have reached agreement that t~ the document should be returned to us based upon that ~ representation and that should put an end to this matter. Paga44 MR.YERRID: For the record on behaff of Florida I have been privy to that discussion before it went on the record.And with those rcpresen=dons I am in agreement with counsel. MS. COLEY: For the record, for the ~te of Mississippi and being the person who received the document, I will assert for the record and for the defense that that is the ouly copy of the document which exists and agree to the stipulation that it be removed. MR. McDERMOTT: Thatxk you. MR.YERRID: I do have something in the way of a stipulation. I understand from talking with defense counsel there is certain protocol that has been established. I have not been a part of it but I have certainly been shown a copy of some establbhed protocol. But by agreement and working in good faith I believe we~ve concluded that the Mississippi deposition can be used for whatever purpose it would be used as a deposition in Florida in those proceedlngs.The exhibits attached to the Mississippi deposition and the nmnbcring afilxed to each exhibit will be consistent with that in MR.YERRID: I will mz~fzrm my intention to try to finish the deposition ~ :z reasomble period of time.And my goal is to fudsh it by tomorrow, certaixfly no later thaa the late afternoon or early eveulng and possibly qoite sooner. I wli/do my best in that tegasd reallzit~ everybody has traveled great lengths. I ara certainly not asking to jeopardize our position. MFL McDERMOTT: All right. Ifas the expert dedgnatinn been marked? MIZ YERRID: Yes, it has. When we left I belk'~ these was a request made for a clemz copy of the expert disclosure statemeot.T~tat has been procured and that with the cou= reporters assismnee-hns been marked and will be a part of thls deposition as Exhibit 24. (Mizerskl £xhlblt No. 24 ~ marked for identification and is annexed hereto.) EXAMINATION (CONTINUING) I~' MR.YERRID: Q: I will jnst ask you fine the record, sir, is that to the best ofyo~ knowledge a photocopy of the disclosure statemeat that you participated in authoring? &: That is correct. Q: And does the FL ia handwriting notation at the upper fight-hand torner denote that it's for Florida usage as opposed to Mtssis~ippi? &: I presume so. I dida't put it on there but that is what I'm led to believe. " ~: As I recall, I had a~l~ed you and cotmsei had inquired about a specific subsection of the question.And so it will be clear, I had asked you about what mules you had received from PJR and cotw, seI said were you ilx:tuding the law firm's compensations. Because we had that dialogue. Do you recall thaL~ ~: Yes, I do. ~: We specifically justsalked about BJR remtmeradon or compemation? Page 45 Paga 46 age 43 - Page 46 (14) Mi~-IJ-Scril~t~ A, WII.LIAM RO~ERTS, JR. & ASSOCIATES

,,~. o~c o* rwr,u~ v. RICHARD W. MIZERSKI, The American Tobacco Company VoL I, April 30, Pege 47 A: Correct. Q: Grouping the I~JR and the law firm compensation as one, in other words looking at the to~tky of your efforts that we~,e discussed thus far in your direct restimony, what is your best estimate, realizing it is ouly an estimate, as to the amount of money paid to you since you left the FI'C up to and including the present time? And I would use information and we will deal equitably with you in this matter.That is to the extent that this is the ~ rule for this enterprise on both s/des.That's fine ~] to the extent that it's nor- th3 MR.YERRID: I appreciate that.And you are not ~ acquiescing. But the assemblage will take place and el we will deal with that at some subsequent time. tel don't imagine it will be a huge undertaking, yesterday as a cutoff. If not paid, certainly accrued to be paid. A: Now are you talking expenses included? Q: EvetTthing" By the way, I will give you an opporttmity to break that out.I don't want to mislead anyone by saying, beeause I Imow there is Q: Let me as~ you, did you ever engage in any work for the health oriented Sroups, that is gsoups that would I~ opposed to smoking or the advertising of smoking related products, such as cigarettes? A: Yes. expenses and ! know f~m where you came.You don't have to rush. A: l'm making a gues~ at this point of som~aing in the area of perhaps $1 ~),000. Q: A,ssuming that's your best estimate or O: And that would be after you left the FI"C? A: Yes. Q: Tell me s little bit about those 11~ experience~, If there is more than one. [~ A: Of course one of them would beThe guesstimate, an accounting would bear om whatever number. Do you have an accountant that does your billing or do you and your wife do it or do you do it? A: No. I had an accountant off and on. ~: Would it be possible for you to give us a Page 48 definitive answer to that question as opposed to a guess ffyou went back and had the opportunity to look ti~ough your records?There is nothing magical about doing that process. A: ~o.The only thing [ wou/d ~y is d~t I'm not su~ how far back in the eighties ! could go. Because as I moved to Ausl~l~, quite honestly ~ had some decision I had to m~ke as to what ~ was ~oing to take given the cons~-~in~ that I have. ! have records presun~bly at |cast seven yesrs back. Q: I would ask that you forward those to the defense lawyers and let them make a dctcrrrdn~don and possibly with those records you could put esdm~tes going b~ck with some passage of dine and P.J~ecdon, estimates of the anloml~ of money that you spent for those records that you don't have.And we would take )'our rcpresentat/on, at leas~ I will take your represen~don for those amounts of money as opposed to itemized accounting" MR. McDERMOtt': Let me interject here. I think at lc~s~ in Mississippi the unde~kin~ on both sides was to discuss compensation with respect to the a¢ issue, or the cases at issue, rather than pc/or con~cts and employments. I will let Dr. Mizerski assemble that FederalTrade Commlssion.Are you asking specifically did I week on prelects anttsmoking? Q: Yes.A~ter, say, 1981-'82. ~ MR, McDERMOTi': I think I t~ybe confused as is Dr. MizerskL I thought you asked for work for health o~entea g~ups, not necessarily on tobacco Page 4 Page 50 related issues but just work in general for groups that would, you k~ow, in some other context be andtobacco, MR.YERRID: I apologize. I think I did that. Let me withdraw the question. Q: Did you work with groups, and I am talking now and confining my questions for purposes of time to tobacco, cigarettes, ffthose are a subsection, but tobacco to encompass all of that, Did you do any work for proponents for no smoking environments or critics or opponents of cigarette a0cerrising or anything such as that after you left the rrc? A: Yes. I have done some work with the Uuited Way, who is involved in some of their activities in antismoking, O: Can you just globally teU me when that would be? A: That would be per'naps '93. Q: What did that activity entail? A: I participated in helping them promote the Urdted Wa)'. promote some of the fimding that would go to groups that would be aligued with antismoking, such as The American Cancer Society, et cetera. A. VgH.LIAMROBERTS, JR. & ASSOCIATES /~4Jm-U-Scr/pt~ (15) Page 47 - Page S0

RICHARD W. MIZERSKI, PILD. The State of Florida v. VoL 1, April 30, 1997 The American Tobacco Compa/~,y Q: When you say you helped the United Way in terms of promoting and furthering its operation. "'here's an umbre~ of organizations that are funded ~1 part by the United Way.You ate aware of that? A: That's correct. Q: Did your help with United Way, was it a Page 51 lq Q: l-Im¢ many hou/s did you expend on that ~ activity i~ '93. approximately? A: W~ activity? O: ~ UnitedWay activity. A: Tke total UnitedWay? ~: "llte total amount and we will break it general assistance effort as opposed to something directed towards the cancer group under the umbrella or some other group? A: .Well, I was involved in evaluating programs of various groups, l/valuating their performance, evaluating their marketing plans, ascertaining future funding, the allocation of funding m various gzoups.And also ~si~ed in developing promoflo~n for the UnitedWa)' ~md some other groups. O: Was Mr.bzamony the I~¢stdom of the United Way of America when you were doing ~ A: I believe it w~s ~ound the time when he was relieved of his position or resigned. So that might help establish about when that was. It was a period in which they ob~onsly had some dtfficnity in rees~bltshing their eredtblliW. G: Did you ~vel to the Vir~Mfa m~in headqu~'ters of the United Way of America in doing this activity or did you work in the field? A: No. I worked in the Taliahassoe area and Leon County and some of the other counties in North down m we d/d befote. A: S¢~.tal weeks.A coup|e of weeks. Q: Acouple of weeks.And that was a pro bono ve~untcer effort? A: T~t's correct. Q: No charges or remtmetation wns given? A: No cl~es or z~nuae~tion. Q: With rel~'d to the couple of weeks, how long ~Sd.you speci~czll)' deal with an), groups that would ~e assoc~ed with the other side of the cigare~ lndm~ry, for ~ck of a better ~en~ Ia othe~ ~rds, the opponems of s~okin~ ci~re~e A: I b~eve the Un~ed Way wonid be ~he oni)' sp~c acti~ty direaed ~ow~rd that. ~: ,~d in the UnitedWay tv~weeb~eflod zhat yo~ ~e~ed m ~ ~a~ ~u d~d yo~ ~c~e of ~e, how much of ~a[ ~wcek ~od ~ d~d m, ~y, ~e ~n ~ncer tq Society arAmcrican LungAssociation? If you can ~ recall. ~ A: I cm't recall.There were meetings, Fioridz. O: Did you work specifically with any pan/culm" chairman of the ioc~d effort of the United Way? A: Yes. Q: Who did yoU work for? A: I don't remember the chatrn~n'$ name offhand. visiting ~ facilities, evaluation of promotion plans, p~sentatious that they put on, questio~ were asked./md I don't recall specifically how long. O: What speciticall)' did you suggesL was it the American Cancer Society, with regard to stop stnokingthat you mentioned? A: T'a~e were a number of groups that were involved.There were not oni)' thcAmcrlcan Cancer Q: You mentioned theAmerican Cancer greup. Did you work with that group individually or was that simply one of the groups that belonged to the United Way participatory family? A: My best recollection is that I actually ~itcd their facPiw, c~duated their program, ImrticilYated in decisions with a selected number of other United Way individuals to determine how much they shou/d be allocated out of the total fund. Q: But these were not refined programs directed towards smoking opposition efforts, or anything such as that? A: Well, it had to do with smok/ng and_ smoking programs and quit smoking programs. Society.there were also various other g~oups who were involved in elimination, or programs concerning smokiz~as well as other kinds of substance abuse. O: ~ I realize that the United Way does a lots of thinga about drug addiction and alcoholism and a lot of other substance abuse programs. Bm speaktngspecifically to cigarette usage, what did you do lltat you can recall to promote those various entities efforts in that regard? A: As I said be.fore, I listened - First of all reviewed their meting plans and evatuatious of - their ctaluations of prev/ous performance. I listencdm their presentations and then later discussedamong a select group of individuals how Page 53 Page 51 - Page 54 (16) Min-U-Scripto A. WILLIAM ROBERTS, JR. & ASSOCIATES

lnc ~am at Horat~ v. RICHARD W. MIZERSKI, T.he American Tobacco Company VoL I, April 30, 199 {,j much tunding should go and what sorts of criteria ~ should be applied to them and perhaps future ~" OI performance. Q: What type of presentations did you listen top I really won't dwell a long time on this. But l'm intaxsted to hear about it. A: At least the UnltedWay I was familiar with is .~arly, if not more often, they would have a Page 55 tz select group of their organizations that they helped el01 fired, would have on-site evaluation by a select group tV,l of volumcers,And before the on-site they would tt~ have written marketing plans and overall plans of teal what they were going to do and how are they going to t~,l ~d~ocate their funding. How they allocated funding in the last year. Evaluations of how well that funding was used.And any kind of potential performance indicators. Q: What'S the best way to utilize funding to get people, in particular teenagers younger than 18 years oki, to stop smoldng? Based upon not only your United Way activities but also your genend A: I don't know if there's a best way.I Page O: 17 and under. A: There were also programs ahead at adults so they could use this information in terms of, let's say they might have child care programs or they might have visiti~ households that were poor.The United Way dealt with a broad range of comdtuents from the elderly to the very poor in rural areas. Q: Let me be very clear. I want you to assume that there is a ten-year old male, you can make him black or white. Depending on what you said before I don't think it wouJd make a difference to you_ In Tallahassee within the city limits.What is the most effective way to see that that child never picks up a dgarette~ ~q ~: The most effective way to make sure that Vq at that early age, perhapseven younger than that, ttT~ that the parents were aware that smoking was an It~l activity that may lead to their own children tt~] ultimately using it because they potentially may be tm modeling orget access to cigarettes through that. tz. Q: In your case, Kents, because your father ~ smoked Kents. ~ rat A: That's correct.So I would deal with - think I noted before that the particular program one would me would very much depend on the age that they Well, again I'm -You are asking me hypothetical because I can't tell you specifically what all of those prognms dld.And, of course, a lot of things Page 56 were going a~ter, where they were in the process of Ill have happened since that time. Q: I'm not suggesting to you about the U~ted Way.And I think that's what counsel is talking about. I am calling upon your expertise, your hackground, your skills and viramlly without regaml to funding what is the best way to ensure that a ten-year old child in Tallahassee, Florida, does not ever pick up a cigarette and become addicted to smoking. MR. MeDERMO'I'r.' I object to the form of the these potential cigarettes uptake, consumption and purchas/ng uptake. Q: Let me fill those in as we go along.The age of the 17 and younger, the geographic problems would be the state of Florida. What was your other criteria? A: Where they were in that stage. Q: Demographically distributed according to the citizenry profile of the state.That is you would have people dwelling in Miami, Tampa, Orlando, (~ question.And to some of its hidden hypotheses. I l~ take it your question is asking him writing on a 0~l clean slate to design his own program. If he had all l~l the money and all the time and all the power in the l~ world, design a program that vdll make sure that a I~ given child doesn't smoke. I~ that the question? I~ M~.¥E~R|D: No. tt~ Q: Here's the question, Doctor. Given the r~l fact that you understand our limitations in our ~,! society, what is the practical approach you would t~ envision that would be possible to utifize in I~] Taliahassee, Horida, to stop a ten-year old child t~! from becoming habituated to smoking cigarettes? t2*1 A: The first step would be to see what sort and you would have people in the roral area of the panhandle and the outskirts of the central Florida area, and the outskirts of mban areas, like Lake Okeechobee. A: I specifically dealt with a particular area.And I don't remember all of the counties. But it ~as Leon County, Wakulla County, Jeffe~on County..~J3d there might have been Liberty County. Q: Those three or four counties would be good.That gives me a reference point. In those areas what would be the best way to proceed to deter youth smoking? A: Once again it would depend on the age of the youth you were talking about. In fact there - Page 58 A. WILLIAM ROBERTS, JR. & ASSOCIATES Mln-U-$crlptO (17) Pa~e ~;~; - ~o,- gn

RICHARD W. MIZERSKI, Ph.D. The State of Florida v. VoL 1, April 30, 1997 The American Tobacco Compatly of environment of that particular market. Because there are all kinds of ten-year olds in the ~.Tallahassee area.Tallahassee is an unusual area, as "hink you probably understand, that has a broad opcctrum from the very, very poor and illirerate to the quite rich. G: I will cut down the parameters so you can Page S9 Page 61 But perhaps more to the point, he is being offered as an ezpert in advertising, marketing, promotion and how that affects the cigarette market and people who may or may not smoke. He is not being offered as an expert on why people start or the adolescent minds of ten-year olds or the sociology of Tatlahassee or anything else. cut down your answer. I want you to assume a family of average income, let's assume - Are you familiar with that, the average income? A: Yes. G: Family of average income. I w'ant you to assume that it's the only child in the household. I want you to assume the parents are in their earl), thirties. I want you to assume that both patents work and I want you to assume that both parents week and in nonprofessional occupations and I don't mean that in a demeaning way. One works as a manager of a hardware store. A: Excuse me. It is too much. I really need to write all of these assumptions down.That is a long profile that will probably take some discussion.And I can explain to you why if you like. Page 60 MR. McDERMOTt: Here's a blank piece of paper. BY MR.YERRID: Q: Average income, ten-year old only child - I will change it. MR. McOERMOTI': Before you start on your new fist let me ask you when you are done with your list to give me an opportunity to interpose an objection. Became we are getting far afield here but you are on a roll and I don't warn to interrupt you. BY MR.YERRID: Q: Ten-year old, father is a lawyer? MR. McDERMOTT: You are starting to sound personal. BY MR.YERRID: Q: And the mother is a homemaker. I want you to first teg me, assuming that they are whi~e Christian and second assuming they are black Christian.Third, ass-aming they art white atheists and fourth assuming they are black atheists. MR. MeDERMO~': Let me interpose an objection here. This is a totally unrcalistdc hypothetical, to ~ extent, it doesn't begin m address a lot of the v-arlabies that relate to why people smoke or don't smoke.There is no showing or foundation that this wimess has sufficient information with respect to potentially relevant variables to address the issue. I~ MR.YERRID: And I take that as a friendly objection I=1 and I will incorporate that because I think it's a t~=~ ~e~.,-~e~ oble~on. t~] Q. I veant you to only look at it in terms of tm your expertise of advet~ marketing and [nl promotions, not human factors, psychological impact 041 or any such thing. Only how best you would address ~ttl the issue in the term of your three pronged tt~ expertise, advertising, meting and promotion. A: Given the hypothetical you gave me. ~: Yes. A: The flrat thing I will note is that there ~ is some very Important in~rmafion that is missing. ~l Q: Okay. m &: Although the father is a lawyer we-don't t~ knowifhe is actively practicing~ whether he is ;~ successful, whether he is unsuccessful, what is their ~ income range, where do they live, what kind of people Page 62 do they work with, what klnd of people do they live with. In other words, what is the neighborhood like. ~: Nice pate of town. Less than $ 100,000. Clearly successful in ternm of ptofessinua! accomplishment and in terms of monetary reward, consider family to be fairly succcss~d. Normal couple. A: in terms of the chtld, rhla lYadcnlar child, successful at school? Am they unsuccessful at school. Q: B student, successf~I at school in terms of getting along well with fellow playmates and teachers. MR. McDERMOTT: Does he catch snuff occasionally? MR.¥ERRID: This hypothetical is very flawed, I can tell you. THE WFrNE$S: I'm not sure.White Christian would necessarily, although if they were religious. Indeed if we said they were a white Mormon family - BY MR.VERRID: ~: No, not a Mormon family, not overly religious.Just believe. A: They could be haptists. If they were Baptists, in fact they could be very severe strictures. • age 59 - Page 62 (18) MAn-U-Sta-ipt~ A, ~ ROBERTS, JR. & ASSOCIATES

The Amebean Tob.~cco Company VoL 1, April 30, 195 G: Presbyter/an. A: As far as smoking. It would depend on how they reviewed their religion.That could be important. If the religion is a very important par~ of their life. Q: Moderately important. Moderately impor~nt and they believe in goodness and truth. What else? A: Most people would probably say the)" believe in goodness and truth. Q: Saying and dning arc two different things. I want you to assume that they do as they say. A: This particular family would appear to be one in which rwst of all this doesn't appear to be the same probability that thb ten-year old, male or female. G: IVl~le. &: This ten-year old male would be in what we would Say a more high risk category. I would expect this tea-year old would be obsetw~nt of the Page63 into your opinion? A: That is correct. O: Please cont~nue. A: SO I would say that the most important thing, of course, is to make sure that he continues in that environment, that the parents do not smoke, to be observant and to see that his friends are, his dose friends, particularly his close male friend is not smoking. So I think a ptogram that would bc aimed at that individual is already in place there. And is no doubt quite efffcctivc. Q: What is the basis for that last opinion? A: As I remember I looked at some smoking rates over the past in terms of'Paliahassec of different ago groupings, And I remember that there was. It seemed to be below that of other parts of the state. Also remember that Tallahassee is very close to the county that I lived in, which was, how quickly ! forgot - ~: Take your time. media, would be provided with schooling commensurate with the location that they're at. Q: Right. A: My experience in thcTallabassec area is Page 64 that they have a rather extensive, particularly at that income level, and If it was the school that was commensurate with that, they have a very active antitobacco program. Q: The school itself?. A: The school itself.And presumably all through his schooling he has been exposed to a great Page 6 Page 66 A: - well, it was a county to.~he wost. MS. COLEY: pdsden County? THE WITNESS. Yes, I lived in Gadsden which had about 67 percent black. One would expect there, and there appeared to be lower smoking rates. So the eni, itonment would be one substantially different than some other urban areas where you might find differences. BY MR.YERRID: Q: I'm sorry, Doctor.You didn't connect with me on that last comment that you make of your is] desl of this. , ~] opinion concerning Gadsden and the black population. ~ Beyond that in this particular city there l~l Can you tic it a little together for me. t,o) is an active media, the Tanahassee Democrat, that t~0~ A: Yes. Q: I believe you also mentioned low incidence of smoking. A: Yes.We find that black males tend to have a much lower incidence of smoking. Q: Than who? - A: White males.Who are in this - Cerrai~ minors. Q: In other words, in comparative census the white male at ago X would have a higher incidence of smoking, commencement of smoking than the black contemporary at the Same a~e. A: That is correct. Incidence of smoking, experimentatlotl of stnoking. Q: I meant to eucapsulc all of them. A: So I think in this particular area of feels very strongly about antismoking.There is a substantial amount of autismoking literature that is coming out there. The city itself is located, it is the state capitol.There arc a lot of heaRh organizations involved there.There is a u-emendons amount of health information that is available. Beyond that, not only the health information but there is a great deal of information for children of this age dealing with the social r'~ factor.And I'm just going to sort of c.tmmcterize it as to basically how to say no when they arc offered various kinds of product. Q: All right, sir, if I can interrupt.That t~) was given as a backdrop and now you are going to get A. WILLIAM ROBERTS, jR. & ASSOCIATES Min-U-$crtpt'~ (19) Page 63 - Page 66

~tL.tXAttU W. bllJ.J~Kl, Ph.D. The State of Florida v. VoL 1, April 30, 1997 The American Tobacco Compa~x. y of the targets it might be going after, this seems to be the least at risk. So I think there needs m be a reinforcement of this program. But given resources ~hat might be increasingly difficult to generate, particularly in the state of Florida, as I am aware, I would think that this particular target market is Page67 Paga 69 Do you believe adverdsing either to the youth orm the adult population results in new smokers and purchases of cigarette products? MR. McDERMOTT: I object to the form of the question to the extent that it assumes there is advertising to the youth market. ~ not the one that we need to focus most of our energy ~ but we need to simply reinforce the program that is ~] available at presem. po] O: And reinforcing the program available at pq presem would be the very active antitobacco program [1~ you mentioned you would assume would be at the pal schooling location, the parents not smoking, the male pq fx'iends not smoking,those types, and you mentioned ps3 more. But those ~ jt.~'t a few of the things you p~ mentioned; correcO ' p T] A: That is correct, sir. pal Q: Let's go into the subsections of those I*~ elements.With regard to the parents not smokin& ~,~ you would agree, would you not, that the effect of ~1 advetxising on adults is ia fact teat and can be I~ measm'od in terms of consumption and sales of I~ productS? In! MR. McDERMOTT: 1object to the form of the Iz~ question.That is too general. Page68 THE WITNESS: No. Why don't we just ray fit~t of all I assume that you are talking in general. BY MR.YERRID: Q: Yes. A: If you are talking in general not cigarettes but any category, then I would agree with you. Q: Now confining it somewhat to this case you do not agree that - Advertising, marketing and promotion, those are yo~r ti~ee areas of expertise; is that correct, sir? A: Th;;['$ correct. Q: You would agree that utilizing alJ three of those areas in the cigarette industry's behalf would not increase sales and create new smokers; is that your opinion? A: I don't want to be argumentative, sir. Yo~ started off saying, "you do not agree" and then you said "you do agree" and then you add some other factors. I would be more than happy to respood m the question. But I want to make sure what your question is. Q: Thank you.You are not being argumentative and ! don't ~e it that way. But beyond that you can answer ff you THE WITNESS: I do not be11~e that advertising gets either youths or adults m smoke. BY MR.YERRID: Q: Do you be/Jeve that the cigarette industry has in the past, and I am speaking about the last 40 odd years, have targeted youths in its adv~ campaign recozds? A: I don't know. Q: Would it SUrl~iSe you to le~Lm that they have targeted underage smokers - underage chiRiren to be smnkers? Strike tha~ Would it surprise you to learn that the cigarette indusu'y has specilically targeted chlkh'en under the age of 18 foz adverddag and-marketing MR. McDERMOTT: I object to the form of the question. I think it is ambiguous as to whether you Page 70 are asking about intendous or effect. BY MR.YERRID: Q: You can answer. A: And you ~ talking about targeting. O: Yes. I think it has bulk-in - A: And targeting in my assumption would be that they not only would evaluate underage, but also would put into force media programs and advertising nod distribution and other forms of marketing, targeted at those individuats.Yes, ! would be surprised. Q: And if the cigarette indusu'y did that they would be - How would you describe such conduct? A: It wouldo't be successful. It Would be foolish on their par for several reasons. First of which would be that it would Iead to condemnation on the part of society, and this would lead to very negative publicky and a dil~culty in doing long term business. Second og all they are not going to be succeas/ul at it. Q: Do you believe marketing or promotional activity on behalf or" the cigarette industry results in new sales and new customers of cigarette products? 'age 67- Page T0 (20) ll~in-U-~crlpto A. WII.LIAMROBERTS, jR. & ASSOCIATES

The American Tobacco Company VoL 1, April 30, 199' How is the, in yore" expcr~ opinion - Page 71 Strike that. In your expert opinion, sir, how is the cigarette indnstr/attempting to replace the smokers that die each year of smoking related maesses? MR. McOERMOTT: ! object to the form of the question, no foundation, and assumes facts which are very much in dispute. BY MR,¥ERFIID: Q: Let me rephrase it and lay a predicate. Sir, do you believe that there are a number of Americans that die each year from smoking related illnesses? A: Yes. Q: And do you believe that nicotine is addictive? A: No. Q: Do you believe that it is habin~d~J A: I believe that it may have some aspects of h~bin~ad~g. But, of course, we wmdd have to put that in the context of a long range of drugs, including alcohol, caffeine and various other ldnds of by-products in such categories as eandy. Page that some feel that dicotine is addictive. But if nicotine is truly addictive and one becomes adhered m nicotine, would you agree from a marketing, advertising and promotional standpoint that l:~micular addict is in a much different position dnn the nonaddict? MR. McDERMOTT: I object to the fotm of the question. I thiz~ your hypothetical is a little bit - it is sor¢ of consumes itself'. If a person is addicted to the role of advertising, is not at all clear.And I don't understand the question. Maybe you can rcphr~c it. BY MR.YERRID: Q: ~the wtmes$ ~ give me that tcsthnony ! would be most appreciative. I~ you can gh, c me that resthnony that the lawyer just gave me that's great. I need that to come ~Eom you because that is the only testimom/I can get in evidence. • : I actually forgot what my counsel might have said.Wasn't your questinn that you wanted me m assume that it was addictive? t~: Let me- ~: Because I very strongly fe~.tt is not addictive. I have not seen an addict and I have tal~ed to man), smokers. My dad included. So I have Page 72 Q: YOU have mentioned alcohol. Let's leave candy out for a moment.They don't have treatment centers that l"m aware of for candy. But they do have treatment centers for alcohoLAnd it's a known addictive substance in some people; correct? A: Yes, it is.Bin may I also add - MR. McDERMOTT: Let me interpose an objectionl I have no objection to your exploring ~he doctor's personal views on this or any other questions.But I would again emphasize that he is being questioned in areas that are outside his expertise and outside the areas in which he is being offered as an expert.But feel free to explore as you wish. MR.YERRID: I will tie it up. THE WITNESS: I wns going to suggest that there are other behaviors such as bulimta, other kinds of repulsive disorders that - BY MR.YERRID: Q: C, ambling~ A: - that art addictDe, that have absolutely no meting efforts and some that may have marketing efforts.And so there once again there would be a broad range of behaviors that there would be treatments for. Q: And I know you don't agree with the fact Page 74 seen very few - I have seen on television people who even with death close to them, of something presumably that could be associated with smoking have continued to smoke. I personally have not seen it. Q: Have you ever visited any cancer wards? A: Yes. I unfortunately have, sir. (i: You have not seen any cancer wards where emphysema victims or lung cancer victims have continued to smoke actnall~ while they are in the hospital in the terminal stages of cancer? A: No, I have not. (~: That would surprise you to see such things? A: I am never surprised. But I think it is quite rare. O: Wodid that affect your belief, your very convinced belief that nicotine is addictive if you saw such things? ~: No. I would interpret that - In fact there is good research on that.That those individnals have made a cost benefit analysis. In ~e sense that they may be near death and they are choosing to live the last days of their life in the way that they see fit. ~: Actually you believe those terminally il/ A. WILLIAM ROBERTS, JR. & ASSOCIATES Min-UoScrtpt~ (21) Page71-Page74

..~..~ffi,~u w. ~v~e~t, t'U.~. The State of Florida v. VoL 1, April 30, 1997 The American Tobacco Company Pa@e 75 cancer patients would be smoking out of choice and enjoyment rather than out of necessity of addiction; ~.~orrect? A: Yes. Q: My question that I asked you to consider, would the advertising, marketing, and promotional campaigns differ if directed towards an addict of a particular product as opposed to a nonaddict of a particular product, assuming that product was ingestible? &: No, I don't think that there is any effect on someone's use of tobacco.A regular user, be it an}, vray you would like to characterize that. I don't believe there is any impact of marketing. except access to the product.But ccttainly not promotion. , O: Would It be fair to say, sir, that in your expert opinion the effect of quote killing fl: $o it's your testimony here today in Los Angcie~ that all the $6 bRlion plus that is spent on ad~etxi*ing, understanding the parameters of the at~eniang dolkirs, discounting, et cetera, but ruing the $6 billion figure you testified about ~,terday, re~t* in not one new smoker being added t~ the smoking ranks of ~ country; is that your umimow/? ~ My testimony was that it ~ not $6 mien bm- l~ $6 million. ~ It is $4.2 bilHoa in the kltest FrC. Bm whatever the amount tmpeaded, they do not add one mw smoker. O: Let's go !rock over it. Wlmth~ we ate talking $4.2 biltlon or $6 l~ion/t is my tecoBection you tetmiflcd about it yesterday. Is it your testimony here today in Los unquote Joe Camel would b¢ nonexistent in term* of comumlxion in cigat~te mage in today's sodcty? &: It will have absolutely no impact on smoking, smoking rates or the uptake of ~moking. ~: A~d would your answer also be the same with regard to elimination of the Marlboro Man? Page 76 O: And with regard to the Wwgin~ Slims [1! commercial, you have seen the young modcis that they ~l use, the very slim modeis with the cigarette in hand? Have you had the oppommity to see those advertisements? A: Yes. In fact I today saw the advertisement in a ~.At least the one I saw w~sn't necessarily very thin. BUt I understand what you are trying to say.I would say categorlcally that advertising, tobacco advertising, has no impact on people's smoking behavior. Except for brand switching. G: I understand.And is it correct, sir, that in your expert opinion the cigarette industry makes no attempt to replace the however number of smokers you've already testified to You are aware of that die each year with new smokers? ~: They do not.They do not do it.And in the absence of advertising we would sdiI have individuals developing or experiment~g and using cigarettes. G: You would agree, would you not, if you are talking about nonsmokers that never start smoking, brand switching is a noulssue? A: That's cot'rect. A=gcie~ that those btliiom of dollars do not add one new smoker to the ~ of~e ~ ~p~fion of ~: ~ ~u am of~'s ~on ~c~ pmdu~, ~ ~c~ ~e~? • : Y~.Va~cly. I ~mc~ ~e Page 77 Page 78 apt~oximate size. I don't remember all of the memage on it, though. ~: The black warning, something to the effete that ~moldag can kill you? Does that sound ~: V¢:~ simliar to the one that is in Autttalia, apptoximately' the same size.And perhaps ev~ inAuswa~ cven more dramatic warning tabeis. • . And it's a coramonweaith country a~ we!i? The connection would be Canada and Australia are ~ I'm more comportable that you describe wire you know.What is the warning in Austraha? /~ There are several waminga in Anstraha. it: Let's talk about the most severe and ~ Smoking Ida. Smoking is addictive. o- Any particular colors? #~ it would make up - I guess no one has a cigarette Imck here.But it would make up about a ~ of.the front of the package, third of the back of the padmge to a ball of the back of the package andnne side would ate be warning.And there would be amamber of them. ~ge "75 - Page 78 (22) Min-U-Script~ A. WILLIAM ROBERTS, JR. & ASSOCIATES

RICHARD W. MIZERSKI, ph;: The American Tobacco Company Vol 1, April 30, 199' Page 70 And the ones that stick out in my mind are that smoking kLlis, smoking causes lung cancer, smoking is addictive, smoking causes heart disease. And there actually are a substantial number of more. The larger the pack the larger the warning'Very striking warning labels. O: Understood. A: Under that environment in which those warning labels were added smoking rates of young people have gone up. MR. McDERMOTT: I don't want to interrupt any particular line of questioning.But you might look for a place in the next few minutes for us to take a break. BY MR.YERRID: Q: So to ~ regardless of the dollan spont o~ the adveniscmcot o£ cigarettes, marketing of dgarettea, the promotinml efforts cigarettes '-,rid their manufacturers, no new smokers arc creared; correct? A: Because o~ that activity. O: Because o~ that activity? A: Yes. Q: Convencly, regardless of the size, shape, description and prondncnc¢, if you will, Page 80 the warnings against smoking, what has happened in your own experience in Australia, the smoking rates for youth smokers has escalated. A: That is correct. It has always. Because we can't put it all to the warning label there is also a ban on tobacco advertising and sponsorship since 1992. (2: In your judgment that has had no beneficial effect? A: Those activities appear to have had no beneficial effect except to provide people with information, Whether they act on it or not is another question. But it is simply that activity has not, in and of it self. apparently, affected the number of new smokers, patticularly in the age group that you were talking about. ~: What about the point of sale? A: There is also tremendous restrictions at the point of sale. I don't believe that there can be any displays.There can only be limited displays, very limited displays. O: Very regulated displays? A: Very regulated. O: And in tenus of the sale to minors very regulated? Page A: Very regulated. Sting operatious.A tremendous amount of coverage it the news media abo~t ~it. Q: And just for my own clarification, I have not been to Australia, But in that country With regard to enforcing the prohibition of sales against cigarettes to minors wonid you say the Australian government h~ done a ~uperiative job of doing that without having any beneficial ~: Yes.As a matter of fact the distribution is even less than it is in the United States.You can't buy it, Only at tobacco shops. O: But the point is that regardless of enforcement the most rigid enforcement in Australia has had no effect on the minors and the youth smoking escalation of rates? A: That is correct.There doesn't appear to be any effects in what is happening with youth smoking. O: Would you surmise, then, sir, based upon your marketing and promotional and marketing expertise that if the same type of en/orccment were possible in the state of Flortda'ff'womd make absolutely no difference to the amber of yotmg folks that smoke? A: I would not expect in and of itself they would. It needs to be a change in society. Q: I understand that and I'm not at all showing disrespect on your other bases of opinion. I'm just talking about enforcement of sales to minor. A: That is correct. O: Having lived in the stare of Florida with regard to advertising, marketing and promotions, do you find fault with the state government or the police departments or the regulatory agencies or law enforcement in not doing their very best to enforce the laws of the s~re against minors smoking and purchasing of cigarettes? A: WeB, I'm aware of restrictions on selling cigarettes to minors.And I fully support that and I think that is the most important thing that can be done. Q: To the best of your knowledge is the state of Florida doing very well in that regard in terms of not selling to minors? A: I really couldn't make a statement as to whether the}' are doing their best. I really don't know the rate of conviction or arrest or these kinds of things. O: But from what you have observed would you Page 82 WILLIAM ROBERTS, JR. & ASSOCIATES Min-U-Scrtp~ (23) Page 79 - Page 82

tus.~qAx~J w. ~t~.a:~Kl, PILD. The State of Flortda VoL 1, Aprtd 30, 1997 The American Tobacco Compa~. y Page agree with me, sir, that the sales to minors is not a contributing factor to the incidence nf youth smoking our state? A: Actually my experience has been that d~ere/sn't enough enforcement, hasn't been in the past.This may have been changed with the new view on tobacco consumption.But there appears to be a number of areas, certainly around my expo~ience in north Florida where youths were able to obtain stages of the smoking experience. Page 85 cigarettes more easily than they should have. Q: Yet you wonid also opine that even if enforcement were a hundred percent possible it would have no effect. A: No, I think what ! was talldn$ about- We're talking about enforcement on dism'budon. Q: Yes. A: I~ there was hundred percent enforcement on distribution or improved enforcement on distribution I believe it would have an effect. Ch What type of effect? A: It wonid cut down the opportunities for individuals to obtain cigarettes. Obviously you need to obtain cigarettes in order to go on and move on beyond experimentation.That is a critical factor. Obtaining the product is a critical thing. Page ~: That flrg cigarette, the inhalation of that first bit of nicotine is a critical point in one's life, isn't it? A: Yes, it is.And studies have suggested that your reaction to that first peff or that fltat cigarette is critical. O: And you would agree, although you disagreed that nicotine is addictive, that the definition of addictive in terms of drug usage precludes f~edom of choice? You would agree with It appears not only with cigarettes but a broad range of drugs that people need to appreciate whatever the drug does.And I would not expel.in effect the research suggests that it is not nicotine that has any impact on that first cigarette, it is the handling and consumption }ust of the smoke that is critical. BY MR.YERRID: Q: I think when you read the transcript you will see that we did switch gears.And my question really dealt with addiction.And I'm not suggesting to you that addiction occurs with the first puff or lnhalatiun. I'm talking about the latter stages of cigmette smoking. Assuming, and I know you don't, assuming that addiction does occu~ you would agree that taking the assumptina that addiction occurs, you would agree that addiction precludes f~eedom of choice in terms of your advertising marketing and promotional ~. A:I don't believe that at aft.There a~e mlifions of people that quit smoking cigarettes as well as many othc~pmducts out there.And so it's c/ear that people are able to quit a broad range of that, wouldn't you, sir? MR. McDERMOTT: I object to the form of the question.You haven't laid a foundation. Go ahead and answer it if you can. THE WITNESS: I cannot answer it "Yes" or "No". BY MR. YERRID: O: I would request a "Yes" or "No" and then products. Q: including cigarettes? A: including cigarettes. Q: You would dLmgree that nicotine addiction is more habit forming and more addictive than cocaine? A: Absolutely that is ridiculous statement. I realize it has been said a few times. I have heard Everett Keep say it and I have looked into the basis for it. Q: I believe cotmse| has a good objection at this point. Let's call time. I'm not asking you to opine about Dr. Keep. nut I will ask you to think on this for lust a moment and let's take our break. How ddiculons is the statement to you that nicotine is addictive? A: I think it trivializes the term addiction.That it doesn't fit into the character of addiction in a metering use or people looking at compulsive behavior. U: Didn't you have a definition of addiction and supply it to us? A: This is how media and other indiv/duals have looked at what can be addictive. But I would rather- I will also suggest that one rake a look at you can explain. MR. ~¢~:DERMO'I3": He may not be able to.He can answer but let him explain. THE WITNESS: Let me respond to what 1 think you asking. But I don't have a problem. I don't believe the nicotine aspect era cigarette is critical in the first puffs of the cigarettes. R is the harshness, whether it makes an indNidual cough.There is Page 86 tge 83 - Page 86 (2g) /Vlln-U-Script@ A. ~rHJ.IAbl ROBERTS, JR. & ASSOCIATES

The .~maerican Tobacco Company VoL 1, April 30, 199' a very good article out of Consumer Research that addresses this very topic. (2: Let's leave that ro the break. My Page 87 question i~did you supply a list of addiction in.minces to us for the purposes of your deposition? A: I think it would be more appropriate it said quote addictions. Q: WhalerS. But I recall seeing a piece of paper. Was that from your input? A: That is correct. (2: Let us locate that and take ten minutes. (Recess taken.) BY MR.YEFIRID: O: Sir, referring your attention to ExhtXHt 11. is that the two-page document that was referenced pr iously? A: Yes. (2: It has a number of addictioos, and that is in quotes.What do you attribute the quotes around addictions to signify? A: Meaning that these have been used, these have been interprotcd as addictions but they haven't been validated. In other words, this is sort of, and in quotes, meaning pataphrasc, the people have suggested or have believed or these would be used for the term of addiction. Page 88 Q: And there seems to be two pages.One page being the page under addictions and then a sefond page, it is same terminology in quotes yet it looks like chronologically linked to certain periods of dine. A: That is correct. Q: And does the first appear to have all the ttmm used oa the second, except the second page has .~,l caffeine just in a different form? ~'~ A: Yes.That it would be quote addictive. O: So there are no illegal products on there that attempts to engage in the terminology of all legal ptoducts that have been at some point in rime designated to be quote addictions. Does that capsulize what the significance of that 2-1yage document you produced here today is? ~ t~ A: I sort of didn't understand the whole , t~ thing. Could you repeat that, please. ~ ~ (The pending question was read.) ~[,0~ THE WITNESS: These are all legal products that have tm been oRen referred to as addictions in the medi~ or l~ various sources of the media. p~ BY MR.YERRID: lul Q: I notice on the third column about t~sl halfway down the name of Frank Sinatra. Frank p~ Slnatra has been considered by someone who put that u~ list together as being an addictiun? pal A: Yes.And I was looking to have Elvts Itt~ here.And I think that has been left off. cot Q: And maybe today we would put Celine ¢~1 Dinn. But those are the types of persons and p~ addictions to personages that is iZlustrating? luj Q: He got the Congressional Medal today so [~ tmybe he is a Congressional Medal winner as well. the dates linkage? A: Yes. (2: I looked at that document yesterday. Where on that docuroent is cigarettes? A: It's not on here.This is a document that discussed other products. Q: And I would likewise assume them Is nothing on there with regard to nicotine? A: That is correct. Q: What about cocaine? A: These would bc looking at legal products. Q: What about caffeine? A: Coffee is in here. Q: So you would denote that coffee v~s " Page 90 MR. McDERMOTT: I notice taxes aren't on here. MR.YERRID: They arc habit forming. MP,. MeDERMOTT: So we don't have government addiction to taxation.That was omitted as well. MR.YERRID: You can put that on the record, bun that wee taken comment was f~om my Washington, D,C. colleague, the cenrer tax city. ~: SO whoever compiled that list -Who did compile it? A: I don't race"act at this point. I would have to speculate, l believe I saw this at a conference and there was some discussion again of the Uivialization of addiction. O: To be very serious, addiction has detrimental consequences tq health, such as extreme sickness or death, and is not to be trivialized.You would agree with that, wouldn't you? A: Absolutely, I would totally agree with you.And what I would be more in tune to talk about in terms of addiction would be when a product or some behavior becomes a center of one's existence. ~: Do you believe -You have seen a lot of war movies and you have seen a lot of westerns. I am sure you have seen a lot of film productions where people, actors, are portrayed on the screen in their A. WIIJJAMROBERTS, JIL & ASSOCIATES ltCln-U-Script~ (25) Page 87 - Page g0

,.,,-..~.,,~m.~ w. ~v~s.~, ~*n-u. The State of l~lorlda VOL 1, April 30, 1997 The American Tobacco Compa~.y Paga dying moments and they ask for a cigarette.You have seen that, haven't you? ~ A: Sortofatrnism.lcan'taclually :call that. But if you would like to make a ,]ypothctical. Q: No. rm jnst wondering ff You had seen that in the film indnsuT, the typical situation where someone is - I think Cllnt E~wood was in ~Thc Good, Bad and UglF" came upon a dying soldier cigare~cs. Q: In any form do you bulicvc nicotine is addictive? A: I am not aware of other forms that it can be taken.And really couldn't say. Q: Do you believe that the cigarette indnsu~ is simply in the business o~ selling nicodnu? ~: No. a~l he lookexi up and asked for a clOtuRe from Ctint p~ E~wood.And Cllnt ~twood put his ci~t in his pq mo~th, You have seen those dying scenes, haven't YOU? A: I don't remember. But | accept that they have happened.And I have seen melodramatic reproductions or com/c reproductions and I would accept it. G: F~om a standpoint of marketing or promotion or ~dver~Ing expertise, does that lend credence to the fact that that Is ~ slgn~cant thing to do, that smoking Is something that IS very manly or in the face of death one can do this pan/cular A: It's a melodramatic presentation. I'm not exactly sure what it is supposed to represent. But rll go along that it happens. Q: rm ]nst not sure whether I saw Frank Sinatra die in "From Here to Eternity." But I recall somcthin8 about a cigareRc being placed in his mouth.What I'm wondering, does that have any lasting impact upon a youth or a child that vinws such a movie? A: No. G: And you would disagree -And I have mad your agiclc and I will got into that tomorrow, I will leave that for tomorrow. But you would agree that there is no later recall in subsequent yc~s that is prompted by carl)" exposure to adve~ising and promotional efforts, that would prompt a purchase of a cigare~c product~ A: That is cermet.As ! understand that's what I dealt with in my l:~micular articlc.Acttmlly tested that p~ticular theory. Q: That hypothesis. A: Yes. ~: Wc talked about nicotine being addictlve.And would you agree or disagree with the following statement, "Nicotine is addictive"? A: No, not in terms of the use in Q: Do you believe that the cigarette industry IS in the bnstness by their own acknowledgment of selling nicoULne, which they term to be an addictive drug? MR. McDERMOTT.~" " ^~I object to the form of the quemion and the use of the "the),." IfI recollect the article orthe piece of paper from which you are reading. BY MR.YERRID: Q: You can ;mswer. . A: rm sorry; ! lost what ",he qnesdon was. Q: Do you believe that the cigarette industry at anytime in the [~t four dce~des had the vlew that nlcotlne - that it was - that the cigarette industry was engaged in tbe bnsiness of selling nicotine and Rn-,her nicotine ~ an Pa9~ 93 Page 94 addictive drug? A: I don't have information to that effect. Q: Would that information surprise you? A: I'm aware that there are various kinds of documents out there. I have not reviewed them. Q: Do You be!love the admissions made by a particular pe~on in the advertising or promotional or-What is the other area you have? Marketing. MR. McOERMO'IT: I shonid add consumer behavior and consumer decision-making, too. But suffice it to say it is laid out in his expert disclosure. BY MR.Yt~FIR[D: ~: I.et me get them all down. I can get these tomorrow but he's fight I have to add these, consumer marketing and consumer disclosure. MR. McDERMOTT: Let me refer you to l/xhibtt 2~. MR.YleRRIO: I agree with you counsel.That is more expansive and I have been limiting my question to the three categories in the Mississippi case. G: But using the advertising, promotional, marketing, consumer marketing, consumer disciosme, all the areas of your expertise that were disclosed tous? MR. McDERMO~I': I think I said consumer behavior and consumer decision-making. tge 91 - Page 94 (26) Min-U-Scrlpt~ A. ~VIJ~LIAM ROBERTS, JR. & ASSOCIATES

RICHARD W. MIZFAgSKI, ,American Tobacco Company VoL Page MR.YERRID: Let's add that. Consumer behavior and consumer decision-making`Anything else? MR. McDERMOTT: Well, again if you scant to say "within your area of expertise" that is fine. MR. YERR[D: That is what I will say. MFL McDERMOTT: That will encompass all of the areas set forth in his statement and I will accept that. BY MR.YERRID: Q: Within your area of expertise as incorporated by the F|ortd= disciosur¢ statement you made, as opposed to the Mississippi disclosure. MR. McDERMOTT: F, xldbit 24. BY MR.YERRID: Q: Do you believe that the admb,dous era internal docum~nta is trutkfuL~ MR. ~OERMOTT: I object to tbe form of the question. It is compotmd. It covers too tuan}' documents.And the use of the word "admlssion,¢ is a legal term of art. I don't thit~ it is p~oper to ask this wtmcss a general question covering every statement and every document by every defendant in this industry or any indusuT.That is Just too broad. MR.YERRID: I understand. Page 96 BY MR.YERRiD: Q: You can auswer. MR. McDERMOVr: If you can. BY MR.YERRID: Q: Do you find in your areas of expertise that internally comments made about the characteristics era manufacturer's own pmdnct are usually something that is to be relied upon, or do you find them to usually be false? A: Oh, I found them to be false, I found them - l'm not talking about tobacco. I have worked with other industries and I often find their statements of interpretation of what happens is if it is incorrect later on aher we do further research. Q: What about a statement that is made by a manufacturer of cigarettes, that selling nicotine was the business of the cigarette industry and that nicotine was an addictive drug. Do you think such a Page 9' individual and the facts that they were using. Whether they were simply using an interpretation of what they thought was reality or not. I really don't have any basis to make a decision whether it was truthful or not, or accurate. BY MR.YERRID: Q: So even internal documents of a cigarette manufacturer may be false, is that what you are A: They may be faise, they may be inaccurate. I don't know. Q: Were you given any documents, internal documents, that stated that, in an executive capacity in-house, that the cigarette company this particular individual was employed by was in the business of taring nicotine.? Were you ever given that documem? ~: I was urver giw.n that documem. ~: Wo~Id it change your opinion in any way? &: About whaO ~: About an}, of the opinions that you have in this case? A: No. Q: Wou/d the fact that that~xicular cigarette manufacturing executive said that nicotine was an add/calve drug. wnuld that change your Paga position in any way? A: No, Q: if Zeus came from down high and said nicotine was addicth, e would that change your position in any way? MR. McDERMOTT: I object to the form of the question. YOU are badgering the witness. MR.YERRID: That is not badgering. I will let the judge answer that. Q: Answer that, please. A: If Zeus came from on high? No. Q: I didn't want to use religion in this way, that is why I used Zeus.The question has been~ asked and answered before. Do you bellcve that nicotine consumption causes or predisposes one to lung cancer as a consumer? MR, McDERMOTr: I object to the form of the statement would faU into a statement that should be believed or disbelieved if it was in the words of the manufactm~r itself?. MR. McDERMOTT: I object to the form of the question, no foundation. THE WITNESS: I don't know whether it should be believed or disbelieved. I would have to Imow the question.You arc way outside his area of expertise. MR.YERRID: I don't agree with you counsel. I think if I asked the question in a vacuum I would agree. I think I will tic k in.Bccauac it goes to his state of mind as to what should or shouldn't be done in advertising, promotion, meting and consumer A. W1LLIAMROBERTS, J1L & ASSOCIATES Min-U-Scrip~ (27) Page 95 - Page 98

Ktt3~tD W. MIZERSKI, Ph.D. The State of Plorida v. Vol. 1, April 30, 1997 The Kmertcan Tobacco Company dccision-m~kln~ and consumc~ dJsdnsurc. I understand your objection but ff you ~.,gnderstand this is a preliminary basis for what wili :t up a predicate question, then you can state your objection and I will continue. MR. McDERMOTT: I wili let you explore his personal beliefs. I will not stop the questions at this point. But this is asking for the toxicological impact of nicotine, which strikes me as being reali}' far atield. BY MR.YERRID: Q: Let me ask you this, tit.The advertising that you have seen, do you believe that accurately reflects the beliefs of the client yon have represented, RIP?That cigarette smoking causes c~)ccr. Q: Do you believe r, hat the warning label that cigarettes can cause certain cardiovascular disorders is faise and misl~flin~ el factor. I don't know the degree one would move from el risk factor to causal. But it is certainly a risk el factor. tot Q: Do you believe that a medical condition ,! - Strike that. (,~ Do you believe that the warning label tnl with regard to dsamtte consumption causing t,~ emphysema is false and mlsleadinl~ pq A: Are we talking about the present? cancer, causes emphysema, causes heart disease? pq MR. McDERMOTT: I object to the form of the question pTi as compound.What advcttisin8 he ~ seen.What arc you talidag about? Tlds is realiy g~tttng awfol vague. BY MFLYERRID: Q: You can attswet'. A: The only advertising I have seen is some recent adverdsing.All of thut advertising has warning labels on it.There is an enormous amount of Page 100 health information out there. People don't even nccd Because I believe that emphysema b noted in the present labels. eq Q: Yes.in the present. pot A: Idon'tknowallofthepresentwording. tea But I would accept that dgat~tes can have an impact tzt! aad cause emphysema, certain forms of emphysema. ~t Q: Would you agree, slr, that under th~ ~ eurtent state of affalm that those are thing* that t~ should he known to the public without regard to the t~ effect, those are thief# that ce_,xa~y, I think in [q your words, wouldn't hurO el those warning labcis, although I thidic it is fine to el have them.People are well aware of the health ~ consequences o# smoking. ~ O: What is the basis of that opinion? el A: Surveys that have been done for man}, ~ years, including surveys that I've done. el O: How about surveys of the cigarette Page 101 Page 102 A: It is known to the public. Q: But those types of warnings certainly can't hmx the public's awareness.You would agree with that, can't you? A: That's true, can't hurt. Q: And for those individuals that don't Imow, even though they should know, those individuals el manufa~xtrers, do you think they have disseminated pot the information that nicotine and the consumption of [HI cigarettes can cause all these health diseases that t~ are now on the packaging of cigarette cartons? P~I A: I don't know. MR. McDERMOTT: Would you restate the question. I [*~ don't understand it. [~b3 If he answered it maybe we can go on. pq (The Reporter informed counsel of p~] the w~mess' answer in the record.) BY MR.YERRID: O: Do you believe that the warning label that cigarettes cause lung cancer is fabe and misleading? 'Tes" or "No"? A: No, O: What is the basis for that? A: I believe that cigarettes can cause lung wili be weli served by such label& won't they? ~: I doubt if there would be individuals who don't know those factors. Q: Well. sir, I submit to you that there are some individuals in this country that don't know the name of the president.You can just basically assume that there ~ some indivlduais that'don't know all of the effects of sumking. I jus~ want you to assume that. p~] A: Okay. I can assume that there ate more [~ people that know the health cffcc~ of cigarettes pot than know the name of the president. [2q ~: That I wouldn't get on with regard to p~ this or an}, other president. Let's just say that you t2~ would agree that there are some individuals in this fa! country- Strike that. r2s~ Would you agree that there are Some 'age 99 - Page102 (28) lVlin-U-$¢x-ipt~ A.~rlLLIAlVIROBERTS, JIL & ASSOCIATES

The American Tobacco Company VoL 1, AprLl 30, 195 Page 103 [q incfiv/duals in the state of Florida that do not know ~ the risks of smoking? Absent the warning labels and tel the health advertisements that are being promulgated (el MR. McDERMOTT: Objection, no foundation. ~ BY MR.YERRID: el Q: Would you agree or disagree? tel A: The only individuals that I can t~ comprehend or betievc that they wouldn't know the ~ health e..ffc~ts that you are talk/~K about would be ~i! individuals who would be institutionalized orin some [1~ way that they are unable to understand. Perhaps ~ could be a mental deficiency, pedmps could be some {141 other aspects. It could be a wide range.There is a psl very high level of health information out there and [*el people's knowledge of health information. It has t171 been there for quite some time. l~q Q: I want to ask about that. For quite some ~,~ time.You have now op'med that people in mental taot institutions may not be aware of the health risk te~! associated with cigarette smoking; is that correct? ~ A: Well- t~l Q: That is who you referred to when you were p4! saying institutions? te~ A: I was giving some suggestions about Page 104 t~| that. I wasn't talking about prisons. I was talking ~ about health. I at one point had a wife that called t~ at Surdand or Sunny Iand. I forget the terminology. tq And I spent quite a bit of time understanding the ~ situation of individuals in that particular state who ~I had some mental problems.And it appears to me that t'0 there are individuals who simply are not aware of a tel Jot of things.And certainly those individuals or ~1 individuals like that would not be aware of health {~01 information. (11! Other than that, I believe there is a p~l very high level of health information. [1~l Q: And you used the word ~and have had this {l,t information for quite some time." Do you recall [I~I saying that? ~l ~: Yes. ~1~ ~: In terms of years, can you quantify ~le~ that? How long has the public in your words, with a ~1~ very few exceptions, had all this information.~ ~1 A: Well, this health information, of course ~11 the level may differ. But health information has r~ been around since I bet/eve the late th/rties and tz~| forties. In 195~31 think there wa~ the Kcttering ~ Sluan experiments dealing with mice and a great deal tes'] of pubt/city surrotmcfing that. CertainJy into the later fifties and 196~ when the surgeon gcncrsl ,'=me out with the surgeon general report on smoking. There have been tracking studies from certainly the fifties on looking at the level of health awareness and the impact of smoking on health.And those have been quite high. Q: From what sources do people in Florida receive information regarding the health cheers, the adverse health effects of cigarette smoking? A: Broad range of sources.Well, it would be the media, an extensive amount from the media. Various health care professionals, such as their doctor~, schools, social agencies. Perhaps as important f~m other indiv/duals who they respect and believe. Q: How have about the cigarette indasu'y? A: Cigarette Industry has provided it through the warning labela for quite some time. ~: That is became it hat been required of the cigarette industry, isn't that so? ~U I don't know. Q: You worked for the FrC. Can you give me one instance where the cigarette industry has acknowledged the hazards of Cigarette smoking publicly to the citizenw of Florida, or any other Page 10 Page 106 tq state, for that ruatter, in a voluntary effort? t~ A: I'm just not aware of that kind of ~ information. tq Q: Are you aware of one instance in the t~ history of advertising, marketing and promotional ~ efforts undertaken by the cigarettes industry r0 directed towards those means? ~ A: I just don't tecall.Weli, I willgive ~ you one instance.And that would be the document ~,0] that we saw the other day.And I don't remember what t*q it was. t~ O: Frank statement to smokers? pal A: No. It wasn't that. I don't think that l*41 document was here. I think it was the document o~f a its] program for I~R that notedin there the health t*~ warning. [*~1 Q: I will show you what has been marked as psl Exhibit 7.You have inst acknowledged to my [~ colleague on behalf of the State of Mlsslssippl that t~ that was the documents tha~ you were recollecting? [~,! A: That is true. [-~ ~: Show me the passage or any part of that t~ muhi-paged document that talks about the health ~4! effects, the adverse health effects of smoking t~ cigarettes. A. WILLIAM ROBERTS, JR. & ASSOCIATES Min-U-Scr/pt~ (29) Pagel03-Pagel06

RICI:L~RD ~-. ~K], Ph-D. The State of Florida v. VoL 1, .~ril ~0, 1997 The American Tobacco Company;. Paga 107 A: "~bu~ pco~c ~m a~m of ~c c~ ~t ~g ~ ~s to one's h~l~.~ ~c ~n g~'s ~ ~tcmcnt. by ~c ~e ~ey a~h~ ~ ~c ~ ~o~ be~es ~at s~g ~ ~ ~ o~'s h~. ~: ~m ~g ~ ~m a s~con gcnc~l's ~tc~ ~n I pm W you ~, show ~ ~ ~ ~ ~d~ ~ a~owledged ~ a ~l~ ~c a~ ~c~ of s~g to one's h~ A: I ~nt ~ a doc~ut or I don't have a g~ ~D~: ~e ~oc~ent ~ w~t R ~. ~ a~~ ~t ~e~ ~ a~e ~ ~ ~ m s~ ci~? Y~ or no? Page 108 m ~i¢ r~le C~e manufacturing • ~e~ ~o~ a~e ~ks, ~e ~on ~ ~ ~e o~ o~e I have access to ~ I ~i done ~ ~c~ s~ ~e~le~ ~e ~d ~e ~e ~ ~ted ~ ~e 195~ and '~? I'm ~ ~ of ~e ~c~r How ~m ~e ~es and Ym ~ ~ ~en ~u ~ on ~e scene at ~e ~C, ~ ~ g~ ~ ~e ~on of~e ~ ~ ~o~ ~ te~ of ~ ~d ~o~e l~.~e~ ~ a ~ ~ ~e ~g at ~at ~e~ .~ I ~ ~e s~eon genenl reported something that cigarette smoking can be hmmdnus to your health. Q: Not are or can klil you or things like that. Nothing as strong as today's warnings? A: It didn't have the phraseology that you are noting. O: Would you agree that today's phraseology is much stronger, much more explicit than that phraseology that was fits! u0aized? A: Yes. But it is inreresttng that you note that.Because I did research during that period for the FTC that looked at the health awareness. It was quite high.As a matter of fact there was no difference~ between smoke,s and nonsmokers. In many cases they overestimated the health risks. Q: Are you done? • : Yes. MR.YERRID: I want to move m strike all aspects of the last answer as nomusponstve except for the first phrase. Q: With regard to the warnings that the regulator, in this case the Frc, requlred~uld you agree or disagree as a former employee ol'that regulatory agency that today's warnings are much more stt, ingent, much more direct, much more encompassing Paga 109 Page 110 and much more informative than those warnings rust utilized in the 1970's? MR. M~DERMOTT: I~t me interpose an objection here. Among other ddngs - MFLYERRID: I w/ll bre~: it down. MR. MnDERMOTr: Well, It is compound. But presence, the ~tct of presence is such that the v~dngs required b)" L~w ~c as they are and were as they MR.YERRID: Ex~crJy. MR. McDERMOTT: That was up to Congress and the surgeon general and the ~rc. If he has an opir~on on the efficacy of those warnings that's fine. But I'm not sure that you've established his expertise.You may want m lay a foundadon you ma~ not. But to the extent that you are challenging the warnings, we think that's out of bounds because of the policy of preemption. MBoYERRID: I wlil respond to that objection in this way. Hrst I think that Cornel! Iaw Review article, which I am sure you read, puts that argument to rest very n;cely in reciting the case law that is deveaopcd in the preemption arguments. I will engage to supply it m you. age 107 - ~ 110 (30) Mtn-U-Script~ A. ~ZILLIAM ROBERTS, JR. & ASSOCIATES

The American Tobacco Company VoL 1, April 30, 19~ (q P) P~ l'~Ol pal l~] pal Page 111 ! am not challengL~g the adequacy of the warnings. I am simply asking this particular witness to compare the warnings that existed to those that exist today without regard to challenging the sufficiency or commenting on the adequacy or even commenting on the preemptive argument that you have so eloquently made. I'm just asking a very simple question.And I would like the answer. TIdE WrFNESS: Present warning labels provide more information.They arc more direct in sornc cases. In t~01 some cases they may bc difficult to understand in that they put a number of different health risks in the same warning. I haven't tested these health warnings l~41 but I have tested earlier warnings.And I would suggest that them may have been other warning options that would have provided simpler language, more direct language that could impart equal amount ttSl of information. ElY MR.YERRID: Q: Before your now present resident country L~tl of Anstmlla and before the present yearnings were utilized that cigarettes can kill you, were the types of warnings that we used in the United States were the predecessor warnings of cigarettes can kill you? Page 112 A: The previous warnings - I'm sorry.Were they the predecessors of this, the ones that I tested? MR. McOERMOTr: You are asking about the AusLmlian predecessor. BY MR.YERRID: Q: If you go hack to the commonwealth warnings oftbe present day, cigarettes can kill you in black and an the areas that there are indicated on the packaging. Prior to that were the warnings very similar in the commonwealth countries of AustraLia and Canada and UK to the warnings that we presently use in this country? A: I'm not sure. I really don't recall what the warnings were previous to the present ones. O: Is it important to know what the intent is of the particular manufacturer of the product you are attempting to assist in advertising, meting or promoting Its affairs? ~: It would depend on what you were trying to do.1~you were trying to ftnd out whetber the marketing program was fuLfill/rig certain objectives they had, then the intent would simply be to suggest back to the manufacturer that their intent was perhaps incorrect for that parricular objective. So intent often is really not terribly important. It is actually what did they do. Q: You have already stated, and I don't want to rehash it, the intent of the cigarette industry, is to do what, to maintain loyalty to a particular brand and stop switching to other brands? A: Yes. Or to get other brands, have people switch. ~: To acquire new customers from competitors. A: From competitors, smokers, yes. Q: Is it important to know the intent of the manufacturer, the cigarette manufacturer, in terms of what effect it intends to have on its product users? A: important for what? Q: Important for your activities in how to advise them to advertise, promote or commercially exploit their product. A: Well, if you arc talking about what are their ob]ecdves, it Is important ~o know what their objectives are.After my evaluation of their marketing to tefi them whether.that would be the kind of activity that would ~ their objectives. G: What is your understanding of the cigarette manufacturing indusu'y's primary intent or I*] goal, as you sit here toda# t~ A: To get the largest share of the smokers, ~ adult smokers. vt] Q: And how do you believe they intend to do ts~ that? t~ A: By keeping their franchise of smokers, el adult smokers, and to get adult smokers from other ~ brands. I t~ Q: And you would agree that one oftheir ,po] prin~ry goals is to supply each cigarette user with (lq an adequate dose unit of nicotine?. [~ A: No.As a matter of fact there is a [~ substantial amount of research that suggests that 11~1 there are many other factors that have an impact on (ls~ whether people continue smoking and their enjoyment ]*~1 oftbe cigarette.The things that are not tied in (*~1 with any kind of nicotine. tlal Q: Do you believe that the industry, the (I~1 cigarette industryin particular, was ever of the t~ notion that the primary goal was the distribution of ~q nicotine in appropriate dosage to its cigarettes ~ customers? MR. McDERMOTT: I object to the form of the question. it is compound.The industry is a bunch of companies and a bunch of people.rm not sure you have A. ~;rILLI2LM ROBERTS, JR. & ASSOCIATES NIin-U-S~-ipt~ ~1) Pa~e 111 - Page 114

tttut~_-,~.~ ~..~..~-.:~-..~, PILL). The State of Florida v. VoL 1, AprU 30, 1997 The American Tobacco Company. Page ~cablished a collective cons~ousncss. ~E W~N ESS: I'm not a~ ~e~e, whoever ~e end~ ~t BY ~: You ~ve been do~g what ~u ~ been ~g for 22 y~, I ~ you ~d? ~: Wo~d ~u a~e ~at ~ ~ to ~e ~e ~d~ ~e~ ha ~Re~e ~ke~ to ~ b~d? ~ Oh, I don't Q: You A: ~ ~c~ ~c~ p~du~ ~go~ ~u ~ ~d ~o~oOes,~ how ~ey ~d ~: ~ you a~ of any ~n ~c~ ~d a ~on ~tc~ of p~se b~ o~ed ~d a~ed u~n ~ 116 o~er MR. McDERMO~: With~spc~ww~t,~to ~e~g or o~er BY MR.YERRID: Q: With respect to general activities. A: I am unaware of common meetings where they agree on any activities. Q: Would you find that unusual, where competitors actually get together in the same board room and dialog strategies and implementation of strategies and patterns of conducts? MR. McDERMOTr: I object to the form of the question as compound.And k really doesn't lend itself to this wimess' area of expertise.There are a lot of imtances in which industries and competitors can meet for various proposes. MFLYERRID: You are going to have to quit testifying. I understand you are trying to make a record and I understand your objection.That isn't a speaking objection. In our state it is fxx)wned upon. I will suggest to you with all respect that you really ll~it your objections to nonspeaking objecdous. State the grounds.And I understand that the grounds are reserved, save the objection to ~e form.That hardly in our state would be Page 117 considered an objection to form.It would be conside~d a speaking objection and inappropriate. So v~fft ~t understanding that you are not a nat, real practitioner in our state I suggest to you thatyou might vnmt to ref~in ftom doing that in the futme. But if you continue I will have no altematite but to take remedia| action. You g~,ahead and do what you ~eant. I ~ ask "~u the question agaln.Would you read hack the questfon. (The ~eportea' read the pending questiom) TH~ I~I'N~SS: r.m not aware, I am not porsoually aware oimeeting$ where manufacturers got together. Where tie purpose you are talking about was common strategies in tenm of matketln__g. BY MR.YERRID: Q: Ateyou aware where common usage occu_rre~that is ma~cting ~ I believe you used Ham in ~our data gathering in 199~.~ere you aware where the dgarette bdusu7 utilizes a particular Q: Ha~ you ever seen a Philip Morris Page 118 documc-~ - Strike that. Whatwas the awareness of the public in the 1970"s as far as cigarette smoking is concerned and the Imzards associated with that activity? A: It *muld depend on the hazard you are talking about. Q: Demh. It is a pretty significant hazard, ~)uldn't you agree? A: The so~eys that were done didn't ask specificagy that waT.They would have questions such as, well, they would aste it a broad ranse of ways. I htre done some of those surveys myself. But typically they would ~ay:. How many people wliI get lung cancer who were regular smokers? Or, how many people wire got inng c~mcer would die of it? Or, people ~ were smoking got hmg cancer would die. So them would be several facets to it. So that's t~e kind of questions.And then you were asldng mewhat were the levels. It would depend on the question that would be asked. (2: Do l,)u think that the avatr~ness of the hazards of cigarette smoking were commeusmte with the awarmess you believe to exist in the present society wth regard to cig;u'ette smoking in the 1970's? • ge115-Pagel18 (32) Mia-U-$cript. A. WILLIAM ROBERTS, j-R. & ASSOCIATES

.~.- .~ .... o* ~'.o..,~:. "~'. RK:HAICJL) W. ~*G., FIx The Americ=n Tobacco Company VoL l, April 30, 19,. Page 119 [q A: In the 1970's the information I had it ~ was q~ite high. Depending again on the aspect that ~al was being questioned about, did not seem m be m significantly different than thc¥ are today. In fact ts~ in many cases they would overestimate the risk of Is] cigarette smoking. ~ Q: And since you have delved into this area, t~ can you tell me what the origin of that inforraadon ~ that caused that awareness was?Was it f~om p0] governmental sources such as the surgeon general or [lq public health groups, or thcAmerican Cancer Society, tl~l things such as thaO t~l A: They would bca broad range of sources of 041 trdormation. ! don't know what caused each vs] particniar respondent.But they would be from t~ newspaper articles and magazine articles and material 0n they would obtain from their doctor.And what they ~ would hear from their ~'icnds. V~l Q: And were any of these origins inclusive gel of the cigarette manufacturers and bases of t211 information disseminators? ~l ~: Iamnotawamofanystud}'thatactuaR}' r'~ looked at what was the origin of that particular tul opinion. Probably their opinion was based on a broad t'~ range of information &om a lot of different sources. Page 120 Q: The person that you like to sometimes think about, John Q. Public, did he ever get, he or she ever get any information in the seventies that wasn't mandated and required to be given by the regulators or other governmental entities, from the cigarette industry? MFL McDERMOTT: Object to the form of the question. BY MR.YERRID: Q: "Yes" or "No" and you can explain. A: I don't know. Q: Do you know of any as you sit here today? A: I don't know. Q: And you have spent how maW years in this area.7 A: 17 years. O: And you cannot name one instance where the tobacco manufacturers, the cigarette manufacturers, have let the public know other than through required dissemination of information of the r/sk of cigarette smoking? MS. McDERMOTT: Object, argumentative. BY MR.YERRID: Q: Isn't that correct? A: I don't recall.There may be material out there. It isn't something that I can recall at this moment. Page 1: (Recess taken.) BY MR.YERRID: Q: The opinions that you~'c referenced in terms o.f the awareness of the dangers and the hazards of cigarette consumption, were those opinions refflcctcd in Gallup polls that you reviewed?What was the basis for that? A: They are actual/}, a number of different po/Is, Gal/up, Har~. Polls that were done by other agencies like, I believe, Walker and Burke and Chliton. Q: Any other polls? rm not limiting you to those.An}, other tbat come to mind? ~: Those are the ones that I'm personally aware of. ~: That is what you are basing your awareness of the gcnetal dtizcmy to these hazards? A: Weft, yes, those specifically that I have had some contact with, yes. Q: You've referred to companies targeting adnit smokers.Are you aware.that most smokers statx before age 187 . ~ A: Start meaning? Q: Start smoking. tq A: What does start mean? r~ O: "rake a cigarette, put it in your mouth m and light it and inhale. ~q A: Stmt, you wlll see, is a whole process, ~ If you are talking about experimentation. ~ Q: Let me strike it.Are you aware that rq many smokers that become habituated to smoking t~ cigarettes became habituated before the age of 187 MR, MeDERMO'Fr: Object to the fot'm of the question. You may answer. THE WITNESS: Actually the resfarch suggests that tt~ typically it's around 18 or so that people become 0:~ regular smokers who normally have relatively sma~ 1~q number of regular smokers before that time. i1s~ Experimentation may happen earlier.But in terms of I1~1 regular smoking behavior it tends to be around the I173 time of 18. I1el ~: What is the basis of that? i~t~ A: There are a number of that. California, for example, has been running some polls.There is the Michigan poll. ~zz]" O: Do they have names?The government of California? A: Yes. Q: Arc you talking about the government of A. WILLIAM ROBERTS, JR. & ASSOCIATES Mln-U-Script~ (53) Page 119 - Page 122

w. mzxa a, The state of Florida v. VoL 1, April 30, 1997 The American Tobacco Compa~.y Paga 123 t~] Michigan? el A: Yes.And I don't remember the specific ~-rm~ology. But they would be either Michigan - ,n sorry. MS. COLEY: The feature project? el THE WITNESS: Yes, it is. el I remember just rev/ewing the 1992 ~ California, and I don't know the whole flOe.But it ~l would be a study that looked at when tndiv/duais t~ became regular users. t~l BY MR.YERRJD: ~n~ el: You would agree, wonidn'tyou, thatsome ~t~ regular users are found in youttfful smokers that are [~4| younger than 187 A: Very few. Q: But some? A: But some. Q: ls that what yo~ are going back to? A: Correct.Well, I'm going back again to looking at those are~ in the world wher~ there is no advertising and where we see the same phenomenon. Or situations which there vms a restriction and let's say alcohol where you couldn't have advertising and all of a sudden they introduced advertising and mthing happened to the aggregate demand and nothing happened to initiation rate~. Q: How do you regulate a cigarette machine. a vending machine/n terms of who can put in the quarters of what it takes to buy a cigarette? A: You put it in an area that it could be obsetved. ~: You agree that should be done? A: I think it should be in area that it can be observed and make sure oftbe legal age of O: If the cigarette companitm know that some minors, for tack of a bette~ term, do intend to smoke on a regular basis, isn't k important for the cigarette manufactm~rs to get their share of that madcetptace? A: I dnn~t think it is important for them to get that share of the marketplace without tobacco advertising.Without tobacco advertising you are Page going to have in some countries, like China and Taiwan, you have much higher incidence of smoking. O: l'm going m try thta case in August, hop~y with some of my coUeaguea or they wi~ try it. But in any evem the case wilt be tried in August, it wouldn't be tried in China orTaiwan. It ~ be ~ed in Palm Beach. Let's restrict answers to this country. MFL McDERMOTI': Let me interject here.The wimes$ is entitled to answer the question the way he can. If you want to clarify and explore - MH.YERRID: Sure.And that cettainiy was not my intent. Ch But if we can restrict it ro the United States and I know I have asked you personally during my quest/ous to go outside the boundary of my country. So I'm not tr#ng to be unfair in terms of your comparison. In terms of time/f you could answer my questions in terms of the United States. A: If there was no tobacco advertising you would you would see the same phenomenon. Q: I understand that's your opinion.You have made it clear that advertising has no effect on the commencement of regular smoking. A: Correct. tndividnab who use that machine. Q: Do you know If that is tegutated at the present time? A: Are wo talking about Mississippi or l~odOa? ~: Florida. A: As I understand there are cafes the machines are in, bats and areas where there would be Page 126 ~m¢ contoM. Q: What about hotels? A: Once again those psobably - I can't speak for all hoteis.The hotels I have seen them in. happen to be in arens where they are in bar or area that can be controlled. Q: Are you saying that with regard to the underage smokers there has been no awareness on behalf of cigarette manufacturers to target those youthful citizens for purposes of having those people become buyers of the cigarenc products they nunu~cture? A: I'm sorry.Would you mind reading that 0: I wiU be glad to state it again. " .A~ you saying, sir, that it is your understanding that the cigarette manufactm'ing industry has not targeted underage smokers? A: I don't knnw if they bave or not. It wouldn't do any good. ~: If they bad what would you think if they had done that, whether it did any good or not. What would you think of that effort? A: I think in terms of their long term marketing plans it would be foolish. Because they ge 123 - Page 126 (34) Mln-U-Script~ A. WILl JAM ROBERTS, JR. & ASSOCIAIT~g

The A.merica~ Tobacco Company VoL 1, April ~0, 199' Page 127 [I] certainly would bring on the wroth of public opinion. r~ Q: Other than being foolish, and other than p] being a failure which you have already given me those t4] answers, do you think it would be anything else? ts~ Such as wrong? ~ A: I don't believe they should bc targeting F] underage individuals. ~ Q: And if they were tattering tmderage ~ individuals, regardless of whether or not they were [t01 successful or unsuccessful, do you believe that that pq practice should be stopped? tm A: Oh, I don't believe they are tasgeting. pal Q: No, no. If they are do you believe that p~] practice should be stopped? p~ A: Well, I don't befie~e ~hey are p~l targeting. I don't see any evidence that they ate [~t~ Q: Understood. But tf they are do you o~1 believe that practice should be stopped? ~0t A: If there was some way that you could show ~11 me that they are taggeflng underage then I think they [z~ should not, whatever that muaus in tegrus ~ targeting, they should not be targeting ~A! individuals. [~ Q: What it menus in terms of targetlng k Page 128 means to get them to smoke and buy cigarette pgoducts.Tha¢ is what I mean by targeting. A: "l~trgeting to me meaus that they actually have media plans and they are expending money to geg underage individuals. Q: Why not? A: Why sho~dd they not target them? Q: Yes. A: Once again I think it would first of all, to the extent that they were trying to do it, it wouldn't work. Underage individuals aren't influenced by advertising in terms of whether they are going to start smoking or not. Second of all, as I said before, it would cause a tremendous amount of bad pubilclty. Q: Any other reason, such as the preservation of our nation's health in terms of the youthfid citizens we have? A: A~ I said before, tt's a situation in which advertising does not have an impact. So whether we stopped somebody f~om doing it or not, it's not going m make any impact.You're going to have youth smoking and the uptake process irrespective of any kind of targeting. Q: I unders-,and your prerulse.And let me Page ask you this, sir. ~ there ever been a period in American civilization in the last 45 years, let's be more specific, in the last five decades, where there was a cessation of advertising and marketing by the cigarette industry? Has there ever been one day? A: Not that I'm aware of. Q: Has there ever been one hour? A: I don't know. Q: DO you Imow of any hour in the hlstory of this 50 years that the dgarette industry has not tnarketed, promoted and attempted to distribute its product of cigarettes? A: Sir, you could say that of any manufacturer, any product, categorically and I would have to give you the same response. Q: I understand, A: So I would say I'm ironware on any product, any manufaci~gr, any product category, group of manufacturers, wbere I could say I knew that or dldn't know that. Q: Are you aware of any common product manufacturing ~'oup, such as d~ cigarette indusu'y that spends as much as $6 blllip~ a year to promote its product? A: Well, I think we would have to look into Page 130 p! how one would group those product uategodes. ~ Q: Arc you aware, just oft the top of your ~ head, of any manufacturer other than the cigarette ~ manufacturing group that spends $6 billion a year to t~ advertise? I~ A: Well, there are some manufacturing rn categories, like a lot of the products of Proctor & ~ Gamble, Dracket, and that would be ~ the atta of ~I household cleaners and products llke that. I don't :I01 know what the figures are.But that may aproach :,~ something like or exceed. p~ ~: Anyone else? p~ A: I have never really sort of grouped - 114~ categories like that that I can remember. But if one p~ looks at it in terms of volume, you have to remember p~ that the tobacco category has had over the time tln anywhere f~om in excess of 40 percent of the tt~ population using their product down to now where pot we're talking about 23-26 percent efthe population. ~ It has a very high penetration in the t21! population. I am not sure that I could really ~ provide you with categories that could be that high ~ and would fall under the same area of consumer r2~! packaged goods with the same characterizations of the ~ marketplace. A. WILLIAM ROBERTS, JR. & ASSOCIATES 1Wd~x-U-Script~ (35) Page 127 - Page 130

....... ~,.t, ~-u.u. The State of Florida v. VoL 1, April 30, 1997 The Amertca~ Tobacco Compav, y Page t~l Q: Is this an awareness that you would say ~| A: Presently. t~ the market share o[ users has dropped f~m 40 percent , ~#q/~c population to 26 percent, I bcll~e those are ~ decline? 9- figures you have used, in the tobacco industry? ~ A: Long term societal movement away from t~ .~: Is there an awareness? ~ cigarettes. ~ Q: Is this awareness that the markes share ~ Q: Isn't it u'uc, sir, that it's a long term has dropped from the ~0 percent to 26 percent? A: I would call it penetration. Q: Penetration. A: Are they aware? I am sm~ they are awar~ because these are public figures. ~: Has there been any effort to stop this decline in the penetration figures or enhance the 26 percent? MFL McDERMOTi': Object, no foundation. You may answer if you can. THE WITHESS: I'm not aware of any nor would it do anything in term~ of actually using mask~tng BY MFLYERRID: Q: What arc the u~diflon~ means available societal awareness of the dangers of cigarette smoking that has caused that decline? A: No. I think that's a factor for certain ~nents of the market. Other segments. Markets are affected by other aspects, such as social factors and expense of that particular product, or the use of that product~ Shifting into other product categories.There are a lot of factors. MR, McDERMOTT: Had you finished your answer? THF WITNESS: Yes. MR, MvDERMOTT: I am sorry. BY MR.YERRI9: Q: Ifyou vrant to add to it. A: No. lz~ to a manufacturer of a product when the penct~tlon z~ tz~ percentage drops in such a sigulficant number rom 40 ~ ~l percent to 26 percent? ~ ~ A: What arc the- 0: In your ~rea of expertlse, sir, m-e you familiar with the phrase, "I'he perccpt~on is 90 percent of teatiqt? A: I have heard it. But that's about it. Page u: What are the options available to either restore the pene~tion, the origir~l penet~tion percentage or stop the deterioration of the percentage? A: There aren't many options at all. Once you have a long term trend happening it is arguably, because I haven't seen any evidence of it, arguably imposa~le to turn it around. O: Am I to assume from what you ~nst said that the 26 percent would be expected to decrease m some lesser percentage as years progress? A: They may. It really would depend on what happens to society. Q: Tell me, sir, when did this 40 percent to 26 percent drop occur, over what periods of yeats? A: From the fiP..tes. I think it was about 47 percent around 1950, I believe. ~: It w~s what? &: 47 percent.And down to - AS I remember it, we are in sort of a ball park on these figures. O: I under.and. A: - to about 26 percent. Depending upon the demographics that you are talking about. Q: What year would the 26 percent be? Page 133 Page 134 Q: Do you believe that societal influences such as taboos against smoking cigzrcttes, restraints from cigarette smokcn to secondhand smoke considerations, ban of smoking on airplanes, those types of thing~ that are societal in nature are reflective of an increased awarenesa of the deutmentsl awareness that cigarette smoking has on health? A: Partially.As I said before, it's also a factor - Q: To what extent? MR. McDERMOTT: Let him finish his answer. BY MR.¥ERRID: G: I interrupted you. ~: Partially.And it ts also starting to be ~ general feciin~ or has been a genesat leering that it is not the appropriate activity to take place, k could be simply in terms of people do,n.'t like seeing it,they don't like smelling it.They don t like people who do iLThere are all ldnds of factors beyond simply the health risks. Health risks are an important Dit of inforroation that has had an impact on some segraents of the marketplace. But depending upon what segments you are talking about there could be many other factors that could be equal or more ~ge 151 - Page 134 (36) Min-U-Scr/la~ A. WIIXIAM ROBERTS, J-R. & ASSOCIATES

T.he American Tobacco Company VoL 1, April 30. 199" Pag~ 135 potent. Q: Can you segregate out what portion that decline is associated with an increased awareness of the health risks as opposed to other components? A: I have never seen any one $egreg~re out thnsc factors. But I have seen in, ~or example, econome~c studies, the ability to take into account price of the product, level of income. Perhaps other products coming on the market like nicotine gum or patches.It's hard to get a mcasure, a single measure of societal attitude that it b not ~ocially responsible. I haven't seen that kind of research. But becan~e presumably people hav~ not measured that factor appropriate over that long time perioda. But if we could get that kind of a me~urc I think we could get a better feel for it. Q: But so far at the ~ame dine a~ we perceive the trial in th~ ca~ there is no mea~me that would al/ow ns to quantify or ~egregate out that portion of the decline attributable directly to health r~ awareness as compared to other components? A: Well, people have u'~ed to do it in the sense that they t~y to account for the fact of price increases, income levels, ~odal ~ changes.You Page 136 know, imm~gntdon.Thc cultund changes becansc of ethnic groups.There certainly ha~ been research that would look at tho~e factor,.And ! presume that we would then be ie~ with ~ome residual that we would have some awareness of health risk but perhaps some other factors as well. G: Let me ask you more simply. If a finder of fact in this particular case ~ cor~mutcd with the task of segregating out that percentage of the decline which I get to bc 21 perccut, from 47 to 26, and it may change, but that's your best esdmare, that perceutagc of that decline attributable to increased public health awareness, can you quantify that in a number or is it ~nst something that you really don't fee! comfortable that you can pul~ out from the other components? A: What I said the base of the data of the long term awareness of health, whatever the measure would be that you are talking about, that you are talking about has not been available.We can to the best of our ability account for other factors, and we would be lefl with some residual. Q: Why has the data not been awi~ble? A: I don't know. I presume that just people have not asked long enough in the same format 0t" Page 137 quc~ions that would be a valid indicator of health Let me ask you something. Do you ~bute ~c ~m not berg a~ble ofh~l~ ~ncss to any ~s on ~e ~ of~c d~e ~d~ to ~dose kno~ ~ks as~c~ted d~e s~ ~. ~DERMO~: Obje~ m ~e fo~ of ~e que~on. ~E W~N~S: No, I a~bu~ it to m~ ~ups or o~fio~ not coHe~g ~ d~g ~at ~¢ ~od ~t ~d appmp~tely ad~ ~ ~at ~ e~ble ~ to ~'of c~ out and accost for ~r ~ ~e o~H smo~ BY MR.YERRID: Do y~ ~ aw ~n to ~e ~at ~ con~ed ~ ~e ~¢~ ~d~ ~m ~e ~ people ~ R~ m ~ ~ o~ ~e s~ of~ ~ ~g ~ ~e ~ ~ ~m ano~er topic no~ ~ ~ a~ why p~ple ~'t co~e~ ~a~ or b ~ ano~ que~o~ te~ o~ - ~on z~ ~ ~d lon~m~l. I am not gong to fo~ a~ut k. A: For this question. I could interpret it the followinl~ If the reason people didn't collect data on thag wns because of some effort bythe tobacco nnnufacturers.And I can't understand how that would work, okay. If you are asking a different question. ~: What do you mean you can't understand how it works. A: Whywouldn't that alma be collected. There could be a lot of factors. ! don't know why the tobacco indumy would stop independent groups like the government from collecting that data. Q: I'm talking about independent data.You can not thin~ why the tobacoo industry or cigarette industry would stop the dissen~afion of data that demonstrated that the nsage of its product would lead to dekness and deaths.You can't imagine that? A: That was not my response. My response was that I can't see how the tobacco indnsuT would stop indepondeut groups, or whomever, ~om collecting that date that would enable us to cull out the impact of health reformation on the overall reduction in sraoklng. O: That certainiy would not, tha~ inability would certain/y not deter the cigarette industry A. WILLIAM ROBERTS, JR. & ASSOCIATES MLn-U-Scrlpt~ (37) Page 135 - Pa~Ze 138

...... • -. ,,~.~.~, ~'~.u. The State of Florida v. VoL 1, April 30, 1997 The Americ.~ Tobacco Company Page 139 disseminating its own in-house data of the public's awareness of the hazard of cigarette smoking. ~L. MR. MeDERMO~[': I don't think I understand and I will ,bject to it. But if you tmderstand it you cau answer it. THE WITNESS: We are on yet another question.That was my point. BY MR,¥ERRID: Q: I'm not sorry. [ think it's a good point.You would agree that the tobacco industry, as you called it, cannot stop outside groups, independent l~'oupa, governmental agencies, such as the surgeon general, from disseminating knowledge and promoting awareness of the public of the hazard of cigarette smoking but you certainly would agree, would yon not, that the manufacturers can stop disseminadna of their in-house knowledge or their in-house data with regard to the hazards of dgarette smoking? You would agree with that, wouldn't you? A: I would agree that they have control over the iifformatinn they provide people. Q: And you would agree - I am not asking you to assume thls.But knowlng the economics and the man power capabilities of the c/garettc industry Page 140 tq as you do, since you have worked for them tot a long g~ period of time on occasion, you would agree that ~ they would have the power to understand, ascertain, 81 evaluate and become aware of hazards associated with FI cigarette smoking in all probability before an}' R outside groupt ~q MR. McDERMOTI': Object to the form of the question, is] it calls for speculation. Isl BY MR.YERRiD: I~O] Q: Wouldn't you? [,! A: No, I wouldn't agree with that.There I~ were independent investigators who evaluated the l~s] impact of a number of different products for quite [~l some rime.ln fact that information was available i~S] and I don't know how widespread it yeas publicized. 0~I But certainly there were people in the government and I~ independent bodies looking at the impact of product '.~1 use among a broad range of categories for quite some • ~ time. ~ BY MR.¥ERRID: ~1 Q: Let me get this straight.As a former z~ regulator and employee of a regulatory agency your n~ statement here in sworn testimony is that the ~4l manufacturer would not be in the best position of all ~ to know the adverse effects of its product? Page 141 A: N~t necessarily. Q: I ~lidn't say necessarily. In all likelihc<~. A: Well, rm not ready to say in all likelihood.As a matter of fact we find in many cases tl~t other bodies are more interested in findingous what are the health effects of various produc~,.l don't know what the probability is that the mamfacture would be in a better position than some odme body. Q: Do yon believe based upon your review of the madmting, advertising and promotional activities as well as the consumer behavior and declsion-making expertlm and consumer disclosure expertise that you bring tothe Florida lawsoR that the cigarette industry used e~dnrsements or has used endorsements of athleus, movie stars or any indlvidnab who because ~f their name or occupation would have a particular appeul to youth? MR. Mr.DERMOT'r: Do you have a time frame in mind? MR.¥ERR|D: Any Hme. THI: V~TNESS: I have some ads thaLgsed some movie stars, I dlda't have any information that. they were appealing to youth with those. BY MR.YERFIID: Page 142 Q: WIca you got here today did you come up WlishireBoulevard tO the deposition? A: I doo't remember. Q: Ha~¢ you seen here in California the ad, for example, where two western, I think you called it western &mericana.Was that your phraseology? A: I think this was the theme, I said it was western Americana, yes. ~: That was the phraseology that you used? A: Yes. Q: Thq, have an American western theme and they bave two cowboys on horseback. One is looking at the other and the caption of dialogue is, "Bob, I have eml~ysema." It is more or less reverse advertisements, a negative advertisement on the Ma~boro Man. In yomopinion, based upon everything that you know in your background, training and experience, is that ad going to be effective in deterring people f~m either smoking or stop people from smo~,~g who have not yet started? A: I don't think that particular thing is going to have an impact.As I said before, there are mare imlxmant factors out there.There are factors that we account for.That is iust the general sense 'age 139 - Page 142 (38) lq, ght-lJ'-Sca-ipt@ A. WILLIAM ROBI/~.TS, JR. & ASSOCIATES

T.he American Tobacco Company VoL 1, April 30, 199 Pete '~43 , ~q of ~c~e~y that ~is is not an app~ptiate pmduc~ to ~ ~c.~d ~decd I have ~ ~ ~e execufio~ ~. ~ ~at append not to have any ~ wba~er. And I think that is very dangerous.We are willing to have our creative impact, I haven't looked at this particular one, I haven't studied its impact. I have looked at antismoking campaigns. There would be some that might be more effective. I don't know who that might be targeted at. To the extent that it is targeted at someone who is worded about the health effects of smoking, then potendaliy it might have - it might be a bit of information that they wodid think about. O: Are you aware of the constitutional amendment passed by the citizens here in California p! A: I would not accept your interpretation of el that happened.As a matter of fact more recently the figures came out that show an increase.There appears to be a change in the way the smoking incidence was asked.And that could be one of the reasons that it was happening. There also seems to be an upturn in the use of a number of differem pmduets, such as illegal drugs and other factors and alcohol and everything else.So there tends to be a generalized upturn in the use of various products by youth and by - I don't think the adult rate has gone up but by youth that could be linked into just general society u'ends. O: Just to clear up some loose ends here, with regard to a campaign to deter smoking both in smokers and also to deter the commencement ofsmoking in nonsmokers? A: Yes. A: Well, it is Prop 99,I believe, t211 O: Are you awa_re of the funding for that campaign? A: I conldn't give you the specifics. Q: Generally? 01 |141 have you ever seen this June 17, 1963 exhibit, marked as Exhibit 25. I have highlighted the portion of it that I will refer to. A: No, I haven't. (Mtzexsld Exhibit No. 25 was tnarked for identification and is annexed hereto,) ~ 8¥ MR.YERRID: Q: Turn to the highlighted portions, A: Yes. It is very substantial. Page 144 Q: And are you aware that when that campaign was properly funded and being utilized there was a dramatic drop and decline in cigarette smoking in terms of both those who hadn't started and also a decline in the number of smokers that had already c~perimcnted in smoking? A: Actually the information that I bavc looked at suggested there has been a tong torm trend in the decline of smoking,That there were many other factors besides just those simple ads.That there were other factors that came into play concerning not only restrictions in smoking but also pricing of cigarettes in part to pay for that campaign. Q: Proposition- A: 991 believe. Q: - 99 was hatted in rerrm of funding by the governor and the funds were diverted to public schools. I don't recall the exact number of m~ons, but it was fairly small compared to the number of bi///ous that we were talking about earfier in the deposition.As I recall there was a dramatic upsurge in the smoking when the ads were taken off the air waves.What do you account caused that? please. I believe the first highlighted pot~iom. Do you see that first highlighted portion? A: Yes. Q:/rod speaking to this area, do you have any awareness of that patticdiar episode involving Senator Moss, and I think it is Senator Neuberger and - I can't read that. A: .~mcrican Cancer Society. Q: Have you had any involvement or any exposure to that particular passage before today? A: No. Q: Turn to the next page that is highlighted.And I ask you to assume that this is authored by a cigarette manufacturing company's executive. Do you have any exposure to this statement, ~Moreover, nicotine is addictive." ~: I think that is what you read to me Q: ! asked you about whether nicotine is ad~ficdve. Have you ever seen this document tha~ came from the archives of the tobacco industry? A: No, I have not. O: And you disagree with that, sir? A: Yes. G: A~d you disagree that the cigarette &.'WILLIAM ROBERTS, JIL & ASSOCI&TES Mtn-XJ-ScriptO (39) Page 143 - Page 146

RICHARD W. M~ZERSKI, PloD. The State of Florida v. VoL 1, AprU 30, 1997 The American Tobacco Compaz~y Page 147 industry is in the business of selling nicotine, an ~,~.~,add~cth'e dru# A: Yes. I think they are selfing .gzrettes. Q: And you disagree that cigarettes ace not simply carriers of the nicotine, the dosages of the A: I disagree.As a n~ttcr of fact I think there is research that suggests thece are many other ~accts of the product that are what people enjoy. I'm not suggesting that they don't enjoy nicotine. But there appear to be a tremendous impact of other things, like handfing the cigarette and smoking the cigarene.Jnst general enjoyment of using the product. Q: We wiU get to that. But in regard to chemical compositions in the cigarette in the Liggett docoments, wMch shows that one of the components is arsenic that is contained in some cig~cette manufacturers'products? A: I have heard about/t in the newsp;tpers. (]: But you have not been asked to look at the Liggett documents and the chemical compositions of the cigaro~cs th~ wen produced and manu~tc~ced and sold in this country? Page 148 A: I have not been asked to look at that document. I have seen reports of it in the press, though. Q: Do you have any problem with a cigarette tmnu~tcturer promotinf, matket~g, ad~enis~g and Page 149 judge would give you that inst.ructinn, that you ace to answer "Yes" or "No" but you have a fight to answer "Yes" and to explain your answer. But any question I give you should be answered with a "yes" or "No" if possible.And then an appropriate exq3lanation is always admiss~le. A: Sir, I will answer it the best I can. And I would like to please you as much as possible. Q: This language bothered me when I read it. I wanted to ask you about it. "Delivering full flavor and incidentally had a nice jolt of nicotine." Have you ever seen that phraseology before in the manufacturers' parlance of talking about what they are delivering to the consumer, give him a nice jolt of nicotine? A: No, I haven't. Q: Have you ever seen -We talked about nicotine and you have said, "No, I think they are in the business of selling cigarettes." Do you recall that discussion just a minute ago? A: Yes. ~: Have you ever seen this "1972 Phfllp Morris Document," internal document f~om the Philip Morris Research Center of Richmond, Virginia, which will be marked as Plaintiff's Exhibit 26? Page 150 (MIzerski Exhibit No. 26 was mzdced for identLficatiott and is annexed hereto.) BY MR.YERRID: Q: Sir, have you seen that before? dism"oottng cigarettes that contain arsenic_> A: Would they occur naturally or ase we talking about injecting arsenic in this. Q: Regardless of how it occurced would you have any problems ffarsenic was contained in the product? A: I think there is probably elements of arsenic in a broad xange of products. Q: If the arsenic could be eliminated but wasn't would you have a problem with that arsenic remaining in the product when sold to the public. "Yes" or"No." A: It would depend on what it would take to A: No, I haven't. Q: Do you agree or disagsee that at least in 1972- A: Excuse me. How about If we both stand? ~: ~ 1972 ~e Ph~p Mo~ R~h Center ~ ~ch~nd,~ ~e~ed ~t cinches we~ a ~r for a do~ of ~co~¢. A: No, I ~ve n~ ~en ~at. Q: ~d it's ~bit 26. ~ve ~u ~er seen -~'s ~e ore" ~m and I ~ ask ~u ~m¢ qu~o~ and I ~ ~me ~ to it ~ter. Do ~u ~fi~ ~m ~ a~b and climi~tc K. MR. McDERMO'I~': Let me interpose an objection.You can ask thc witness If hc can answer it yes o¢ no. But if he can't he can response in any way that is proper. MR.YERRID: ! agsee. Q: Mr.Wimess let me be real clear.The your review of the industry, and I'm talking about the cigarettes industry approach to marketing, and advertising, promotional activities.And I'm not carving out any of thoso things. Consumer disclosure, coasumer behavior and decision making. Do you believe that their approach cegasding endorsements of athletes, movie stars or individuals 'age147 - Page150 (40) Min-U-Script~ A, WILLIAM ROBERTS, JR. & ASSOCIATES

~' ..c ~tz,,~: ~. rto~,~- v. RICHARD W. MIZERSKI, PhE ~he American Tobacco Company VoL 1, April 30, 199' t~ t~ Pl oq ra~ Page 151 has changcd over thc )'cars? hsve had.~d ~c~ have had, Z be~, o~ c~c~ ~9~ most ~cc~ Q: A~ut assoc~fion or whm~ ~c ~ge ~ ~ yo~ ~e~e. G: ~ve you ~n~g and ~ew, let me ~ i~ and when I come ~ you ~ ~ed for iden~fion ~ a~xed he.w.) BY MR.YERRID: Q: ~vc you had ~e ~ ~e, ~ A: Y~+ Q: Page 153 Page 152 this document in preparation for you*" testimony? Pl A: That's correct, t~ Q: If you don't mind standing up.Would you t~ agree that the highlighted potxions on Page 2 where ~ [q A: Well, as a matter of fact the code, I R believe, addresses that very thing. 5o it would go R against the code if in fact that is what people were I*] doing. @ Nonetheless, as you understand there is a t@ study done by my graduate student StaceyVofimer.We ~0 have experlmentaUy tested things such like that. I@ Not clgaretxes but on other products. t~ Q: And I will get to that.And you can Vt, opine on that as long as you want. But without P~l regard to other products that code you referred to Oil only refers to the cigarette industry as I understood tn~ it. t~41 A: That's right. Vt~ Q: With regard to that and realizing that t~t~ one of your students-Was that a thesis? t~ A: Ph.D.dissertadon. t~ Q: Without regard to that dissertation I am p~ referencing that document I showed you.What happens t~ in a situation such as that when the code, as you tell carl it, is violated~ What should occur? tz~ A: What shonld occur ate other individuals teal of that o~on, I don't know the specifics of rat the mechanism, but other manufacturers would be t~l presumably upset by that and ask something be done or Page 154 it looks like it is numbered 2,and then guing over to Page 3, it looks like a continuum of that page. A: ~ght. Q: I know the print is smaller but I think it is the same document.Would you agree that that is what ultimately became the code,as you have referred to it? A: Certainly these are elements that were addressed in the code. Q: And in terms of 2, %re do not use that not to be done again, or some sort of remedy. Q: Unless the other manufacturers were in acquiesocnce of that or also participating in that form of conduct; isn't that cort~ecr2 MR. McDERMOTT: I object to that question as argumentative. THE WITNESS: I don't know.You arc asking what would happen. But that is presumably what would happen. I guess one would have to determine whether money changed handa to prompt that particular form of placement. BY MR, YER~ID: Q: Ifyou can look at Pa.ge 3 o~that documcm. [t looks llkc ~mother No. 2 at the top, endorsements of athletes, movie stars or any individuals who because of their name or occupation would have a purtic, ular appeal to youth." Do you believe that is the appropriate guideline that is in place today in the tobacco industry? doesn't it? . A: It is No.3.We do not use situations where the actors appearing as smokers are engaged in the games, sporr~ activities or occupations which might have an particular appeal to youth. t201 Q: Within abom a hundred feet of that tZ~l Marlboro commemlal billboard when I was coming to r~ the deposition today which said, '~ob, I've got r~ emphysema," I looked on the on the other side of the ra! mad and there was a Marlboro commercial that looked r~ like AI Uuser was in one of the Indy type formula A: Yes. Q: With regard to that particular guideline, do you believe that it would be violative of that guideline, for example, to contract with Sylvestcr Stallone to pay him a haif million dollars to display a cigarette product in a movie? A.WILLLM~ROBERTS, JR. & ASSOCIATES Mdm-U-Stwiltto (41) Page151- Page154

...... , .... The State of Florida v. VoL 1, April 30, 1997 The &meftcatt Tobacco Company Page 155 Pl race cars with a big Marlboro logo and on the race ~ car promineutly displayed and the hog bent with the ~.Marlboro logo and wordage, signagc is what I would "all it, encompassing this athlete.Would that also • Je a violation of the ethics orthe code as you call ~ it? ~ MR. McDERMOTT: I object to the form of the question, ~ argumentative. m if you are laminar with the sign or know p~ what the questioner is asking about you can respond. pl! THP W~'NESS: I know wbat he is asking. I guess the p~ aspect here I would have to a~ you before ! could pet respond to that comment, was A1 Unser smoking. p4] Becanse here it mys,"Where actors appear as smokers pet are engaged in any garaes, sports acti~ties or vet occupations which n~ght have a parfic~ar appeal to vT] youth." vet G: if I said that I certainly didn't rne~n to Vet say it. He is not smoking. He is sitfinf, the visor ~m~ I think is down.There is not a lit cigarette on the t~tl billboard. I didn't want to dissuade you from your audience. It was a situation comedy that was basically animation.A~d nowadays, of course, the Page 157 ~ Fliutstones ate used for children's vitamins and t*~ loges, for those kinds of things. [s~ Q: But your original thought is that the ~ Flintstones program was aimed at adults as opposed to m chlidren? ~ A: That's correct. ~ Q: And Mickcy Monse, I would assume you have p~ an opinion there. In the mankedng scheme of things pq do you think he is directed at children or a parent? P~I A: I kind of know about Mickey Monse.And I pet think Mtckey Mouse has had a broad range of p~ following. pet Q: Both youth and adult? pe] A: Both youth and adult, absolutely. p~ O: AndJoeCameLwheretsJoeCamel vet directed? V~ &: Joe Camel would be directed at adult in01 smokers. taq Q: And any discussions with regard to tu~ opinion.I'm suggesting that is the scenario, t~ t~ It is a blilboard of a sporting figure in tu! the race car with the loges prominently displayed and t2et the Marlboro cleady visible in a number of areus. youthful smoker*, tmderage smokers wanting to look cool and be cool, and that being uttllae-~ to nmrket dgarette products would surprise you if they appeared to occur in cigarette conference mows in Page156 Page 158 would that violate that type of restriction? A: No. Q: Would that type nf advettisemeut affect children's feelings toward Marlboro cigarettes? A: No. ~: Why not? A: There is no evidence that it does.As a matter of fact there is a substantial amount of in_formation that suggests that children ptobably wouldn't even look at the billboard, or at least the sixties and seventies? MR. McDERMOTt: Object to the form of the question. I don't think I understand it. But if you do you can mmver it. THE WITNESS: My understanding you are asking about Joe Camel and the use of Joe Camel back in the sixties and seventies. I thought he wns created in the late eighties. BY M~.YER~ID: O: I asked about Joe Camel but I asked about the perception of being cool, of looking cool, fitthtg in. Do you thLn.k that those WpeS of'notions were bandied ~d3out in the conference rooms of the cigarette industry as cariy as the SiXties and seventies without the character of Jbe Camel? &: I am not sine if they used "cool or "hip" or what was the apptoprlate terminology back Q: Do you think they used something like that? A: Smoking is a llfe-style activity.And I don't know how the)' communicated about that. Q: TOt me, don't you think some people that are young and underage, I'm talking about 12 or 13 years old, want to smoke so that they can demonstrate ml wouldn't remember the billboard.Typically our tnt users, those are the individuals that pay attention pal to bii~oards like that. V~ P(I For example, I am not a nscr.Although IV41 p~l have an interest in tobacco smoking, l don't remember psl pet seeing that. I have seen ads and pay attention to pet pn them. For whatever reason I did not see that. Pn pet Q: I'm not being trite with you and I know pet ttet the hour is late, but I'm going to ask the question pet • et at the risk of being trite.Would the Flintstones 2q appeal to youths if they were used in cigarette z~ adven~semeuts, portrayal of the Fllntstones using z~ cigarettes? ~4! A: Well, the original - I don't know.The ra4] ~et original Fliutstones were basically aimed at an adult 'age155 - Pagc158 (42) Min-U-Scrilm~ A. WILLIAM ROBERTS, JI~ & ASSOCIATES

~A4c ~rtcma Tobacco Company Vol, 1, April 30, 199' rt~ Page 159 to the wo~d and their peers that they are adults and they are risk takers and they are cool? A: I don't think that would paraphrase it correcdy. I think I would put it a little bit differently. I think they would like to fit in with a particular group. I think they would like to be seen as an individual that fit with that group.And the activities they would use to manifest that could be wide ranging. Cigarette smoking for some groups is in. It is always very in for adult groups. I have noticed that ardsts, people in film, people in the theatre, I have been quite surprised, In terms of college students they tend to be heavy smokers. So there is very clearly some factors outside of any advertising and marketing that are prompting that particular behavior. So being cool can be important for youth as well as adults, Q: I waot to be very clear and then I will Would you di~gree or agree with the following statement, "tobacco cotngmdes have consistently denied the)" actively attempt to turn young people into smokers through advertising"? A: Do ! believe they have ~aid thaO P~9¢ Q: Do you agree or dl~gree that that is the position tobacco companies are taldng? A: I believe that is the position I have heard a number of times from various spkespeople for var/ou~ manufacturers. Q: Do you believe that the internal documents, and ! am specifically referring to Exhibit 21 as referenced by Exhibit 22, which we have a bal~ sheet of.This is mine, thls is not an exhibit. Lfyou ~ read that second parag~ph, I Page [~} MR.YERRID: It could be.And I'm not saying you are t~ wrong. mr Q: Have you seen this Plainr~f's Exhibit 21 m before today? ~ A: I'm not sure if ! have seen this before. r~] I might have seen it in regards to mamrial that I r~ have looked at in the past in terms of the Canadian ~ investigation. 1~ Q: Do you believe that it demonstrates a r~0] targeting of the youtlfful rm.--ket by cigarette rnl MI¢ McOERMOTr: ! object to the form of the qae~on, rla~ compound.Tha~ is one manufacturer. [~4] BY MR.YERRID: [lS] Q: Manufacturer.Take the amendment. its] A: I would have to review k. [1~ Q: Since we ase going to have a break dds [~ eveulng could you utilize that break? Do you have a copy of that document? MR. BEACH: No, sir. MR.YERRID: OFF the record. (Discussion off the record.) (Recess taken.) BY MR.YERRID: Q: I'm going to wind up the best I can in Page 162 believe k is referencing Exhibit 21, A: What is the question again. Is thb referencing this? Q: Yes. A: I don't know if it is or not oft]land: Q: Have you ever seen this Marketing the tmxt few minutes so I may jump umuad. I don't warn you to think that the document I have given you a copy of is going to be the subject of my examinadun.That is for you to review tonight, I want to be real clear before we break. It is your expert opln~on that dgarette advertising does not cause anyone to smoke; is that correct? A: That is correct. Q: And it is focused exclusively on brand switching? I~l A: That is correct.And reinforcement of 11~] brand loyalty to whatever extent it is, [1~ Q: That was not intentional. It is focused r14~ exclusively on brand switching and the enforcement-of [15] brand loyalty, whatever that. particular bland happens I1~ to be, Keeping people on one brand or moving people Research, Inc, report? from one brand to another. A: Yes, it would be that..Ml consumer package goods in the maturity stage. Q: And cigarettes are in the advanced maturity stage on that fife cycle? A: That's correct. ~: You mentioned - I'm going back over my notes from yesterday. You mentioned there were examples of good MR. McDERMOTI': Let me slate for the record that on the ~ace ofh it does not.There is a reference in the pardz[ newspaper article to the document for 1988 and it appears that that document is dated 1977. MR.YERRID: I understand that.And I believe that the ardclc is longer than just the passage we have. MR. McDERMOTr: All right. A. WELUAM ROBI~TS, JR. & ASSOCIATES Min-U-Scrlp~O (43) Page 159 - Page 162

....~-u.~ w. ~ttza:x~t, t'rt.LL The State of Florida v. VoL 1, April 30, 1997 The American Tobacco Compatiy Paga advertising and examples of bad advertising. I thing )'our good advertising example was eating weB. ~ A: I don't remember the context or my saying hat. Q: In any event, that would be one illustration of good advertising, drink milk, eat properly, get plenty of exercise and rest. A: It would be an example of trying to get individuals to do certain healthy behaviors. 0: An.w~ay, that was of the type you discussing of the good advertising. My question is A: Cotdd I respond to thaO G: Please. A: I may have said something like that. Normally when I think about good advertising or bad advertising it wouldn't be in terms of some value |udgmem li~e that. Heaith~ kind of behavior advertising would be good and lind advesflMng would be for alcohol or something else. I would normally use it in teftm of how effective it would be in terms of the objectives they might have. Q: Is there any example of good advertising that comes to cigarette advertising? ~: Once again.We are using a definition of what I interpret to be my definition which would be good in terms of it's fulfilling it~ objectives and getting brand switching ur to hold share against compatitors. ?at we talking about advertising that w~uld be for health_rxd activities? ~: What I would prefer to do ls do both. But I don't want to preclude your definition as an exl~ert. It may be vastly di~erent than the other defmitinn~. Let's use your deflation. Fulfdlment of goals and product needs, manufacturen' needs. What would be forms of examples of good advertising in the cigarette industry? A: There would be examples of reposhioning of the brands like Marlboro that we talked about yesterday in the Mississippi transcript.Where we would be letting individuals know that it now occupies a different position to the rest of the competitors, how it looks. t~: Ttansfortnation from female to male? A: That's unclear about whether it was strictly female to male. But certainly it wasn't exclusively female. In that it had a different theme, it had a different look to it. It would be the kind of packaging that perhaps could be used by Paga 165 both genders.And that it was distinctive and consistent over time. Q: The Marlboro repo$ifioning, can you give me something in more current terms in the nineties? What would be a good example - Strike that. What would be an e~mple of good dgarette ad~ under your defidiflon? A: Well, I think some of the Joe Camel advertising is unique. It differentiates it from other brands. It is something that does not have the look of other advertising. That it's c/early identifiable. It tends to be consistent over time. And indeed the Marlboro advertising of more recendy is one that continue~ on the theme. It is consistent, which is very important to have good advertising.something that is consistent overtime. Changing the theme, changing the look. These kinds of things simply appear to distract from what might be called good advertising in that you want to have a consistent positioning to your particular audience.As long as that positioning is something that/s acceptable.WelL ac~ble to that particular group. Q: You have given me the examples and I appreciate that.If you can move to the second Paga 166 definition that you referenced, the definition of the health oriented definition. Strike that. Are there uny examples of good advertising in the cigarette marketing promofiona! or advertising efforts? ~: Fm not aware of any advertising that poraays cigarettes as a healtlfful activity, no. ~: And if ciga~--tte advertising did portray cigarette smoking as a healihful activity do you believe it _w,.ould be false and deceptive? A: I don t believe it would be appropriate. It would not be appropriate - I would hard to take - False and deceptive is a fairly specific kind of tema.And so that if we said something in the advertising about the health conseqtlences - I~: Go ahead."If we said something" and you were interrupted. St: Well, there am specific methodologies that are normally used to determine whether individuals pick up some particular health things from a cigarette.And I would expect that I would use the same methodology to evaluate those as 1 would any other consumer packaged goods. t~: Do you recall Exhibit 22 as being a composite that you received from Dr. PoBay? ~age163-Pag¢166 (44) M.itt-U-Script~ A.WILISAMROBERTS, JR. & ASSOCIATES

The American Tobacco Company VoL 1, April 30, 199 ol A: I don't remember the number.Yes, I do. ~l Q: There is correspondence.That is why I'm ~l trying to refresh your recollection. [41 A: Yes. is] Q: It had a number of attachments to it. A: That's correct. Page 167 fireworks. So it is it straining activity that one sees.When they see someone they know do it. Q: Thus to tie back into what you mentioned earlier, do you remember when we started the dialogue about what we could do to stop youth smoking, the commencement of Youlh smoking and you said, one of m at least were some infcreminl advertising vq A: I wo~d ~y ~e ~emes ~at I m~ ~mc 0~ of~esc ~ we~ commie ~. I don't [s~ ~mc~er, but o~ ~ I ~d ~ve w ~e ~mc [14] ~mmcm. [~ For ~mple, he~ it ~ no h~l~ c~ V~ B ~de for ~ton. G~t ~e ~ ~mn's ~. u~ s~ to ~ of h~l~ c~ ~de ~ o~ Q: Did you at some time look at the atmchmenm ~nd glean f~om the a~chmems that them cigarette makers. Why don't we defer that and in the morning we could look at that and see if there are any health claims that might be made in the archives that were sent to You ~s opposed to mkln-4~ the time the influences, one of the boxes I put was parents not smoking. 0,l A: Yes.that's correct. (10] Q: Do You remember saying that? t(q A: Yes. t~] Q: I gueSs you tied that in because it is [~ such a spectacular event and it has such an [,~] impression on the adolescents? 0sl A: Very young children, that is when R [~ starts.Tbeir first obser~tion of the use of that 071 particular product type is when I said it is rather [~ spectacu/ar and makes a very strong impression on [lg~ the~ [~ Q: $ogu~tothcadul:l~u:m-~care ~] l~ving the Youth smo~go G~ing to the adult t~ how important is it for the nousmoking adult to haw I~ the very best available and ac(m~te and u'uthful Wq to do it mulght.We will try to ot'ganinc it so that ¢~ those can be segregated out, Pag~ [~[ (Discussion off the record.) r4 BY MR.YERRID: ~ Q: At the very end of the day yesterday, [~1 like the very end of the day today, I noted something m that it was wcil a~er four. I put this in quotes. ~ I have the transcript down there but I think it is r~ something you said, cigarette activities - • l A: Basic~Uy. ~I Q: "Cigarette activity is a spectacular O0l consumption acth~ty."You used that phrase. Did [(q you use that phrase yesterday? [nl A: I seem to remember that, yes. I~3l Q: What did you mean by that.71 just wauted [14] somc amplification on that. [~sl A: As someone who is now very sensitive to t~el yotmg children and what they art looldng at and how o71 they would look at things, I have noticed that when t,el children watch some of the early cigarette smoking t~] that the consumption of cigarettes is a very t201 spectacular activity. It is something You put in ~,! your mouth, You light, you inhale, it burns, you blow r~ smoke out. Really in the terms of how it has an tz~ impact on an observer, particularly a very Young r~l obset-cer, it is a spectacular actlvity.And I am not r~ sure that it could be matched by anything else except infommflon before making a decision to smoke, which by your own mstimony may be the greateSs effective Page 170 factor upon their own children in that regard? A: I really didn't understand the whole thing. Could you please read it back to me. (The Reporter read the pending question.) THE WITNESS: They made a decision. I mean there is almost no - very, very few number of adult parents who are begitming to smoke that haven't smoked before. So there is a great deal of infotmatio n. If they choose to smoke or smoke again, then I think they obviously will have to realize that it's going to have a detrimeutal effect potentially on their young children in terms of how they may view the smoking occurrence. BY MR.YERR~D: Q: I understand that it may have a detrimental effect oo the young children and I am not in disagreemem with your opinion in that regard. With all due respect to you, sir, how important is it to the adult smoker to have aCCtLrate and truth/ul information regarding hazards of cigarette smoking before making that decision either to resume smoking or initiate smoking for the first time? A: You had actually said the adult smoker. And you went through that scenario. I assume you A. WILLIAM ROBERTS, JR. & ASSOCIATES ltlin-U-Script~ (45) Page 167 - Page 170

......... ', ,~.u The State of Florida v. VoL 1, April 30, 1997 The American Tobacco Compa~..y Page 171 meant the adult who was not a smoker. Q: I think that ls a better question. ~ A: Well, it's important that they have that afortr~tion. Q: And if that im'ormation that they have is false or in any way deceptive, what would you as an advertising, promotional, whole gambit of your expertise, what would you say to the exposure of that adult to false and misleading/nformation? A: False and misleading information from health authorities, from the media? G: From the cigarette manufacturer. A: They are not looking - MR. McDERMOTt: I object to the form of the que~on, calls for speculation. THE WITNESS: They are not looking to the cigarette manufacturer for health information.That is absurd.They are not looking to that individual. Nor would they be looking to the alcohol industry for health information or the candy industry for that ltfformation. BY MR.YERRID: G: On what bas/s do you make that statement? A: My experience ta dealing with a broad range of categories.People have a real question Paso 172 aoout credibility when they arc getting information Rom manufacturers. MR. McDERMOTT: Arc you finished with your answer? BY MR,YERRID: Q: But let's deal with the cigarette industW if we can, please. If the cigarette industry assumes an obtigadott to disseminate true and accurate information with regard to the ramifications of cigarette smoking, do you agree that that duty that is assumed should be discharged in a true and valid manner in all activities concerning your area of expertise, in particular advertising and promotional activity? MR. McDERMO~q': I object to the form of the question, it assumes facts not in evidence, cars for speculation. Answer if you can. THE WITNESS: I have no reason to believe that they are disseminating unttutlfful information. BY MR,YERRID: G: R'they did what would your opinion of such activity be? A: The same opinion that ! have for any manufacturer.They shouldn't provide false or deceptive information.That would app|y to all 0! t~ [~s} 113| ltn Page 173 marketers. MR.YERRID: With that we will adjourn for the day. 0"iME NOTED: 5:10 I declare under penalty of perjury under the laws of the State of l~lotida that the foregoing is true and correct. Executed on _, 1997, at ~,__. SIGNATURE OF THE WITNESS Page 1~'4 STATE OF CALIFORNIA ) ss: COUNW OF LOS ANGELES ) We, HAROLD M. LIXBO'CITZ, C.S.1L No. 290, and LAWRENCE SCHUMACHI~L C.S.R. No. 1464, Certhqed Shorthand Reporters do hereby certify: That the foregoing deposition of RICHARD W. MIZi/RSKI, Ph.D. was taken before us at the time and #ace therein set forth, at which time the witness was put on oath; That the testimony of the wimess and an objections made at the time of the cxnndnaflon were recorded stenographical/y by us, and were thereafter That the foregoing deposition is a true record of the testimony and of all objections made at the time of the examination. We further certify that we are neither counsel for nor related to any party to said action, nor in an], way interested in the outcome thereof. age 171 - Page 174 (46) Mtn-U-Script~ A. XVII.LIAM[ ROBERTS, JR. & ASSOCIATES

RICHARD W. MIZ.BRSK1, The American Tobacco Company VoL 1, ApriI 50, 199 [2tl tall Page 175 t~tl HAROLD M. LEIBOVITZ. C.S.R. No. 290 LAWRENCE SCHUMACHER, G.S.R. I~. 1464 tNOEX VOLUME I WEDNESDAY, APRIL 30. 1997 WITNESS EXAMINATION RICHARD W, MIZERSKI, PH.D, (By Mr. Yetrid) 3.7 (By Mr. Ye~'~d) 46 Page 176 R psi stiput~0n INDEX Page [q lm lm tam t~ DIRECT EXAMINATION By Mr.Yentd 3,7 By Mr. Yetrid 46 Signature of Deponent 173 Cerllfk',ate of Reporters 174 EXHIBITS Page MtZERSKI F.~. 24, Two-page document entitled 45 • lmpllc~lon~ of Baltelle Hlppo I & II and MIZERSKI EXH. 26, One-page document entttled 150 "1972 philip Morris Documen(," ..... M ~.ERSK| F.XH. 27, Thr~e-page docgmetlt ~ltk~d 151 "Suggesled r~,ly 1o Senator Kenne~,t's Page 177 Page 178 A. WlI.I.IAM ROBERTS, J~ & ASSOCIATES l~in-Td-$cript~ (47) Page 175 - Page 178

Lawyer's Notes