appendices to notes and authorities of imperial … to notes and authorities of imperial tobacco...

C A N A D A PROVINCE OF QUÉBEC DISTRICT OF MONTREAL No 500-06-000076-980

SUPERIOR COURT (Class Action)

CONSEIL QUÉBÉCOIS SUR LE TABAC ET LA SANTE -et- JEAN-YVES BLAIS

Plaintiffs vs. JTI-MACDONALD CORP. IMPERIAL TOBACCO CANADA LIMITEE ROTHMANS, BENSON & HEDGES INC.

Defendants

C A N A D A PROVINCE OF QUEBEC DISTRICT OF MONTREAL No: 500-06-000070-983

SUPERIOR COURT (Class Action)

CÉCILIA LÉTOURNEAU

Plaintiff vs. IMPERIAL TOBACCO CANADA LIMITED ROTHMANS, BENSON & HEDGES INC. JTI-MACDONALD CORP.

Defendants

Appendices to Notes and Authorities of Imperial Tobacco Canada Limited

APPENDIX I – THE EVIDENCE OF DR. DAVIES ................................................................ 1

A. Background and Independence ................................................................................. 1

B. Plaintiffs’ Mischaracterization of Dr. Davies’ Evidence ............................................... 4

APPENDIX II - ITL’s SAFER CIGARETTE RESEARCH ...................................................... 7

A. Efforts to Measure Smoke Components as a First Step to Developing a Less Hazardous Product ........................................................................................................... 7

B. Biological Assays and Other Tests ............................................................................ 8

B.1 Ames .................................................................................................................13

C. Design Modifications Represented the State of the Art .............................................16

C.1 Selective/Specific Reduction..............................................................................16

C.1.a Nitrosamines .................................................................................................19

C.1.b Project Day ...................................................................................................27

C.2 General Reduction .............................................................................................28

C.2.a Filters ............................................................................................................30

C.2.b Paper Porosity & Filter Tip Ventilation ..........................................................31

C.2.c Recon/CRS/WTS ..........................................................................................31

C.2.d Expanded Tobacco .......................................................................................33

APPENDIX III – CAUSATION / ASSOCIATION / RISK FACTOR .......................................35

A. The Evolving Conception of “Causation” ...................................................................35

B. Plaintiffs’ Mischaracterizations of the Evidence Regarding ITL’s Knowledge ...........37

APPENDIX IV – CLARIFICATION OF THE EVIDENCE REGARDING ITL’S KNOWLEDGE OF ADDICTION & THE ROLE OF NICOTINE .....................................................................43

A. Plaintiffs’ Mischaracterizations Regarding ITL’s Knowledge of "Addiction" ..............43

B. Smokers Do Not Smoke Only for Nicotine ................................................................47

APPENDIX V – COMPENSATION AND SMOKING DELIVERIES ......................................49

A. The Faulty Conclusion in Monograph 13 & Compensation Via Increased Consumption ....................................................................................................................49

B. Nicotine is Not the Driving Force Behind Compensation ..........................................53

C. ITL Did Not Design Cigarettes So As To Facilitate Compensation or To Mislead Consumers (Who Were Not Misled In Any Event) ...........................................................54

D. Standard Deliveries Were Never Intended to Represent Actual Human Smoking Deliveries .........................................................................................................................58

E. Plaintiffs’ Conflation of Machine Smoking Deliveries, Compensation and Consumers’ Perceptions of “Light”/ Lower Delivery Cigarettes ............................................................60

F. Government and Public Health Community’s Awareness of Compensation .............62

APPENDIX VI – CLARIFICATION OF THE EVIDENCE REGARDING ALLEGATIONS OF “NICOTINE MANIPULATION” .............................................................................................65

APPENDIX VII – RECONSTITUTED TOBACCO, pH and SAND LEAVES .........................67

A. Reconstituted Tobacco Is Irrelevant to the Allegations of “Nicotine Manipulation” ....67

B. The Free Base Nicotine/PH Fallacy ..........................................................................68

B.1 Increased pH does not result in increased nicotine absorption or the speed of absorption .....................................................................................................................68

B.2 ITL did not add or do anything to its cigarettes to increase the pH of its cigarettes ......................................................................................................................70

C. Cigarettes Made Only from Sand Leaves Would be Rejected by Smokers ..............70

APPENDIX VIII – CLARIFICATION OF THE EVIDENCE REGARDING DELIVERY TARGETS (SWAT, SWAN, SWACO) ..................................................................................74

APPENDIX IX – ADDITIVES ...............................................................................................76

A. Coumarin ..................................................................................................................76

A.1 Hunter List .........................................................................................................77

A.2 No Misrepresentations Regarding ITL’s Use of Coumarin .................................78

B. Reconstituted Tobacco & Additives ..........................................................................79

APPENDIX X – “15-PACKS” ...............................................................................................83

APPENDIX XI – CLARIFICATION OF THE EVIDENCE REGARDING ALLEGED “DENIALISTS” .....................................................................................................................84

A. The Constitutional Theory/Genetic Susceptibility ......................................................84

B. Cormier & Warburton ................................................................................................86

APPENDIX XII – ITL’s DOCUMENT RETENTION POLICY ................................................89

A. Introduction ...............................................................................................................89

B. Litigation Was Only a Theoretical Possibility ............................................................89

C. Plaintiffs’ Claims Regarding Alleged Rationale for the Document Retention Policy is Unfounded and/or Based on Evidence Unrelated to ITL ..................................................90

D. Plaintiff’s Misstate Evidence Regarding Document Destruction at ITL......................91

E. Other Questionable Allegations of Destruction .........................................................93

F. Plaintiff’s Claims Regarding Me Potter’s Submissions to the Court are an Unfounded Attack on Me Potter..........................................................................................................95

G. The BAT Reports Were Made Publicly Available ......................................................95

APPENDIX XIII – CHART OF OBJECTIONS TO QUESTIONS UNDER RESERVE ..........99

APPENDIX XIV – ITL’s MOTION and PLAN OF ARGUMENT RE PARLIAMENTARY PRIVILEGE ........................................................................................................................101

APPENDIX XV – ITL’S MOTION FOR CONFIDENTIALITY OF FINANCIAL STATEMENTS ..........................................................................................................................................102

1

APPENDIX I – THE EVIDENCE OF DR. DAVIES

A. Background and Independence

1. Dr. Davies is a Professor Emeritus at the University of Strathclyde in Glasgow,1 having researched and taught Psychology and Applied Social Psychology since 1969.2 He was external examiner for 25 Ph.D. and four (4) M.Phil. theses, the vast majority of which involved addiction issues, including some entirely about smoking.3 He supervised 18 Ph.D. theses and 20 Masters’ theses up to 1996, at which point he stopped counting. Nearly all of these were in the area of addiction, including some specifically related to smoking.4

2. Dr. Davies has researched and studied in the field of drug use and addiction since 1969,5 and he has done extensive research in clinical settings and working face-to-face with drug users since 1969.6

3. Dr. Davies founded the addiction research group Argus at the University of Strathclyde in 19767 to do research in a “real community environment”.8 This work included a number of smoking studies9 and studies on the dynamics of quitting drug habits.10 Dr. Davies served as Director of the Centre for Applied Social Psychology (a transformation of Argus) until his retirement. The Centre focused on applying different models of theory within psychology to real world problems.11

4. Dr. Davies is a fellow of the British Psychological Society (the highest designation the Society can bestow on a member)12 and was elected as a Fellow of the Royal Society of Medicine.13 His editorial positions with peer-reviewed journals include ten (10) years on the editorial board of the peer-reviewed British Journal of

1 Trial Transcript (Davies), January 27, 2014, p. 23, lines 10-11

2 Trial Transcript (Davies), January 27, 2014, p. 23, lines 24-25; Trial Exhibit 21060.1


4 Trial Transcript (Davies), January 27, 2014, p. 47, line 24 to p. 49, line 25 and pp. 49-56, line 13; Trial Exhibit 21060.1



7 Trial Transcript (Davies), January 27, 2014, p. 35, lines 1-19 and p. 38, lines 23-25




11 Trial Transcript (Davies), January 27, 2014, p. 37, lines 7-15 and line 25 to p. 38, line 3; Trial Exhibit 21060.1



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Addiction (now called Addiction).14 He was Editor-in-Chief of the peer-reviewed journal Addiction Research and Theory for approximately 18 years until his recent retirement, and he remains on the editorial board.15

5. Dr. Davies has published extensively in the field of addiction and drug use, including two (2) books (the Myth of Addiction (two editions) and Drugspeak: The Analysis of Drug Discourse),16 fifteen (15) book chapters on addiction and drug abuse,17 ten (10) published reports for national or governmental agencies,18 fourteen (14) unpublished reports for government agencies,19 and fifty-two (52) papers in peer-reviewed journals (including ten (10) articles in the British Journal of Addiction, six (6) in Addiction, six (6) in the British Journal of Clinical Psychology, among others).20

6. He has held numerous prestigious official and government research appointments, including from the Scottish Government,21 and various leadership positions with the National Health Service (NHS) Quality Improvement Scotland.22 He has received extensive research grants from government and official bodies (only one of which included funding from a tobacco company, unbeknownst to him at the time).23

7. Plaintiffs unfairly assert that Dr. Davies has no research or clinical experience in tobacco addiction and that he has not focused on tobacco24 despite Dr. Davies’ extensive academic, research and leadership achievements at the highest levels in the field of addiction research.25 Dr. Davies is a researcher,26 not a clinician, but he testified that he has “a good deal of clinical experience” through clinical trials27 and research in clinical settings, as well as real world environments.

14

Trial Transcript (Davies), January 27, 2014, p. 28, lines 3-135; Exhibit 21060.1

15 Trial Transcript (Davies), January 27, 2014, p. 26, lines 10-11 and p. 27, lines 1-4; Trial Exhibit 21060.1

16 Trial Transcript (Davies), January 27, 2014, p. 61, line 21 to p. 72, line 20; Trial Exhibit 21060.2




20 Trial Transcript (Davies), January 27, 2014, p. 71, lines 9-19; p. 72, line 4 to p. 73, line 6; p. 73, lines 19-21; Trial Exhibit

21060.2


22 Trial Transcript (Davies), January 27, 2014, p. 41, lines 10-21 and p. 42, line 17 to p. 43, line 7; Trial Exhibit 21060.1

23 Trial Transcript (Davies), January 27, 2014, p. 58, line 5 to p. 61, line 20 and p. 94, lines 9-24

24 Plaintiffs’ Notes and Authorities, para. 247
























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8. The fact that Dr. Davies has not focused exclusively on smoking and nicotine is no impediment to his ability to comment on the use of nicotine. He testified: “No, I think exactly the opposite... if you focus on one thing [drug] to the exclusion of the other, you fail to see the bigger picture.”28 Plaintiffs’ suggestion that Dr. Davies “admitted” that his experience and expertise has not focused on tobacco29 is misleading. When pressed to admit that his “main” focus was not tobacco use, Dr. Davies said: “I would not characterize it that way, sir. I would say that I looked at all drugs, and none of them was the specific focus of any of the research I have done.”30 Dr. Davies adopts (and strongly favours) a comprehensive view of the process of addiction that considers other drugs in addition to nicotine.31

9. Moreover, Plaintiffs have themselves tendered an addiction expert who does not specialize in tobacco use.32 Dr. Negrete has treated more than 10,000 patients for clinical dependence, but only “hundreds” of smokers are among them33 – the vast majority of whom were only treated for nicotine dependence incident to the chemical dependences for which they sought treatment.34 Dr. Negrete’s clinical research35 and writing have not focused specifically on nicotine addiction.36

10. When asked whether many psychiatrists specialize in nicotine addiction, Dr. Negrete said that most psychiatrists do not specialize in addiction period.37 Given that Plaintiffs have tendered an addiction expert who has not focused on nicotine, their attempted criticism of Dr. Davies for this reason must be squarely rejected. In view of Dr. Davies’ vast experience in addiction research, teaching and writing, it is appropriate to give his evidence significant weight.

11. Despite criticizing Dr. Davies for an alleged lack of focus on nicotine, Plaintiffs at the same time unfairly characterize him as a consultant for the tobacco industry since at least 1992.38

12. To the contrary, Dr. Davies testified that he wrote the Myth of Addiction in 1992, “entirely” on the basis of his experience with drug use, “entirely unsolicited by anybody and unfunded by anybody” and the “ideas were entirely mine.”39 He was

28

Trial Transcript (Davies), January 27, 2014, p. 79, lines 10-16




32 Negrete Report, Trial Exhibit 1470.1, p. 2

33 Trial Transcript (Negrete), March 20, 2013, p. 68, lines 15-19

34 Trial Transcript (Negrete), March 20, 2013, p. 68, lines 20-24; p. 69, lines 10-15






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indeed contacted by a lawyer for a tobacco company after the Myth of Addiction was published to consult on scientific articles.40 Yet Dr. Davies has never before filed a report or testified in a tobacco case.41 When cross-examined about any connections with the tobacco industry, Dr. Davies candidly said: “I have no banner to carry for the tobacco industry, sir, I wish people wouldn’t smoke, I’ve done research to try and get people to stop smoking, and I would not wish to be any closer to the tobacco industry than I am at the moment.”42

13. Dr. Davies was very clearly objective, indeed at times critical of the tobacco industry, and any insinuation that he is biased is not credible. Indeed, when asked whether he was subject to any constraints in preparing his report or any of the opinions therein, Dr. Davies answered “No. If I had been, I wouldn’t be here.”43

B. Plaintiffs’ Mischaracterization of Dr. Davies’ Evidence

14. Plaintiffs contend that Dr. Davies “agreed that his own opinions run contrary to all reputable scientists and health authorities that have drawn the conclusion that tobacco is addictive.”44 However, Dr. Davies was not asked that question. In the question cited, he was asked whether he would agree that the vast majority of public health organizations opine that nicotine addiction or dependence is the fundamental reason that smokers persist in using tobacco product.

15. In response to that question, Dr. Davies did not agree that nicotine is the fundamental reason that smokers persist. He went on to explain that the USSG“ in a number of reports” does “put the nicotine aspect of this in a broader context involving social support and those kinds of things....”45 Throughout his testimony, Dr. Davies consistently articulated a well-supported view that tobacco use is attributable to a wide variety of factors including, but not limited to, nicotine itself.

16. Further, Plaintiffs’ omit critical portions of Dr. Davies’ evidence as to his reluctance to use the word “addiction” in response to their hypothetical scenario of a teenager calling him to seek advice about using crystal meth. Dr. Davies was unequivocal that he would advise her that crystal meth is “dangerous” and could give rise to a habit:

If it were to happen, I would be telling the young lady, ‘Do not do this, it is dangerous. You can get in a mess with this stuff. You may well develop a habit with this stuff, and you’d be much better to leave it well alone.’ That is what I would say to her, and I would not be using the word ‘addiction.’ I would be saying, ‘Don’t do it, it’s dangerous. There are other things that young women like

40




43 Trial Transcript (Davies), January 27. 2014, p. 81, lines 19-22









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yourself ought to be doing that are more satisfying. This is not a good idea.’ (emphasis added)

46

17. Dr. Davies went on to explain why he would choose explanations that do not involve the word “addicted” in favour of more meaningful explanations regarding the risks of increased use: “I would never tell her that she would get into a situation... a situation where she couldn’t stop...” with a reference to his prior evidence.47

18. Dr. Davies later said: “I don’t tell people that they’re addicted, I’m a researcher. My own evidence shows that, for particular groups of people, the notion of addiction is a handicap to stopping when they’re already using the drug. And I’ve supported that argument with a number of references from the Maudsley Hospital, Dick Eiser and other people.”48 Dr. Davies’ view was clear throughout that people must know that they can stop and can get out of even the most difficult situations involving drug dependence.

19. He also explained: “... And if you find that you can persuade particular groups of people, particularly those who haven’t started, by emphasizing something called ‘addictive property’ of this substance, and that prevents them from starting, it’s a good message in that context. It’s not a good message if they’re seriously thinking about doing it, intend to do it or are already doing it.”49

20. With respect to cigarettes, he said: “I remain convinced that telling young people who are using cigarettes that they are in the grip of a habit... but that they will find it very difficult to quit because of the pharmacology of the drug, is not a message that I would wish to see widely circulated amongst young people. I think you would go for the health risks and the damage, and say, ‘This is doing you no good at all.’”50

21. Plaintiffs also mischaracterize Dr. Davies’ comments in the video interview that was played during his cross-examination at trial.51 In the video interview, Dr. Davies commented on specific social marketing campaigns that were designed to deceive people in order to produce a desired change of behaviour. He described this “unacceptable” strategy as “a very thorny problem.” Dr. Davies cautioned against the use of misleading statistics and bad science, even if used for what the government perceives to be a good purpose (such as deterring second-hand smoke and cocaine use): “Bad science in a good cause is (still) bad science.”52

46



48 Trial Transcript (Davies), January 29, 2014, p. 85, line 19 to p. 86, line 2; p. 55, lines 18-20

49 Trial Transcript (Davies), January 29, 2014, p. 84, line 19 to p. 85, line 1


51 Trial Exhibit 1692 ; Plaintiffs’ Notes and Authorities, para. 252


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22. Finally, Plaintiffs quote a section of Dr. Davies’ Preface to his Drugspeak book, wherein Dr. Davies expresses a healthy scepticism of bodies of theory.53 As explained later in the Preface, and at trial, Dr. Davies questions what he calls the “illness-treatment-research cycle” regarding addiction and notes the partisan nature of all research in the area. The fact that his “faith in an objective and disinterested science has been shaken”54 was evident in his testimony that Dr. Volkow’s ends-driven opinions are ideological and are themselves funded by certain interests, as discussed above.

23. Contrary to Plaintiffs’ approach, Dr. Davies’ healthy scepticism – notably, with respect to all purported scientific writing – is laudable and merely underscores his strong commitment to objectivity. Dr. Davies tells his students: “Don’t uncritically believe anything that anybody says, including what I’m telling you now.” He testified as to the importance of bringing a “critical edge to everything that you are told.”55

24. This Court should strongly prefer the testimony of an expert whose well-considered views are formulated from vast experience and sharply-critical thinking. Dr. Davies explicitly cautions against blindly accepting conclusions simply because they are written by scientists in white lab coats who use big words to try to reduce complex bio-psycho-social phenomena to a single pharmacological cause.

53

Plaintiffs’ Notes and Authorities, para. 249

54 Trial Exhibit 21060.63, p. 5 pdf



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APPENDIX II - ITL’s SAFER CIGARETTE RESEARCH

1. As was discussed in ITL’s Notes and Authorities, Plaintiffs have adduced no evidence to suggest that ITL failed to comply with the state of the art in connection with efforts to reduce the hazards of cigarettes. Instead, the evidence is overwhelmingly to the contrary. There was simply no design defect.

2. The following represents a brief overview of the work that ITL has engaged in over the decades in connection with these efforts.

A. Efforts to Measure Smoke Components as a First Step to Developing a Less Hazardous Product

3. Among other things, ITL made a sizeable contribution to the development of quantitative methodologies for the measurement of smoke components, and many such efforts were published as well as referred to in publications such as the US Surgeon General’s reports).56 The reason for such work was explained by Dr. Porter; namely, where a smoke component has been identified as a potentially harmful element in tobacco smoke, one needs to have a reliable method for measuring any reductions in concentration. Examples of such efforts, from the 1960s alone, included the development of methodologies to measure:

a. benzo(a)pyrenes57

b. phenols58;

c. aldehydes, hydrogen cyanide and acrolein59;

d. oxides of nitrogen60; and

e. the natural radioactivity in tobacco and tobacco smoke.61

4. The efforts to develop superior analytical methodologies for the measurement of various smoke components (all of which was related to efforts to reduce potentially harmful components in tobacco smoke) continued throughout the

56

See, for example, Trial Exhibit 20148-AUTH, Trial Exhibit 20149-AUTH, Trial Exhibit 601-1964, p. 152 pdf & p. 259 pdf

57 Trial Transcript (Porter), August 27, 2013, from p. 49, line 12 to p. 51, line 12; Trial Exhibit 367; Trial Exhibit 367A, pp.

17-18 pdf, abstract 20

58 Trial Transcript (Porter), August 27, 2013, from p. 57, line 5 to p. 58, line 11; p. 60, lines 3-17; p. 61, lines 11-23 &

Trial Exhibits 20143-AUTH; and 20144-AUTH

59 Trial Transcript (Porter), August 27, 2013, from p. 63, lines 10 to p. 64, lines 12; from p. 66, line 17 to p. 67, lines 16,

Trial Exhibits 20145-AUTH; and 20146-AUTH

60 Trial Transcript (Porter), August 27, 2013, from p. 68 , line 9 to p. 70, line 10, Trial Exhibits 20147-AUTH and

20024.6A

61 Trial Transcript (Porter), August 27, 2013, from p. 71, line 13 to p. 72, line 13; from p. 73, from line 25 to p. 76, line 11;

Trial Exhibit 20148-AUTH, Trial Exhibit 20149-AUTH, Trial Exhibit 601-1964, pp. 152 & 259 pdf. Although natural radioactivity was subsequently determined not to be present in tobacco smoke in sufficient quantities to be a causative agent for lung cancer, it was nonetheless investigated by ITL when the possibility was originally raised in the public literature.

EXHIBITS/Exhibit%2020148-AUTH.pdf


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class period.62 ITL engaged in such research independently, as well as in conjunction with third parties such as Labstat.63 There was nothing hidden or secret about these efforts. Indeed, the report emanating out of the 50th Tobacco Chemists’ Research Conference (the “TCRC”), (which conferences were replete with industry studies, including those of ITL, as well as studies from independent researchers and governmental bodies, such as AgCan and Health Canada ), stated:

The fifty year history of the TCRC presentations is rich in the development of new analytical methodologies for the study of tobacco, smoke and related material. Of the more than 2,000 papers that have been presented, more than half dealt with analytical methodology topics.

64

B. Biological Assays and Other Tests

5. Looking at how to accurately measure smoke components was but one aspect of the significant and on-going efforts by ITL to develop a cigarette with less risks. Another form of “measurement” related to the development and use of bioassays and other tests to measure the biological activity of tobacco smoke and its components, all of which was done so as to provide guidance to product modification that might result in a less hazardous product.

6. It is important to state at the outset what “biological activity” means: it is the interaction of a substance with any biological substrate and the changes that may occur to the biological substrate.65 It is not, as was claimed by yet another tobacco control advocate, Professor Stanton Glanz (and as was adopted by Dr. Castonguay both in his ‘expert’ report66 and repeated on the stand) “a tobacco industry euphemism for causing cancer and other diseases”.67

7. The phrase “biological activity” or “biologically active” is commonly used in the scientific literature and by public health authorities, including the Canadian government, a small sample of which was shown to Dr. Castonguay in cross-examination.68 Dr. Castonguay could no longer maintain that this was a tobacco industry euphemism, but asserted that now the government was using the phrase as a euphemism. On being shown an article co-authored by himself that used that very same phrase (“The tar delivery, which is generally accepted as the index for the carcinogenic potential and the biological activity of cigarette smoke” [emphasis added])69, he attempted to suggest that the term was being used in

62

Trial Transcript (Porter), August 27, 2013, from p. 77, line 9 to p. 83, line 6; p. 98, lines 8-16, Trial Exhibit 20150, p. 20 pdf & Trial Exhibit 20151

63 Trial Transcript (Porter), August 27, 2013, p. 99, lines 8-13

64 Trial Exhibit 20150 at p. 4 pdf.

65 Trial Transcript (Porter), August 27, 2013, p. 106, lines 2-9; Trial Transcript (Read), September 9, 2013, from p. 87,

line 21 to p. 88, line 14

66 Trial Exhibit 1385 at p. 15 pdf

67 Trial Transcript (Castonguay), February 13, 2013, from p. 162, line 14 to p. 163, line 5

68 Trial Exhibit 20013 at p. 1 pdf, Trial Exhibit 20014, p. 2 pdf

69 Trial Exhibit 20015 at p. 4 pdf



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this writing as a definition for carcinogenic activity, despite the clear distinction being made in his own article by use of the word “and”.70

8. The only expert put forward by Plaintiffs who attempted to speak to cigarette design features was Dr. Castonguay, a self described “tobacco control advocate”71 (in stark contrast to the neutrality which is required of an expert), who was not qualified as an expert in cigarette design, and had never engaged in any work relating to cigarette design.72 Further, Dr. Castonguay performed no comprehensive review of the work carried out by ITL relative to its efforts aimed at developing a safer cigarette.73 Indeed, he did no review at all of the documents produced by Defendants,74 relying only on limited documents obtained from the public domain without the requisite expertise to understand them, resulting in frequent erroneous conclusions.

9. Plaintiffs asked (and this Court accepted) that Dr. Castonguay be qualified solely in the areas of tobacco chemistry and toxicology.75 All other “evidence” provided by Dr. Castonguay in his alleged ‘expert’ report ought to be given no weight, in light of his admitted lack of expertise, unfamiliarity with Defendants’ productions and research activities and erroneous conclusions drawn from his selected readings. In fact, Dr. Castonguay’s credibility in even his alleged areas of expertise was significantly eroded in cross-examination.

10. At the end of the day, the purpose of measuring biological activity was to provide guidance as to possible changes that might result from an alteration in design, in the hopes that reducing or eliminating such activity might lead to the reduction in risk for a given disease (given that one cannot directly measure such changes directly in smokers).

11. However, developing a useful bioassay is extremely difficult. A useful bioassay must have some hypothetical relevance to the disease in question, it has to be something that can be carried out within a reasonable timeframe, it has to reproducible (in other words, reliable), it should be able to differentiate between different design features and it should be a test that is generally accepted by workers in the field.76

12. One of the earliest bioassays used by independent researchers such as Wynder and Hoffman in the 1950s was the mouse skin painting test. Following their lead, BAT was using the test by 1960.77 Generally, mouse skin painting tests use

70

Trial Transcript (Castonguay), February 13, 2013, from p. 172, line 2 to p. 175, line 25

71 Trial Exhibit 30011, p. 1 pdf


73 Trial Transcript (Castonguay), February 13, 2013, p. 180, lines 9-14



76 Trial Transcript (Porter), August 27, 2013, from p. 110, line 15 to p. 111, line 22 and from p. 161, line 24 to p. 166, line

24

77 Trial Transcript (Read), September 9, 2013, from p. 105, line 8 to p. 106, line 11


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highly inbred mice that are particularly susceptible to tumours. The backs of these mice are shaved and then tobacco smoke condensate is collected and ultimately painted onto the backs of mice over a two year period. 78 This is often done in conjunction with a ‘pre-painting’ of a known carcinogen, as tobacco smoke itself had been generally recognized as a weak carcinogen. In other words, the bioassay’s utility was not so much to determine whether tumours would develop, (as the situation had been designed so as to produce tumours), but to see which types of tars or (other cigarette constituents) would cause more tumours than another. 79

13. ITL had access to mouse skin painting test results conducted by a myriad of outside scientists and health organizations, as well as those conducted on behalf of and by BAT. ITL did not test its own commercial cigarettes using this test because: (a) it did not have the facilities to perform such tests; and (b) the NCI, other independent scientists and health organizations and BAT had performed extensive testing on all the parameters that ITL could possibly use in its cigarettes – there was simply no reason to re-invent the wheel, but the wheel was nonetheless used.80 As was stated by Mr. Read:

...we had the group program; they [ITL] contributed to the group program, they were parties to the decision making. I can see no logical reason why they would actually seek to undertake, independently of the group, mouse skin painting studies.”

81

14. Like all bioassays (whether historically or currently), there were limits to the mouse-skin painting test. Eminent researchers such as Wynder and Hoffman as well as the U.S. National Cancer Institute commented that the significance of mouse skin painting experiments in the formulation of less hazardous cigarettes was limited by the uncertain relationship of the test to human lung cancer and by the virtual absence of information on the cardiovascular and respiratory effects of cigarettes modified so as to produce lower biological activity based on the test.82 The evidence before this Court is that the relevance of the mouse skin painting test was arguable, although the guidance it provided served a useful tool in ITL’s efforts to modify its products, such as the continued use of reconstituted tobacco.

15. The mouse skin painting test is no longer a common test used today in connection with tobacco and tobacco smoke, as it has been superseded by other

78

Condensate is the collection of smoke particles that are collected on a Cambridge filter pad. See Trial Transcript (Read), September 9, 2013, from p. 96, line 8 to p. 97, line 1

79 Trial Transcript (Porter), August 27, 2013 from p. 112, line 1 to p. 114, line 12; Trial Transcript (Read), September 9,

2013, from p. 97, line 18 to p. 100, line 10; Trial Exhibit 20154-AUTH at p. 201 pdf (the “Bible” in the field, according to Dr. Castonguay – see Trial Transcript (Castonguay), February 7, 2013, p. 119, lines 6-14; Trial Exhibit 40346, p. 65 pdf; Trial Exhibit 20821.3, p. 51 pdf; Trial Exhibit 20152-AUTH, p. 427 pdf

80 Trial Transcript (Porter), August 27, 2013, from p. 139, line 14 to p. 142, line 8; from p. 164, line 9 to p. 168, line 22;

Trial Exhibit 40346.81, Trial Exhibit 20152-AUTH at pp. 420-438 pdf, Trial Exhibit 20154-AUTH, pp. 187-195; Trial Exhibit 40346.289, Trial Exhibit 40346.290, Trial Exhibit 40346.291, Trial Exhibit 40346.292, Trial Exhibit 20155-AUTH; Trial Transcript (Read), September 9, 2013, p. 109, lines 6-17

81 Trial Transcript (Read), September 9, 2013, p. 118, lines 10 to 24

82 Trial Exhibit 20152-AUTH p. 438 pdf, Trial Exhibit 20154-AUTH, p. 153 pdf,Trial Exhibit 40346.289, p. 3 pdf; see also,

Trial Transcript (Bilimoria), March 5, 2013 from p. 143, line 24 to p. 144, line 2






EXHIBITS/Exhibit%2020154-AUTH.pdf#page=201























TRANSCRIPTS/Transcript%20-%20March%205,%202013%20-%20Bilimoria%20(Day%20120).PDF#page=143

11

tests – science does not stand still, and what is seen as practical or useful on day X is not viewed as such on day Y.83 For example, while the ISCSH84 recommended the use of mouse skin painting studies on novel products (such as tobacco substitutes), it did not otherwise recommend its use during its life span (from 1974 to 1988).85

16. ITL also had access to the results of another bioassay test – inhalation studies, both those conducted by BAT as well as those performed by independent researchers.

17. In the 1960s and 1970s, independent scientists in the field of toxicology were making significant efforts to develop tests to evaluate materials. As well, the UK tobacco industry was collectively investigating inhalation techniques at their laboratory at Harrogate. In addition to this, BAT built its own in-house animal inhalation facility in 1973.86

18. BAT’s focus on inhalation studies began as efforts in mouse skin paintings started to wind down. The concentration on inhalation studies as opposed to mouse skin painting studies was not the result of cost considerations, as inhalation studies were more expensive to conduct than mouse skin painting bioassays.87

19. ITL did not test its own commercial products using the inhalation studies, other than in connection with Project Day (which represented a significant change to the tobacco itself), given that, (as was the case with mouse skin painting tests), others had performed extensive testing on all the other parameters that ITL could use in its cigarettes.88

20. Further, similar to mouse skin painting studies, there were significant limitations in terms of the use of inhalation studies. Among other things, animals breath through their noses, which contain a different clearance mechanism than human lungs, and often stop breathing for long periods of time when exposed to smoke. These limitations that were recognized by leading independent researchers such as Wynder and Hoffman.89

21. In addition, despite the significant amount of effort that was devoted to developing a useful inhalation test (particularly by BAT), the test ultimately proved relatively uninformative in terms of providing guidance in the development of less hazardous cigarettes. Inhalation studies were unable to produce any primary

83

Trial Transcript (Porter), August 27, 2013, from p. 165, line 24 to p. 166, line 3

84 The ISCSH was a committee of independent scientists charged by the UK government to provide advice on matters

such as cigarette modification, the processes whereby hazards might be reduced and other related matters.

85 Trial Transcript (Read), September 9, 2013, from p. 114, line 3, to p. 116, line 6

86 Trial Transcript (Read), September 9, 2013, from p. 119, line 11, to p. P. 120, line 13

87 Trial Transcript (Read), September 9, 2013, p. 122, lines 12-22

88 Trial Transcript (Porter), August 27, 2013, from p. 172 line 22 to p. 173, line 10

89 Trial Exhibit 20154-AUTH, p. 153 pdf







12

tumours, so at the end of the day, its utility was limited to assessing cigarette smoke simply as an irritant as opposed to the relevant endpoint, being primary tumours.90

22. ITL also made significant efforts on its own to develop reliable bioassays, and in particular short-term tests, (given that mouse skin painting required approximately two years for results to be obtained). Many of these efforts, such as those below, failed to produce a reliable, reproducible test that was sufficiently sensitive to be able to guide product modification:

a. a “cytochrome reduction” test;91

b. a “hemoglobin” test;92

c. an “aryl hydrocarbon hydroxylase” (“AHH”) test;93

d. an “L-asparaginases” test;94

e. a test having to do with the “inhibition of radical initiated vinyl acetate polymerization” by tobacco smoke fractions;95

f. a test pertaining to the depletion of antioxidants by tobacco smoke;96

g. a test regarding the effects of various smoke condensates on ascorbic acid;97

h. a test pertaining to investigating “the reducing properties” of tobacco smoke;98 and

i. the effects of tobacco smoke on the oxidation process of parts of cells.99

90

Trial Transcript (Read), September 9, 2013, from p. 123, line 2 to p. 125, line 4 & from p. 126, line 19 to p. 127, line 11

91 Trial Transcript (Billimoria), March 5, 2013, from p. 34, line 20 to p. 36, line 8; Trial Exhibit 20024.5

92 Trial Transcript (Porter), August 27, 2013 from p. 239, line 10 to p. 240, line 6, Trial Exhibit 20157-AUTH

93 Trial Transcript (Billimoria), March 4, 2013, from p. 31, line 19 to p. 32, line 13; Trial Transcript (Bilimoria), March 5,

2013, from p. 63 line 13 to p. 65, line 14; Trial Exhibit 20024.9 at p. 8 pdf, Trial Exhibit 20024.10, Trial Exhibit 20024.11, Trial Exhibit 20024.12, p. 2 pdf, abstract 159, Trial Exhibit 20024.13 at p. 2 pdf, abstract 121, Trial Exhibit 20024.14, Trial Exhibit 20024.16, p. 2 pdf, abstract 864, Trial Exhibit 20024.17, Trial Exhibit 20024.18, p. 2 pdf, abstract 273, Trial Exhibit 20024.19

94 Trial Transcript (Bilimoria), March 5, 2013, from p. 22, line 22 to p. 24, line 21; Trial Exhibit 20024.1, Trial Exhibit

20024.2

95 Trial Transcript (Porter), August 27, 2013, from p. 248, line 2 to p. 249, line 14 & p. 252 lines 15-19, Trial Exhibit

20160-AUTH & Trial Exhibit 20161-AUTH; Trial Transcript (Bilimoria), March 5, 2013, from p. 37, line 4 to p. 41, line 13; Trial Exhibit 20024.6

96 Trial Transcript (Porter), August 27, 2013, from p. 262, line 7 to p. 265, line 9, Trial Exhibit 20163-AUTH; Trial

Transcript (Bilimoria), March 5, 2013, from p. 110, line 12 to p. 113, line 8; Trial Exhibit 20024.20, p. 2 pdf at abstract 739, Trial Exhibit 20024.21

97 Trial Transcript (Bilimoria), March 5, 2013, p. 28, lines 3-19, p. 33, lines 7-19, Trial Exhibit 20024.3, at p. 21 pdf,

abstract 25, Trial Exhibit 20024.4

98 Trial Transcript (Bilimoria), March 5, 2013 from p. 53, line 15 to p. 56, line 8; Trial Exhibit 20024.7 & Trial Exhibit

20024.8


















































13

23. The fact that these endeavours did not result in usable testing methodologies is the nature of science, and does not diminish the significant energy expended in this regard. Nor did they fail to provide guidance towards workable solutions. This work assisted in understanding the properties of tobacco smoke and some of its effects.100 Indeed, many of these efforts were published in peer reviewed journals and were cited in U.S. Surgeon General reports.101

24. Certainly, the Ames test (discussed in further detail below) was utilized by ITL. However, this was not the only bio-assay it used along the way. Apart from accessing the results of mouse skin painting tests and inhalation studies, it also used, in connection with product modification efforts, a test known as the nitromethane fraction index test (NMFI)102 (which, test, contrary to the false allegation made by Plaintiffs in their submissions,103 was in fact shared by ITL with the Canadian government),104 a paramecium test105 and a hyperplasia test.106 In the 1990s, as these test began to be available, ITL used the chromosome aberration test, the unscheduled DNA synthesis test, the in vitro micronucleus test and the neutral red uptake test. Such tests were first used in connection with experimental cigarettes and later in connection with commercial cigarettes, as technical issues with these tests were sorted out and large scale testing was feasible. 107 Like the Ames test, the in vitro micronucleus test and the neutral red uptake test are currently mandated for use by regulations to the Tobacco Act.108

B.1 Ames

25. ITL began using the Ames test in the mid 1970s. Like other bioassays, the Ames test was used by ITL in an effort to measure the effect of tobacco smoke (or certain components of tobacco smoke) on a biological system – in this case, the biological system was a strain of the salmonella bacteria, E-coli.109 The Ames test

99

Trial Transcript (Porter), August 27, 2013, from p. 243, line 19 to p. 245, line 3; Exhibit 20158-AUTH & Exhibit 20159-AUTH, Trial Transcript (Porter), August 27, 2013, from p. 256, line 19 to p. 257, line 13, Exhibit 20162-AUTH

100 See, for example, Trial Transcript (Porter), August 27, 2013, p. 264, lines 2-9

101 Trial Transcript (Bilimoria), March 5, 2013, from 70, line 9 to p. 72, line 18 & from p. 116 line 8 to p. 118, line 7, Trial

Exhibit 20025, at pp. 2& 3 pdf, Trial Exhibit 20026, pp. 2, 3 & 4 pdf

102 Trial Transcript (Porter), August 27, 2013, from p. 267, line 4 to p. 269, line 6; Trial Transcript (Read), September 9,

2013, from p. 149, line 18 to p. 151, line 18


104 Trial Transcript (Bilimoria), March 5, 2013, from p. 156, line 19 to p. 157, line 7

105 Trial Transcript (Porter), August 27, 2013, from p. 269, line 15 to p. 271, line 23; Trial Exhibit 20165-AUTH

106 Trial Transcript (Porter), August 27, 2013, from p. 271, line 24 to p. 272, line 18

107 Trial Transcript (Porter), August 27, 2013, from p. 296, line 11 to p. 297, line 24 and from p. 303, line 5 to p. 304, line

25; Trial Transcript (Porter), August 28, 2013, from p. 12, line 24 to p. 18, line 1;Trial Exhibit 20175, Trial Exhibit 20176

108 Trial Exhibit 20166, pp. 32-33 pdf, section 14.2 (6)(a)(b)&(c)

109 Trial Transcript (Bilimoria), March 5, 2013, from p. 12, line 21 to p. 13, line 12






























14

looked at mutagenesis (damage to DNA). At the time, it was thought that there was a good correlation between compounds that were carcinogenic and those that were mutagenic according to the Ames test (i.e. Ames active), such that the Ames test would be a very useful short term test for the carcinogenic potential of tobacco smoke and its components. Over time, however, that correlation has been found to be substantially less than originally thought.110 That being said, the Ames test fit with the various requirements for a good bioassay:

a. It provided results within a reasonable timeframe;

b. It provided a conceptual link between the test and a disease associated with smoking;

c. It was able to differentiate between different design features;

d. It was reproducible; and

e. It was generally accepted by workers in the field.111

26. Dr. Castonguay opined that the Ames test was an “inadequate test” (without knowledge of the other tests used by ITL over time (whether directly or through use of third party data)); he also claimed that it was unreliable (with absolutely no evidence that this was the case) – however, he was completely unaware that the Canadian government itself was making use of this test in the 1970s.112 Further he made absolutely no reference, when criticizing its use by ITL, to the fact that the Ames test is currently, and has been since 2005 mandated by regulation to be used by Canadian tobacco manufacturers.113 In contrast to Dr. Castonguay, who admitted he had absolutely no expertise in cigarette design, Dr. Porter, who spent his career investigating ways to produce a less hazardous product, confirmed that the Ames test remains useful as it points to possible modifications that can be done to the product.114

27. It is of note that Dr. Castonguay, exhibiting again his willingness to make disparaging comments about ITL without any knowledge of the actual facts of the matter, stated that ITL did not communicate the fact that the tobacco smoke in its cigarettes was mutagenic (as tested under the Ames test). However, he admitted that he made such an assertion without any awareness of scientific publications disclosing ITL’s acknowledgment of this fact, nor was he aware of any communications between any of Defendants and the Canadian government regarding this issue.115

110

Trial Transcript (Porter), August 27, 2013 at p. 274, lines 6-13

111 Trial Transcript (Porter), August 27, 2013, from p. 273, line 6 to p. 275 line 11

112 Trial Transcript (Castonguay), February 13, 2013, p. 187, lines 20-24; Trial Exhibit 20017 and Trial Exhibit 20019

113 Trial Transcript (Porter), August 27, 2013, from p. 274, line 25 to p. 276, line 11; Trial Exhibit 20166, pp. 32-33 pdf,

section 14.2 (6)(a)













15

28. The truth, as can be clearly seen in the evidence and was acknowledged by Dr. Castonguay in cross-examination, is that:

a. ITL scientists frequently published articles and made public presentations disclosing the fact that cigarette smoke contained mutagens;116 and

b. The information was freely communicated by ITL to the Canadian government.117

29. Dr. Castonguay ultimately admitted that his allegation was wrong.118

30. Further, ITL did not rest on its laurels and simply remain satisfied with the use of the Ames test. Instead, it was itself continuing to investigate a battery of tests and was actively encouraging BAT to investigate and develop further tests to complement Ames.119

31. Despite the extensive evidence in these actions regarding bioassays, and suggestions by Plaintiffs during the trial that test X was inadequate, or that Y or Z should have been used (without understanding that Y and Z may indeed have been used in respect of the various design parameters), the evidence is clear: There exists no test or even a panel of tests that proves that the risk to health will decrease with any modification to the cigarette design or that one cigarette is safer than another.120

32. Further, the incredible difficulty inherent in relying on these various bioassays and other tests was that results were not consistent. Test A might tell you to go in one direction, but test B suggested another avenue. As useful as the tests were to product modification, the results of any of the tests, individually or collectively, do not allow for a conclusion that one product is safer than another. This was the case previously and remains so today.121

33. Nonetheless, despite all of these difficulties, ITL engaged in serious and long-term efforts to develop and use these various bioassays in its efforts to reduce

116

See, for example: Trial Transcript (Bilimoria), March 5, 2013 from p. 48, line 6 to p. 50, line 8; Trial Exhibit 20018, p. 25 pdf, abstract Ca-3 (note as well that representatives of the Canadian Federal government both attended and presented at this conference – see p. 24 pdf, abstract Ac-11);

Trial Transcript (Bilimoria), March 5, 2013, from p. 107 line 15 to p. 109, line 21; Trial Exhibit 20020, p. 5 pdf

Trial Transcript (Porter), August 27, 2013, from p. 287, line 2 to p. 290, line 9, Trial Exhibit 20167, Trial Exhibit 20168, p. 3 pdf, Trial Exhibit 20169, p. 2 pdf, Trial Exhibit 20170, p. 4 pdf, Trial Exhibit 20171, Trial Exhibit 20172 & Trial Exhibit 20173

117 See Trial Transcript (Bilimoria), March 5, 2013 from p. 119, line 13 to p. 122, line 24, Trial Exhibit 20019, pp. 23 & 25

pdf


119 Trial Transcript (Porter), August 27, 2013, p. 295, lines 8 to 17

120 Trial Transcript (Read), September 9, 2013, from p. 88, line 15 to p. 89, line 8; Trial Transcript (Porter), August 28,

2013 from p. 41 line 9 to p. 42, line 10

121 Trial Transcript (Read), September 9, 2013, from p. 186, line 13 to p. 190, line 11.


























16

the hazards of cigarettes. There was no failure in the state of the art on this (or any) front.

C. Design Modifications Represented the State of the Art

34. All of the efforts made to measure smoke components and then to develop and utilize tests such as bioassays were undertaken to have tools available to guide the way towards product modification and the development of what was hopefully a less hazardous cigarette. The two major categories of efforts engaged in by ITL were selective reduction and general reduction. ITL also had the benefit of receiving the extensive research that BAT engaged in pertaining to more novel products, none of which, unfortunately, proved to be both workable and acceptable to consumers. Further compounding these difficulties is the continuing lack of ability to assess the biological properties that are predictive of the health consequences of their use.122

C.1 Selective/Specific Reduction

35. At the end of the 1950s, with the emergence of the epidemiological evidence and the availability of mouse skin painting data, ITL’s (and BAT’s) view was that they would analyze tobacco smoke and attempt to determine the potential culprits responsible for the apparent increase in disease, with the ultimate objective of removing those components.123 The task, which seemed relatively simple in early days when the quantum of known chemicals in tobacco smoke was small, became exponentially more complex a decade later, when there were over a thousand known components present in tobacco smoke. Despite this increasing complexity, at no time did ITL (or BAT) cease efforts to selectively reduce smoke components identified in the literature as being potential culprits for smoking related health risks.124

36. By the end of the 1950s, ITL was investigating means by which it could try to reduce the amounts of benzo(a)pyrene in cigarette smoke (also known as 3, 4 benzpyrenes, and hereinafter “BaP”), given that this component had been identified in the public literature as a suspected toxin in smoke.125 Such investigations represented an ongoing effort by ITL throughout the class period.126

37. Dr. Castonguay overstepped once again in his report, stating that BaP was one of the first substances to be identified as carcinogenic, suggesting that this had been established by the 1950s.127 When asked if the International Agency for

122

Trial Transcript (Read), September 10, 2013, from p. 56, line 14 to p. 59, lines 21

123 Trial Exhibit 20315.1, p. 2 pdf; Trial Transcript (Read), September 9, 2013, from p. 258, line 19 to p. 260, line 16

124 Trial Transcript (Porter), August 28, 2013, p. 194, lines 19-23; Trial Transcript (Read), September 9, 2013, from p.

262, line 9 to p, 266, line 3


126 Trial Exhibit 20181-AUTH; Trial Exhibit 20182-AUTH; Trial Exhibit 20183-AUTH; Trial Exhibit 20184-AUTH; Trial

Exhibit 20185-AUTH; Trial Exhibit 20186-CONF, pp. 8-9 pdf















EXHIBITS/Exhibit%2020186-CONF.pdf#page=8


17

Research on Cancer (the “IARC”) (an admitted authority on the identification and documentation of carcinogenic agents)128 had classified BaP as a human carcinogen by 1998, his response was “Je ne sais pas”. 129 Counsel for ITL assisted Dr. Castonguay with this issue, establishing that the IARC had only classified BaP as a human carcinogen in 2010.130

38. In any event, efforts to selectively reduce BaP were beset with a common and on-going conundrum – namely, manners which reduced a particular smoke component had the unintended consequence of increasing another.131 For example, Wynder, Hoffman and others reported that adding nitrate salts to tobacco would reduce the amount of BaP in tobacco smoke, which then reduced the tumorigenic activity of tobacco condensate.132 ITL responsibly investigated such claims. However, adding nitrate (while reducing BaP) also resulted in the increase of other undesirable smoke components, such as hydrogen cyanide and nitric oxide. It also causes an increase in nitrosamines.133

39. ITL of course also looked at reducing carbon monoxide (“CO”). It did so by investigating all of the conventional cigarette design parameters available (such as paper additives, the width by which one cut tobacco, paper porosity, the density by which tobacco was packed in the cigarette rod and various filter variations, such as the pressure drop).134

40. However, the most significant means by which one can reduce gas phase components such as CO was and is filter ventilation. Unventilated filters are simply not effective in reducing this component. The evidence before this Court is that one could not reduce the amount of CO in cigarette smoke below approximately 10 or 12 mg CO without the use of filter ventilation.135

41. The reduction of phenols represented yet another ‘category’ of selective reduction efforts engaged in by ITL since the 1960s (and continuing following the close of the class period).136

42. Notably, cellulose acetate filters (the type of filters used by ITL in virtually all of its commercial cigarettes) selectively reduced certain types of phenols (which

128

Trial Transcript (Castonguay), February 6, 2013, p. 217, lines 3-16



131 Trial Transcript (Porter), August 28, 2013, p. 145, lines 7-12 & p. 163, lines 14-21

132 Trial Exhibit 20154-AUTH, pp. 527 & 532 pdf

133 Trial Transcript (Porter), August 28, 2013, from p. 144, line 10, to p 148, line 20;

134 Trial Transcript (Porter), August 28, 2013, p. 133, lines 10 to 25

135 Trial Transcript (Porter), August 28, 2013, from p. 87, line 5 to p. 88, line 21; Trial Exhibit 601-1979, p. 771 pdf












18

resulted in a higher rate of reduction for these phenols as compared to tar generally).137

43. ITL has engaged in ongoing efforts to selectively remove many other smoke constituents over the decades, many of which continued to be investigated as part of ITL’s Project Day.138

44. Dr. Castonguay identified smoke components such as mercury, nickel, chromium, lead and cadmium in his ‘expert’ report139, but to what end?

45. The IARC has classified mercury as a group 3 chemical (not classifiable as to their carcinogenicity to humans).140 The SGR has stated that it is unlikely that nickel plays a significant role in the aetiology of lung cancer among cigarette smokers.141

46. As to chromium, lead and cadmium (the latter constituent again raised by Plaintiffs in their submissions),142 on cross-examination Dr. Castonguay agreed that the evidence for these components playing a major role in the development of tobacco related cancers was not compelling.143

47. Diminishing his credibility further, Dr. Castonguay wrote in his report that, notwithstanding knowledge of the presence of cadmium in their products “et des conséquences associées à une exposition au cadmium. Ils ont tenté de minimiser la portée toxicologique de travaux d'analyse du cadmium dans la fumée de tabac.”144 What was the basis for his conclusion that these Defendants attempted to minimize the toxicological significance of cadmium? He had no references to support the statement in connection to ITL (or JTI or RBH) and on cross-examination, he claimed that the “support” was actually based the fact that he had found absolutely no reference to cadmium in their internal documents.145 This indeed would be a self-fulfilling prophecy, given that Dr. Castonguay performed no review at all of the documents produced by Defendants.146

48. Cadmium is a trace metal found in soil and in the atmosphere, and is generally absorbed from the soil to tobacco through the tobacco root system. The evidence clearly shows that contrary to Dr. Castonguay’s baseless statement, Defendants

137


138 Trial Transcript (Porter), August 28, 2013, from p. 157, line 23 to p.160, line 21

139 Trial Exhibit 1385, pp. 29-30 pdf


141 Trial Exhibit 601-1982, p. 222 pdf

142 Plaintiffs’ Notes and Authorities, para. 304.

143 Trial Transcript (Castonguay), February 7, 2013, from p. 209, line 22 to p. 211, line 1, Trial Exhibit 20036, pp. 16-17

pdf


145 Trial Transcript (Castonguay), February 7, 2013, from p. 211, line 10, to p. 212, line 18














19

were actively engaged in efforts, together with Agriculture Canada, to understand the cause of cadmium in tobacco smoke and to reduce the levels.147 Dr. Castonguay was not only unaware of this, but he was also unaware that ITL provided the very document he relied on to establish ITL’s knowledge of cadmium to the Canadian government’s researchers!148

C.1.a Nitrosamines

49. The reduction of one category of smoke constituents has been the subject of much evidence during these proceedings – nitrosamines, and in particular, tobacco specific nitrosamines (“TSNAs”). Plaintiffs make further reference to these constituents in their submissions, relying in no small measure on misstatements of the evidence and in an even greater measure on only Plaintiffs’ counsels’ apparent expertise’ to suggest that Defendants (and presumably health authorities, independent scientists and the Canadian government) were negligent in failing to discover, prior to the late 1990s, that a change in the curing process would result in a reduction of the already low levels of TSNAs in Canadian cigarettes.

50. The issue of nitrosamines generally149 is the only area of tobacco research that Dr. Castonguay had some hands-on experience with, and even in this area, he wore his advocate’s cloak and made assertions and innuendos that proved to be incorrect.

51. For example, in his report filed with the Court, Dr. Castonguay states that by 1965, scientists at ITL and BAT knew that cigarette smoke contained nitrosamines. For this proposition, he quoted the following passage from a 1965 BAT report:

Four independent analytical procedures have shown nitrosamines to occur in smoke condensate and results suggest that the amounts may approach 5 ug/cigarette.

150

52. What Dr. Castonguay purposely left out from his report is the very next sentence in the document quoted from:

However, it is not yet known whether nitrosamines are present in the smoke produced by cigarettes or whether they are formed in the smoke collection process”. [emphasis added]

151

147

Trial Transcript (Porter), May 30, 2012, from p. 39, line 25 to p. 40, line 7; Trial Transcript (Porter), August 28, 2013, from p. 55, line 16 to p. 56, line 3

148 Trial Transcript (Castonguay), February 7, 2013, from p. 212, line 19 to p. 213, line 16; Trial Exhibit 1385, p. 35 pdf &

footnote 195, p. 99 pdf; Trial Exhibit 346T-2M; Trial Exhibit 319M, p. 32 pdf

149 Dr. Castonguay’s expertise does not extend to matters of tobacco curing. See Trial Transcript (Castonguay), February

6, 2013, p. 59, line 2 - 24

150 Trial Exhibit 1385, p. 14 pdf & footnote 37, p. 86 pdf

151 Trial Transcript (Castonguay), February 7, 2013, from p. 105, line 14, to p. 108, line 21; Trial Exhibit 346D-2m, p. 5

pdf

TRANSCRIPTS/Transcript%20-%20May%2030,%202012%20-%20Porter%20(Day%2034).PDF#page=39







EXHIBITS/Exhibit%20346T-2m.pdf

EXHIBITS/Exhibit%20319M.pdf#page=32






EXHIBITS/Exhibit%20346D-2m.pdf#page=5

EXHIBITS/Exhibit%20346D-2m.pdf#page=5

20

53. In other words, the existence of nitrosamines in tobacco smoke was only speculation as of 1965, as was admitted by Dr. Castonguay on cross-examination.152

54. Plaintiffs repeat this attempt to erroneously alter the timeline as to the discovery of nitrosamines in tobacco smoke by asserting that ITL knew that they were in tobacco smoke as of 1969.153

55. The fact is that there was no confirmation that nitrosamines existed in tobacco smoke in the 1960s.154 Instead, confirmation only came about in 1970s, with the discovery by Dr. Hoffman of the American Health Foundation that NNN (a TSNA) was in tobacco smoke. This information was published in 1975. This was followed by the discovery of another TSNA (NNK) in tobacco smoke several years later, again by a scientist from the American Health Foundation. This was admitted by Dr. Castonguay on cross-examination.155

56. NNN and NNK (the two TSNAs addressed at length by Dr. Castonguay in his report) were only determined to be carcinogenic to humans in 2007 (although it is significant that even when the 2007 IARC report was put to Dr. Castonguay in cross-examination, he misread the document, and stated that even as of that date the, NNN and NNK were not human carcinogenic agents).156

57. Like the discovery of the existence of nitrosamines in tobacco smoke, Plaintiffs misrepresent the timing of the discovery that nitrosamines were carcinogenic, asserting that ITL knew that this class of compounds was carcinogenic in the 1950s157 or by 1965.158 Suffice it to say, the documents they rely on do not, as is often the case, stand for the propositions alleged by Plaintiffs.

58. At the end of the day, Dr. Castonguay admitted (as the WHO has stated) that one cannot conclude that the reduction of nitrosamines or any of the other individual constituents in tobacco smoke, will reduce the rate of incidence of disease in smokers who smoke cigarettes with lower levels of specific smoke components.159

152


153 Plaintiffs’ Notes and Authorities, para. 302. Indeed, the exhibit relied upon by Plaintiffs, Trial Exhibit 1345, states that

it was possible, in the United States, that there might be a requirement to measure nitrosamines. However, the word nitrosamines is circled in the document, and a handwritten notation beside the relevant paragraph reads “not proved in smoke?” – Trial Exhibit 1345, p. 2 pdf

154 Trial Transcript (Castonguay), February 7, 2013, from p. 58, line 17 to p. 59, line 6; Trial Exhibit 20011.1, p. 3 pdf


156 Trial Transcript (Castonguay), February 7, 2013, from p. 72, line 22 to p. 74, line 19; Trial Exhibit 20027, p. 5 pdf, at

“Overall Evaluation”.



159 Trial Transcript (Castonguay), February 7, 2013, from p. 88, line 18 to p. 90, line 6; Trial Exhibit 1422, p. 100 pdf















21

59. Further, Dr. Castonguay admitted that even today, it is unknown to what extent (if any) a particular carcinogen in tobacco smoke contributes to smoking related cancer.160 This stands in direct contrast to his “expert report”, where he claimed that independent scientists had demonstrated that it was the class of constituents known as polycyclic aromatic hydrocarbons (“PAHs”) that were responsible for the induction of larynx cancer among smokers. (““Les résultats montrèrent que les hydrocarbures aromatiques polycycliques de la fumée de tabac sont responsables de l’induction du cancer du larynx chez les fumeurs [234].”)161 Such inaccuracies appear throughout his report, demonstrating Dr. Castonguay’s zeal in his role of advocate, and amply demonstrate why his expert report is anything but an independent opinion that can be relied upon by this Court, even in the areas for which he was qualified as an expert.

60. Notwithstanding the unknown effect that might result from a reduction of nitrosamines, ITL (and BAT) extended significant efforts in attempting to reduce the levels.162 Dr. Castonguay, from his limited review of limited documents found in the public domain, suggested that ITL (and BAT) could have reduced the levels of certain TSNAs as early as the mid-1970s, yet failed to do so. However, once again, Dr. Castonguay lack of knowledge regarding ITL’s research efforts, as well as the effects of changes in cigarette design was demonstrated. As discussed below, Plaintiffs again assert this unfounded proposition; namely, that ITL could and should have reduced the nitrosamine levels in its cigarette smoke prior to the change that occurred in 2001.

61. To use but one example, Dr. Castonguay wrote in his report:

Toujours en 1976, British American Tobacco informait ITL que le filtre contenant du polypropylène était plus efficace à réduire les rendements en NNN que le filtre à l'acétate de cellulose [64].

163

62. The insinuation that ITL knew that including polypropylene in filters would result in any material reduction of NNN is baseless.

63. The 1974 report relied upon by Dr. Castonguay for the assertion actually stated the following:

It is of interest to find that, although non-selective for NNN, the polypropylene filter is more efficient at removing NNN and TPM than a comparable cellulose acetate filter which has the same pressure drop and approximately the same weight. Thus, from the point of view of NNN filtration, polypropylene filters have some slight advantage over cellulose acetate filters.” (emphasis added).

164

160

Trial Transcript (Castonguay), February 7, 2013, p. 100, lines 6-24.


162 Trial Transcript (Porter), August 28, 2013, from p. 177, line 24 to p. 178, line 3; Trial Transcript (Read), September 10,



164 Trial Exhibit 346K-2M, p. 8 pdf







EXHIBITS/Exhibit%20346K-2m%20(L541R).pdf#page=8

22

64. Dr. Castonguay could not tell the court whether the slight reduction being referred to would have resulted in a reduced risk of developing smoking related diseases, nor could he say whether the “slight advantage” referred to was later shown to be correct.165

65. The evidence before this Court is that polypropylene filters did not in fact provide an advantage in the selective reduction of NNN over the type of filters used by ITL (being cellulose acetate filters). Furthermore, polypropylene filters were in fact disadvantageous as compared to cellulose acetate filters, since the latter selectively reduced phenols and other nitrosamines, whereas the former did not.166

66. The evidence is that cellulose acetate filters (being the type of filters used by ITL since the 1950s) selectively reduced nitrosamines by 80%.167

67. What is also clear on the evidence before this Court is the following: Canadian cigarettes traditionally had lower levels of nitrosamines than was the case with U.S. cigarettes. Accordingly, ITL (and the other Defendants) were already working with relatively low levels of TSNAs in their products, even before the change to the curing process came about that reduced these levels even further.168

68. The further evidence before this Court is that in the late 1990s, a company by the name of Star Tobacco claimed that they had developed a modified form of curing (involving microwaving) that would significantly reduce the formation of nitrosamines. While ITL investigated this process, it determined that the process resulted in tobacco that was virtually unsmokeable (raising the Wynder adage that a safer cigarette is not safer if no-one will smoke it). However, during this time period, R.J. Reynolds (U.S.) reported that by changing the curing process from direct to indirect heat, the formation of nitrosamines would indeed be significantly reduced.169

69. ITL contracted with farmers to test the Reynolds process by equipping various barns with the indirect heat curing systems and then comparing the levels of nitrosamines in tobacco smoke with tobacco that had used the traditional direct heat process. The result of these preliminary investigations substantiated the Reynold’s claim – there was up to a 90% reduction in nitrosamine formation.170

70. By year 2000, Defendants wanted TSNAs to be removed or reduced as soon as possible. Accordingly, the Tobacco Advisory Committee (whose membership

165

Trial Transcript (Castonguay), February 7, 2013, from p. 115, line 22 to p. 118, line 11


167 Trial Transcript (Porter), May 29, 2012, p. 253, lines 7-17; Trial Transcript (Porter), August 28, 2013, p. 178, lines 4-11

168 Trial Transcript (Castonguay), February 7, 2013, from p. 121, line 15 to p. 128, line 12; Trial Exhibit 20029, p. 14 pdf &

Exhibit 1422, p. 99 pdf

169 Trial Transcript (Porter), August 28, 2013, from p. 187, line 11 to p. 190, line 21; Trial Transcript (Robitaille),

December 19, 2013, from p. 39, line 18 to p.40, line 19










TRANSCRIPTS/Transcript%20-%20December%2019,%202013%20-%20Robitaille%20(Day%20196).PDF#page=39



23

included representatives of Defendants, the Ontario Flue-Cured Tobacco Marketing Board (the “Marketing Board”), Agriculture Canada representatives, and was chaired by the Ontario Assistant Deputy Minister of Agriculture) commissioned a study to be conducted for the purpose of making a final determination of the process to be used (the Star process versus the Reynold’s one). The recommendation from the project leader, received at the end of year 2000, was to move forward with the Reynold’s process.171

71. Defendants wanted the new process to be in place by the end of 2001 for the 2001 crop of tobacco. However, there were approximately 1,300 tobacco growers in Ontario, with approximately 1,300 kilns to be converted. This meant that there were significant issues in terms of obtaining the supply of kilns from a specialized manufacturer, the new kilns had to be installed, farmers had to determine the correct parameters for the drying process and electrical power sources for the new process needed to be obtained for many farmers.172

72. The total cost of the new process was originally estimated at least $100 million,173 with the price tag ultimately being approximately $80 million dollars. While the Marketing Board originally proposed that the project be funded in equal parts by the growers, the manufacturers, the Ontario government and the Canadian government, the Canadian government chose not to provide any funding at all. Instead, each of the Ontario government and Defendants (collectively) contributed $20 million, with the growers paying for the balance of the cost.174

73. Despite the fact that the new process would most certainly reduce the formation of nitrosamines in tobacco smoke, at no time did the Canadian government or any provincial government require the tobacco industry to make the change. Nonetheless, one MP publicly praised the step, noting that the Canadian industry was taking a pro-active, responsible approach in making the change.175

74. ITL’s original negotiating position, in early 2001, was not to provide financial assistance unless the provincial and federal government participated as well. However, once the Ontario government agreed to assist in April 2001 and it was clear that the federal government would not be providing funds, ITL, together with the other Defendants, contributed $20 million.176 Contrary to the insinuation made

171

Trial Transcript (Robitaille), December 19, 2013, from p. 38, line 9, to p. 40, line 19; Trial Transcript (Robitaille), December 19, 2013, from p.42, line 22, to p. 43, line 15

172 Trial Transcript (Robitaille), December 19, 2013, from p. 43, line 16 to p. 44, line 22; Trial Transcript (Robitaille),

December 19, 2013, from p. 46, line 2 to p. 48, line 1

173 Trial Exhibit 20031; Trial Exhibit 20033, p. 1 pdf; Trial Exhibit 21057, p. 1 pdf

174 Trial Transcript (Robitialle), December 19, 2013, p. 48, line 9 to p. 49, line 4


176 Trial Transcript (Robitaille), December 19, 2013, p. 49, lines 5-20





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24

in Plaintiffs’ submissions,177 this negotiating tactic played absolutely no role in the time to market of the reduced nitrosamine tobacco.178

75. The agreement for the purchase of the 2001 crop was entered into at its normal time, and while the growers could only commit to a firm 25% conversion for the 2001 crop year, by the following year, the new conversion process was being used for 100 percent of the Ontario tobacco crop.179

76. Plaintiffs rely on a statement from Mr. Chapman to support the view that at least RBH did not use the indirect cured tobacco right away because they had inventories of other tobacco to first be utilized.180 Mr. Chapman made no reference to ITL, nor does it apply to ITL.

77. However and in any event, this evidence is clearly superseded by the fuller evidence provided by Mr. Robitaille, who had direct knowledge regarding the quantum of the indirect cured tobacco that Defendants were originally able to purchase as well as how the tobacco auction system worked. The evidence is that it was impossible for ITL to simply only buy (and therefore only use) the reduced nitrosamine tobacco from the 2001 crop - this was simply not possible in light of the anonymous Ontario auction system, where a buyer did not know which farmer grew what tobacco or what process was used to cure the tobacco.181 Further, going to a different country to buy 100 percent of the tobacco requirements one year, and then attempting to re-enter the Canadian market the following year was also not possible. Such a step would have bankrupted the growers’ industry (which consisted of 1,300 growers, 17,000 workers as well as the local businesses in Southwestern Ontario that relied on the monies generated by tobacco growing and spent by these workers in order to survive).182 It would appear that such a step would not have been viewed favourably by the government, who reportedly warned that if Canadian tobacco is replaced by imports, you “ain't seen nothing yet" (respecting regulations).183

78. The evidence before this Court is that ITL moved as quickly as it could to change the curing process once it was aware of the science which made this possible, it purchased as much of this tobacco as possible at the outset and that accomplishing the feat of conversion within a 15 month time frame was a significant achievement.184

177


178 Trial Transcript (Robitaille), December 19, 2013, from p. 131, line 25 to p. 132, line 23

179 Trial Transcript (Robitaille), December 19, 2013, from p. 80, line 18 to p. 82, line 3; Trial Exhibit 21059, p. 6 pdf (s.

C.5(b)) & p. 8 pdf (s. E.1(a))


181 Trial Transcript (Duplessis), September 12, 2013, from p. 210, line 6 to p. 211, line 21; Trial Transcript (Robitaille),

December 19, 2013, from p. 82, lines 4-21

182 Trial Transcript (Robitaille), December 19, 2013, from p. 82, line 22 to p. 84, line 1

183 Trial Exhibit 1673, p. 2 pdf; Trial Transcript (Robitaille), December 19, 2013, from p. 227, line 1 to p. 228, line 24

184 Trial Transcript (Robitaille), December 19, 2013, from p. 229, line 24 to p. 232, line 8; Trial Exhibit 1667, p. 3 pdf




EXHIBITS/Exhibit%2021059.PDF#page=6



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25

79. The reduction was real and represented a significant accomplishment. Did it reduce the level of nitrosamines to zero? No it did not, nor could it. As Health Canada acknowledged (when determining not to financially support the project), “[t]here really is no way to reduce levels of nitrosamines to zero, either in tobacco or tobacco smoke.”185 Even Dr. Castonguay conceded this point.186

80. Further, it is false to suggest that ITL or BAT did not engage in earlier efforts to reduce nitrosamines in tobacco smoke, or that they had the ability to reduce nitrosamines at an earlier point in time, but failed to do so. Instead, the evidence before this Court is that both ITL and BAT engaged in extensive efforts to reduce these smoke components at all material times and moved quickly to make changes when they had the ability to do so.187

81. As to Plaintiffs’ brazen suggestion that ITL and the remaining Defendants negligently encouraged changes in tobacco curing (in the 1960s) and were negligent in failing to recognize that the previous method of curing tobacco was responsible for an increase in TSNAs,188 this is wholly without any evidentiary foundation.

82. First, there is no evidence that Defendants were responsible for the change in the method of curing in the 1960s.

83. Second, as referenced previously, Plaintiffs suggest that testing for nitrosamines in tobacco ought to have been conducted in the 1960 – had this been done and then had the levels been compared to the curing method that came into effect in the late 1960s,189 certainly, the change would have been seen, say Plaintiffs. One wonders how this could have been done when not only was there no standardized method for such testing in the 1960s, but the presence of these compounds in tobacco smoke remained unconfirmed until the mid 1970s (in the case of NNN) and then the late 1970s (in the case of NNK).

84. Third, Plaintiffs state that:

Yet it had been well known for decades that incomplete combustion of propane or natural gas would yield oxides of nitrogen, and that oxides of nitrogen would react with nicotine to produce tobacco-specific nitrosamines.

190

85. Not surprisingly, Plaintiffs cite no evidence for this proposition, because there is none. This was an understanding that was only arrived at in the late 1990s.

185

Trial Exhibit 20033, p. 1 pdf



188 Plaintiffs’ Notes and Authorities, Annex 6

189 See Trial Exhibit 1621, p. 10 pdf for confirmation that the change to gas and oil burners had largely occurred prior to

1969.

190 Plaintiffs Notes and Authorities, Annex 6, p. 3 pdf




REFERENCES%20TO%20PLAINTIFFS%20N&A/Annex%206%20of%20Plaintiffs%20N&A.pdf


REFERENCES%20TO%20PLAINTIFFS%20N&A/Annex%206%20of%20Plaintiffs%20N&A.pdf#page=3

26

86. It is correct, as Plaintiffs note, that the 1979 SGR commented that “during curing and fermentation of tobacco, specific nitrosamines can be formed....”,191 but repeating this statement alone in an effort to establish their new-found negligence claim is nothing but an attempt to mislead.

87. Plaintiffs do not reference that this report, at the conclusion of the passage on nitrosamines, also states:

Although no data are presently available, it is possible that residues of pesticides with amino groups give rise to nitrosamines in tobacco and its smoke. This area needs to be investigated

192

In other words, how and why nitrosamines were formed during the curing (and fermentation) process remained unknown at this time.

88. The actual evidence before this Court is that prior to the late 1990s, there had been significant work done in an attempt to reduce nitrosamines in tobacco smoke, including on the issue of the role of curing in the formation of nitrosamines.193

89. It was only in 1998 that RJ Reynolds discovered that the exclusion of combustion gases from curing barns was critical for reducing nitrosamines in tobacco.194

90. Plaintiffs say that “since direct heating was introduced the risk of death from smoking has steadily increased”195, citing to Exhibit 1719. Exhibit 1719 has to do with the occupational exposure to asbestos and the risk of lung cancer. It has absolutely nothing to do with the nitrosamine content in tobacco smoke.

91. Plaintiffs then refer to an article authored by Michael Thun (with no cite to the relevant article), to posit a theory that is completely unsupported by expert evidence – namely that “unnecessarily increased levels of nitrosamines” may be part of an observed risk of death since the 1960s.196

92. One can only assume that the exhibit Plaintiffs are referring to is Exhibit 1718, a document put to a single witness in cross-examination, with absolutely no questions posed on the accuracy of the relative risk (“RR”) numbers over time or what they might be attributable to.197 Instead, the only questions asked related to the comparison with some RR numbers referenced in that article as compared to the witness’s assessment of the RR of disease in connection with asbestos exposure. The curing issue was simply not discussed with any epidemiologist. This is just another case of plaintiffs' playing ‘amateur epidemiologist’ and

191

Plaintiffs Notes and Authorities, Annex 6, p. 4 pdf; Trial Exhibit 601-1979, p. 712 pdf


193 Trial Transcript (Gentry), November 7, 2013, from p. 74, line 21 to p. 77, line 21.

194 Trial Transcript (Gentry), November 7, 2013, from line 76, line 19 to p. 77, line 21

195 Plaintiffs’ Notes and Authorities, Annex 6, p. 6 pdf, and footnote 14, Trial Exhibit 1719

196 Plaintiffs’ Notes and Authorities, Annex 6, p. 6 pdf

197 Trial Transcript (Price), March 19, 2014, from p. 111, line 1 to p. 115, line 11




TRANSCRIPTS/Transcript%20-%20November%207,%202013%20-%20Gentry%20(Day%20182).PDF#page=74





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27

confusing ‘correlation’ (to the extent that one can derive correlation from the information provided, which they cannot) with ‘causation’.

93. Further, one can well ask, how could one draw an analogy of any increase in disease over the decades based on a document which is not dealing with Canadian smokers, who at all material times, smoked cigarettes with significantly lower amounts of nitrosamines than U.S. smokers (whose data was relied on by Thun)? As noted below, Plaintiffs own expert, Dr. Siemiatycki acknowledged that such a difference would play a role in the relative risk of disease.198 As is also noted in section A.5 (Low tar products - relative safety profiles), even those who suggest that an increase in disease (adenocarcinoma) may be linked to nitrosamines make clear that this theory does not apply to Canadian smokers.199

94. In any event, this 2013 article plays no role whatsoever is determining whether ITL’s cigarettes were manufactured in accordance with the state of the art until the close of the class period. On the issue of nitrosamines (as in all other circumstances), the answer is, they were.

C.1.b Project Day

95. Project Day is a multi-decade project undertaken by ITL beginning in the mid 1980s, and which continues to present. Project Day’s objective was and is to produce a less hazardous cigarette.

96. At the outset of the project, multiple concepts were discussed, in the hopes that the direction taken would meet with consumer acceptability (going back to the adage that a safer cigarette is not safer if no-one will smoke it). Various concepts were considered, including a reduced tar to nicotine cigarette and a heat not burn cigarette (of the type that had been attempted by RJ Reynolds with its Premier cigarette). Ultimately, the concept that was settled on was a significant modification to the tobacco itself, which involved identification of precursors in the tobacco leaf that resulted in undesirable chemicals in tobacco smoke and a removal of those precursors – in particular protein.200

97. In addition, the Day concept also involved considerable research pertaining to filter development in order to further reduce the vapour phase components. In fact, specialized filtration was called for due to the fact that the removal of protein caused a significant increase in smoke components such as formaldehyde (demonstrating the incredibly complex nature of altering smoke chemistry; the removal of a number of undesirable smoke components often has the unintended consequence of increasing others). ITL spent approximately 8 years developing a filter that was both effective in removing the increased formaldehyde and other aldehydes and was subjectively acceptable. The resolution of the filter issue came about in the early 2000s.201

198

Trial Transcript (Siemiatycki), March 19, 2013, p. 113, lines 11- 23

199 Trial Exhibit 601-2014B, p. 210 pdf


201 Trial Transcript (Porter), August 28, 2013, from p. 159, line 7 to p. 163, line 20 & p. 214, lines 1-18

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98. Detailed presentations regarding Project Day were given to Health Canada representatives who expressed interest in the concept, although no substantive comments were provided by these representatives that might guide the way forward, other than a suggestion that biomarker and clinical studies be undertaken.202

99. Clinical trials were conducted from 2005 to 2007 in order to establish the use of biomarkers as a way of monitoring the uptake into the body of how cigarettes were smoked. Following these studies, there was a study carried out in Germany, where smokers were given three types of reduced risk products, including a Project Day sample. The results showed a significant decrease for 11 biomarkers of exposure, with the next phase of testing (still in the future as of the date of Dr. Porter’s evidence) being a study to look at what is referred to as “biomarkers of harm” (looking at specific biomarkers in the body that are generated when some damage is caused to the body).203

100. The Project Day tobacco together with a synthetic material known as “Baltec”, (derived from an earlier BAT project to develop a synthetic tobacco, known as BATFlake), is currently part of a program using these elements together with filter modifications to develop a product with reduced risk. The data derived from studies has been provided to the FDA to assist both the FDA and BAT in developing a program as to how the product might be assessed and put in the market.204

101. Dr. Porter worked extensively on Project Day from 1987 until well after the close of the class period. He explained the difficulties experienced in getting the product to market, and was asked what his response was to the assertion that Project Day was not a serious R&D effort, that it was simply a cosmetic effort or a public relations effort. His response was short and to the point:

Well, that’s complete nonsense.205

102. Yet, this is what Plaintiffs now say, in the face of overwhelming evidence to the contrary.206 This is simply a wholesale re-writing of the evidence provided in these actions.

C.2 General Reduction

103. While ITL engaged in considerable efforts to selectively reduce various smoke constituents throughout the class period, independent scientists, public health authorities and governments recognized the increasing complexity of this task, and focused instead on the goal of general reduction, which term means an

202

Trial Transcript (Porter), August 28, 2013, from p. 214, line 19 to p. 216, line 2; Trial Transcript (Duplessis), September 16, 2013, from p. 130, line 14 to p. 132, line 18

203 Trial Transcript (Porter), August 28, 2013, from p. 240, line 10 to p. 245, line 10; Trial Exhibit 20204-AUTH



206 See Plaintiffs’ Notes and Authorities, para. 937


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29

overall reduction in the various smoke components, with most emphasis being placed on “Tar”.207

104. For example, in 1983 the ISCSH stated that there was insufficient evidence to incriminate individual compounds (at the level occurring in tobacco smoke) with the health hazards of smoking, and stated “..we would not, at this stage, recommend the selective reduction of any of them.” 208 Instead, the goal was one of general reduction.

105. This remained Health Canada’s view, even as at 2000, when Defendants sought financial assistance for the modification of the curing process. As stated in an internal Health Canada memorandum:

It is the position of the Tobacco Control Programme that, while reduction of one carcinogen in tobacco and tobacco smoke is a potentially positive health measure, this will not make the product significantly safer. Rather than adopting a policy of reducing exposure to one toxic chemical and waiting many years to verify whether this worked or not, the objective should be to reduce and eliminate exposure to all toxic chemicals in tobacco smoke in an expeditious manner.

209

Clearly, Health Canada’s internal view as of 2000 was – continue the course of general reduction.

106. Governments, including the Canadian government, endorsed the idea that tar might be responsible for smoking related diseases, encouraged tobacco manufacturers to reduce the tar yields of cigarettes and encouraged smokers to switch from high to lower yield cigarettes.210

107. Despite decades of efforts, the only modification that has received significant support from public health authorities and independent scientists is general reduction.211 It was (and is) ITL and BAT’s view that the reduction in tar over the decades has likely resulted in a reduction in risk to the smoking population.212

108. The basic elements used to generally reduce deliveries are: filters, filter tip ventilation, paper porosity, reconstituted tobacco, the use of stem in recipes (whether cut rolled stem (“CRS”) or water treated stem (“WTS”)) and expanded tobacco.

207

Exhibit 20256.1, p. 7 to 14 pdf; Exhibit 30245, p. 7 pdf; Exhibit 20037; Exhibit 20177, pp. 137-138 pdf; Exhibits 20081.1 & 20081.2; Exhibit 40346.306; Exhibit 20041, p. 20 pdf, para. 33, p. 27 pdf, para. 58, p. 78 pdf; Exhibit 20225, p. 16 pdf; Exhibit 40346.313, p. 2 pdf

208 Trial Exhibit 20035, p. 8 pdf, para. 26


210 See, for example,Transcript Trial (Dixon), September 17, 2013, from p. 143, line 21 to p. 154, line 21

211 Trial Transcript (Porter), August 28, 2013, from p. 51, line 22 to p. 53, line 14; Trial Exhibit 30245, p. 7 pdf; Trial

Exhibit 20177 at pp. 137-138 pdf; Trial Exhibit 20039, p. 3 pdf, para. 2.1; Trial Exhibit 20225, pp. 4-5 pdf; Trial Exhibit 20041, p. 20 pdf, para. 33 & p. 27 pdf, para. 58; Trial Exhibit 20081.1 & Trial Exhibit 20081.2; Trial Exhibit 40346.306

212 Trial Transcript (Dixon), September 18, 2013, p. 115, lines 6-25; Trial Transcript (Porter), August 28, 2013, p. 53, lines

11-14; Trial Transcript (Read), September 10, 2013, from p. 51, line 10 to p. 56, line 13
















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30

C.2.a Filters

109. Despite comments made by Plaintiffs to the contrary, filters have reduced toxicity and have been widely recognized as an improvement by scientists and public health authorities.

110. Filters were being promoted by independent researchers by the end of the 1950s.213 This promotion continued at all material time, including by the U.K.’s Royal College of Physicians214, the U.S. Surgeon General,215 Health Canada216 and the U.K.’s ISCSH,217 among many others. Filters have also been recognized as reducing smoke carcinogens and reducing the risk of lung cancer.218

111. In 1994, in response to a member of the public’s suggestion that filters should be mandatory, Health Minister Marleau wrote:

In your letter, you suggest that cigarette filters should be mandatory. You may be interested in knowing that almost all of the manufactured cigarettes sold in Canada are filtered. This has helped reduce the amount of toxic constituents delivered to smokers.

219

112. Even those who have relied on Monograph 13 for the incorrect proposition that smokers of low tar cigarettes smoke more (and therefore, they say, achieve complete compensation), write that the risk of lung cancer is higher for those who smoked non-filter cigarettes.220

113. ITL undertook extensive research in an effort to improve its filters, using, as noted above, cellulose acetate filters.221 Cellulose acetate filters are an effective means of reducing components in the particulate phase of smoke, such as PAHs, phenols, non-volatile nitrosamines and arsenic. The cellulose acetate filter removes most smoke components broadly in the same proportion as tar generally and in fact, selectively reduces some of the phenols and other smoke components.222

114. Filters have been a crucial component in reducing the yields demanded by the Canadian government and requested by health authorities generally.

213

See, for example, Trial Exhibit 20048, p. 6 pdf


215 Trial Exhibit 601-1981, pp. 97-98

216 Trial Exhibit 40346.191; Exhibit 20044 at pp. 1-2 pdf; Trial Exhibit 20178, pp. 90-91 pdf


218 Trial Exhibit 601-1981, pp. 97-98 pdf; Trial Exhibit 20178, p. 91 pdf


















31

115. When asked if he had ever heard of a request from Health Canada to remove the filters from cigarettes, Dr. Porter responded in the negative.223 Similarly, Mr. Choiniere stated that to his knowledge, there were never any briefing notes or options presented to senior management at Health Canada suggesting that filters should be removed from cigarettes (nor that ventilation should be decreased or removed).224

116. Notwithstanding the above, Plaintiffs now assert that filters are not effective and mostly a marketing tool,225 an allegation notably absent from their pleadings. The allegation is simply false.

C.2.b Paper Porosity & Filter Tip Ventilation

117. Porous paper used on the tobacco rod is a ventilating feature that allows air to come into the cigarette rod while the cigarette is being smoked, diluting the smoke, which results in less smoke coming through the filter and into the mouth of the smoker.226

118. Like filter tip ventilation, using porous paper on the cigarette rod will serve to bring down deliveries of tar and nicotine. Both will also reduce gas phase components such as CO. However, the latter is not as effective as filter ventilation, since ventilation provided via paper is lost as the smoker smokes. In contrast, ventilation on the filter tip remains in place throughout the smoking experience.227

119. As noted, Plaintiffs have inaccurately pointed to filters as being a marketing fraud, and have made unfounded assertions and misstated evidence as well regarding filter ventilation. The issue of filter ventilation is discussed in Section A.4.a.

C.2.c Recon/CRS/WTS

120. ITL used both CRA and WTS in its cigarettes.

121. CRS is simply tobacco stem that is flattened in a steam roller and then cut to the desired width. WTS is CRS that is moistened as part of the process and it is used to expand the CRS. As is the case with expanded tobacco (discussed below) this reduces the volume of tobacco that would otherwise be in the tobacco rod due to the increased volume of the stem, thereby reducing the overall deliveries. Further, as stem has very little nicotine in it, its inclusion serves to preferentially reduce nicotine.228

223

Trial Transcript (Porter), August 28, 2013, p. 85, lines 18-21

224 Trial Transcript (Choinière), June 11, 2013, from p. 216, line 17 to p. 219, line 8

225 Plaintiffs’ Notes and Authorities, para. 299 and Section II.E.3.d.2

226 Trial Transcript (Porter), August 28, 2013, p. 108 lines 2-9


228 Trial Transcript (Porter), August 28, 2013, p. 116, line 2 to p. 118, line 1; Trial Transcript (Leblond), August 30, 2012,

from p. 93, line 6 to p. 95, line 2


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122. Reconstituted tobacco (“Recon”) is a method of recovering and reusing small pieces of tobacco (including stem). The Recon used by ITL was first known as PCL (for processed cigarette leaf) and then PCL-X. The ingredients and the various processes used for manufacturing the Recon used in ITL’s cigarettes were discussed in great detail by Mr. Sinclair.229

123. Like CRS and WTS, ITL’s Recon contained stem, as well as the more brittle parts of lamina which come from the leaves in the lower positions of the plant, which generally have less nicotine. Accordingly, Recon reduced not only tar deliveries, but it also served to preferentially reduce the nicotine content of ITL’s cigarettes.230

124. The U.S. National Cancer Institute conducted mouse skin painting tests showing that Recon, like stem and high porosity paper used in cigarettes, produced lower biological activity in the cigarettes.231 The reduced tumourigenic activity of Recon had been reported in the public domain since, at least, by 1965232 (at which time Recon was being used in ITL’s cigarettes).

125. ITL also conducted its own studies regarding the biological activity of Recon made by various processes, including processes know as the Gerlach (or Rappaport) process as well as the Schweitzer process.233 Some studies had shown that Gerlach sheet had a particularly low biological activity as measured by certain tests.234 However, the Gerlach process used methylene chloride, a solvent that is used in paint strippers. It is very volatile, very toxic and has been designated as a suspected carcinogen. Further, the Gerlach process resulted in much higher tar deliveries than PCL and as well gave a taste that was completely unacceptable to smokers.235

126. The Schweitzer process, on the other hand, was made by a different process altogether, known as a paper making process. Like Gerlach, some studies showed lower biological activity for the Schwitzer process than seen in the band process used by ITL in manufacturing PCL. Here too, however, there were downsides in making use of this alternative process. First of all, the Schweitzer process was reported to have a higher nitrate content than PCL.236 This is not surprising given that burley tobacco (as well as wood pulp) was required to be used in making this Recon (and burley contains higher amounts of nitrate, and therefore higher levels of TSNAs than flue cured tobacco).237 The use of burley in

229

Trial Transcript (Sinclair), April 8, 2014, p. 42, Q. 135 and following


231 Trial Transcript (Porter), August 28, 2013, p. 127, lines 10-21; Trial Exhibit 20972, pp. 10-11 pdf


233 See, for example, Trial Exhibit 20180-AUTH; Trial Exhibit 346FF, p. 4 pdf

234 Trial Exhibit 346FF, p. 4 pdf


236 Trial Exhibit 20180-AUTH, pp. 18-19 pdf


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EXHIBITS/Exhibit%20346FF.pdf#page=4

EXHIBITS/Exhibit%20346FF.pdf#page=4




33

this process was a necessary component, as one needed the strength that burley stem provided in order to keep the sheet from falling apart. Flue-cured tobacco was simply too weak for the process. Not only would the inclusion of burley have increased the nitrate content in Recon, the use of burley (and wood pulp) also imparted an unacceptable taste to Canadian consumers.238

127. Accordingly, as was the case with the other design components used in ITL’s cigarettes, ITL complied with the state of the art regarding its use of Recon.

C.2.d Expanded Tobacco

128. An expanded tobacco, known as DIET (for dried ice expanded tobacco) was used in ITL’s cigarettes beginning in the 1980’s, and provided yet another mechanism for reducing deliveries. As explained to this Court, when a green tobacco leaf is cured, it shrinks in size and the cell structure collapses. The DIET process attempts to reverse that to a certain extent by injecting carbon dioxide into the tobacco, which expands the cells by releasing pressure and pops the leaves back up to almost the same size they were before curing. DIET tobacco has shown lower biological activity in both Ames and mouse skin painting studies.239

129. DIET lowers deliveries as it takes up more space in the tobacco rod than non-expanded tobacco; since there is less tobacco to be burnt than would otherwise be the case, it reduces deliveries. In fact, nicotine is reduced even more than tar, as when the carbon dioxide passes through the tobacco, it tends to extract approximately 25% of the nicotine in the leaf (like Recon, hardly the tool of a manufacturer allegedly attempting to increase the nicotine content in its cigarettes).240

130. The use of these design features, (filters, filter ventilation, reconstituted tobacco, CRS, WTS, and expanded tobacco), resulted in a large reduction in nicotine, tar, CO and other smoke constituents over the years. ITL made use of all of the design features at hand in order to reduce the deliveries of its cigarettes. There was no “state of the art” feature that was not used.241 And at all material times during the class period health authorities were encouraging the manufacture of lower delivery cigarettes. Whatever debate exists currently was not the prevailing view prior to the close of the class period. Further, no health authority has suggested that ITL increase the tar, nicotine or CO deliveries of its cigarettes, whether prior to the publication of Monograph 13 or afterwards. To those that assert that tar reductions over time were simply a deceptive marketing ploy, Dr. Porter stated that this simply was not true:

238

Trial Transcript (Sinclair), April 8, 2014, from p. 13, line 7 to p. 14, line 19








34

[b]ecause there were actual reductions that were created and observed..and measured.

242

131. At the end of the day, Dr. Castonguay conceded in cross-examination that ITL engaged in efforts to reduce the hazards of its cigarettes.243 Indeed, these efforts are indisputable, and it is indisputable that at all material times, ITL complied with the state of the art.

242


243 Trial Transcript (Castonguay), February 13, 2013, from p. 178, line 2 to p. 179, line 1 & Trial Exhibit 20008.2, p. 3 pdf




35

APPENDIX III – CAUSATION / ASSOCIATION / RISK FACTOR

1. Plaintiffs place significant emphasis on ITL’s debate with public health authorities in the early part of the Class Period concerning the technical requirements for “causation”. For the reasons set out above, ITL submits that this scientific debate has no bearing on consumer appreciation of the underlying risks of smoking. Similarly, the debate itself was not grounded in a differential of knowledge between ITL and the government, public health authorities, or indeed the public. Rather, it derived from the differing perspectives of ITL – who sought to identify a causal mechanism as part of its ongoing research and design work – and the government / public health authorities, who simply sought to curb public smoking behaviour and were therefore less concerned with the underlying causal mechanisms. At all times, however, all parties to the debate had the same knowledge of the underlying risks, their terminological disagreement notwithstanding.

2. While ITL does not view this debate as being relevant to these proceedings, the presentation of the evidence by Plaintiffs on matters of causation is deeply flawed, in several respects. Accordingly, to the extent that this Court feels that this debate is at all relevant to the matters in issue, ITL wishes to clarify the evidence.

A. The Evolving Conception of “Causation”

3. As would be expected, what the scientific, public health and medical community knew and/or stated with respect to the various risks and dangers associated with cigarettes has varied over time. In the early 1950s, studies by physicians and scientists appeared in leading scientific and medical journals reporting associations between smoking and disease. These studies raised concerns about a possible link between cigarette smoking and lung cancer.244

4. However, there was widespread consensus within the scientific and medical communities that these studies did not demonstrate that smoking was a “cause” of disease using traditional definitions of causation.245

5. In the 1950s, the predominant view of causation in the health sciences was consistent with that traditional view: causes were viewed as being directly related to effects, not merely statistically associated with them. The existing paradigm of disease causation was derived from Koch’s postulates, which envisioned single agents that related one to one to specific diseases.246

6. Epidemiology and statistics were often held in low regard in the 1950s.247 Further, critics of the early retrospective epidemiological studies pointed to issues such as bias both within the groups being studied and the questions posed in connection with these studies such that they could have tainted the results. As well, and

244

See, for example, Trial Exhibit 40346.81, Trial Exhibit 40346.74

245 Trial Exhibit 40346, pp 32-34 pdf, paras. 3.40 to 3.46; see also, for example, Trial Exhibit 40346.1, pp. 1 & 2 pdf









36

more fundamentally, many such critics felt that while epidemiology could show an association, causation needed to be established in a laboratory with experimental data that established the mechanisms behind the disease.248

7. Accordingly, the dominant view was that causal proof presupposed a one-to-one correspondence between cause and effect, and focused on the mechanisms by which a specific exposure was directly connected, through provable biological links, to a specific biological effect.

8. Dr. Perrins’ testified that as of 1963, there was a consensus building as to causation within the public health community regarding smoking and lung cancer, but there remained some dissent present among the medical community, who maintained a traditional approach to understanding disease and causation.249

9. As to the meaning of “consensus”, Dr. Perrins explained his use of the word as follows:

...an officially sanctioned agreement on a particular finding reached over a period of time which is, or comes to be, supported by a vast majority of public health and medical communities, without any meaningful dissent. [emphasis added]

250

10. As noted by Dr. Perrins, the 1964 U.S. Surgeon General’s report251 (“SGR”) accepted the causation issue as:

....having been one of legitimate dispute among the medical community but nevertheless it came down firmly on the side of a robust association which it determined was a causal relationship between cigarette smoking and lung cancer. “It did so by endorsing and articulating a new epistemology of chronic disease epidemiology....” [emphasis added]

252

11. Indeed, the 1964 SGR specifically stated that no new research was conducted in connection with its report.253 It also noted that the Committee “discussed vigorously” and debated “[v]arious meanings and conceptions” of how “the term cause” would be used in its conclusions.254 Yet, as was noted 40 years later in the 2004 SGR, even after such vigorous discussions and debates, the 1964 SGR’s authors “could neither precisely define...the word cause” or even “describe the underlying causal relationship itself, the size of an estimated effect, the degree of statistical evidence for that estimated effect, the strength of the causal claim, or some combination of these elements of the evidence.”255

248

Trial Transcript (Perrins), August 19, 2013, from p. 155, line 16 to p. 158, line 15

249 Trial Transcript (Perrins), August 19, 2013, from p. 187, line 19 to p. 189, line 2

250 Trial Exhibit 40346, p. 13 pdf, para. 1.17

251 Trial Exhibit 601-1964

252 Trial Exhibit 40346, p. 40 pdf at para. 3.67



255 Trial Exhibit 601-2004A at p. 26 pdf

TRANSCRIPTS/Transcript%20-%20August%2019,%202013%20-%20Perrins%20(Day%20157)%20(corrected%20version).PDF#page=155

TRANSCRIPTS/Transcript%20-%20August%2019,%202013%20-%20Perrins%20(Day%20157)%20(corrected%20version).PDF#page=187


EXHIBITS/Exhibit%20601-1964.pdf




EXHIBITS/Exhibit%20601-2004A.pdf#page=26

37

12. According to the 2004 SGR, the criteria posited in the 1964 Report were just emerging at that time into the public health realm, although they have since become widely accepted and used both in epidemiology and public health.256

B. Plaintiffs’ Mischaracterizations of the Evidence Regarding ITL’s Knowledge

13. In their review of the evidence, Plaintiffs’ fail to acknowledge this terminological evolution surrounding issues of “causation”. For example, in paragraphs 282, Plaintiffs assert that a 1977 memorandum from Mr. Gibb of ITL establishes that ITL “knew” since early 1963, that tobacco smoke caused disease.257 Plaintiffs state this in an apparent effort to demonstrate that what was said internally was vastly different than the external position taken. This is simply not the case.

14. A simple reading of the document demonstrates that Mr. Gibb was saying only that the Canadian government disagreed with ITL’s position in 1963, and that the general debate in the scientific community had moved to how smoke acts as a causative factor and what the harmful constituents might be. He made no comment as to the appropriateness of that debate, and acknowledged what the public health community and the general public generally understood – namely, that smoking “caused” disease. Indeed, the memo states that Mr. Gibb agreed with the seven points articulated in the underlying ITL position paper referred to, the first such point stating:

Being aware of the complexities surrounding smoking and health, I.T.L. accepts and is responding to the statistical association that smokers as a group contract certain diseases at a higher rate than non-smokers.

258

15. Plaintiffs fail to direct this Court to Mr. Gibb’s personal (and internal) position on smoking and health from the relevant time, where he wrote:

Is smoking really harmful? The argument is made that the findings of the epidemiologists, being statistical inferences, do not constitute "scientific" proof. While statistical logic has its limitations, and the limitations are not always respected, the role of such methodology in public health research must be recognized. Classical "scientific" experimentation and "proof" are not possible avenues of research with respect to many diseases of mankind. The statistical information, coupled in some instances with indirect but corroborative evidence from various fields of medically oriented scientific research has convinced the vast preponderance of medical and governmental authorities that smokers as a group suffer certain diseases to a greater extent than do non smokers. This conclusion seems valid when applied to smokers as a group, but only holds as a statistical probability when applied to the individual. [emphasis added]

259

16. As to Dr. Green (of BAT’s) position in 1977, Plaintiffs assert that he too knew (presumably as of 1963) that tobacco smoke “caused” disease (again suggesting disingenuousness on the ITL with respect to its limited public statements

256

Ibid

257 Plaintiffs’ Notes and Authorities, paragraph 282; Trial Exhibit 125

258 Trial Exhibit 125A, p. 1 pdf

259 Trial Exhibit 27A, p. 3 pdf; attachment to Trial Exhibit 27 & Trial Exhibit 1054


EXHIBITS

EXHIBITS/Exhibit%20125A.pdf




38

regarding causation).260 What Plaintiffs fail to highlight are Dr. Green’s views regarding epidemiology and causation as of 1977:

For example from the evidence we have that smoking is a factor in multiple correlations and is strongly associated with some diseases, this may be sufficient to substantiate a claim that smoking is a cause of the disease or causes an increase in the incidence of the disease. If it can be reliably predicted that if smoking is decreased in a population so will the incidence of this or that disease then smoking is a cause in the general or probabilistic sense.

261

But the evidence obtained from populations is not relevant to the individual – as far as the individual is concerned general causality has no validity and it would be quite improper to imply predictability. [emphasis added]

17. It is therefore false for Plaintiffs to assert that ITL accepted at this time that the “ultimate test for chronic disease causation was through epidemiology”.262 As Dr. Green further commented in writing to Mr. Gibb (referring to the very paper Dr. Green wrote which Plaintiffs now rely on):

You say epidemiology etc. "seems valid when applied to smokers as a group but only holds as a statistical probability when applied to the individual". I had that in-mind when I talked about 'probabilistic' causality. However, in my current paper I am going further and saying - for a number of reasons I could develop - that epidemiology tells you nothing about the probability of John Smith getting this or that disease. [emphasis in the original]

263

18. Plaintiffs further misrepresent what ITL accepted in terms of what constitutes “cause” in pointing to the document emanating from the 1962 group research conference. In particular, they say that this is evidence that ITL knew that tobacco smoking caused lung cancer.264 In fact, that very document demonstrates the opposite of Plaintiffs’ proposition. Following the publication of the 1962 RCP report, Sir Charles Ellis of BAT stated at this first BAT group R&D conference that:

This report [the 1962 RCP report] provided the occasion for statements of faith by people who seemed to find it necessary, however, to silence their

own-self criticism by repeating phrases like, "conclusive proof beyond the

shadow of doubt"... "devastating effect of the marshalling of cold scientific

facts", and so on.265

19. In contrast to the views contained in the 1962 Report, Sir Charles stated, for an internal audience:

260

Plaintiffs’ Notes and Authorities, paras. 282 & 283


262 Plaintiffs’ Notes and Authorities, para. 284, 1

st bullet

263 Trial Exhibit 125D

264 Plaintiffs’ notes and Authorities, para. 284, 2

nd bullet; Trial Exhibit 1343.


REFERENCES%20TO%20PLAINTIFFS%20N&A/Para%20282-283%20of%20Plaintiffs.pdf



EXHIBITS/Exhibit%20125D.pdf




39

Yet we who have been immersed in the subject for many years know that this report produced no new fact, produced no new arguments, indeed, except for the contribution of an emotional gloss, left the subject untouched. We know only too well that there are no conclusive proofs; that there are few, if any, cold scientific facts.

266

20. In other words, the document makes clear that society – adopting a colloquial conception of causation – had accepted that causation was firmly established. For the scientists at this conference, however, the absence of a causal mechanism remained a source of concern. Notably, insofar as these proceedings are concerned, society’s understanding is the relevant fact (the latter scientific debate is largely meaningless to the matters in issue).

21. Other documents cited by Plaintiffs similarly do not stand for the propositions cited. For example, Plaintiffs rely on a 1969 document to “establish” that ITL accepted that smoking caused lung cancer in 1960.267 The passages relied on by Plaintiffs refer to mouse skin painting studies, done in an effort to try and clarify the role of smoke constituents in lung cancer – as discussed, mouse skin painting tests do not and cannot establish that cigarette smoke causes lung cancer in humans.

22. Other documents relied upon by Plaintiffs for this alleged acceptance of “causation” as of 1960 or 1967 similarly do not contain support their position, but rather contain the following references:

a. in a 1976 document: associations being drawn between certain diseases, including lung cancer, but the document then states that the biological effects of smoke and the diseases associated with smoking “is not clear”;268

b. in a 1987 document: the association between cigarette smoking and a number of diseases, such as lung cancer;269

c. in a 1978 document, an acknowledgment that their traditional view of causation was not consistent with the majority view;270

d. in a 1967 document: an assumption that “if there is no inhaling, there is no lung cancer or respiratory disease”, but which document specifically states: “Considerable discussion took place on the assumptions made by R&D scientists without any attempt to justify them or to agree to their correctness at this time.”271 [emphasis added]

266



nd bullet, Trial Exhibit 1345, p. 3 pdf

268 Trial Exhibit 58.54, p. 5 pdf, referenced at footnote 267 of Plaintiffs’ Notes and Authorities (para. 284)

269 Trial Exhibit 395, p. 1 pdf; referenced at footnote 267 of Plaintiffs’ Notes and Authorities (para. 284)

270 Trial Trial Exhibit 1356.1, p. 1 pdf, referenced at footnote 267 of Plaintiffs’ Notes and Authorities (para. 284)

271 Trial Trial Exhibit 1344, p. 3 pdf, referenced at footnote 268 and 269 of Plaintiffs’ Notes and Authorities (para. 284)












40

e. in a 1970 document: an acceptance that “without inhalation, no association between smoking and respiratory disease could reasonably be alleged.”272 [emphasis added]

23. The same two documents referenced in subparagraphs (d) and (e) above are cited by Plaintiffs to establish that ITL was “convinced of the causal link between smoking and emphysema since at least 1967”.273 This is a blatant misrepresentation of the evidence – the documents simply do not stand for this proposition.

24. Plaintiffs also show a fundamental misunderstanding of the nature of some of the research studies they reference in an apparent attempt to establish that ITL “knew” certain matters regarding tobacco, yet supposedly destroyed documents in an apparent attempt to hide documentation which confirmed that tobacco use was “risky and harmful”.274

25. A great number of the studies they refer to are those involving mouse skin painting tests. The use and limitations of mouse skin painting tests are discussed

in Appendix II ("ITL’s Safer Ciragette Research"). Simply put, a positive result in

mouse skin painting tests (which virtually always involved the pre-painting of the mice with a known carcinogen, prior to the application of tobacco condensate to the skin) does not mean that the substance causes lung cancer in man, but most certainly provided guidance in terms of tobacco modification.275 Indeed, as Plaintiffs note in paragraph 290 of their submissions, Dr. Porter saw value in the test as of 1987 – such testing, however, was in connection with Project Day, a product with substantial differences as compared to a traditional ITL cigarette (whose parameters had already been thoroughly tested in mouse skin painting studies).

26. Certainly, there has been no shortage of published studies involving mouse skin painting studies – as of 1961, a text was published with 18 pages of abstracts of published research pertaining to mouse skin studies done up to 1959.276 To the extent that there is any question as to whether this text was reviewed outside of tobacco manufacturers, a 1962 letter from Dr. Best (Chief, Epidemiology Division, Department of National Health & Welfare) clears this up. In forwarding this text to the director of Epidemiology at the Department of Health in B.C., Dr. Best lauded the quality of the book as a reference source.277 Notably, this text and its three supplements (weighing in at 944, 815, 574 and 807 pages respectively) stated that funding for the texts was provided by the Council for Tobacco Research (or

272



th bullet; Trial Exhibits 1344, p, 3 pdf; Trial Exhibit 1346, p. 3 pdf

274 Plaintiffs Notes and Authorities, para. 285

275 Trial Transcript (Porter), August 27,2013, from p. 111, line 23 to p. 114, line 12; Trial Transcript (Read), September 9,

2013, from p. 114, line 3 to p. 115, line 6; Trial Transcript (Bilimoria), March 5, 2013, from p. 142, line 14 to p. 144, line 2

276 Trial Exhibit 20152-AUTH, pp. 420-438 pdf

277 Trial Exhibit 20153













41

its predecessor the Tobacco Industry Research Committee), being the tobacco research bodies funded by the U.S. tobacco companies.278

27. To suggest, as Plaintiffs do, that there was something in BAT’s mouse skin painting these studies that would confirm “causation” is simply a gross misstatement as to what these studies disclosed and the meaning and use of the test. What ITL and the rest of the scientific community knew about mouse skin painting tests is the following:

It has been known for some years that when cigarette smoke is condensed and the condensate subsequently dried and stored it forms a " tar" -like substance which when painted on the backs of certain strains of mice gives rise to epithelial tumours (literature reviewed by Wynder and Hoffmann, 1964). Among all the efforts which have been made in recent years to study the carcinogenic properties of cigarette smoke experimentally, this still remains the salient phenomenon; cigarette smoke condensate undoubtedly has the property of a complete carcinogen for epithelial tissue of laboratory animals.

These statements were contained in a report published in 1966, from a researcher who headed up the mouse skin painting program at the Tobacco Research Council – an organization founded and funded by the UK tobacco companies, including BAT.279

28. Plaintiffs also point to certain inhalation studies for proof that ITL knew that tobacco smoke “caused”, for example, larynx cancer in animals.280 What Plaintiffs gloss over, perhaps because no questions were asked on the documents (even though Mr. Read stated that he was able to answer any questions Plaintiffs might have on BAT R&D reports),281 is that animals who developed precancerous or cancerous lesions during the relevant studies had had their tracheas pre-treated with a carcinogenic compound, N-methyl-N-nitroso-urea.282 In other words, like mouse skin painting studies, a situation had been created where tumours were likely to develop, and the hope of this bio-assay was to see which types of tars caused more tumours than others.

29. Further like mouse skin painting, as discussed previously, there were difficulties acknowledged by independent scientists in extrapolating the results of these animal studies to humans. In addition, as was acknowledged by Dr. Castonguay, most studies that expose lab animals to potential carcinogens expose them to doses much higher than common human exposure.283

278

Trial Exhibit 20152-AUTH, p. 7 pdf; Trial Exhibit 20156.1-AUTH, p. 7 pdf; Trial Exhibit 20156.2-AUTH, p. 7 pdf; Trial Exhibit 20156.3-AUTH, p. 7 pdf

279 Trial Exhibit 20223-AUTH, p. 1 pdf, Trial Transcript (Read), September 9, 2013, from p. 209, line 21 to p. 211, line 22



282 See Trial Exhibit 58.37, pp. 5 & 7

283 Trial Transcript (Castonguay), February 13, 2013, p. 245, lines 19-24; Trial Exhibit 40030, p. 1 pdf


EXHIBITS/Exhibit%2020156.1-AUTH.pdf#page=7




EXHIBITS/Exhibit%2020223-AUTH.PDF







42

30. There are clear limitations to these bioassays. One such limitation is that they cannot establish that smoking causes disease in humans.

31. With respect to Plaintiffs’ references to ITL’s knowledge of the existence of various smoke chemicals,284 the evidence is clear that ITL – acting as a responsible manufacturer – was certainly aware of the various smoke chemicals in tobacco smoke as they were discovered, and attempted to reduce these smoke components.

32. Knowledge of these constituents did not establish knowledge of formal causation – as Dr. Castonguay conceded in cross-examination, it is not clear today the extent to which any smoke constituent contributes to risk285, and further, the fact that a chemical or product is classified as a human carcinogen does not allow you to conclude anything about the probability that the agent will cause cancer in humans.286

33. Again, while the foregoing discussion is helpful context, it is ultimately not relevant to the central matters at issue in these proceedings. Whether one characterizes it as an “association”, a “risk factor” or “causation”, the general public’s understanding is unchanged – if you smoke, you are more likely to develop a smoking-related disease. Accordingly, the internal scientific debate at ITL regarding the causal mechanisms (or lack thereof) – which admittedly bled into some of the very few public statements by ITL representatives – would not have had any bearing on the general public’s appreciation of the risks.

284

Plaintiffs’ Notes and Authorities, paras. 299-304


286 Trial Transcript (Castonguay), February 13, 2013, from p. 248, line 20 to p. 251, line 12; Trial Exhibit 40030, p. 3 pdf

REFERENCES%20TO%20PLAINTIFFS%20N&A/Para%20299-304%20of%20Plaintiffs%20N&A.pdf




43

APPENDIX IV – CLARIFICATION OF THE EVIDENCE REGARDING ITL’S KNOWLEDGE OF ADDICTION & THE ROLE OF NICOTINE

1. Plaintiffs’ position regarding the evolving state of knowledge concerning “addiction” is premised upon a number of flawed assumptions, and fails to account for the fact that the evidence clearly establishes that knowledge of the habit-forming properties of cigarettes have been known by all parties (i.e., ITL, the government & public health authorities, and the public) throughout the Class Period.

2. Plaintiffs’ Notes and Authorities contain a number of misstatements with respect to the evidence regarding ITL’s knowledge of “addiction” and the role of nicotine. To the extent that this Court deems these issues to be relevant to these proceedings, ITL’s clarification of the evidence is set out below.

A. Plaintiffs’ Mischaracterizations Regarding ITL’s Knowledge of "Addiction"

3. Plaintiffs state that ITL knew that tobacco was "addictive" in the early 1960s. To

the extent that Plaintiffs intend to suggest that ITL knew that cigarettes were something "more" than habit-forming (i.e., a "compulsion"), this assertion is false, (although it remains unclear precisely what it is that Plaintiffs are suggesting ITL "knew", and presumably is alleged not to have disclosed).

4. Plaintiffs begin their Notes and Authorities in respect of this issue by stating that as of 1962, ITL and other tobacco companies were very interested by nicotine and its use in the body, and for this point, they refer to a 1963 Tobacco Chemists’ Research Conference.287 It is unclear how the fact that ITL was interested in aspects of nicotine, a naturally occurring tobacco substance, establishes knowledge of addiction. It is even more confusing, to say the least, that a conference, hosted by representatives of the Canadian government in 1963, and including presentations relating to “the distribution of nicotine between the vapour phase and particulate smoke” or a presentation relating to an apparatus for collecting the particulate phase of tobacco smoke (which includes nicotine),288 or the measurement of BaP, which presentations are relied upon by Plaintiffs for their assertion, are even remotely relevant to the issue of addiction or ITL’s knowledge of same.

5. Plaintiffs point to the fact that at a 1962 BAT research conference, ITL heard that nicotine was “absorbed by the central nervous system” and that nicotine was “metabolized to cotinine” as further alleged evidence of its knowledge of addiction.289 What Plaintiffs leave out is the fact that cotinine being a metabolite of nicotine had been publicly documented prior to 1962290 – and still the 1964 SGR conclude that smoking was a habit. Similarly, the fact that nicotine is

287

Plaintiffs’ Notes and Authorities, para. 305; Trial Exhibit 367A, pp. 12 & 17 pdf

288 Trial Exhibit 367A, p. 12 & pp. 16-17 pdf

289 Plaintiffs’ Notes and Authorities, para. 305, Trial Exhibit 1343, p. 38 pdf (plaintiffs wrongly point to p. 22 pdf for this

proposition, but that is clearly incorrect. The only place where cotinine is referenced in this document is at p. 38 pdf)

290 See, for example, Trial Exhibit 20152-AUTH, p. 35 pdf









44

absorbed by the central nervous system was specifically recognized within the 1964 SGR – still, smoking was classified as a habit:

The habitual use of tobacco is related primarily to psychological and social drives, reinforced and perpetuated by the pharmacological actions of nicotine on the central nervous system.

291

6. Nor does the fact that BAT was sponsoring research in the early 1960s to learn more about nicotine, or the fact that Sir Charles Ellis of BAT mused about whether smoking might be addictive or a habit establish that ITL knew any more on the subject than the U.S. Surgeon General.292 Indeed, Sir Charles’ reference to smoking being a “habit of addiction” was exactly the phrase referenced in the 1962 RCP report as the common loose terminology being used at that time, including by medical doctors.293

7. As for the many other “admissions” stated by Plaintiffs to have been made by ITL since the early 1960s, none of these establish that ITL considered smoking to be addictive at the relevant times.

8. Plaintiffs point to a number of exhibits for these alleged admissions, as discussed below:

a. A 1976 BAT research report - Exhibit 58.5, p. 15 pdf, “last sentence”:294 The document, beginning at the end of p. 15 pdf reads:

The majority of smokers who are smoking for the nicotine content of smoke may still be smoking for the different effects of nicotine. They may seek the pharmacological stimulation of nicotine ....

There is no admission of addiction, but rather a recognition that nicotine has pharmacological effects – something that was acknowledged in the 1964 SGR.295

b. A 1981 BAT Board Strategies document - Exhibit 185, p. 39 pdf296: the document states that BAT’s position was that for the great majority of smokers, smoking is “habituative”, but comments that heavy smokers and chain-smokers have demonstrated addictive “symptoms”.

c. A 1976 memorandum written by M. Descôteaux, a 29 year old P.R. representative at the time -Exhibit 11, pdf 5297: M. Descôteaux refers in his memorandum to “addiction” and the “addictiveness of smoking” but also

291

Trial Exhibit 601-1964, p. 43 pdf

292 Plaintiffs Notes and Authorities, paras. 306 and 307


294 Plaintiffs’ Notes and Authorities, para. 308 & footnote 333

295 Trial Exhibit 58.5, p. 15 pdf; Trial Exhibit 601-1964, p. 349 pdf

296 Plaintiffs’ Notes and Authorities, para. 308, footnote 333, Trial Exhibit 185, p. 39 pdf


st bullet, footnote 334, Trial Exhibit 11, p. 5 pdf














45

testified that he was not communicating in the language used by ITL, and further stated:

So, and I said "addiction" should have been in quotation marks. This is a report, okay, and I know it's legitimate that you ask questions about it, but I just want to put it in a certain context. This is nineteen seventy-six (1976), I've been made Public Relations Director in nineteen seventy-two (1972); so I've been on the job for four (4) years. I am, in nineteen seventy-six (1976), twenty- nine (29) years of age and I've been in public relations for... but in any meaningful manner, for four (4) years. Somebody asks me to prepare ideas on new policies that might work better than the ones that have been followed previously and that led nowhere. So as a young kid, I roll up my sleeves and I try and come up with brilliant ideas, with a lot of naivety and, more importantly, a lot of ignorance. Some things in this document are laughable, but they were, at the time, my best try. There is also an effort at flowery language. I speak in flowery manner and I speak... a written English because I learnt my English essentially by reading in English and by taking courses, but my accent is terrible. I didn't read (sic) it on the street as some would. So you'll find all kinds of things to have fun with, but before you start, I just want you to understand this is the general context. This is the... and there is a lot of things in this that if my assistant came to me tomorrow, who would be twenty-five (25) or thirty (30) years old, with as little experience as I had, and would present me with this report, I would have a lot of problems with it.

298

Whether or not smoking is addictive is a scientific issue. This document, written by a 29 year old P.R. employee, simply cannot be taken as an “admission” by ITL that smoking was addictive. Although it does indeed demonstrate that non-scientists at large, being unconcerned with scientific definitions, had little difficulty in labelling smoking as addictive.

d. A 1976 document said by Plaintiffs to be an admission by Mr. Gibb of ITL that smoking was addictive – Exhibit 121299: this is a blatant misrepresentation by Plaintiffs, as the passage they have excerpted in their submissions does not come from Mr. Gibb, but rather, it is from a published article authored by M.A.H. Russell (an independent scientist) in the British Medical Journal. There is nothing in Mr. Gibb’s cover memo that hints at an acceptance of the statement made by Dr. Russell.300

e. A 1976 third party marketing document – Exhibit 113A301: the document reports on what smokers had expressed to these researchers. While this demonstrates that smokers certainly were aware of and believed that smoking was addictive, it certainly does not constitute an admission by ITL as to the scientific issue of smoking and addiction.

f. A 1980 visit report to Dr. Kozlowski of the Addiction Research Centre – Exhibit 32: while this document records that Dr. Kozlowski felt that “the effects

298

Trial Transcript (Descôteaux), March 14, 2012, from p. 229, line 15 to p. 230, line 23


nd bullet, footnote 335



rd bullet, footnote 336, Trial Exhibit 113A, p. 8 pdf




TRANSCRIPTS/Transcript%20-%20March%2014,%202012%20-%20Descoteaux%20(Day%203).PDF#page=229





46

of withdrawal from tobacco smoking are much more severe than most people believe and are comparable to the effects from heroin”, the document discloses no agreement from ITL on the point – indeed, the handwritten comment next to the statement reads “A little hyperbole”.302

g. 2 documents written by Mr. Bexon in 1984 and 1986 respectively – Exhibits Exhibit 267 and 266303: As to the first document (Exhibit 267), Mr. Bexon refers to the fact that smoking can be very hard to quit – something that has been well documented in the public domain at all material times. Indeed, when the U.S. Surgeon General concluded in 1964 that smoking was habituative, rather than addictive, it stated:

Thus, correctly designating the chronic use of tobacco as habituation rather than addiction carries with it no implication that the habit may be broken easily.

304

As to Exhibit 266, a handwritten document from Mr. Bexon, the document itself makes notes that he was recording focus group research:

The research on smoking conducted in Toronto is preliminary – reflective of attitudes in Toronto and not even really a proportional reflection of that because of the nature of the work. In spite of these caveats it is worth a fast overview of what went on in these groups.[emphasis added]

305

9. In contrast to this document (which received much attention from Plaintiffs during the trial) is a document which, without question, clearly records Mr. Bexon’s personal views on the issue of addiction. In 1989, Mr. Bexon wrote to Dr. Dunn (the head of ITL’s R&D department) commenting on the increased rates of quitting that had occurred in the 5 year period between 1984 and 1989, and stated:

Now, I'm not a scientist Pat - and I suppose definitions have a lot to do with it, but when 55% of a group have given something up (and when you throw in the fact that some of the other 45% don't want to), it doesn't seem to be that we are dealing with a substance with all the addictive properties that have been assigned to it.

There are probably more hard core television watchers who would have trouble without the tube. [emphasis added]

306

Plaintiffs’ repeated assertions that Mr. Bexon’s handwritten notes summarizing focus group comments constitutes an admission of addiction cannot stand in the face of this memorandum.

302

Plaintiffs’ Notes and Authorities, para 308, 4th

bullet, footnote 337, Trial Exhibit 32, p. 1 pdf, Trial Exhibit 267, p. 8 pdf and Trial Exhibit 266


th and 6

th bullets, footnotes 338 and 339














47

10. In any event, whether various ITL employees considered smoking to be addictive at certain points in time is neither here nor there. Employees were not required to adopt any particular view. The fact is that ITL had no material information pertaining to the subject of addiction than was not in the public domain. Prior to 1988, there was no scientific consensus that smoking was addictive, and even then, Canada required a further report in 1989 to draw a conclusion (positing yet again a different definition than that seen in the 1988 SGR). The definitional issue continues to be a live one, with the U.K. Royal College of Physicians having provided yet an even simpler definition than seen before in year 2000, stating:

Under the current definition, the terms [addiction and dependence] refer to a situation in which a drug or stimulus has unreasonably come to control behaviour.

307

11. Further, as discussed further in our submissions, the issue of addiction being a compulsion is one that continues to be disputed to this day by independent scientists:

The mischaracterization of addiction as a chronic, relapsing, neurobiological disease characterized by compulsive use of drugs or alcohol is thus not just mistaken, but an impediment to effective clinical and societal treatment of the problem.

308

B. Smokers Do Not Smoke Only for Nicotine

12. As discussed in further detail below, while nicotine is undoubtedly an important component of the overall smoking experience, it is not the case that smokers smoke only for nicotine. Accordingly, the discussion set out in paragraphs 309- to 317 of Plaintiffs’ Notes and Authorities is misleading.

13. Plaintiffs state in paragraph 309 that in “1967, the BAT group, including ITL, already understood that people smoked for nicotine. At a BAT Group Research Conference in 1967, it was stated, “Smoking is a habit attributable to nicotine””, referring to page 3 of Exhibit 1344.

14. However, Plaintiffs have conveniently omitted that the relevant statement was an assumption only, and that the document reads, regarding this and other assumptions, as follows:

Considerable discussion took place on the assumptions made by R&D scientists and these were listed without any attempt to justify them or to agree on their correctness at this time. [emphasis added]

309

15. Does the fact that it had been suggested (in a 1972 BAT research report) that many smokers smoked for the pharmacological effects of nicotine, constitute knowledge of addiction on ITL’s part, as stated by Plaintiffs?310 Of course not –

307




310 Plaintiffs’ Notes and Authorities, paras. 309 & 313; Trial Exhibit 58.2, p. 4 pdf





REFERENCES%20TO%20PLAINTIFFS%20N&A/Para%20309%20&%20313%20of%20Plaintiffs%20N&A.pdf


48

the pharmacological aspect of nicotine was acknowledged in the 1964 SGR. Further, the suggestion that nicotine was a significant factor in smoking had been in the public domain long before the 1964 SGR. Indeed, the 1972 BAT research report relied on by Plaintiffs cites to three published articles in support for the suggestion – one of which dates from 1892!311

16. Nor does the fact that ITL may have been informed in 1984 that:

a. nicotine has an effect on the central nervous system through nicotinic cholinergic receptors;

b. nicotine stimulates acetylcholine; or

c. nicotine has a biphasic effect,

constitute an admission of addiction, as asserted by Plaintiffs in paragraphs 317 and 318 of their submissions312. Nor were any of these factors “secret”, as suggested by Plaintiffs.

17. The fact that nicotine has an effect on the central nervous system through nicotinic cholinergic receptors had been in the public domain for more than a decade prior to 1984.313

18. Similarly, the fact that nicotine stimulated acetylcholine (a neurotransmitter) was a matter in the public domain since as late as 1964.314

19. So too was knowledge of the biphasic effect of nicotine long in the public domain (nicotine’s ability to both stimulate and depress). Indeed, this had been in the public domain since the beginning of the 20th century.315

20. It is noteworthy that paragraph 317 of Plaintiffs’ submissions cite to Exhibit 1366.2 (pages 417 and 420)316 for the proposition that “Stimulation of acetycholine by nicotine results in biphasic effect, first of psychological well-being, followed in less than an hour by feelings of nervousness and edginess.” As is far too frequently the case, this information is not found in the cited reference.

21. In any event, as discussed above, neurobiology is virtually irrelevant to a determination of addiction.

311

Trial Exhibit 58.2, pp. 4 & 40 pdf

312 Plaintiffs’ Notes and Authorities, paras 317 and 318

313 See, for example, Trial Exhibit 20156.3-AUTH, pp. 35 and 57 pdf

314 Trial Exhibit 20156.1-AUTH, p. 28 pdf


316 Trial Exhibit 1366.2, pp. 417 & 420 pdf











49

APPENDIX V – COMPENSATION AND SMOKING DELIVERIES

1. Plaintiffs’ Notes and Authorities manifest a fundamental misunderstanding of the phenomenon of compensation, and draw faulty conclusions in respect of various issues. In particular, Plaintiffs make the following erroneous assertions:

a. compensation has resulted in no benefit to low yield cigarettes;317

b. a main mechanism used by smokers to compensate is an alteration in the quantum of cigarettes smoked;318

c. ITL defined compensation as an “involuntary modification of smoking behaviour”;319

d. nicotine is the driving force behind compensation;320

e. ITL designed cigarettes so as to facilitate compensation or to mislead consumers;321 and

f. compensation is analogous to machine deliveries and whether or not smokers obtain standard yields when smoking.322

2. For the reasons set out below, none of these positions are sustainable on the evidence.

3. Further, as is clear on the evidence, it is unquestionable that the Government and the PHC were fully aware of the phenomenon of compensation at all material times.

A. The Faulty Conclusion in Monograph 13 & Compensation Via Increased Consumption

4. Plaintiffs rely on the conclusions of Dr. Burns in Monograph 13 for the faulty proposition that there is complete compensation, and that therefore there has been no benefit to reduced delivery cigarettes. This is in direct contrast to the evidence of Dr. Dixon, and further suffers by the fact that compensation is limited to smokers who switch brands.323 Plaintiffs specifically chose not to call Dr. Burns to the stand to reply to the evidence of Dr. Dixon on this point. As such, Dr. Dixon’s evidence is unchallenged,324 and Plaintiffs’ attempts to rely inferentially

317



319 Plaintiffs’ Notes and Authorities, paras. 320 & 526


321 Plaintiffs’ Notes and Authorities, paras. 326, 533 & 544

322 Plaintiffs’ Notes and Authorities, paras. 416 & 419

323 It is clear that whether or not a smoker compensates on switching brands, and to the degree to which he or she

compensates, is manifestly an individual issue.



REFERENCES%20TO%20PLAINTIFFS%20N&A/Para%20320%20and%20526%20of%20Plaintiffs%20N&A.pdf


REFERENCES%20TO%20PLAINTIFFS%20N&A/Para%20326,%20533%20and%20544%20of%20Plaintiffs%20N&A.pdf

REFERENCES%20TO%20PLAINTIFFS%20N&A/Para%20416%20and%20419%20of%20Plaintiffs%20N&A%20.pdf

50

on statements by Burns (in Monograph 13 or elsewhere) – without an expert witness to tender or adopt any such statements – are improper.

5. As Dr. Dixon noted, if one examines table 4-1 of Monograph 13, 36 of the 45 cited studies in the table show a reduced risk of lung cancer for unfiltered versus filtered and/or lower tar versus higher tar cigarettes. This is essentially the same point made by Peter Lee in his 2001 peer-reviewed publication. 325

6. While Dr. Burns acknowledged these disease reductions, he dismissed the historical relevance of the results on the basis of purported ‘corrections’ made for differences in the number of cigarettes consumed by the smokers of high and low yield cigarettes in some of the studies.326

7. Dr. Dixon’s evidence establishing that the Burns conclusion was faulty on two points. First, two published reviews concluded that the lung cancer reductions afforded by lower tar cigarettes were present irrespective of whether the data was, or was not, corrected for differences in cigarette consumption.327

8. Furthermore (and squarely within his sphere of expertise), Dr. Dixon clearly rebutted the underlying theory used by Dr. Burns in coming to his conclusion – namely that compensation was complete (whether the manner of compensation was due to increased cigarette consumption or otherwise).

9. Contrary to Plaintiffs’ contention that compensation via increasing the number of cigarettes smoked is a “main” manner of compensation,328 the evidence before this Court is that compensation by changed consumption is unusual.329 Indeed, the fact an increase in consumption did not occur with smokers of Canadian cigarettes (despite any hypotheses that may have been articulated to the contrary) was established in a 1995 survey done on behalf of Health Canada, where it was found that:

Smokers of ‘light’ cigarettes smoked fewer cigarettes per day than smokers of regular cigarettes, 14.2 cigarettes per day vs 17.3 cigarettes per day. This was consistent for both men and women and type of smoker.

330

324

Clearly, documents such as Monograph 13 have no evidential value as to the truth of contents except to the extent that any passages therein have been adopted by a properly qualified witness. (see McTear v. Imperial Tobacco Limited, [2005] CSOH 69, at para. 6.63). No such proof was made by Plaintiffs.

325 Trial Transcript (Dixon), September 17, 2013, p. 174, line 13 to p. 177, line 2; Trial Exhibit 40346.221, pp. 97-106 pdf;

Trial Exhibit 20267

326 Trial Exhibit 40346.221, pp. 93-95 pdf

327 Trial Transcript (Dixon), September 17, 2013, from p. 177, line 3 to p. 186, line 23; Trial Exhibit 20267; Trial Exhibit

20269


329 Trial Transcript (Dixon), September 17, 2013, from p. 264, line 18 to p. 266, line 2; See also Trial Exhibit 20010, p. 8

pdf; Trial Exhibit 601-1984, pp. 346 & 358 pdf


CASELAW/McTear%20v.%20Imperial%20Tobacco%20Limited,%20%5b2005%5d%20CSOH%2069.pdf#page=428

CASELAW/McTear%20v.%20Imperial%20Tobacco%20Limited,%20%5b2005%5d%20CSOH%2069.pdf#page=428















51

10. In 2001, Dr. Kaiserman of Health Canada repeated these conclusions, noting that Canada was in a better position to understand smokers of “light” and “mild” cigarettes than in most countries:

Thanks to the Canadian Tobacco Use Monitoring Survey (CTUMS) we know that about two-fifths of smokers (42%) smoke "light" or "mild" cigarettes and that another one-fifth (24%) smoke "ultra light" or "ultra mild" cigarettes. We know that smokers of these lower tar products smoke fewer cigarettes on average than regular cigarettes (17.7 vs. 14.2 vs. 12.1 cigarettes per day, respectively); tend to be less addicted and try to quit more frequently. [emphasis added]

331

11. Certainly, smokers can compensate by way of a change in the number of cigarettes smoked, but the evidence is clear – by no means is this a “main” method of compensation.

12. Dr. Dixon further clarified how it was that Dr. Burns came to his erroneous conclusion regarding complete compensation, in the face of a wealth of information to the contrary.

13. Specifically, Dr. Burns relied on two studies for his conclusion – one of these studies (the Peach study) was not a compensation study at all. Instead, it was a study where the researchers looked at the effect of going from high to low tar on respiratory symptoms such as cough and phlegm. One simply could not measure compensation from this work.332 The second study was one published in 1987 by Lynch and Benowitz (14 years before the publication of Monograph 13). The interpretation of the study given to it by Dr. Burns in Monograph 13 had not been previously seen in the field.333

14. What the Lynch and Benowitz study (the “Benowitz Study”) did was to measure plasma cotinine in smokers (a marker for nicotine levels).334 The researchers measured the cotinine levels in smokers on day 1 and at the same time inquired as to the brand of cigarettes smoked and asked smokers to provide an estimation of their daily cigarette consumption. Six years later they went back to these smokers (or as many as they were able to) and asked them whether they had switched brands. Those that had not switched were part of the control group, those that had switched to lower tar delivery cigarettes were classified in the study as “decreasers” and those who had made an upward switch in deliveries were classified as “increasers”.335

15. Those smokers who had not switched showed a slight increase in cotinine since the advent of the study, but not significantly so. Decreasers on the other hand

331


332 Trial Transcript (Dixon), September 17, 2013, p. 234, lines 11-21

333 Trial Transcript (Dixon), September 17, 2013, from p. 237, line 11 to p. 238, line 14

334 Cotinine is a metabolite of nicotine and its measurement in smokers provides one with an indication of the daily

exposure of nicotine from tobacco smoke.

335 Trial Transcript (Dixon), September 17, 2013, from p. 238, line 11 to p. 240, line 12; Trial Exhibit 40346.221A; Trial

Exhibit 40346.221, p. 73 pdf





EXHIBITS/Exhibit%2040346.221A.PDF



52

had a decreased level of continine. Increasers, as expected, showed an increased cotinine level. If compensation was complete, one would expect both increasers and decreasers to show no change in the continine levels – that it was not so supported the incomplete compensation conclusion.336

16. Dr. Dixon, by reviewing the data in the full Benowitz Study, was able to calculate the degree of compensation and determined that it was 50%.337

17. How then did this single study provide the basis for concluding that compensation was complete, despite the vast number of studies to the contrary? The answer is that when Lynch and Benowitz inquired as to the number of cigarettes smokers were smoking in the six year follow-up, smokers claimed to be smoking less cigarettes. Doing the calculation then on a per reported cigarette basis (as opposed to simply testing their actual cotinine levels), the “decreasers” showed a relatively flat line for cotinine. But, the control group showed a sharp increase in cotinine levels – how could this be when they had not switched brands and they are self-reporting that they are smoking less cigarettes per day? Similarly, the “increasers” showed a much steeper incline on the “per cigarette” calculation than they did simply by measuring their overall cotinine levels – again, how could this be when they were claiming to smoke less cigarettes per day?338 The answer is that it simply does not make sense, and the reason for this is that self-reported numbers of cigarettes smoked per day is notoriously unreliable. Dr. Dixon’s view in this regard has been echoed by the W.H.O.:

There is no question that levels of nicotine or cotinine in biological fluids or hair and nails are more accurate measures of the amount of recent nicotine intake for an individual than the number of cigarettes smoked per day or other self-reported measures of intensity of tobacco use.

339

18. Further and in any event, even using the notoriously unreliable measure of self-reported cigarettes smoked per day, and using the plasma cotinine per cigarette analysis set out in the Benowitz Study, smokers of the low delivery cigarettes obtained lower yields than did smokers of higher yield cigarettes. As Dr. Dixon stated, “lower is lower”, however you measure it. 340

19. Other documents put to Dr. Dixon by Plaintiffs in support of the complete compensation theory invariably relied for their conclusion on the faulty conclusion in Monograph 13. Dr. Dixon’s view was clear:

..my expert opinion is that the conclusions in Monograph 13 are not supported by the science.

341

336

Trial Transcript (Dixon), September 17, 2013, from p. 240, line 13 to p. 242 line 6

337 Trial Transcript (Dixon), September 18, 2013, from p. 11, line 18 to p. 14, line 15; Trial Exhibit 40346.221B; Trial

Exhibit 1584


339 Trial Transcript (Dixon), September 19, 2013, p. 259 line 1 to p. 263, line 1; Trial Exhibit 1422, p. 74 pdf





EXHIBITS/Exhibit%2040346.221B.pdf








53

20. There is no expert evidence to the contrary.

B. Nicotine is Not the Driving Force Behind Compensation

21. Plaintiffs assert that “the fact that nicotine is addictive can be drawn from the knowledge of compensation”.342 This is simply false, as the evidence reflects. In truth, compensation has nothing to do with “addiction to nicotine”.

22. Dr. Dixon’s evidence is that it is the sensory aspects of a cigarette that are far more important than the pharmacological effects of a cigarette in terms of human smoking behaviour.343 These sensory effects include taste, aroma, and most importantly, the “common chemical senses”, being the feel of the smoke in the mouth. These senses include things like coolness, mouthful of smoke, irritation at the back of the throat and a sensation referred to as impact (the immediate sensation of nicotine stimulating the nerve endings that exist in the throat region upon inhalation).344

23. While in the early days of attempting to understand the phenomenon of compensation, it was often thought that nicotine was the reason for changes in smoking behaviour, the theory that people compensate only for nicotine has now been debunked. While nicotine may play a role in why people compensate, there are other factors at play. Indeed, it has been increasing found that people compensate for mouth sensations and that the primary driving factor is tar.345

24. As to Plaintiffs’ claim in paragraph 319 of their Notes and Authorities that statements from the 1984 BAT Smoking Behaviour – Marketing Conference ‘evidences’ that ITL considered compensation as a sign of addiction – this is simply a complete mischaracterization of the plain meaning of the words Plaintiffs cite and a blatant disregard for the evidence provided on the very statements in question. After reading to Mr. Read the passage now cited by Plaintiffs, counsel asked “Are we to take from this that BAT is acknowledging in this document that smokers are addicted to nicotine?”. Mr. Read’s response was clear – what the document stated (and what participants were considering) was a hypothesis only:

...I think, if you look at the typeface, it's asking the question, "IF smokers are ADDICTED," then a certain series of things follow. It's a hypothesis which is testable, and the two (2) points that are being raised indicate the basis on which that hypothesis may be tested. If people are only smoking for nicotine... or oral smoke, they'd be just looking for a nicotine source, and we accepted that that was part of a hypothesis that could be tested and, perhaps more importantly, from a competitive point of view, others may be able to provide products that just delivered nicotine. And that was worth understanding and investigating.

346

342



344 Trial Transcript (Dixon), September 17, 2013, from p. 45, line 19 to p. 48, line 19 & p. 57, line 3 to p. 65, line 18; Trial

Exhibit 20256.1, pp. 27-29 pdf; Trial Exhibit 20258

345 Trial Exhibit 20256.1, pp. 24-27 pdf; Trial Transcript (Dixon), September 18, 2013, from p. 98, line 9 to p. 115, line 5;

Trial Exhibit 20292; Trial Exhibit 20293; Trial Exhibit 20294; Trial Exhibit 20295

346 Trial Transcript (Read), September 10, 2013, p. 153, line 6-19















54

......

A- I wonder if I might add, just so that I can... to sort of set the scene, because I don't want to leave things uncovered. Clearly, when you come down in delivery, there is a complete change of sensory characteristics on the product; there is no doubt about that. The questions that are being raised here are: is it being driven solely by nicotine? And the answer to that is: no.

347

25. Plaintiffs’ once again invent evidence in paragraphs 320 and 526 of their submissions when they state that ITL defined compensation as the “involuntary modification of smoking behaviour in order to increase or decrease the delivery of tobacco smoke constituents.” This is blatantly false, as a review of the documents cited by Plaintiffs as “support” establish.348 There is nothing within these documents to support the so-called involuntary definition as articulated by Plaintiffs, let alone that any such definition was adopted by ITL.349

C. ITL Did Not Design Cigarettes So As To Facilitate Compensation or To Mislead Consumers (Who Were Not Misled In Any Event)

26. Plaintiffs falsely state that ITL designed cigarettes that facilitated compensation.350 Not only is this without any evidentiary foundation, it is in fact contrary to the evidence, and represents yet another instance of fabricating evidence when the actual evidence fails to support Plaintiffs’ theory of the case.

27. In connection with their ‘facilitating compensation’ theory, Plaintiffs make reference to the concept of elasticity and ITL’s limited research regarding same.351 To be clear, elasticity is wholly different from compensation, the latter of which is a function of smoking behaviour. An elastic cigarette is not measured by how human smokers smoke a cigarette.

28. Dr. Porter explained, at the request of Plaintiffs, the definition of elasticity. It is a term which is based on the results of measurements taken on a cigarette smoking machine. One obtains the measurements of (typically) tar and nicotine using a 35 ml puff and then with a 70 ml puff. Normally, if it's a non-elastic cigarette, you would expect to get twice as much tar or nicotine from a 70 ml puff as you would from the 35 ml puff. An elastic cigarette, on the other hand, would have more than double of the smoke constituents – in other words, you would obtain more than a proportionate increase.352

347

Trial Transcript (Read), September 10, 2013, p. 155, line 9-17

348 Trial Exhibit 1366.2, pp. 112 & 432 pdf; Trial Exhibit 58.5, pdf 3

349 In paragraph 325 of their Notes and Authorities, Plaintiffs continue this theme of citing documents as “support” for

propositions, which documents contain no such support. In this paragraph, Plaintiffs say that “smokers often did not realize that they even made [such compensatory] changes, citing to Trial Exhibit 1366.2, p. 438 pdf. Again, a review of this page of the Exhibit shows that Plaintiffs have wholly misrepresented the evidence contained therein.


351 Plaintiffs’ Notes and Authorities, paras. 326-327

352 Trial Transcript (Porter), May 31, 2012, from p. 39, line 19 to p. 40, line 24










55

29. ITL did some experimental work to determine if elasticity even existed. In its experiments, its commercial products tested showed no elasticity.353

30. In addition, Dr. Porter was not aware of any of the exploratory or experimental research projects involving the concept of elasticity ever making their way into ITL’s commercial products.354 Nor do Plaintiffs provide any evidence to the contrary.

31. Dr. Porter’s testimony in this regard was corroborated by the expert evidence from Dr. Dixon, who explained that the results of part-filter analysis studies show that "highly-ventilated, ultra-low cigarettes [that Castonguay and others have suggested were designed to be more elastic] produced the lowest average tar and nicotine exposures to smokers within each of the markets studied”.355 Dixon elaborated that "[i]t is clear that compared with less ventilated higher yield cigarettes, highly ventilated ultra-low tar cigarettes are associated with smokers obtaining lower exposures to cigarette smoke constituents," something that "would not be the case if cigarette manufacturers including those in Canada had designed their highly ventilated cigarettes" to be elastic.356

32. Notwithstanding this clear and uncontroverted evidence, Plaintiffs later state in their Notes and Authorities that ITL followed a plan to “exploit compensation” by developing products that would provide “low TPM under machines smoking conditions but which will give high TPM to the average human smoker”.357 This is utter nonsense.

33. Plaintiffs point to an excerpt from Monograph 13 written by Dr. Lynn Kozlowski in an effort to save their allegation of deceptive design (which excerpt was not put to any witness, let alone the author or an expert witness).358 Dr. Kozlowski simply discusses the fact that smokers can alter deliveries by various methods, and points in particular to filter vent blocking (either with fingers or lips). As discussed previously, filters and filter ventilation serve an extremely important role in reducing deliveries. As was also discussed, the effect of filter vent blockage in increasing deliveries is minimal. There is simply no expert evidence to the contrary.

34. Plaintiffs further point to a statement made by a BAT scientist in 1984 which, they allege, “describes the motivation behind the industry’s design choice” – to design a cigarette in order to sell twice as many as would otherwise be the case.359 “Thereafter” they say “ITL refined the techniques of making cigarettes that

353

Trial Transcript (Porter) May 31, 2012, p. 215, lines 1 to 18

354 Trial Transcript (Porter), May 31, 2012, from p. 259, line 24 to p. 260, line 8

355 Trial Exhibit 20256.1 (Dixon Report), p. 33.

356 Ibid.

357 Plaintiffs’ Notes and Authorities, paras. 533 and 544









56

promoted compensation.”360 Such an assertion is wholly contradicted by the evidence.

35. First, the relevant statement Plaintiffs rely on is recorded as having been made by a BAT scientist during a conference called the “Structured Creativity Conference”, and is a 2-M document. To suggest that this document accurately described the motivation of ITL in designing their cigarettes is an impermissible use of the document. In any event, the document says nothing about ITL (whether its motivation in designing cigarettes or otherwise).

36. Further, the letter to participants in this conference stated:

You should feel free to be as creatively free-ranging as possible in your product type proposals. Technical constraints usually apply to the realisation of any innovative notion, but they should be regarded as open for discussion and not as existing and binding.

361

37. Mr. Read confirmed that this was consistent with his understanding of the mindset behind these conferences and the approach of what was being discussed – namely, that these conferences were designed to be free brainstorming sessions with individuals noted for their free-thinking in order to come up with a whole array of “wacky thoughts”.362

38. Plaintiffs have no evidence of any significant design change in ITL’s cigarettes following this date of this conference that would result in this theoretical easily compensatable cigarette.

39. What Plaintiffs do have is evidence that ITL never designed a cigarette with the objective of making it compensatable.363

40. It is the case that ultra low cigarettes tend to be products that are ‘oversmoked’ most significantly. However, as Dr. Porter stated, when asked about the an overview document he assisted in preparing, (and which Plaintiffs rely on to suggest that ITL deliberately manufactured and sold cigarettes that promote compensation),364 the ultra-low cigarette in question had a standard 1 mg tar delivery and the 2 or 3 smokers from whom these results were obtained from obtained perhaps 2 or 3 mg per cigarette. Yes, this is higher than the printed standard deliveries, but so too is the number significantly lower than most cigarettes on the market.

41. The fact is, some smokers who switch brands do compensate, but Plaintiffs fail to address the opposite side of the coin – namely, is it even possible to design a cigarette which is not compensatable at all? The only witness qualified as an expert in cigarette design was asked this question and his answer was as follows:

360

Plaintiffs’ Notes and Submissions, para. 538



363 Trial Transcript (Knox), February 14, 2013, p. 198, line 14 to p. 199, line 11

364 Plaintiffs’ Notes and Authorities, para. 539 & para. 328-329; Trial Exhibit 388


EXHIBITS/Exhibit%2020229-AUTH.PDF#page=3


TRANSCRIPTS/Transcript%20-%20February%2014,%202013%20-%20Knox%20(Day%20114).PDF#page=198

REFERENCES%20TO%20PLAINTIFFS%20N&A/Para%20539%20&%20328-329%20of%20Plaintiffs%20N&A.pdf


57

I don't believe it is because, you know, if a person is smoking one particular... let's say a higher yield cigarette, and then they move down to a lower yield cigarette, if they were then to change their behaviour, so if they were, let's say, taking a forty-five millilitre (45 ml) puff on the high yield one, go down to a lower yield one, and go, say, fifty-five mil (55 ml), they're compensating. And I can't think of any way that you could prevent a smoker from doing that, so... In any cigarette design, the smoker could always take a bigger puff. So if you're measuring on a machine and you're looking at the... you know, the design of the cigarettes, you're producing the yields of those cigarettes, in the hands of any smoker there's always going to be a possibility that any cigarette will be compensatable. So I can't think of any way of producing a cigarette that would be non-compensatable.

365

42. As to Plaintiffs’ suggestion in paragraph 326 of their submissions that the 1984 “BAT Stance on Compensation” (seen in the brief from the 1984 BAT Smoking Behaviour – Marketing Conference) represented an effort to mislead, this was clearly refuted on the evidence.

43. As Mr. Read (who not only attended the conference but also was the head of BAT’s human smoking behaviour group at the time) explained, the conference was held at a time when there was a great deal of debate about the future of low tar cigarettes, the introduction of current and future low tar products and whether it could put into the marketplace a lower tar cigarette that would meet with consumer acceptability.366 The “BAT stance on compensation” specifically stated that the marketing policy in developing a cigarette with small improvements in elasticity were not clear. As explained by Mr. Read, the reason for this lack of clarity was because BAT had not had to consider it – in other words, it was a contemplative statement only. Further, the reason why BAT scientists were considering small degrees of elasticity in cigarettes was because it was thought that in order to encourage smokers to move to still lower delivery products (as governments, including the Canadian government were promoting), then, if smokers engaged in compensatory behaviour at the outset of the switch, they might find such products more acceptable. The, as smokers became used to the new brand, and reverted to their previous smoking pattern, BAT would have facilitated the smokers’ transition to lower delivery products, thereby fulfilling the public health policy of reduced deliveries to the smoker.367

44. However, and in any event, this contemplative position played no role in ITL’s product development. The evidence is clear and uncontroverted: ITL never designed cigarettes with the objective of making them compensatable or elastic.

368

365

Trial Transcript (Dixon), September 18, 2013, from p. 79 line 19 to p. 80, line 13


367 Trial Transcript (Read), September 10, 2013, from p. 159 line 19 to p. 163, line 17

368 Trial Transcript (Knox), February 14, 2013, from p. 198, line 14 to p. 199, line 11; Trial Transcript (Porter), May 31,








58

D. Standard Deliveries Were Never Intended to Represent Actual Human Smoking Deliveries

45. As is abundantly clear, standard machine derived deliveries were never intended to reflect, nor could they reflect, what smokers actually obtain when smoking a cigarette. One smoker does not smoke the same as another smoker, and smokers do not smoke their own cigarettes the same each and every time they smoke. No standard parameters could be set that would relay actual human deliveries to all smokers. They were simply intended to provide a ‘buyer’s guide’ to the relative rankings of Canadian brands, with the Canadian government’s intent being to convince smokers who chose to smoke to smoke lower delivery cigarettes.

46. The Canadian government first asked the Canadian manufacturers to provide it with standard tar and nicotine deliveries in 1966, shortly before the announcement of the FTC method. In response, the manufacturers provided a report from an independent testing and research firm setting out machine derived deliveries for 22 Canadian brands.369

47. In 1967, the FTC, in an effort to provide consumers with standardized information regarding the tar and nicotine deliveries of U.S. cigarettes, developed what became known as the “FTC method”. This method was based on a protocol developed by C.L. Ogg, a chemist with the U.S. Department of Agriculture.370

48. In the press release announcing the method, the FTC clearly acknowledged that:

a. the test was not designed to measure the amount of tar and nicotine that the “average” smoker would obtain from any particular cigarette, as no two human smokers smoke in the same way and no individual smoker always smokes in the same fashion; and

b. the purpose of the testing was not to determine the amount of tar and nicotine inhaled by any human smoker, but rather to determine the amount of tar and nicotine generated when a cigarette is smoked by machine in accordance with the prescribed method. 371

49. The Canadian government investigated the appropriate testing methodology on its own, together with its contracted researchers at University of Waterloo. It made its own inquiries to the FTC and decided on the methodology that was to be used in Canada. That methodology differed slightly from the FTC method – one such difference was the butt length (30 mm) to which cigarettes would be smoked. While the butt length would be changed when the Canadian government mandated the use of the ISO methodology, it was clear that from the very outset,

369

Trial Exhibit 40347.31; Trial Exhibit 20368.1; Trial Exhibit 20368.2








59

the decision as to the differences between the FTC method and the Canadian method used prior to ISO was made by the Canadian government.372

50. ITL publicly cautioned that standard deliveries would not reflect what any individual smoker actually obtained:

“There are too many subjective factors in the smoking of any product” Mr. Keith said, citing the speed at which a person smokes and the number of puffs he takes. All have a bearing on the tar and nicotine [content the smoker] takes into his mouth, Mr. Keith said. Stating tar and nicotine contents on cigarette packages could give a smoker a false sense of what he is getting from a cigarette, Mr. Keith said and could also give a false sense of security.

373

51. A BAT scientist, in the BAT Smoking Behaviour text, also clearly and publicly acknowledged that standard smoking machine deliveries were by no means equivalent to human smoking. 374

52. Throughout the decades, the Canadian government also cautioned the public that the actual intake of smoke components would vary depending on the way the cigarette was smoked.375

53. Indeed, with full knowledge of the issue of compensation, the Minister of Health advised the public in 1984 that, while deliveries certainly increased when smoked more intensively, and that the amount of constituents a smoker obtained depended on how one smoked their cigarettes, “the tar and nicotine values printed on packages are a satisfactory buyer's guide to cigarettes with lower average yields of toxic substances” 376 – in other words, less is still less.

54. In 1988, the ISCSH spoke to critics of machine smoking deliveries and the suggestion that these numbers were misleading to consumers – the ISCSH’s comments can be directed squarely to the allegations Plaintiffs now make in paragraphs 415 to 422 of their submissions and elsewhere:

In the United Kingdom, the Department of Health & Social Security (DHSS) has, since 1972, published tables of cigarette tar and nicotine yields(together with carbon monoxide from 1978) which are obtained with an internationally agreed standard smoking procedure. This uses machine parameters of 35 ml puff volume and 2 second puff duration taken once a minute. These parameters have been criticised as not reflecting average human behaviour and leading to published yields universally underestimating yields actually obtained by the average smoker. Critics of the machine smoking procedure have frequently failed to understand that values presented in tables published by DHSS have never been intended to be actual yields obtained by any one

372

Trial Exhibit 20563; Trial Exhibit 20569; Trial Exhibit 20570; Trial Exhibit 20571; Trial Exhibit 40274, p. 1 pdf; Trial Exhibit 20573, p. 1 pdf; Trial Exhibit 20572; Trial Exhibit 20578 & Trial Exhibit 20578.1; Trial Exhibit 20584, p. 2 pdf

373 Trial Exhibit 20049, p. 2 pdf; see also, for example, Trial Exhibit 20050, p. 2 pdf


375 Trial Exhibit 20256.1, pp. 4-5 pdf; Exhibit 40547.1, p. 3 pdf; Trial Exhibit 21227, p. 3 pdf; Trial Exhibit 40547.15, p. 1

pdf; Trial Exhibit 40547.40, p. 2 pdf























60

smoker. Rather. they enable brands to be ranked. This allows inter-brand comparison under a standard test procedure, presenting the smoker with information to enable him to choose, if he so wishes, a lower yielding brand. [emphasis added]

377

55. Even Dr. Castonguay (who was not qualified as an expert in smoking behaviour or cigarette design) agreed that standard smoking machines were not and could not be designed to replicate what an individual smoker received, stating “..toute la planète est d'accord avec ça.”378

56. Of course, after publishing the standard deliveries themselves in the late 1960s, and insisting on the placement of such yields on packages and advertisements (which Defendants complied with, beginning in 1974), the Canadian government enacted legislation in 1989 that required the printing of standard tar, nicotine and CO deliveries on packages. There simply can be no fault on the part of ITL for first complying with the government’s strong requests, and then complying with the law.

E. Plaintiffs’ Conflation of Machine Smoking Deliveries, Compensation and Consumers’ Perceptions of “Light”/ Lower Delivery Cigarettes

57. Plaintiffs conflate three separate issues in paragraphs 415 to 422 of their submissions and elsewhere.

58. For example, in paragraphs 416 and 419, Plaintiffs cite extracts of exhibits that speak to an apparent misconception smokers might have regarding the machine derived numbers and the amounts of smoke constituent yields they obtain. However, any number only has meaning to any smoker in comparison to different number on a different package. It is simply a measure of comparison. A different measurement scheme will give you different numbers, but no matter what parameters you use, it simply tells the smoker if you smoke two different brands with different standard yields, then you are likely to obtain more (or less) from Brand X than Y. And, in any event, for the reasons stated above, there is no legal wrong that ITL committed in placing machine derived deliveries on its packaging and in advertisements.

59. Plaintiffs then reference documents which speak to compensation in paragraphs 418 and 421 of their Notes and Authorities, both of which point to blocked ventilation holes in particular. As established on the evidence in these actions, vent blocking is both an uncommon compensatory mechanism and in any event, does not result in any significant increase in deliveries to the smoker.

60. As for the balance of issues raised by Plaintiffs, they effectively contend that smokers did not know about compensation, among other things. In this regard, Plaintiffs rely on some statements made by Dr. Kozlowski and a 2005 article authored by Bernart and al. To be clear, the statements of Dr. Kozlowski referenced by Plaintiffs in paragraph 418 of their submissions do not come from a formal study that has been filed as an exhibit; rather, Dr. Kozlowski was

377





61

commenting on some apparent results in a survey regarding U.S. smokers as part of a presentation made and which comments were recorded in the Report of Canada’s Expert Committee in Cigarette Modifications.379

61. The other article relied upon by Plaintiffs for their consumer unawareness point is Exhibit 1589, quoted by Plaintiffs in paragraph 420 of their submissions. All that the authors of this study were doing was summarizing other research done by other authors involving US smokers– the article was not itself a study conducted by these authors investigating the awareness of smokers, let alone Canadian smokers.

62. Further, this article was addressed by one witness only – Dr. Dixon, who disagreed with many of the findings in this paper (which was not a compensatory study at all, although the authors simply repeated some comments on compensation allegedly made by other authors).380 Dr. Dixon was asked by Plaintiffs if he agreed with the very comments that Plaintiffs now seek to rely on, being a conclusion drawn by Kozlowski et al. taken from some research conducted with U.S. smokers. He did not:381

Okay. Let me try and go through this. The first section, yes, tobacco industry has reduced cigarette tar yields by those methods that are described there. I agree that, as a result, machine-measured tar values have decreased by more than sixty percent (60%) during the past fifty (50) years; I agree with that. I disagree with the next statement, "This reduction in (...) values has had little influence on the risk faced by smokers", because that is something again which we've looked at in the epidemiology studies that have been published, which suggest that there has been a risk reduction. The other bit I disagree with is the Kozlowski work, with the fact that less than ten percent (10%) of smokers in a national sample knew that one light cigarette could deliver the same amount of tar to the smoker as one regular cigarette. I agree that that is what Lynn Kozlowski found in that study, but, to me, that statement is false. Because, if you're asking the smoker of a full flavour cigarette and a smoker of a light cigarette, then they are actually looking at the sensory effects and they're saying, "This cigarette is strong; this cigarette is weak." And if someone says, "Do you realize that those two (2) cigarettes are giving you the same amount of smoke?" Then, most people will say, "No, I don't agree with that." And that is where this ten percent (10%) comes from, because people are judging on what they're actually perceiving from the cigarette. And as I said yesterday, if you get a high sensory effect in the throat when you inhale, and a low sensory effect, the only way that is achieved is by having more smoke in the former, less smoke in the latter.

382

63. Dr. Dixon’s expert opinion was amply supported by the evidence pertaining to Canadian smokers and their understanding of compensation, filter vents and what “Light” means (which, even if Dr. Kozlowski’s disputed finding can be given

379

Trial Exhibit 40346.316, p. 58 pdf

380 Trial Transcript (Dixon), September 18, 2013, from p. 241, line 25 to p. 251, line 17. The underlying Kozlowski study

was filed as Trial Exhibit 1585, and it is clear from the exhibit that the study was performed with U.S. Smokers. Dr. Dixon’s evidence regarding Trial Exhibit 1585 can be found at: Trial Transcript (Dixon), September 18, 2013, from p. 157 line 13 to p. 160, line 8










62

credence with no expert testimony in support of same,383 demonstrates that Canadian smokers are in fact “less ignorant that their American counterparts”).384

F. Government and Public Health Community’s Awareness of Compensation

64. By the end of the 1960s, the public literature on the issue of compensation was on the increase, with a significant amount of it being funded by the U.K. tobacco industry through the auspices of the Tobacco Research Centre (the “TRC”). The scientists working at the TRC investigated many issues, one of which was compensation, and published articles pertaining to the subject before the close of the 1960s. These early studies clearly noted that smokers can alter the amount of smoke constituents, including nicotine, by changing the manner in which they smoke.385 Not only did TRC scientists publish on the subject themselves but the TRC also provided grants to other independent scientists who published on the subject in 1971 and earlier.386

65. In the U.K., the Royal College of Physicians recommended in its 1971 report that tobacco manufacturers focus its efforts on reducing the standard deliveries in their cigarettes.387 Following the publication of this report, the U.K. Minister of Health asked for a committee to be formed (using experts from the U.K. Department of Health, independent scientific experts and members of the U.K. tobacco industry) in order to consider the conclusions in the 1971 report and make recommendations as to what information should be communicated to smokers in the U.K. That committee was known as the Standing Scientific Liaison Committee.388 In its report, the committee was fully aware of the potential for compensation, stating:

Because the smoker can vary his own intake of tar and nicotine by the way he smokes whichever brand he chooses, he could, without realizing it, nullify any beneficial effects from a change to lower tar yield cigarettes.

389

66. The Canadian government was in possession of this report, discussed it internally and forwarded it to its funded researchers for further consideration.390

67. That same year, ITL discussed the issue of compensation with the Department of Health, 391 and in 1973 it proposed (along with the other members of the CTMC) a

383

Again, in the absence of expert evidence adopting the Kozlowski theory, the theory itself has no evidentiary value.

384 Trial Exhibit 20297, pp. 4-8, in contrast to Plaintiffs’ Notes and Authorities, para. 420

385 Trial Transcript (Dixon), September 17, 2013, from p. 209, line 14 to p. 212, line 23; Trial Exhibit 20275

386 Trial Transcript (Dixon), September 17, 2013, from p. 213, line 4 to p. 214, line 3; Trial Exhibit 20256.1, p. 22 pdf; Trial

Exhibit 20276 (see p. 3 pdf for the acknowledgment of the TRC funding)

387 Trial Exhibit 20038 at pp. 68-69 pdf, para. 9.39

388 Trial Transcript (Read), September 10, 2013, from p. 11, line 13 to p. 12, line 2; Trial Exhibit 20764 at p. 1 pdf

389 Trial Exhibit 20039, p. 4 pdf, para. 2.6

390 See, for example, Trial Exhibit 21441, p. 1 pdf and Trial Exhibit 20770

391 Trial Exhibit 20706.5A, p. 4 pdf















EXHIBITS/Exhibit%2020706.5A.pdf#page=4

63

joint research effort with the Canadian government which involved the issue of compensation.392

68. In 1977, BAT hosted a smoking behaviour conference, which included presentations regarding the physiology, pharmacology and psychology of smoking behaviour. There were approximately 50 delegates that attended this conference, including independent scientists, representatives from public health authorities and external research organizations as well as BAT and ITL scientists.393 Emanating from this conference was a published text394, which included a number of papers directly on the issue of compensation, some of which were authored by independent researchers395, some by ITL scientists396 and some by BAT and other industry scientists.397

69. The Canadian government directly funded compensation research398 and the issue of compensation continued to be considered in detail in the public literature in the 1980s and beyond. For example, the 1981 SGR canvassed a myriad of studies on the subject and included 31 citations to studies dealing with nicotine and compensation, 6 citations to studies pertaining to the issue of compensation by increased consumption, a reference to a ventilation hole blocking study, citations to 10 studies looking at the issue of puff frequency on compensation and five citations to studies relating to puff volume as a compensation mechanism. It is worth noting that 8 or 9 of the studies referred to in the 1981 SGR were studies authored by BAT researchers.399

70. ITL met with Health Canada representatives in 1986 and provided both an overview of its past studies and anticipated research in the area of human smoking behaviour.400 Following that meeting Dr. Somers of Health Canada wrote:

On behalf of Mr. Collishaw and myself, I would like to thank you and your colleagues for yesterday’s visit to your R&D facilities. We were most interested to learn, at first hand, the nature of your studies and we appreciated the open manner in which you discussed the work.

401

392

Exhibit 20088.1, pp. 9-10 pdf


394 Trial Exhibit 20009

395 Trial Exhibit 20009, at p. 94 pdf, p. 124 pdf, p. 167 pdf, p. 174 pdf, p. 178 pdf, p. 190 pdf & p. 204 pdf

396 Trial Exhibit 20009, at p. 106 pdf & p. 111 pdf

397 Trial Exhibit 20009, at p. 139 pdf, p. 148 pdf, p. 154 pdf, p. 160 pdf & p. 184 pdf

398 See, for example, Trial Exhibit 20702, p. 2 pdf; Trial Exhibit 20705, p. 1 pdf; Trial Exhibit 20725.1; Trial Exhibit

40347.130, pp. 1-2

399 Trial Transcript (Dixon), September 17, 2013, from p. 204, line 20 to p. 207, line 19; Trial Exhibit 20273

400 Trial Exhibit 21488; Trial Exhibit 20248.1; Trial Exhibit 20248.2; Trial Exhibit 20248.3, p. 1 pdf

401 Trial Exhibit 20248.2






























64

71. It is without question that at all material times, the Government and the PHC were aware of the phenomenon of compensation. There was nothing secret or hidden in this respect.402 Notwithstanding this knowledge, tar and nicotine numbers were printed on packages and advertisements at the request of the Government and were then required to be so printed pursuant to legislation. The Government’s policy objective regarding such disclosure was to encourage Canadian smokers who chose to continue to smoke to choose lower delivery cigarettes. This policy was successful.

72. Lower delivery cigarettes were widely lauded as having reduced the risk of disease as all times prior to the close of the class period. Evidence suggesting that the risk has not been reduced is based on (a) a faulty conclusion in Monograph 13 regarding the extent of compensation, or (b) recent unproven suggestions that adenocarcinoma has increased, but as discussed previously, this finding, if given any weight whatsoever, has absolutely no application to Canada.403

73. Plaintiffs’ allegations pertaining the above referenced matters have been demonstrated, on the evidence, to be patently false.

402

Trial Transcript (Dixon), September 17, 2013, from p. 201, line 23 to p. 220, line 16

403 Trial Exhibit 601-2014B, p. 210 pdf


EXHIBITS/Exhibit%20601-2014B%20.pdf#page=210

65

APPENDIX VI – CLARIFICATION OF THE EVIDENCE REGARDING ALLEGATIONS OF “NICOTINE MANIPULATION”

1. In an attempt to bolster their claims that: (a) ITL was interested in maintaining a level of smoke nicotine to addict smokers, and (b) there was a specific level of nicotine that would result in a non-addictive cigarette, Plaintiffs attempt to re-interpret a handful of dated documents – without supporting fact or expert testimony. In so doing, however, they fundamentally misstate the evidence.

2. For example, Plaintiffs point to what they say are the “minutes of a CTMC meeting” as “evidence” of a desire to identify the dose necessary to addict smokers and optimize cigarettes to deliver more nicotine.404 In fact, the document relied upon by Plaintiffs are the minutes of a meeting between members of the CTMC, Health Canada and AgCan.405 Far from looking to identify a “dose” required to addict smokers, the minutes reveal that Defendants were cautioning the Canadian government of the possibility of compensation should deliveries be reduced too much, too quickly. In doing so, they drew to the government’s attention a study that had been conducted in England where compensation was seen when smokers were switched to a cigarette with lower standard deliveries that 1.0 mg. As discussed above, the compensation phenomenon was already receiving attention in the scientific community at this time.

3. Dr. Zilkey, who attended this meeting, was taken to the very section that Plaintiffs now rely on as evidence of an insidious effort to addict smokers, and clearly confirmed that what was being discussed was the potential for compensation.406

4. Plaintiffs further misstate the evidence by asserting that a 1982 letter from Mr. Gibb (ITL) demonstrates a desire to know what the “addictive” dose was – this is a blatant misrepresentation of the document, which merely discussed the issue of consumer acceptability and what some older research may have shown.407

5. Plaintiffs then point to a 1984 Smoking Behaviour Research Conference and say – here is evidence of a desire to addict – someone at that conference suggested 0.7 mg per cigarette is the amount necessary for consumer ‘satisfaction’. 408

6. Plaintiffs fail to note that that this very comment now referenced by Plaintiffs in their submissions was put to Mr. Knox, who attended the conference. Mr. Knox firmly rejected the proposition, stating that one simply could not state that any specific amount of nicotine was desired by all smokers – indeed, ITL had marketed many brands successfully that contained less smoke nicotine than the number suggested.409

404


405 Trial Exhibit 40346.244, p. 4 pdf & Trial Exhibit 20706.5A, pp. 3-4 pdf

406 Trial Transcript (Zilkey), December 9, 2013, from p. 96, line 5 to p. 97, line 15

407 Plaintiffs’ Notes and Authorities, para. 508; Trial Exhibit 277

408 Plaintiffs’ Notes and Autorities, para. 509

409 Trial Transcript (Knox) February 14, 2013, from p. 195, line 6 to p. 198, line 23; Trial Exhibit 1366.2, p. 327 pdf




TRANSCRIPTS/Transcript%20-%20December%209,%202013%20-%20Zilkey%20(Day%20191).PDF#page=96






66

7. Plaintiffs also fail to note that Mr. Read provided evidence regarding this document, and the ‘0.7 minimum nicotine’ thesis. As Mr. Read noted, the conference took place at a time when there was a great deal of debate regarding low tar products, trying to understand how they were used by consumers, what drives smoking behaviour and whether the companies could put into place a low tar cigarette that was competitive and acceptable product to consumers (at the time a low tar product would have been a product below 10 mg tar).410

8. The passage of the exhibit Plaintiffs rely on for the ‘0.7’ theory was a slide from a previous conference, which again, raised issues about the role in smoking behaviour. The summary of this previous conference did not corroborate that 0.7 mg nicotine was a fixed number for consumer acceptability, but instead confirmed: “how little is really known about nicotine in relation to product behaviour and smoker satisfaction.”411

9. When asked whether BAT ever determined that there was, in fact, some minimum dose of nicotine required by smokers, Mr. Read stated “no”.412

410

Trial Transcript (Read), September 10, 2013, from p. 143, line 10, to p, 145, line 1; Trial Transcript (Read), September 10, 2013, p. 146, line 19 to p. 148, line 2

411 Trial Transcript (Read), September 10, 2013, from p. 148, line 11 to p. 152 line 13; Trial Exhibit 1366.2, p. 324 pdf








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APPENDIX VII – RECONSTITUTED TOBACCO, pH and SAND LEAVES

A. Reconstituted Tobacco Is Irrelevant to the Allegations of “Nicotine Manipulation”

1. As noted above, the use of reconstituted tobacco was widely hailed by independent scientists, public health authorities and the Canadian government as a feature of a less hazardous cigarette, due to the fact that it had lower biological activity (as measured by various tests) than tobacco itself.

2. In contrast to the unsupported allegation that Recon was a feature designed to increase nicotine, the fact is that it does the opposite. As discussed previously, because of the use of stem (which contains very little nicotine) and the fact that the small pieces of broken tobacco used in Recon generally have a lower level of nicotine, Recon itself has lower levels of nicotine than tobacco lamina used in cigarettes. The net effect was that the use of Recon by ITL in its cigarettes lowered nicotine levels.413

3. This is also the case with CRS and WTS, two components of cigarette recipes used by ITL - using CRS and WTS in cigarette recipes (as ITL did) reduces the nicotine content.414

4. As to adding nicotine to ITL’s Recon – the evidence is again crystal clear – no nicotine was added (either to Recon or ITL’s cigarettes at large):

Jim Sinclair:

159 Q Okay. Mr. Sinclair, did Imperial ever use nicotine, ever add nicotine to the reconstituted tobacco it manufactured for commercial use?

A No, we did never, did not.415

Gaetan Duplessis:

309Q-So, Mr. Duplessis, did Imperial add nicotine to the recon tobacco used in its commercial cigarettes?

A- No.

310Q-Did Imperial add nicotine to its commercial cigarettes at all?

A- No.416

Andrew Porter:

693Q – Okay. Did Imperial ever add nicotine to its products?

A- Never.417

413

Trial Transcript (Porter), August 28, 2013, from p. 116, line 15, to p. 117, line 9

414 Trial Transcript (Porter), August 28, 2013, p. 116, line 2, to p. 117, line 9

415 Trial Transcript (Sinclair), April 8, 2014, from p. 46, line 23, to p. 47, line 1

416 Trial Transcript (Duplessis), September 16, 2013, p. 133, lines 10-15





68

5. After Plaintiffs objected to Dr. Porter’s evidence, on the basis that he could only speak to what he knows personally, Dr. Porter stated that this was the type of thing he would have been aware of, had it happened, and he had no awareness of nicotine ever having been added to ITL’s cigarettes at all.418 Nor do Plaintiffs assert in their submissions that nicotine was added to ITL’s commercial cigarettes. Indeed, an investigation by the Canadian government confirmed that nicotine was not added by ITL (or any of Defendants) to its commercial cigarettes.419

B. The Free Base Nicotine/PH Fallacy

B.1 Increased pH does not result in increased nicotine absorption or the speed of absorption

6. Plaintiffs have zero expert evidence to support the now debunked theory they allege regarding "manipulation by pH". Instead, Plaintiffs point to a passage from a 1973 R.J. Reynolds document420, and then state “Dr. Castonguay agreed with that statement”.421

7. Dr. Castonguay did indeed agree with the statements presented to him, and also made unsubstantiated and scientifically incorrect insinuations and assertions in his ‘expert” report filed with this court on the issue of ITL’s “control of nicotine yields”422. This was notwithstanding that once again he had absolutely no expertise in any of the subjects surrounding such assertions.

8. One of the factors listed by Dr. Castonguay that entered into play (“D'autres facteurs entrent en jeu”423) was the increase of pH in smoke424. In his non-expert opinion (having admitted that he had no expertise in cigarette design425, (as well as pharmacology426, addiction427, molecular biology428, biology generally429, neurology430, psychiatry431, psychology432), one could increase the pH in smoke

417

Trial Transcript (Porter), August 28, 2013, p. 259, lines 12-14

418 Trial Transcript (Porter), August 28, 2013, from p. 259, line 17, to p. 260, line 24

419 See, for example, Trial Exhibit 40348.145


























69

by adding a base, which added base would increase the availability of nicotine to the smoker433.

9. In contrast to the ill-informed views of Dr. Castonguay, Dr. Dixon, (who, unlike Dr. Castonguay, was qualified as an expert in this area) explained both the underlying theory, and how the theory had been proved to be inaccurate.

10. The relevant theory starts with an intention to increase the pH of cigarette smoke, generally by the addition of ammonia or ammonia compounds, a theory repeated by Plaintiffs.434 In consequence of that allegation, it is claimed that the increased pH causes the nicotine in smoke to change its form from what is referred to as “bound” nicotine to “free” nicotine. Then it is claimed that the consequence of an increase in the amount of free nicotine is that nicotine will more readily absorbed in the lung. The ultimate consequence, according to the theory, is that nicotine gets to the brain more quickly and also in a greater quantity.435

11. However, multiple studies (including, but not limited to studies conducted by Dr. Dixon) have concluded that this theory is wrong – the increase in pH, brought about by the use of additives such as ammonia or ammonia compounds, neither increases the bioavailability of nicotine (that is, the amount absorbed by the smoker) or the rate at which nicotine is absorbed into the arterial circulation (the manner in which nicotine travels to the brain).436

12. In fact, as Dr. Porter noted when being examined by Me Boivin, when one is dealing with free-base nicotine, a greater amount is inhaled in the upper respiratory tract than in the lower part, and this results in a longer time for the nicotine to reach the CNS.437

13. In addition, Dr. Gentry testified that at a range of 5.5 up to before 6.5, the level of free nicotine is essentially zero. At 6.5%, it would be roughly 2 to 3 percent.438 According a very small percentage of nicotine in the smoke would be free nicotine.439

14. Like Dr. Dixon, Dr. Gentry explained that regardless of whether nicotine is presented to the smoker is a free or bound form, 90 percent of all nicotine is

431




434 Plaintiffs’s Notes and Authorities, paras. 577-578

435 Trial Transcript (Dixon), September 18, 2013, from p. 116, line 20, to p. 119, line 10; Trial Exhibit 20256.1, pp. 33-34

pdf

436 Trial Transcript (Dixon), September 18, 2013, from p. 120, line 19 to p. 123, line 24, Trial Exhibit 20256.1, pp. 33-34 pdf

437 Trial Transcript (Porter), May 30, 2012, p. 102, lines 6-21

438 According to the Benchmark Study relied upon by Plaintiffs, the pH level of Canadian cigarettes hovered between 5.9

and 6.2, with the very highest being measured at 6.39 –see Trial Exhibit 366, p. 5 pdf

439 Trial Transcript (Gentry), November 6, 2013, from p. 140, line 2, to p. p. 144, line 16













70

absorbed in the lung – the form does not make any difference in the quantum absorbed. The explanation for why the form does not matter is as follows: the surface of the lung and the blood systems are buffered to approximately 7.4 pH. When materials hit the large area of the lung, they are immediately put into that buffer system, and regardless of what the pH level was of the cigarette smoke prior to entering the lung, its pH will be increased by the lung itself. 440

B.2 ITL did not add or do anything to its cigarettes to increase the pH of its cigarettes

15. Coupled with the failed theory posited by Plaintiffs is the simple fact that ITL did not add or do anything to its cigarettes to increase the pH of its cigarettes.

16. The possible addition of ammonia to cigarette recipes441, as inevitably seen in documents filed by Plaintiffs, pertains to the addition of ammonia to reconstituted tobacco. Mr. Sinclair was unhesitating on this point – ITL never added ammonia or ammoniated materials to the reconstituted tobacco it manufactured for commercial use, nor did it use the technology that related to its use.442

17. In the same vein, Dr. Porter was aware of no ammoniated treatment of the tobacco used its ITL’s commercial cigarettes.443 Having been with ITL from 1977 to 2007, he stated unequivocally that ITL never adjusted the pH level of its commercially available cigarettes during his time with the company.444 Nor was he aware of any attempt to alter the pH in ITL’s commercially sold cigarettes at any point in time.445

18. Plaintiffs’ allegations on this issue are simply refuted by the evidence in these actions.

C. Cigarettes Made Only from Sand Leaves Would be Rejected by Smokers

19. As part of their “nicotine manipulation” allegations, Plaintiffs assert (without evidentiary support) that ITL ought to have manufactured its cigarettes using the leaves from the lowest part of the plant. These leaves are known as “Sands”.

20. In particular, Plaintiffs allege that Dr. Marks of AgCan acknowledged that Defendants could have used sands in order to reduce the nicotine content, and that ITL’s decision not to do so was somehow wrongful.446 The problem Plaintiffs

440

Trial Transcript (Gentry), November 6, 2013, from p. 144, line 17, to p. 146, line 10

441 To be clear, ammonia is a naturally occurring smoke component (see Trial Exhibit 601-1980, p. 257 pdf). The fact that

the 1999 benchmark study relied upon by Plaintiffs (Trial Exhibit 366, p. 5 pdf) references the ammonia levels in the smoke of Canadian cigarettes is no indication of ammonia being added. It is simply a measure of the naturally occurring ammonia in the smoke of Canadian cigarettes.

442 Trial Transcript (Sinclair), April 8, 2014, p. 47 line 2 to line 24



445 Trial Transcript (Porter), May 31, 2012, from p. 245, line 23, to p. 246, line 3; Trial Transcript (Porter), August 28, 2013,

from p. 259, line 12, to p. 261, line 11











71

face (as they are fully aware) is that ITL did use Sands. What it did not do is to use exclusively Sands.

21. Not referenced by Plaintiffs is what Dr. Marks had to say about using only Sand leaves in cigarette recipes:

399 Q-And can you help the Court to understand whether cigarettes can be made from only the lower sands leaves?

A- They could be made, but they wouldn't be acceptable. The way cigarettes are made is that they take different portions and different prime positions on the plant, and they would blend that together to make a brand or to make a type of cigarette that they wanted to sell. And so if you made it just from the sands, it would be very low quality, harsh... it would not be acceptable to anyone. So in order to get some... they had to blend different positions from the plant in order to get a particular brand, and they would have to evaluate tobacco each year to do that same... to do the blending... to vary their blending depending on the quality of tobacco from year to year, to get some consistency in their brands, and from a quality control viewpoint. So that was our information on the way that worked.

447

22. Simply put, the choice of leaves used (and the failure to make cigarettes exclusively from the Sands) had nothing to do with maintaining addiction – it had to do with providing products that met with consumer acceptability, as any manufacturer seeks to do. As discussed above, consumer acceptability was crucial in the development of a less hazardous cigarette, which was the driving goal behind the reduction of reduced tar and nicotine yields as well as the marginal reduction in the tar to nicotine ratio in cigarette smoke that occurred over time.

23. The issue of the reduction in tar/nicotine ratios is discussed in section C.3.f., but is part and parcel of the issue as it relates to using the Sand leaves only.

24. The Canadian government wanted smokers, if they were going to smoke, to smoke Canadian tobacco:

Eugene Whelan, Minister of Agriculture:

..it is important that those Canadians who do choose to smoke have access to Canadian products and that those products be as safe as possible for the users. ...To this end we have developed new tobacco varieties with much improved ratios of tar-to-nicotine. Additionally, our tobacco is one of the cleanest tobaccos in the world with respect to pesticide residues.

448

D.G. Hamilton, Assistant Director General, Agriculture Canada

...everyone agrees that Canadian cigarettes can and should be made from Canadian grown tobacco.

...

447

Trial Transcript (Marks), December 3, 2013, p. 118, lines 3-23


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The Federal Task Force on Agriculture recommended a research program into the production and manufacture of tobacco, that could meet the demand requirements, including health considerations of the 1970’s.

449

25. As Dr. Zilkey stated, while Sand leaves generally had both lower tar and nicotine yields than leaves from further up the plant, they also had a low sugar to nicotine ratio, and a cigarette would be too harsh if it was manufactured solely from these leaves. Such a cigarette would have an unacceptable taste and flavour and aroma, and smokers would not smoke it.450

26. Had ITL only used Sand leaves in the cigarettes it manufactured, the evidence is, this would have resulted in a commercially unacceptable product – and not because of the levels in nicotine yields (although Plaintiffs point to no evidence that a cigarette manufactured with only Sand leaves would result in a ‘non-addictive’ product). But of course, smokers could then turn to other manufacturers for acceptable cigarettes, including imported brands.

27. Each year the domestic manufacturers would advise the chair of the Tobacco Advisory Committee (being a representative of the Government of Ontario) of their purchase needs for the coming year. This involved purchases from the five levels of the leaves on the tobacco plant, being, from top to bottom, Tips, Leaf, Cutter Leaf, Cutter and Sands.451

28. The single largest purchase for the 2001 crop year was not from the highest level of the plant (or even from any of the top three levels), but rather was from the second lowest level, “Cutter”. The Tips, which traditionally contained the highest levels of nicotine, was the second smallest purchase, percentage wise, of the plant leaves. 452 There is no evidence that the purchases for this year, in terms of the proportion of the leaves bought, was anything other than normal course.

29. Granted, the amount of Sands bought represented the smallest percentage of the overall purchases. However, contrary to Plaintiffs insinuations, it was not necessarily the case that Sand leaves contained the lowest level of nicotine. Instead, the evidence is that Cutters (just above Sands) often had the lowest level of total nicotine alkaloids453 – the very part of the plant that saw the highest levels of purchase.

30. On the other hand, it would appear that the Sands also contained the highest levels of many metals, as well as pesticides.454 This is as would be expected,

449

Trial Exhibit 20720A, p. 6 & 7-8 pdf

450 Trial Transcript (Zilkey), December 9, 2013, from p. 126, line 16, to p. 129, line 6

451 Trial Transcript (Robitaille), December 19, 2013, p. 214, lines 5-19

452 Trial Exhibit 21059.1. p. 5 pdf

453 See Trial Exhibit 20855.2, p. 5 pdf; Trial Exhibit 20855.1, p. 29 pdf, Trial Exhibit 20965, p. 10 pdf

454 Trial Exhibit 20855.1, p. 10 pdf, Trial Exhibit 20903.9, pp. 3 and 6 pdf and Trial Exhibit 20965, p. 8 pdf


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since these elements would be absorbed from the soil.455 Would Plaintiffs take the position that the portion of the tobacco plant with the highest yields of these elements should have been used only, simply to reduce the nicotine content in the tobacco smoke by a small amount? It is a question for which the answer is all too obvious.

455

Canadian tobacco was known as having very low levels of pesticides, due to the work done by AgCan, and as assisted by ITL and others. See Trial Transcript (Duplessis), September 16, 2013, p. 110, line 5, to p. 112, line 10. This was touted by AgCan as one the health benefits of Canadian tobacco – see Trial Exhibit 40348.31, p. 52, pdf



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APPENDIX VIII – CLARIFICATION OF THE EVIDENCE REGARDING DELIVERY TARGETS (SWAT, SWAN, SWACO)

1. Plaintiffs erroneously suggest that – contrary to the testimony of government witnesses in these proceedings – ITL was somehow not in compliance with Health Canada’s delivery targets over the years. This assertion rests on a complete distortion of the evidence.

2. To take the issue of SWAT – Plaintiffs say that a SWAT of 12.3 achieved by ITL as of the close of 1984 was a failure.456 It is to be kept in mind that SWAT was not only a function of the tar deliveries of a cigarette but also the quantum of brands purchased by consumers at the various tar levels. ITL of course had brands with much lower tar levels than 12 mg – whether or not these brands would be purchased by consumers was not controlled by ITL.

3. Further, SWAT was based on the declared tar deliveries for cigarettes. These declared deliveries were always average deliveries, with tolerances built into the measurement scheme (which is not an exact science). The need for tolerances was clear – tobacco is a plant and the smoke deliveries produced by it are subject to variables that are outside a manufacturer’s control (e.g. weather factors, among others).457 Indeed, tolerances in respect of measurements were built into the legislative scheme under the Tobacco Products Control Act.458

4. To use but one example, in 1982, Mr. Clayton of Health Canada noted that while ITL’s SWAT for 1981 was 13.4, based on declared values, the actual analyzed number was a SWAT of 12.3 – that is, it was actually lower than the SWAT based on declared values.459 Accordingly, to say that the SWAT of 12.3 in 1984 based on declared (but not analyzed values) was a failure is monumentally unfair.

5. Further, Plaintiffs in essence seek to say, on the one hand, that the promotion of cigarettes with lower deliveries was wrongful on the part of ITL, yet, on the other hand, seek to condemn ITL for a SWAT (based on declared tar deliveries) that was less than half a milligram short of the requested target. This is simply illogical.

6. In addition, it is historically inaccurate to state that there was an agreement on the part of CTMC members to align carbon monoxide with tar levels. Rather, what the CTMC and the Canadian government agreed to was a best efforts undertaking to attempt to bring SWAC down to 13-14 mg by the end of 1984 and to use best efforts to closely align SWAT and SWAC.460 ITL’s SWAC based on declared values was 12.9 as of the close of 1984, and its SWAT and SWAC were closely aligned.

456


457 See, for example, Trial Transcript (Duplessis), September 16, 2013, p. 113, line 20 to p. 114, line 3; Trial Transcript

(Duplessis), September 12, 2013, from p. 262, line 20 to p. 263, line 16

458 Trial Transcript (Howie), September 26, 2012, from p. 254, line 7 to p. 255 line 11


460 See, for example, Trial Exhibit 1554.74A; Trial Exhibit 1554.74; Trial Exhibit 1554.76; Trial Exhibit 1554.79





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7. Further and in any event, it is clear on the evidence that the only way possible to reduce CO significantly is via filter ventilation. Yet, Plaintiffs suggest that filter ventilation was in some way a fraud (which has clearly been rebutted on the evidence). This is yet a further example of the inherent contradiction in the positions taken by Plaintiffs.

8. To the extent that there was an “failure” to reach a SWAC of 12, again, this failure is de minimus and certainly is no reflection of the efforts ITL made to reduce SWAC, which at all material times were subject to the purchase choices made by consumers.

9. As to SWAN – whether the goal of a SWAN of 1 mg was initially proposed by Defendants or not is of no relevance. There is no evidence that a SWAN of 1 mg. was not achieved by ITL. Further, at no time has the Canadian government mandated a maximum nicotine delivery in cigarettes. This continues to be the case today. Nor is there any evidence, as demonstrated previously, that cigarettes at X or Y level of nicotine would not be addictive. There simply is no magic number. Certainly, there is no suggestion by Plaintiffs that they would accept a maximum level of nicotine at, say, .9 mg, as an acceptable result.

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APPENDIX IX – ADDITIVES

A. Coumarin

1. Plaintiffs’ allegations regarding coumarin are unsubstantiated by any fact or expert evidence, and constitute nothing more than a red herring.

2. In summary, Plaintiffs assert that ITL knew that the additive coumarin was hazardous and further that it misled the public in this regard. These allegations, once again, are false. Notably, the only evidence relied upon by Plaintiffs to support their allegations that coumarin was hazardous (irrespective of whether or not it was used in ITL’s products) is a single document authored in 1989 which states that as a consequence of some in vitro experiments and liver cells, the Additives Guidance panel recommended that coumarin be removed from BAT brands.461 No questions were posed about the present knowledge of the toxicological data pertaining to coumarin, what these in vitro bioassays actually found, or whether they turned out to be erroneous. Simply put, Plaintiffs tendered no evidence and asked no questions at all about the underlying science.

3. In summary, the evidence before this Court is as follows:

a. coumarin is not a carcinogen;462

b. present data indicates that it may have anti-tumorogenic properties;463

c. ITL used small amounts of coumarin in a very small number of ITL brands – with extremely limited market share – for a limited period of time; and

d. ITL removed coumarin from its cigarettes (whether in coumarin itself or in other additives containing it) in 1981 or 1982, or at the latest, sometime prior to September 1988.

4. The above facts are fully dispositive of Plaintiffs claims, and no further consideration of the issue is warranted. However, to the extent that this Court considers it relevant, a more detailed discussion of the evidence relating to the use of coumarin is set out below.

5. Coumarin was a flavour additive used in a couple of ITL U.S. style blended cigarettes. The market share of ITL’s U.S. style cigarettes was miniscule (for example, as of 1993, these cigarettes accounted for 0.5% of ITL’s cigarette production).464 Nonetheless, Plaintiffs devoted a substantial amount of time to the issue of coumarin – presumably because Dr. Wigand had made the claim, after

461

Plaintiffs’s Notes and Authorities, para. 631; Trial Exhibit 59.41. Notably, the other exhibit cited by Plaintiffs in

connection with this issue have no bearing on their "coumarin is hazardous" theory.

462 Trial Transcript (Porter), August 28, 2013, from p. 266, line 25, to p. 267, line 5; Trial Exhibit 20027.1, pp. 6 and 8 pdf;











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being fired from Brown & Williamson, that coumarin was rat poison.465 This demonstrably false statement was corrected by Dr. Porter (among others).466

6. Nonetheless, Plaintiffs continue to assert that coumarin is hazardous, though they do so without evidentiary support. Rather, the evidence before this Court is that coumarin is not a carcinogen. Its carcinogenic potential has been investigated at least twice by the IARC, including as late as year 2000, and on both occasions, the IARC has classified coumarin as a “group 3” substance (“not classifiable as to their carcinogenicity to humans”).467 It is to be kept in mind that the IARC has not even concluded that coumarin is possibly carcinogenic to humans (a group 2B substance).

7. In fact, the evidence before this Court is that coumarin and some of its derivatives have recently been shown to have some anti-tumorigenic activity.468

A.1 Hunter List

8. In the U.K., the ISCSH was heavily involved in the review and approval of additives for use in tobacco products. In fact, the first task that this committee undertook was to consider the use of additives in U.K. products, and to generate an approved list. The list not only referenced additives approved for use, but also, the upper limits for use. The chairman of the ISCSH was Lord Hunter, and as a result, the list of approved additives as they existed from time to time became known as the “Hunter List”.469

9. The first Hunter List was published in September 1977 in the London Gazette (the U.K’s Official Gazette), having been informally distributed shortly before that time. Coumarin was not on the first Hunter List.470 However, the list was not static. Instead, when the ISCSH published its first list, it also anticipated additional additives being placed on the list in the future, and a toxicological protocol was set for assessing such further additives.471 Four months later, in January 1978, an updated Hunter List was issued, with the Committee stating the following:

The Independent Scientific Committee has considered the health aspects of some further additives for use in tobacco products and has concluded that those listed below may be included in List 2 published in The London Gazette

465

Trial Exhibit 20057.2, p. 1 pdf; Trial Exhibit 46, p. 1 pdf;

466 Trial Transcript (Porter), August 28, 2013, p. 267, line 12, to p. 268, line 3

467 Trial Transcript (Porter), August 28, 2013, from p. 266, line 25, to p. 267, line 5; Trial Exhibit 20027.1, pp. 6 and 8 pdf;



469 Trial Transcript (Read), September 10, 2013, from p. 95, line 25, to p. 96, line 14













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on 20th September 1977...and may be used in quantities not exceeding the amounts stated.

472

10. Coumarin was included on that list.473

A.2 No Misrepresentations Regarding ITL’s Use of Coumarin

11. As mentioned, the evidence discloses that coumarin was used in a couple of ITL’s U.S. blended cigarettes – and the evidence also discloses that the levels of coumarin in those cigarettes (or any other flavour additives naturally containing coumarin, such as deer tongue and tonka been) were well under the limits set in the Hunter List.474 Documents indicating that coumarin levels used in ITL cigarettes were not within the “limits” set by the Hunter Committee date from the short period between the first and second Hunter List being published.475 That is, coumarin was not an approved additive as of the Fall of 1977 when the first list was issued, but it was by the beginning of 1978, and in any event, at all times the level used by ITL were well under the limit that was eventually stipulated in January 1978.

12. As Plaintiffs acknowledge, the evidence indicates that coumarin, deer tongue extract and tonka been extract were no longer being used in ITL’s cigarettes as of 1982.476 Although this same document indicates that coumarin was still being used as of that date in pipe tobacco, chewing tobacco and cigars, none of these products are relevant to these actions. Plaintiffs fail to recognize this distinction when they allege that the fact that coumarin synthetic crystals were listed in a list of “active K numbers presently used in the Montreal plant” as of September 1984 supports their allegations of deception.477 As Plaintiffs are fully aware, as of 1984 the Montreal plant was manufacturing not only cigarettes (including blended cigarettes), but also pipe tobacco, cigars, chewing tobacco and other tobacco products. Indeed, Mr. Duplessis spoke to this issue and in fact, commented on the very same exhibit which Plaintiffs now rely on to cast ITL as a deceiver.478

13. Plaintiffs attempt to demonstrate that coumarin was being used in a single ITL brand as of 1985 by virtue of a 2M document – clearly attempting to inappropriately rely on the document for the truth of its contents.479 Despite the wrongful use of the document, it is instructive to note that the amount of coumarin stated to be present in that single ITL brand was 45 ppm (ppm, or parts per million being the equivalent of ųg per gram). The maximum limit of coumarin, as

472

Trial Exhibit 20227.2


474 Trial Exhibit 20227.2 (setting the maximum application rate at 525 ųg/g [micrograms per gram]); Trial Exhibit 531,

attaching Trial Exhibit 532, p. 2 pdf

475 Trial Exhibit 373A, p. 1 & 3 pdf

476 Trial Exhibit 530C

477 Plaintiffs’ Notes and Authorities, para. 625 and Trial Exhibit 1000

478 Trial Transcript (Duplessis), September 16, 2013, from p. 194, line 5, to p. 196, line 25; Trial Exhibit 20305

479 Plaintiffs Notes and Authorities, para. 626; Trial Exhibit 1307-2M







EXHIBITS/Exhibit%20530C.pdf






EXHIBITS/Exhibit%201307-2m.pdf

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approved in the Hunter List was 525 ppm (525 ųg per gram).480 And if this small amount of coumarin was in that brand as of 1985 (which is in conflict with other evidence),481 it matters not – as further set out below, there was simply no deception.

14. Plaintiffs also fail to mention that Mr. Leblond specifically testified that he recalled that ITL stopped using coumarin in its cigarettes as of 1981.482 Although there was some confusion on the record about dates, what is absolutely certain is that ITL was not using coumarin in its cigarettes or fine cut by at least September 1988, as was confirmed in a letter written by ITL’s then head of R&D, Dr. Dunn.483 Prior to this, ITL informed the Canadian government about the use of coumarin in its products (when in fact it was used in certain ITL products).484

15. There is simply no deception as it relates to ITL’s use of this additive, which, in any event, was and is not a carcinogen and for which Plaintiffs have filed no evidence to establish that its use by ITL in its cigarettes was indeed hazardous.

B. Reconstituted Tobacco & Additives

16. Plaintiffs theorize – in the face of evidence to the contrary – that certain fine cut products contained additives at certain times during the Class Period, and that these additives may have made their way into reconstituted tobacco. On the basis of their theory, Plaintiffs further claim that ITL’s public statements (near the end of the Class Period) about the absence of additives in its cigarettes were “misrepresentations”.

17. First, there is no evidence whatsoever that any additives used in fine cut tobacco was hazardous. More to the point, the evidence is crystal clear – ITL did not use offals from fine cut tobacco in the reconstituted tobacco used in its cigarettes.485

18. Plaintiffs state that the testimony of Mr. Jim Sinclair on this subject should be “disregarded given [his] hesitation on the subject”.486 This is a complete mischaracterization (at best) of Mr. Sinclair’s evidence.

19. Mr. Sinclair worked at the Ajax Plant and later, the “Comet” plant (which manufactured ITL’s reconstituted tobacco) from 1960 (when ITL started manufactured reconstituted tobacco, then referred to as “PCL”) to 1999. He was the plant manager of the Ajax plant as of 1983, and then the plant manager of the Comet plant when the Ajax plant was decommissioned.487

480

Trial Exhibit 20227.2

481 See Trial Exhibit 530C

482 Trial Transcript (Leblond), August 30, 2012, from p. 214, line 21 to p. 215, line 22

483 Trial Exhibit 21202.

484 See, for example, Trial Exhibit 531, p. 2 pdf and Trial Exhibit 532, p. 2 pdf

485 See, eg., Trial Transcript (Sinclair), April 8, 2014, p. 37, lines 7-10.

486 Plaintiffs’ Notes and Authorities, footnote 718

487 Trial Transcript (Sinclair), April 8, 2014, from p. 7, line 19 to p. 12, line 7








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80

20. Mr. Sinclair was acknowledged both during Plaintiffs’ evidence and during Defendants’ proof as the individual who had the most knowledge regarding what went into ITL’s reconstituted tobacco, and what was not in it.

21. When Plaintiffs questioned Mr. Hirtle during Plaintiffs’ proof, the issue of whether or not fine cut offals were used in ITL’s PCL was put to him:

360Q-Okay. But my question is whether or not Ajax collected them, and your answer would be yes?

A- I think this would be the Montreal plant that collects them. Is that what he's referring to?

361Q-That Ajax would be collecting all waste of fine-cut from all manufacturing plants; whether they use it or not, it's something Mr. Sinclair will tell us very soon, but...

A- Yes, that... yes, you would have to ask him.488

22. Tellingly, Plaintiffs chose not to call Mr. Sinclair, leaving that to ITL.

23. Mr. Sinclair was asked about whether or not offals from fine cut dust were ever used in the reconstituted tobacco in ITL’s commercial products. His answer was anything but hesitative:

113Q And were offals from fine cut tobacco used at all in the reconstituted tobacco used in Imperial's commercial products?

A No, it was not.489

24. In cross-examination, Plaintiffs put a document to Mr. Sinclair disclosing that fine cut material was used in certain reconstituted tobacco.490 There was no hesitation from Mr. Sinclair - this document was a recipe for RJR Macdonald’s reconstituted tobacco, which was manufactured for it by ITL. Mr. Sinclair remained clear – no offals from fine cut tobacco were used in the manufacture of the reconstituted tobacco used in ITL’s products:

470Q So 1734, and it's headed "Additional Materials for RST." Who used the term "RST"?

A MacDonald Tobacco, RJR MacDonald Tobacco.

471Q Did Imperial use the term for its PCL RST?

A No. That was their term, reconstituted sheet tobacco, RST.

472Q So when we're talking about additional materials for RST, whose recon are we talking about?

A RJR MacDonald Tobacco.

488

Trial Transcript (Hirtle), December 19, 2012, p. 92, lines 12-20

489 Trial Transcript (Sinclair), April 8, 2014, p. 37, lines 7-10

490 Trial Exhibit 1734.

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473Q And that would be for ‐‐ the same for all of the other exhibits that Ms. Gagné put to you regarding RST?

A Yes, that's correct.

474Q Okay. And you said in the press release, when you ‐‐ in your direct examination, when we took you to the press release, and it said right there in

the press release that small amounts of materials ‐‐ and I don't want to rephrase, so I'm just going to turn back to it. It's Exhibit 40017, and that's at tab 5, Mr. Sinclair. And I'm going to go to page 2 again. Mr. Justice, are you there?

THE COURT: I am.

MS. ROBERTS: Thank you. 475Q - Page 2 right at the top, when it says:

"Two manufacturers, RJR MacDonald and Imperial Tobacco Ltd., use small quantities of reconstituted tobacco, a method of recovering and reusing small pieces of tobacco from the initial stages of processing and manufacturing of

cigarettes and fine cut ‐‐"

Is there anything incorrect about that statement? Do you agree with that statement?

A I agree with that statement, yes.

476Q And who used fine cut in their recon from time to time?

A RJR MacDonald.

477Q Did Imperial?

A No, they did not.491

25. As to any “misrepresentation” on the issue of fine cut materials used in reconstituted tobacco by any of Defendants – there was none.

26. The press release issued by the CTMC in 1994 specifically stated that reconstituted tobacco might use offals from fine cut tobacco, and this was in fact correct – RJR Macdonald’s recipe from time to time used very small amounts of such materials, but ITL did not.492

27. Plaintiffs attempt to hang their hat on two exhibits (Exhibit 1258 and 1257-2M) to suggest that, despite Mr. Sinclair’s plain evidence, these documents are “clear” – they establish that Mr. Sinclair, the manager of the plant that manufactured reconstituted tobacco, was wrong – fine cut scraps were most certainly used (although they relegate this assertion to one line in a footnote).493

28. Exhibit 1257-2M is a 1988 document which makes no reference to fine cut offals being used in ITL’s reconstituted tobacco. As to Exhibit 1258, a 1987 document,

491

Trial Transcript (Sinclair), April 8, 2014, from p. 128, line 15 , to p. 130, line 4


493 Plaintiffs’ Notes and Authorities, footnote 718



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it too makes no specific reference to fine cut offals, and most certainly, none of these documents reference the use of such scrap material in ITL’s products.

29. As Mr. Duplessis confirmed, altering the recipe for reconstituted tobacco used in ITL’s cigarettes (in any manner, but including the use fine cut material) would require, first, approval by the product development group, then further approval by Dr. Massey and Dr. Dunn, and then ultimately management committee approval.494 He was not aware of such approval having been sought or given.495 Certainly, Plaintiffs filed no evidence of such approval, at any of these three levels. Simply put, there was no such evidence, and as Mr. Sinclair confirmed at all times during his evidence, fine cut materials were not used in the reconstituted tobacco used in ITL’s cigarettes.

30. Once again, however, as with coumarin, this was much ado about nothing. There is no evidence that any additives used in fine cut tobacco were or are hazardous to health. Further, and in any event, the fact that fine cut material was used in reconstituted tobacco was disclosed to the public – the distinction being that it was RJR-Macdonald that utilized small amounts of this material in its reconstituted tobacco, not ITL.

494

See for example, Trial Exhibit 21319, which involved the changing of the PCL recipe in terms of the ratio of the “flour” portion and binder used, and clearly evidencing the three layers of approval required.

495 Trial Transcript (Duplessis), September 16, 2013, from p. 191, line 12, to p. 194, line 4



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APPENDIX X – “15-PACKS”

1. In their Notes and Authorities, Plaintiffs make a passing reference to the sale of “15s” (i.e., packs containing 15 cigarettes) as alleged confirmation of efforts by ITL “to ensure that its products were available at a price young people could afford”.496 Similarly, they baldly assert that ITL sought to “provide products that were cheap and affordable to youth ... because they were packaged in what became known as ‘kiddie packs’.”497 Both of these statements are made by Plaintiffs without evidentiary support, and are advanced in the face of clear – and uncontested – evidence to the contrary:

a. The witness testimony498 and documentary record499 confirm that ITL’s launch of 15s in the late 1980s was grounded in three strategic rationales: (i) to track the decline in average daily consumption, (ii) to off-set rising cost pressures attributable to rising taxation in the 1980s, and (iii) to allow for trial launches and competition with major competitive brands. At no point did ITL ever intend to launch 15s with a view to capturing the so-called “youth market”.500

b. In the wake of attacks by anti-tobacco lobbyists alleging that 15s were potentially appealing to youth, ITL undertook a quantitative analysis of sales and confirmed that there were in fact no material differences in purchasing demographics between 15s and the standard packs of 25.501 Notably, this same research confirmed that over 70% of purchasers of 15s were over the age of 25.502

c. Notwithstanding this quantitative data, ITL voluntarily agreed in the 1990s to stop selling 15s in order to appease the anti-tobacco lobbyists who were alleging youth appeal (contrary to the data).503

The facts stand in marked contrast to Plaintiffs’ bald assertions that ITL’s sale of 15s is dispositive proof that ITL was hell-bent on capturing the youth market.

496

Plaintiffs’ Notes and Authorities, paras. 821-822.

497 Plaintiffs’ Notes and Authorities, para. 775. What Plaintiffs fail to mention, of course, is that the term “kiddie packs” was

ascribed by anti-tobacco lobbyists, not the industry [see Trial Transcript (Ricard), October 9, 2013, p. 169, Q. 333].

498 Trial Transcript (Ricard), October 9, 2013, pp. 167-169, QQ. 330-332.

499 Trial Exhibit 269. See, also, Trial Transcript (Ricard), October 9, 2013, p. 171-174, Q. 338-343

500 Trial Transcript (Ricard), October 9, 2013, p. 170, Q. 335.

501 Trial Exhibit 1172, pp. 3 and 8 PDF.

502 Trial Transcript (Ricard), October 9, 2013, pp. 173-174, Q. 342-343. See, also, Trial Exhibit 1172, p. 8 PDF.

503 Trial Transcript (Ricard), October 9, 2013, p. 174, Q. 345.



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APPENDIX XI – CLARIFICATION OF THE EVIDENCE REGARDING ALLEGED “DENIALISTS”

A. The Constitutional Theory/Genetic Susceptibility

1. Plaintiffs allege that the “constitutional theory” of causation/genetic susceptibility to smoking related diseases was part of the disinformationist campaign in connection with ITL’s funded research.504 This is simply false.

2. Such an allegation was also made by Dr. Wigand in his examination in chief, in connection with research funded by the SRG (a committee that Dr. Wigand was never a member of). Specifically, Dr. Wigand was asked to comment on some funded research referenced in a SRG discussion document (the “Discussion Document”) prepared circa 1989505, where the Discussion Document stated:

The most informative study in this area would be to identify a genetic factor that increases the risk of lung cancer, and to investigate whether incidence of the particular factor is different in smokers and non-smokers. Idle's work on metabolism of procarcinogens has so far covered the first part of this question, but has not yet adequately covered the second . However, before additional funding were to be committed, some additional questions need to be answered e.g. do the enzymes that Idle is interested in metabolise chemicals that may be relevant to the development of lung cancer?

506

3. According to Dr. Wigand, this was but an example of continuing “to find or look at ways in which you could deflect or generate controversy on...that it’s not tobacco, not tobacco smoke, it’s some other factor.”507

4. Mr. Read explained the legitimate science underlying the research (something Dr. Wigand did not do), and then when asked to comment on Dr. Wigand’s assertion, he simply stated: “...with all due respect, I believe that Jeff was wrong on that issue.”508

5. The claim made by Dr. Wigand was thoroughly demolished by Dr. Hogg, who was unquestionably knowledgeable on the subject of research pertaining to genetic susceptibility and disease, and whose lack of bias stood in stark contrast to the advocates called by Plaintiffs.

6. Dr. Hogg’s evidence was clear - research which attempts to identify genetic factors that might cause or increase the risk of diseases such as lung cancer, emphysema and other diseases associated with smoking has been an important and relevant area of investigation. In fact, this was an area of research he conducted that was funded by the CTMC.509

504

See, for example, Plaintiffs’ Notes and Authorities, para. 1468

505 Trial Transcript (Read), September 10, 2013, from p. 176, line 13, to p. 177, line 14; Trial Exhibit 262C

506 Trial Exhibit 262C, p. 6 pdf

507 Trial Transcript (Wigand), December 10, 2012, from p. 65, line 20, to p. 66, line 20


509 Trial Transcript (Hogg), December 16, 2013, from p. 89, line 14, to p. 91, line 19; Trial Exhibit 21054, p. 6, pdf




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248 Q Right at the top of the page, Dr. Hogg, you wrote:

“We propose to test the hypothesis that those whose pulmonary function deteriorates rapidly while smoking represent a susceptible minority of the smoking population. This hypothesis is based both on work published in the literature and our own experience, which has shown us that people who have the greatest decrease in lung function have often smoked no more than those whose function is well preserved. We believe this is related to the fact that those who deteriorate rapidly have a more severe inflammatory reaction in both their central and peripheral airways.”

And my question, Dr. Hogg, is did you consider at the time that this was a legitimate scientific enquiry to attempt to determine whether there was a susceptible minority of the smoking population that were more likely to develop certain diseases?

A Yes.510

7. Not only has it been a legitimate area of research for many decades, it remains as such today, as evidenced by Dr. Hogg:

Q And what is your view on that now?

A I -- I -- I mean, this is a major topic of investigation in the pulmonary community right at this moment, because we know very well -- and it's been established over and over -- that some people who decline rapidly in their function have smoked no more than other people who have smoked -- whose function is -- remained nearly normal. And, you know, if you go on -- on the internet, for example, a picture that is often used in various lectures is a person celebrating their and 100th birthday and smoking a cigarette. And there are some people that can smoke heavily and they -- doesn't seem that their lungs deteriorate very much. And there are other people who have smoked just average amounts that will deteriorate very rapidly. Now, we're getting insight into why that occurs, but we don't understand it completely. And there was -- major research funding has just been awarded last week as a matter of fact to -- to -- to a group in -- in Vancouver here to look for a biomarker that these people might have. Something you could measure in the blood that might identify the susceptible minority. Because those are the people that you want to absolutely stop from smoking, and those -- and everybody should stop, but those people particularly have to stop. And -- and also the people that you need to treat early if you're -- if you're going to have any chance of preventing that decline.

511

8. Dr. Hogg has published (non-CTMC funded) research in this area512, which research was relied on by another of Plaintiffs’ experts, Dr. Desjardins.513

9. As to the claim that the aim of conducting this type of research (attempting to identify genetic factors that might increase the risk of diseases) was simply an

510

Trial Transcript (Hogg), December 16, 2013, from p. 90, line 24 to p. 91, line 19

511 Trial Transcript (Hogg), December 16, 2013, from p. 91, line 13, to p. 93, line 2

512 Trial Transcript (Hogg), December 16, 2013, from p. 93, line 3 to p. 96, line 12; Trial Exhibit 21055

513 Trial Transcript (Hogg), December 16, 2013, from p. 93, line 3 to p. 96, line 12; Trial Exhibit 21055; Trial Exhibit 1382,

p. 15 pdf, para. 2.2.15









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effort to generate controversy regarding smoking and disease causation, Dr Hogg stated:

I disagree with that....it just closes down a whole area of research which is actually being quite productive at the moment.

514

10. Dr. Hogg is not alone - the 2010 SGR referenced recent studies supporting the possibility of interactions between genetics, smoking and disease causation, further confirming the fact that such research remains a serious issue for scientific investigation.515

11. Certainly, the parameters and theories in connection with such research has altered over time – such is the nature of research. However, what is absolutely without question is that such research cannot be viewed through Plaintiffs’ blinkered lens.

B. Cormier & Warburton

12. As discussed previously, Dr. Cormier and Dr. Warburton are both respected scientists in their fields, and it does not lie in the mouths of Plaintiffs to now challenge their credentials, particularly without any expert evidence to support their allegations. What is more, the fact evidence cited by Plaintiffs in support of their allegations does not receive fair treatment in their Notes and Authorities.

13. For example, one of the attacks by Plaintiffs relating to Dr. Cormier is premised on the suggestion that Mr. Neville misled the Canadian government as to the fact that the Cormier report was indirectly funded by the CTMC (as the party funding the SFS).516 This is incorrect. Mr. Neville clearly stated that the Department of Health was aware that the CTMC was practically the sole source of funding for the SFS.517 Mr. Bedard also made it crystal clear that the CTMC’s funding was well known – as a result, he was often branded as a liar, simply because of this funding (echoing Plaintiffs’ position throughout their submissions):

Mais de manière générale, je dois dire que quand j'arrivais quelque part, on disait: "Ah, bien oui, il est financé par l'industrie du tabac, donc ça doit être un menteur professionnel, donc ça être un manipulateur", et caetera. Ce qui n'était pas le cas, mais je devais vivre avec ça.

518

14. Plaintiffs note that Mr. Neville stated in a letter to the Honourable Perrin Beatty that the Cormier report had been prepared “independently”519, without providing Mr. Neville’s explanation of the meaning of that statement – Mr. Neville’s

514

Trial Transcript (Hogg), December 16, 2013, from p. 96, line 4 to p. 98, line 5

515 Trial Exhibit 601-2010A, pp. 274-275 pdf & p. 330 pdf


517 Trial Transcript (Neville), June 6, 2012, p. 248, lines 4-10

518 Trial Transcript (Bédard), May 1, 2012, p.180, lines 10-15






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testimony is that the statement was intended to mean that the Cormier report had been prepared independently of Dr. Warburton’s.520

15. Further, there is absolutely no evidence that any of Defendants or the CTMC altered or interfered with Dr. Cormier’s opinion – the opinion was his and coincided with that held by ITL and the remaining Defendants.

16. Similarly, Plaintiffs allegations regarding Dr. Warburton are premised on an equally “skewed” interpretation of the evidence. In particular, Plaintiffs rely on the testimony of Dr. Wigand (whose claims about research involving genetic susceptibility were thoroughly discredited) and his suggestion that Dr. Warburton’s response to the Royal Society’s Report was given “even if the Industry’s views were that ‘nicotine was why people smoked’”.521 Wigand further claimed – without personal knowledge – that the point of the study was to “generate the controversy that nicotine is not addictive.”522 It is of note that Plaintiffs attempt to conflate the report dated December 12, 1989 by Dr. Warburton (which report was provided to the Canadian government) with this general discussion by the SRG of Dr. Warburton’s theories three months earlier.523

17. It is crucial to read the entirety of the relevant passage of the SRG document in order to put the discussion into context:

4. THE EFFECTS OF NICOTINE

(i) Addiction

It is difficult to identify research areas that will have a bearing on the subject of whether or not nicotine is addictive. There is already some evidence indicating differences between nicotine and drugs that are generally accepted to be addictive, from both human and animal studies. Any additional evidence in this category would be useful but is should be borne in mind that even amongst the drugs that are accepted to be addictive there are differences.

Work on alternative theories or explanations for why people smoke would be more constructive. To date, David Warburton has been something of a lone voice on the suggestion that smokers smoke, not because they are addicted, but because smoking fulfils a useful function for them. An analysis of the validity of Warburton's claims and further, more detailed work in this area is already going on at the University of Leeds.

It is extremely difficult to identify research into biological mechanisms of addiction, since it is not clear what they actually are . However, BAT is already supporting work in this area with Dr Roy Wise in Montreal, looking at effects of nicotine compared to other drugs in brain pathways and behavioural systems relating to reward and dependence.

524

520

Trial Transcript (Neville), June 6, 2012, from p. 247, line 5 to p. 248, line 3


522 Trial Transcript (Wigand), December 10, 2012, p. 67, lines 16-20

523 Trial Exhibit 262C, p. 12 pdf; Trial Exhibit 430, pp. 3-41

524 Trial Exhibit 262C, p. 12-13 pdf

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18. Dr. Read addressed the allegation of generating a ‘false controversy’ directly, stating:

Again, with all due respect, you just read the text into the Court, and it's a very clear text. It says one needs to understand these processes to be able to evaluate the issue of addiction and to understand it in biochemical terms, pharmacological terms, physiological and, more importantly, psychological terms. And it's... I said I think it's roundabout eighty-seven, eighty-eight (87-88), it's a critical point where people are changing their thoughts about the definition of addiction, and we and others are beginning to look and trying to look to put it on what I would call a more scientific basis.

I'm not sure whether the Court understands how drugs are appraised in terms of their dependency in experimental studies. They usually involve animals... invariably involve animals. One is called the rat maze, the other one is called pedal pushing where, in the feed, or in the water that's supplied to these animals, you either have a drug of interest or a placebo such as water. And by giving them these particular compounds, they have more or less difficulty exiting from a rat maze, that's the theory of the rat maze. We find they press the pedal more frequently if they like what they're getting from the drug of interest. And from that, values are described to the addictiveness or whether a compound has an addictive property. Different drugs have different degrees of response in those studies. Many people have criticized them to say, look, when you're looking at something that happens in man, you're looking at addiction, there's far more to it than pressing pedals or walking out of mazes. But it's a very difficult issue, it's very intractable issue to try and use animal models to determine the level and degree of addictiveness of any particular compound. And this is reflecting that, and saying, look, the modern science is moving towards tracking human pathways; we have like positron emission tomography where we can track actually signals happening in the brain without being invasive. All these techniques are coming into play, and we're looking at them in great detail, and more detail.

525

19. As noted above, Dr. Warbuton was a named contributor to the 1988 Surgeon General’s report on nicotine addiction. His research work was frequently cited in not only that report, but others as well.526 He was and is a reputable scientist.

525

Trial Transcript (Read), September 10, 2013, from p. 185, line 19, to p. 187, line 16

526 See, for example, Trial Exhibit 601-1981, pp. 57, 84, 161 & 174; 601-1988, pp. 133, 146, 197, 219, 236, 254, 394-402,

414, 418, 420, 424, 456, 465 & 468-469 pdf; Trial Exhibit 601-1989, pp. 360 & 394 pdf; Trial Exhibit 601-1990, pp. 528-529 & 579 pdf

























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APPENDIX XII – ITL’s DOCUMENT RETENTION POLICY

A. Introduction

1. ITL maintains that the issue of ITL’s handling of its company documentation has no relevance to any matter at issues in this proceeding. Document retention does not relate to the common questions or ITL’s liability to Plaintiffs. Further, Plaintiffs have not articulated any legal reason why ITL’s document handling practices entitle them to punitive damages or any other form of relief.

2. Should the Court disagree with ITL’s position on this matter, however, ITL has provided this Appendix to address the specific allegations of document destruction set out in paragraphs 639-662 of Plaintiffs’ Notes and Authorities.

B. Litigation Was Only a Theoretical Possibility

3. At the outset, it is important to recognize that the only possible legal restriction which could be said to have been applicable to ITL with respect to historical document retention arises in the context of litigation (ongoing or threatened). However, and as specifically noted in ITL’s main submissions, Plaintiffs are not claiming spoliation against ITL.

4. This is clear from the position taken in response to Defendants’ pre-defence motions where it was noted by Justice Riordan in his Judgment:

ITL insists that the spoliation of documents cannot be the source of a claim for damages...This is not the use to which the Plaintiffs wish to put this evidence.

For the third, fourth or perhaps fifth time, the Plaintiffs confirmed that they intend to use this evidence to show “the gravity of the debtor’s fault” for the purpose of assessing punitive damages, as foreseen in article 1621 of the Civil Code.

527

5. Even if Plaintiffs were claiming spoliation (which they have said they are not), it is clear from the evidence from and on behalf of ITL that smoking and health litigation was never pending or threatened prior to the commencement of the first of such actions against ITL in 1995 (the Ontario class action - Caputo v. Imperial Tobacco Ltd. ).528 As such, until 1995 ITL had no obligation to preserve any company documentation respecting issues relating to R&D.

6. Despite their best efforts, Plaintiffs have offered no evidence of a credible threat of litigation against ITL prior to Caputo.529 The documents they cite in this regard are: 1) a legal opinion about the possibility of criminal proceedings against Canadian tobacco companies sought by an anti-smoking group (which was prepared as a hypothetical and never materialized); and 2) a letter from the same anti-smoking group that does not actually mention litigation. Neither of these documents threatens or suggests an imminent lawsuit against ITL by a specific

527

Conseil québécois sur le tabac et la santé c. JTI-Macdonald Corp., 2013 QCCS 1924, p. 12, paras. 52-55

528 Plaintiffs’ Notes and Authorities, para 641

529 Plaintiffs’ Notes and Authorities, para 641, Trial Exhibit 264 and Trial Exhibit 265.

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plaintiff or a group of plaintiffs. Accordingly, neither document constitutes evidence of a credible threat of litigation against ITL prior to Caputo.

7. Plaintiffs also reference Project Four Seasons is support of their contention, and in doing so, make a number of inaccurate statements regarding this project. In particular, Plaintiffs contend that “Project Four Seasons” was commenced under the guidance of an American consulting firm in 1987.530 The evidence cited by Plaintiffs in no way supports this. Exhibit 40, for example, is not connected to the creation of Project Four Seasons, but merely mentions it. It also does not show that an American firm was involved in its creation. Regardless, it is not unlawful to seek advice from American consultants.

8. What the evidence does show is that project Four Seasons was commenced around 1986. It was a forward-looking effort aimed at examining what tobacco product liability actions might look like if they were ever commenced in Canada, along with possible defence strategies. It was a theoretical exercise based on the possibility that litigation could be brought against ITL in the future by some unknown plaintiffs. It was about managing potential business risk in connection with this possibility – a possibility that recognized at the time might never turn into a reality. 531

9. Almost 10 years went by between the initiation of Project Four Seasons and the commencement of the Caputo class action. There was no certainty during this time frame that a tobacco product liability action would ever be commenced against ITL in Canada. Indeed, ITL’s own litigation counsel, Lyndon Barnes, indicated that prior to Caputo, ITL was not subject to any pending or threatened litigation and that even he thought litigation was merely a possibility.532

10. It is also critical to note that for document destruction to have any legal significance at all, which by Plaintiffs’ own admission it does not, there must have been an intentional destruction of relevant evidence. This makes Plaintiffs claim more difficult to establish. In this case all of the R&D reports that were destroyed under the document retention policy have been produced in this case. It was always the intent that these reports would remain available.

C. Plaintiffs’ Claims Regarding Alleged Rationale for the Document Retention Policy is Unfounded and/or Based on Evidence Unrelated to ITL

11. What is also troubling is the fact that Plaintiffs seek to ground their allegations regarding document destruction against ITL by pointing to the behaviour or statements of any number of people who were never actually part of ITL. References to BAT, employees of B&W, and counsel of these companies abound in Plaintiffs’ Notes and Authorities. No evidence, however, has been proffered by

530


531 Trial Transcript, June 18, 2012 (Barnes), p. 94, Q. 421

532 Trial Transcript, June 19, 2012 (Barnes), from p. 94, QQ. 299-304


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Plaintiffs to support the claim that ITL’s intention in destroying company documentation was to keep it out of the record in litigation.533

12. It should also be noted that the R&D databases referenced in some of the relevant correspondence are the BAT “Interbat” databases, to which ITL's access was never removed.534

13. It is equally unclear how the concerns of B&W employees as expressed in internal memoranda or correspondence are relevant to ITL.535 As discussed below, actions taken by B&W in connection with this issue (such as the minutes of the Vancouver R&D conference) are wholly irrelevant to ITL.

14. Moreover, Mr. Barnes’ testimony contradicts the significance Plaintiffs attach to the one statement they raise in proof suggesting that ITL was concerned about the production of R&D documents in litigation.536 The “victory” referenced in an ITL trial report at having BAT R&D Reports excluded from the C-51 proceeding was the hope that BAT would no longer be so concerned about its documents and that ITL would no longer have to keep dealing with BAT on the subject.537

15. Most importantly, Mr. Barnes specifically testified that ITL was not concerned about the content of R&D documents coming out in litigation, that ITL was prepared for this prospect in C-51 and that he actually expressed this view to BAT’s counsel.538

16. Perhaps most telling in assessing ITL’s intent is what ITL did not do. As more specifically explained below, ITL did not destroy any documents during the pendency of the C-51 case and in fact it took ITL almost 2 years after C-51 was over to implement the document retention policy. More importantly, if ITL was on a mission to get rid of documents so they would not be available for litigation purposes, why did they not adopt and implement the document retention policy before launching the C-51 litigation? The C-51 litigation was totally within ITL’s control and it could have easily avoided all of these issues by getting rid of the evidence before even contemplating the constitutional challenge. It did not. This important fact is consistent with all of the evidence of the counsel involved in the document issues regarding ITL’s intent.

D. Plaintiff’s Misstate Evidence Regarding Document Destruction at ITL

17. Plaintiffs’ submissions regarding ITL’s efforts to prevent R&D documents from going public in litigation simply misstate the evidence.

533


534 Trial Transcript, August 28, 2013 (Porter), p. 272, Q. 746; Trial Transcript, September 10, 2013 (Read), p. 110, QQ.

161-162

535 Plaintiffs’ Notes and Authorities, para. 644-645

536 Plaintiffs’ Notes and Authorities, para. 646, Trial Exhibit 68

537 Trial Transcript, June, 19, 2012 (Barnes), p. 70, QQ. 236-39

538 Trial Transcript, June 18, 2012 (Barnes), p. 104, QQ. 460-61; Trial Transcript, June 19, 2012 (Barnes), p. 18, QQ. 35-

49 and p. 71, QQ. 238-39













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18. For example, their description of the implementation of ITL’s 1990 Document Retention Policy and the 1993 Revised Cost Sharing and Access to Documents Agreements is inaccurate and should not be relied upon by this Court.539

19. First they claim that “[i]mmediately after the [court’s decision in C-51 to exclude BAT documents], ITL's lawyers quickly began to establish a policy to destroy research or return it to the BAT research group in the United Kingdom”.540 The implementation of both the 1990 Document Retention Policy and the aforementioned agreements, however, cannot in any way be characterised as “immediate”.

20. ITL’s Document Retention Policy was not adopted until October 1990, a year after the ruling excluding BAT R&D documents from the C-51 hearing.541 The Access to Documents Agreement was not concluded until 1993, approximately 3 years later.542 ITL’s copies of the BAT R&D Reports listed in Me Potter’s letters were not disposed of under the 1990 Document Retention Policy until mid-1992543, and other reports were not returned to BAT until 1993 under the Access to Documents Agreement.

21. Further, many of the documents Plaintiffs point to in support of the allegation that ITL’s lawyers got to work putting in place mechanisms to destroy documents after the C-51 ruling relate entirely to the events in late 1989 and early 1990 surrounding BAT’s desire for the return of its reports during the C-51 hearing.544 A desire is not equivalent to action, and no documents were ever actually returned to BAT or destroyed during this time frame.545

22. There has been no evidence offered that ITL lawyers were ever involved in the selection of documents to be destroyed or returned based on their sensitivity to litigation.546 There is also no evidence that ITL or its counsel sought to destroy documents in the face of what they perceived to be imminent litigation.

23. Finally, Plaintiffs also make the staggering (and false) allegation that “by 1993 ITL's entire corporate body of research, reports and results were returned to BAT

539


540 Plaintiffs’ Notes and Authorities, para 648

541 Trial Exhibit 341; note Plaintiffs reference in para. 646 of their Notes and Authorities that a destruction policy took

affect a month after October 1989. There is no evidence cited to support this point and none was offered at trial.

542 Trial Exhibit 96A

543 Trial Exhibit 58, Trial Exhibit 59, Trial Exhibit 59A; Trial Transcript (Barnes), June 18, 2012, p. 52, QQ. 163-67

544 Plaintiffs’ Notes and Authorities, para. 648, specifically Trial Exhibit 81, Trial Exhibit 84, Trial Exhibit 85 and Trial

Exhibit 109; See also Lyndon Barnes’ Trial Transcript regarding this timeframe which puts these exhibits in context, Trial Transcript (Barnes), June 18, 2012, p. 29, QQ. 67-74, p. 35, QQ. 98-110, p. 42, QQ. 126-27, p. 62, QQ. 225-58, and p. 104, QQ. 460-61

545 Trial Transcript (Barnes), June 19, 2012, p. 85, QQ. 281-82























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or destroyed”.547 This makes no sense and flies in the face of the evidence at trial.

24. Plaintiffs know all too well (from the productions made in this matter) that all ITL research reports were retained. A significant number of these reports, spanning in date from the 1960's to the close of the class period, were filed as exhibits in these actions.548

25. Further, through 1993 and beyond, ITL continued to have access to BAT’s historical R&D Reports as required, it maintained its access to the BAT Interbat database, and continued to receive current BAT reports as it had in the past.549 ITL’s R&D group did not suddenly grind to a halt in 1993 as Plaintiffs’ allegations would suggest.

E. Other Questionable Allegations of Destruction

26. Certain of the other allegations advanced by Plaintiffs regarding “document destruction” merit comment simply by virtue of their misleading nature.

27. For example, Plaintiffs point to an ITL Operations Committee meeting minute that raises the issue of the destruction of ‘Leo Laporte’ documents. However, there is no evidence whatsoever as to why a one line reference to the disposal of old documents in 1994 should be of concern.550

28. There is no evidence to suggest that the disposal of these old records was anything other than in the ordinary course. In short, Plaintiffs cannot baldly assert that historical actions were “wrongful” without at least being able to point to something in the evidence to support such a claim.

29. Further, Plaintiffs overly zealous attacks in connection with this issue is evidenced by their accusation in the course of the trial that all Leo Laporte documents had been destroyed and as a result they had not received any in ITL’s productions. Of course this was yet another example of Plaintiffs misstating the situation as within about a half an hour, and while in court, ITL’s counsel was able to identify almost 400 documents authored by Leo Laporte which had been produced to Plaintiffs.551

547


548 See Trial Exhibit 367; Trial Exhibit 20148-AUTH; Trial Exhibit 20181-AUTH; Trial Exhibit 20182-AUTH; Trial Exhibit

20143-AUTH; Trial Exhibit 20183-AUTH; Trial Exhibit 20144-AUTH; Trial Exhibit 20145-AUTH; Trial Exhibit 20146-AUTH; Trial Exhibit 20185-AUTH; Trial Exhibit 20147-AUTH; Trial Exhibit 20180-AUTH; Trial Exhibit 20157-AUTH; Trial Exhibit 20158-AUTH; Trial Exhibit 389A; Trial Exhibit 20162-AUTH; Trial Exhibit 20163-AUTH; Trial Exhibit 389-2M; Trial Exhibit 166; Trial Exhibit 161; Trial Exhibit 1275-2M; Trial Exhibit 378-2M

549 Trial Transcript (Porter), August 28, 2013, p. 279, QQ. 786-90; Trial Transcript (Duplessis), September 16, 2013, p.

212, QQ.496-97 and p. 214, QQ. 503-05; Trial Transcript (Read), September 10, 2013, p. 108, QQ. 157-62


551 Trial Transcript (Ackman), April 4, 2012, p. 99, QQ. 257 and pp. 109-111

































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30. It is also pure conjecture to suggest that the document at Exhibit 1330-2m was intentionally destroyed as part of some systemic effort to eliminate problematic documents from public view.552

31. Certainly, the excerpt itself was not destroyed, and Plaintiffs somewhat strangely rely on that excerpt (which was produced by ITL, and which itself is a 2M document) to prove a particular assertion as to who wrote another 2M document,553 (neither of which documents are ever referenced again in the balance of their Notes and Authorities).

32. The fact is, documents do get disposed of, misplaced or lost during the course of everyday business. This fact is particularly evident when a claim engages documentation spanning more than 5 decades. No company in the world would be able to produce a complete set of historical records, and it is ridiculous to expect that ITL would have in its records every document it ever received.

33. Finally, Plaintiffs’ reliance on the apparent edits to minutes of the Vancouver constitutes a further example of efforts to use a discrete incident involving the actions of non-ITL personnel as evidence of a broader and sinister course conduct at ITL.554

34. None of the documentary evidence cited by Plaintiffs actually shows that ITL personnel had anything to do with the amendments of these meeting minutes.555

35. ITL did not amend the minutes, and it kept not only one previous version of much longer minutes, but two! One has to ask, if ITL was so concerned about the content of the original Vancouver meeting minutes why did it keep, and produce, two copies of these minutes in this proceeding? Why did these minutes not "disappear” through ITL’s alleged practice of ridding itself of troublesome documents?556 The answer is – what occurred in the U.S. and the apparent concerns of certain people from B&W have absolutely no relevance to the actions and intentions of ITL.

36. Both Mr. Duplessis and Dr. Porter testified that ITL’s lawyers were not involved in reviewing, vetting or approving scientific communications between the BAT companies or ITL’s own research work or documentation.557 There was no such policy at ITL, demonstrating once again that Canada and the U.S. are not only not a single country, but also that ITL and B&W (or any other company) cannot be viewed through a myopic lens as though they were one and the same.

552


553 Trial Exhibit 320.1-2M


555 Plaintiffs’ Notes and Authorities, para. 654, note all the exhibits pointed to show is that Dr. Dunn had input into the

agenda for the meeting and that B&W was involved in modifying the minutes

556 Trial Exhibit 262 and Trial Exhibit 262A

557 Trial Transcript (Porter), August 28, 2013, p. 270, Q. 737-39 and p. 276, QQ. 770-83; Trial Transcript (Duplessis),

September 16, 2013, p. 217, QQ. 517-21; see also the Trial Transcript (Barnes), Trial Transcript, June 18, 2012, p. 91, QQ.401-402; Trial Transcript (Read), September 10, 2013, p. 190, QQ. 293-300


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95

37. Lastly, Plaintiffs claim that ITL’s public disclosure about the destruction of documents was misleading.558 There is no allegation in these proceedings that any class member was misled and suffered harm as a result of Michel Descouteaux’s explanation of the circumstances surrounding these events. This issue is completely irrelevant.

38. In any event, the allegation that ITL’s public disclosure was misleading is itself baseless. It was in fact correct that – as stated – (i) the BAT reports ITL disposed of were only copies, (ii) the originals of these reports remained intact, and (iii) copies of these documents were readily available.

F. Plaintiff’s Claims Regarding Me Potter’s Submissions to the Court are an Unfounded Attack on Me Potter

39. Plaintiffs’ references to Me Potter’s submissions in the C-51 hearing are as irrelevant and inaccurate (as they are offensive).559 This is clearly an unjustified attempt to attack Me Potter’s professional reputation by implying that he purposely misled the court in the C-51 hearing.

40. The transcript of the C-51 hearing demonstrates that Me Potter’s arguments surrounding the disclosure of BAT R&D Reports to the Canadian Government did not centre on whether ITL funded or owned the research in question in some fashion, but rather the difficulty for ITL in explaining research which it had not conducted and documents which it had not authored.560

G. The BAT Reports Were Made Publicly Available

41. As noted in the foregoing section, Plaintiffs make the bald statement that BAT reports were destroyed in order to ensure that information relating to the risks and dangers of tobacco would not be made public, without pointing to specific information in such reports that was purportedly unknown.

42. Plaintiffs do not cite any evidentiary support for this allegation because there is no such evidence. In fact, the evidence is that while BAT was conducting its own mouse skin studies, or inhalation studies, there was a wealth of information in the public domain regarding these subjects, much of it placed into the public domain by BAT itself.561 Further, and in any event, for the reasons set out above, studies such as mouse skin painting or animal inhalation studies do not establish that tobacco smoke causes disease in man, but rather provide helpful guides in respect of product modification.

43. Perhaps most importantly, ITL freely shared the BAT reports with the Canadian government as part of their collaborative working relationship. In particular:

558



560 Trial Exhibit 70, p. 43.

561 See discussion in Notes and Authorities.




96

a. ITL provided copies of BAT reports on nitrosamines to AgCan scientists;562

b. ITL provided AgCan scientists with BAT reports regarding Recon, and shared a multitude of other information on the subject;563

c. ITL provided BAT reports regarding inhalation studies to both the Canadian government’s funded researcher (Dr. Basrur), as well as to Dr. Hogg;564 and

d. ITL provided a BAT report regarding cadmium content in tobacco to yet another Canadian government researcher, Dr. Rickert.565

44. Moreover, both ITL and BAT published reports on smoking behaviour, adding to the extensive publications on this topic already in the public domain. 566 Similarly, BAT readily provided researchers with BAT’s inhalation system to facilitate further research in this area.567

45. Outside scientists, such as Dr. Rickert, visited BAT’s Southampton facilities, and were provided with yet another BAT invention (being a system for measuring oxides of nitrogen in smoke).568 Indeed, even prior to receiving this BAT invention, Dr. Rickert wrote in a report prepared for the Department of Health that he had received information from Mr. Gibb of ITL pertaining to the levels of nitric oxide in cigarettes.569

46. Later visits to Southampton by Health Canada officials resulted in an offer from BAT to have Dr. Kaiserman or any of his staff actually come and work at Southampton, with full access to all of BAT’s research and programs. Although Mr. Kaiserman commented that the offer was “interesting”, he failed to follow up.570

47. Dr. Hogg was invited to, and did visit, BAT’s facilities in Southampton early on in his career, where BAT discussed their work with him (and Dr. Hogg similarly discussed his work with these scientists). These discussions were nothing unusual; rather, they were characterized by Dr. Hogg as “normal scientific exchanges.”571

562

Trial Exhibit 319D at pp. 76, 77, 87 & 113 pdf

563 Trial Exhibit 319D, pp. 93 & 98 pdf;

564 Trial Exhibit 319D, pp. 111 & 113 pdf

565 Trial Exhibit 319M, p. 32 pdf

566 See discussion in Notes and Authorities.

567 Trial Transcript (Bilimoria), March 5, 2013, pp. 81-83, QQ. 296-309; Trial Exhibit 20024.13, p. 2 pdf

568 Trial Transcript (Read), September 10, 2013, pp. 72-75, QQ. 97-106; Trial Exhibit 20226-AUTH


570 Trial Transcript (Read), September 10, 2013, pp. 68-72, QQ. 94-96

571 Trial Transcript (Hogg), December 16, 2013, pp. 86-88, QQ. 234-241

EXHIBITS/Exhibit%20319D.pdf#page=76



EXHIBITS/Exhibit%20319M.pdf#page=32




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48. ITL provided information pertaining to various bioassays directly to the Canadian government, including, among other things, information regarding the mutagenicity data (as measured by Ames).572 In fact, ITL was one of the earliest parties to publish on the issue of the mutagenicity tests as applied to tobacco smoke, and was in fact the first to be able to activate tobacco smoke as mutagenic using a particular test.573 Defendants offered to have further short term bio-assays done for the Canadian government at the manufacturers’ own expense.574

49. Each of ITL and BAT had open policies in terms of disclosure with governments and independent researchers.575 Indeed, Dr. Hogg described Sir Charles Ellis of BAT (in a 1972 letter to Mr. Laporte) as having “stimulated a great many people concerning how products present in smoke get deep down into the basement membrane.”576 This occurred not in some private conversation, but rather at an important international public conference held in Aspen, where the subject matter of the conference was COPD.

50. The work undertaken by BAT as reflected in the BAT R&D reports was work done to understand the product and to develop safer cigarettes. Mr. Read was asked about the suggestion that Plaintiffs now make again in their submissions – namely, that this work was kept secret within the BAT group:

90Q- All right. And we've heard some suggestions... or numerous suggestions in this case that the work that was being done to understand the product or to develop safer products were kept secret within the BAT group. Could you comment generally on the extent to which governments, health authorities, independent scientists were invited to visit the facilities and view the work that was going on at BAT, generally? And then we'll get into some specifics.

A- Of course, I've heard that comment. I just... I just find it amazing that anyone can really say that, you know, we've had such a long involvement with the Government in the U.K., with the Independent Scientific Committee, contribution to the Tobacco Product Research Trust. I took the material, Baltech, I took it to the Department of Health to be discussed by SCOTH. I think I indicated yesterday that the Independent Scientific Committee had different names at different times, it currently is known as SCOTH. I submitted all of the data that we had, I asked them for an opinion whether we could put it into the U.K. marketplace for research purposes, not for commercial use. And that didn't find favour. That's been shared with them; we've published an enormous amount of work on our Reduced Toxicant Product Program, we've published and attended many conferences talking about risk-assessment framework, the frame that we think is appropriate for

572

Trial Exhibit 20416, p. 1 pdf; Trial Exhibit 20919.6, p. 1 pdf; Trial Exhibit 20019, pp. 23 & 25 pdf; Trial Transcript (Bilimoria), March 5, 2013, pp. 156-157, QQ. 610-12

573 Trial Transcript (Bilimoria), March 5, 2013, from pp. 48-50, QQ. 157-70; Trial Exhibit 20018, p. 25 pdf


575 Trial Exhibit 21488; Trial Exhibit 20248.1; Trial Exhibit 20248.2; Trial Exhibit 20248.3; Trial Transcript (Duplessis),

September 16, 2013, pp. 114-118, QQ. 239-52, and pp. 128-132, QQ. 296-307; Trial Transcript (Porter), August 28, 2013, pp. 149-150, QQ. 435-40; Trial Exhibit 20186-CONF

576 Trial Exhibit 21053, p. 4 pdf; Trial Transcript(Hogg), December 16, 2013, pp. 84-86, QQ. 228-33



















EXHIBITS/Exhibit%2020186-CONF.pdf



98

evaluating changed products. And we have really three (3) elements that we deal with: mouth level, which shows how people use a product; we have biomarkers of exposure that we've extensively published on, that shows that constituents in cigarette smoke, if reduced at the mouth level are reduced in the body. And we are working hard, as many people are, on so-called biomarkers of harm or effect, and those... it's the new frontier in science, where many people are looking to try and to have, early in disease, biological changes that predict long- term health consequences. No one at this stage has a resolution or a set of markers that anyone would accept as being predictive at this stage. There are some exciting and interesting opportunities, but so far no one would ever launch a product or modify a product on the basis of that information alone, today.

577

51. There is clear and uncontroverted evidence regarding the significant and consistent sharing of ITL/BAT research with public health authorities and the number of publications by ITL and BAT regarding their respective research undertakings. Notwithstanding the direct challenge to do so, Plaintiffs made the conscious strategic decision not to pose any questions to witnesses with respect to content of these alleged “missing” BAT reports (or what information was or was not in the public domain). Instead, in their submissions Plaintiffs make sweeping and unfounded assertions that there was unidentified relevant information in the documentation pertaining to the health risks of cigarettes which was not otherwise in the public domain. This is simply untrue and unsupported.

52. The foregoing submissions demonstrate that the entire issue of “document retention” has no bearing on the common questions, ITL’s liability, or these proceedings more generally and therefore should be ignored by the Court.

577

Trial Transcript (Read), September 10, 2013, pp. 63-64, Q. 90


99

APPENDIX XIII – CHART OF OBJECTIONS TO QUESTIONS UNDER RESERVE

Date of

Objection

Transcript Description Basis for

Objection

Ruling Exhibit

1 2012-06-04 36-163,

36-164

QQ. 497 and 500:

Q- (...) Do you know why they

consider it important to increase the

warning size?

Q- (...) why Health Canada desires

to increase the size of the health

warnings?

Relevance

Under

reserve

2 2012-06-07 39-119 Q. 419:

Q- And do you know why he did not

have a handler, as opposed to all the

others?

Parliamentary

privilege

Under

reserve

448-PP

3 2012-09-25 61-10 General objection re: Relevance of

questions pertaining to other

diseases than the ones targeted by

the class action

Relevance Under

reserve

4 2012-09-25 58-278 Q. 685:

Q- Okay. And I take it that it's your

testimony that JTI-MacDonald does

not consider that 'smooth' is a

variant of 'light' or 'mild'?

Relevance Under

reserve

5 2012-09-27 63-144 Q. 474:

Q- And how did you assure yourself

that pregnant women were very well

aware of those risks?

Relevance Under

reserve

6 2012-11-28 90-37 Q. 17:

Q- (...) what use could a historian

have made of that information?

Question

assumes truth

of contents

when not

proven

Under

reserve

550-2M

EXHIBITS/Exhibit%20448-PP.pdf


100

7 2012-11-28 90-42 Q. 22:

Q - And again, as a historian of the

American tobacco industry, if you

look at the second paragraph of the

page, we read,"Hill & Knowlton will

send a copy of the ad issued by

TIRC on the Attitudes of the United

States tobacco industry a number of

years ago."Do you know what that

refers to?

Question

assumes truth

of contents

when not

proven

Under

reserve

550-2M

8 2013-01-23 105-111 Question regarding Rossland, B.C.

advertisement - Exhibit 1381.50

Relevance;

This ad did

not run in

Quebec

Under

reserve

1381.50



101

APPENDIX XIV – ITL’s MOTION and PLAN OF ARGUMENT RE PARLIAMENTARY PRIVILEGE

(Previously Submitted to the Court on June 8, 2012)

102

APPENDIX XV – ITL’S MOTION FOR CONFIDENTIALITY OF FINANCIAL STATEMENTS

(dated April 28, 2014 and Previously Submitted to the Court on May 1, 2014)