Reports that Matter

United States v. Philip Morris USA Inc.: Amended Final Opinion

Suppression and Concealment of Scientific Research

Section 89 of 129

Suppression and Concealment of Scientific Research

  1. At various times, Defendants suppressed or otherwise concealed documents and information adverse to their public or litigation positions. For example, notes of a November 5, 1975 CTR meeting of a subcommittee of the Research Liaison Committee reveal that Ed Jacobs of Jacobs & Medinger directed that "no further formal minutes be made - also all should remove notes & previous minutes from corporate files." 1003294811-4811 (US 20171).

  2. In 1978, Sheldon Sommers, Chairman of the CTR Scientific Advisory Board ("SAB"), complained to William Gardner, the Scientific Director of CTR, that he (Sommers) was concerned that the CTR lawyers were controlling tobacco research by CTR based upon legal considerations. Sommers stated: "I think CTR should be renamed Council for Legally Permitted Tobacco Research, CLIPT for short." Indeed, the lawyer control of CTR had become so pervasive that Sommers concluded that "[m]y considered opinion is that the time for me to sever connections with CTR is near." 11319256-9256 (US 20281). He resigned as Chairman of SAB in 1980.

1439
  1. In 1981, Robert Northrip, a Shook, Hardy & Bacon attorney who at various times represented Philip Morris and B&W, explained at a Committee of Counsel meeting that lawyers' Special Project funding was used to allow adverse research findings to be hidden from the public. 521038287-8291 at 8289 (US 30481).

a. R.J. Reynolds 3868. To its credit, R.J. Reynolds ("RJR") disclosed large portions of its scientific research.

RJR scientists have published more than 800 manuscripts since 1980 in the fields of chemistry, biology and toxicology. Townsend WD, 196:13-16 (discussing (no bates) (JD 067970)). Likewise, Reynolds scientists have made over 800 scientific presentations at scientific conferences like the Society of Toxicology and the Tobacco Science Research Conference, among others, since 1980. Townsend WD, 196:17-20.

  1. Once the Vice President of R&D decided that scientists should do certain research, they were allowed to conduct the research, freely discuss it with each other, and freely write memoranda about it. DiMarco, Burton Dep., 8/14/01, 205:1-12; Townsend WD, 193:10-24, 194:1-7.

  2. No one at RJR prevented R&D scientists from publishing material once the Vice President of R&D decided it should be published. DiMarco, Burton Dep., 8/14/01, 205:13-18; see also Mosberg, United States Dep., 4/23/02, 45:21-48:12 ("[c]ertainly nobody impeded us from publishing, but in some instances where no new findings were observed, we didn't publish that work.").

1440

  1. Despite that history, RJR's lawyers -- both inside and outside counsel -- had significant influence on the actual research conducted by the company. A 1985 "fact memorandum" from RJR's outside counsel, Jones, Day, Reavis & Pogue, described RJR's research and development activities. The Law Department and R&D Management exerted control to "prevent the distribution or production of certain reports," including a 1953 literature survey by Claude Teague that "indicted" cigarette smoking. 515873805-3929 at 3896-3897 (US 21922). Another company scientist, Jim Fredrickson, who was working on identifying nitrosamines (carcinogens) in smoke in approximately 1965-67, was told "not to prepare a final report on his research but merely to record the work in his laboratory notebooks." 515873805-3929 at 3898-3899 (US 21922).

  2. A December 31, 1985 memorandum from Jones Day makes clear that "[a]fter the 1964 Surgeon General's report came out, the Law Department, according to Ralph Rowland, did influence research objectives to a degree, because the lawyers did not want anyone performing research that would appear to acknowledge that cigarettes or cigarette smoke contained harmful constituents or posed a health problem." The memorandum also noted that "the Law Department did participate in setting the guidelines for testing of additives," and "[s]ince Sam Witt became General Counsel of R.J. Reynolds Tobacco ("RJRT") in 1981, the Company lawyers have played a major role in reviewing research protocols relating to smoking and health and drafting R&D mission statements . . . [I]t was understood that the lawyers controlled things in this area." The memorandum acknowledged that "the Law Department through the years has had a great deal of influence over RJRT-sponsored outside research," and that "Jacob, Medinger has played a major role in reviewing and choosing foreign research projects to be funded by RJRT." It also stated that "Peter Van Every (an attorney in the Law Department of RJRT) . . . [had a] 'New York Times principle,' . . . by which [he meant that] 'things should not be written that could not be published in the New York Times.'" 515873805-3929 at 3870, 3875, 3878, 3879, 3886, 3893 (US 21922).

1441

  1. In December 1982, RJR attorneys (both those within the company and outside) became very concerned about positions taken and statements made by Robert DiMarco, the head of RJR's Research Department. Those concerns are discussed in detail in a December 13, 1982 memorandum from Wayne Juchatz, who later would become RJR's General Counsel, to Sam Witt, who was then RJR's General Counsel. The memorandum discusses a lengthy meeting between Juchatz and DiMarco in which DiMarco stated that it was "essential" that RJR try to develop a "less mutagenic [carcinogenic] cigarette," but said that he had been told by Ed Jacob, an outside counsel, that he could not do that. When Juchatz explained to DiMarco his concerns from a product liability standpoint, DiMarco "refused to accept it as a rationale for not doing what he felt [RJR] had an obligation to do (as a responsible manufacturer)." Juchatz stressed the need for "close cooperation" between the R&D Department and counsel. 505741150-1153 at 1150-1151 (US 23009).

  2. At that meeting, DiMarco readily acknowledged that his scientific views were in "direct contradiction" to RJR's legal positions and stated that over the prior twenty years knowledge about "cancer causation . . . had developed . . . to the point where . . . [RJR's] legal defense [that there was no causation] had been rendered (or was perilously close to being rendered) obsolete." DiMarco further told Juchatz that RJR's medical/scientific witnesses "lacked credibility and integrity." 505741150-1153 at 1151 (US 23009).

1442

  1. DiMarco also told Juchatz that he was so concerned about the "rigid legal positions" taken by RJR outside legal counsel -- "which had restricted the proper functioning of the R&D Department" -- that he would seek "'second opinions' [either from RJR's Legal Department or, if necessary, from outside counsel of his own choosing] on past legal advice restricting R&D activities." 505741150-1153 at 1151 (US 23009).

  2. Finally, at the December 1982 meeting, DiMarco advised Juchatz that, contrary to RJR's official legal position, he would not oppose FDA regulation of the tobacco industry. Juchatz, in his memorandum, concluded that "[t]his statement reflected an insensitivity to the legal and political issues inherent in FDA regulation of our business." DiMarco also disagreed with the Legal Department's efforts to remove ammonia from the list of ingredients required to be supplied to the Department of Health and Human Services. After further pressure from the Legal Department, DiMarco "reluctantly" agreed to the proposed removal. 505741150-1153 at 1151-1153 (US 23009).

  3. Following the December 1982 meeting between DiMarco and Juchatz, RJR attorneys, principally its outside counsel, became so concerned about DiMarco and the possibility that his views, if made known outside of RJR, would create great litigation risk for RJR, that the lawyers discussed the possibility of terminating him. The Legal Department met for a full day with outside counsel to discuss how to handle DiMarco. The lawyers concluded that "[w]e [counsel] will, therefore, be required to maintain close surveillance of [DiMarco's] R&D work in order to minimize the risk that [DiMarco's] 'beliefs' find their way into documents or projects which create unnecessary legal risks." 505741143-1147 at 1146 (US 20747); Juchatz TT, 11/18/04, 6611:12-6611:22. In a subsequent memorandum on the same issue, the lawyers reiterated that DiMarco's beliefs created legal risks for RJR:

1443

[W]e have advised management based upon our own and outside counsel's opinion that there are substantial litigative risks associated with having an individual as head of R&D who believes that smoking causes disease. . . . We have further advised management that while this risk can be reduced, it cannot be eliminated.

They reiterated that they would be required to "closely [monitor] what is in fact going on in the R&D department." 505745988-5992 at 5991 (US 20748).

  1. In 1982, outside counsel Ed Jacob advised RJR and its Research & Development Department that: (a) RJR could not make a "safer" cigarette, as that would create substantial legal concerns; (b) Research & Development would have to work closely with the Legal Department if RJR were to allow Research & Development to try to develop a safer cigarette; and (c) one of the serious legal concerns that RJR had was that any work on a safer cigarette would amount to an implicit admission that existing RJR products are unsafe. Juchatz TT, 11/18/04, 6575:18-6576:25, 6583:4-6584:14, 6585:4-6586:5, 6590:19-6591:20, 6592:23-6593:21, 6594:25-6595:23, 6597:6- 6598:1, 6599:8-6599:19.

  2. Despite the concerns raised by RJR counsel and what appears to be the close scrutiny of DiMarco's activities, he himself does not appear to have felt that his operation of the R&D department was compromised. Dr. DiMarco, an RJR employee for over thirty years, stated in 1999 that his discussions with RJR lawyers were simply to make sure that he was going to run the research and that the company was committed to his research. DiMarco, Falise Dep., 10/29/99, 193:18- 194:14. Indeed, he emphasized that, at all times, he controlled his department. DiMarco, Falise Dep., 10/27/99, 57:25-58:22. In a 2001 deposition, Dr. DiMarco indicated that he did not recall feeling, during January 1983, that he was not in control of the R&D Department or that he was frustrated. DiMarco, Burton Dep, 8/14/01, 65:11-66:5. Dr. DiMarco did not recall an occasion on which he was told by the president of RJR what research he could or could not perform. DiMarco,

1444

Burton Dep., 8/14/01, 202:9-202:15; 203:2-17.36 For more detail on DiMarco, see Section

V(D)(5)(b)((2))((a)), supra.

b. BAT Group

  1. BAT Industries plc (which became BAT plc in 1998) was a vast empire of frequentlyshifting companies in the United Kingdom, the United States, and Australia. Throughout the 1980s and most of the 1990s, BAT Industries was the parent company of Defendant B&W in the United

States and Defendant BATCo in the United Kingdom. BATCo is the former parent of B&W, but was a sister corporation from 1979 to 2004. BATUS, a holding company, is now the immediate parent company of B&W. These many far-flung corporate entities, along with numerous other operating companies owned by BAT Industries, including British American Tobacco Australia

Services Limited ("BATAS"), formerly W.D. & H.O. Wills,37 cooperated and coordinated their

While Defendants told the Court that they intended to produce Dr. DiMarco to explain these events, and he was on the defense witness list, Juchatz TT, 11/18/04, 6618:21-6619:8, Defendants did not call Dr. DiMarco.

BATAS was formerly known as W.D. & H.O. Wills (Australia) Limited ("Wills"). "Prior to August 23, 1999, BATCo, through intermediate holding companies, held approximately 67% of the shares of W.D. & H.O. Wills Holdings Limited ("Wills"). The remaining shares were publicly traded." R &R #102 at 25 (citing to Affidavit of BATCo Assistant Company Secretary, Geoffrey C.W. Cunnington at ¶ 2). "In 1999, the British American Tobacco Group merged with Rothmans, another international cigarette manufacturer. . . . On or about August 23, 1999, . . . Wills in a 'buy back' acquired the shares held ultimately by BATCo (67%) and Rothmans Holdings Limited then acquired the 33% of the Wills shares that had been publicly traded." Id. at 26. "A subsidiary of Wills, WD & HO Wills (Australia) Limited was renamed British American Tobacco (Australia) Services Limited ("BATAS")." Id. "In the spring of 2001, a new intermediate holding company was created called British American Tobacco (Australasia Holdings) Pty Limited ('Australasia Holdings'), which acquired all outstanding shares of British American Tobacco Australasia Limited and thus became the Australasian resident holding company of BATAS. Australasia Holdings is owned 68.06% by BAT Holdings (Australia) BV (formerly known as Rothmans Australia BV) and 31.94% activities and policies to prevent documents from being discovered in United States litigation and federal regulatory proceedings, and from being disclosed to the American public.

1445

  1. Shortly after joining B&W as Vice President of Research and Development in 1989, Jeffrey Wigand, as part of his orientation, was required to go to Kansas City, Missouri to meet for three days with lawyers from the law firm of Shook Hardy & Bacon for an orientation session. Id. at 30:16-31:2.

  2. At the session Wigand was "coached by lawyers regarding the company line on smoking and health, and addiction." The company line was "[t]hat causation had not been proven and that nicotine had not been shown to be addictive." Id. at 30:10-30:15. Wigand described the orientation session as follows:

Lawyers were instructing me, a scientist, how to interpret epidemiological studies. In every instance, I was instructed that the evidence in the public health domain had not satisfactorily proven causation. I was told that studies that demonstrated a link between smoking and cancer were fraught with errors. Moreover, I was told that epidemiology could not be relied upon because it was just statisticians doing guess work.

Id. at 32:5-33:6.

  1. Scott Appleton, a scientist who specialized in toxicology and was hired by Wigand while he was head of Research and Development at B&W, was also required to attend a similar lawyer training session at Shook Hardy & Bacon. Wigand WD, 34:11-35:10; 680901663-1665 (US 79219).

37 by BATCo through another holding company." Id.

1446
  1. In September 1989 the Brown & Williamson Research Policy Group ("RPG") met for several days in Vancouver British Columbia. Wigand WD, 35:21-23; see also 901096811-6811 (US 89367) (memorandum from Jeffrey Wigand to Alan Heard listing recommended agenda items for the meeting); 620202422-2432 (US 89368) (meeting agenda). The RPG was comprised of the top scientists from each of the BAT Group's cigarette companies, including B&W, BATCo, Imperial Tobacco of Canada, W.D. & H.O. Wills of Australia and others. Wigand WD, 36:1-17.
  1. Several sensitive issues were discussed at the Vancouver meeting including nicotine analogues, biological assays and biological testing methodologies (including NTP protocol), environmental tobacco smoke (ETS), Y-1 genetically enhanced-nicotine tobacco, how to selectively reduce the particular noxae that were in tobacco smoke, fire safe cigarettes, and FDA regulation.

Wigand WD, 39:3-40:13; see also 620202422-2432 (US 89368). Following the meeting, BATCo scientist Ray Thornton prepared a detailed thirteen-page set of minutes, "which summarized the discussion and the actions of the meeting." Wigand WD, 41:9-18; 401034784-4796 (JD 011303).

  1. The Court does not credit the testimony of either J. Kendrick Wells or Jeffrey Wigand about what happened to the Vancouver conference minutes. Wells' testimony was simply not credible and Wigand's was unreliable, contradictory, and impeached on a number of points. However, a comparison of the thirteen-page draft minutes and the three-page final minutes demonstrates that significant material was deleted from the longer draft. Compare 401034784-4796 (JD 011303) and AA0374-0374 (JD 011304).

  2. After the Vancouver conference, there was concern amongst the BAT Group executives that scientists' statements would contradict the public statements and legal positions being taken by the company. As a result, Patrick Sheehy, then Chairman and CEO of BAT Industries, ordered BAT Group lawyers to bring the scientists together for a meeting to "solidify a method by which records related to scientific meetings and scientific research would be handled in the future." Wigand WD, 54:2-55:16; 202347085-7086 (US 22032).

1447
  1. The meeting was convened by Stuart Chalfen, the Chief Solicitor of BAT Industries. The meeting was held in New York City in January 1990 (the "NYC meeting"). It was run by Nick Cannar, head of BATCo's legal department, who also prepared the meeting agenda. 202347085- 7086 (US 22032).
  1. At the meeting, BAT representatives discussed litigation concerns: Concern about volume of research documentation spread around the Group; Discovery; Difficulties faced by author company in explaining documents in a foreign court particularly if it is not even a party to the proceedings in which those documents are to be produced. . . .

202347085-7086 (US 22032); Wells WD, 46:1-5.

  1. The NYC meeting agenda also set forth procedures to ensure that minutes from future scientific meetings would not contain "contentious" material. The agenda states:
  1. Improve quality of [scientific] documents by: a) Educating scientists in each research centre about document writing/document creation. b) Regular lawyer reviews and audits of scientific documents produced in each company. c) Arrange a system to ensure that all research related conference minutes involving representatives of more than one Group company are vetted by the lawyer for the company issuing the minutes before the minutes are sent out.
1448

  1. As suggested at the meeting, BAT thereafter held a series of mandatory training sessions about writing and document creation for company scientists. "The sessions were called 'caution in writing' seminars and at Brown & Williamson they were presented by lawyers, predominantly from Shook, Hardy & Bacon." Wigand WD, 59:13-23. At the seminars, scientists were instructed by lawyers "on how to sanitize the documents they created." Id. at 60:1-6. The scientists were told "how to avoid writing documents with contentious words and topics." The contentious words included words like "safer," "addictive," "disease," and "cancer." Id. at 64:15-23.

  2. As a follow-up to the New York City meeting, BAT also implemented "lawyers' reviews" whereby, company scientists could only send documents containing sensitive information to sister companies if the document was first "reviewed and approved by a company lawyer." Wigand WD, 60:7-14.

  3. As also suggested at the NYC meeting, BAT implemented a policy to have lawyers vet research-related conference minutes. The word vetting as used within the BAT Group of companies meant "[d]eliberately and consciously removing contentious and controversial information from company documents that would benefit an adversary in litigation." Wigand WD, 35:15-20. As Wigand testified:

Nick Cannar told us that before meeting minutes could be circulated, they would be reviewed by the lawyers and, if necessary, the lawyers would remove contentious information before the minutes could be circulated.

Id. at 61:3-6.

  1. At the NYC meeting, lawyers Nick Cannar and Kendrick Wells: agreed that the cost sharing agreement would be revised to specifically state that BATCo owned the documents that it created
1449

and that it could demand them back at any time. So, for example, the thought was that if lawsuits in the United States were seeking documents created by the Fundamental Research Center, then BATCo could demand all copies of the documents back from the United States and Brown & Williamson would be saved from having to produce them in litigation.

Wigand WD, 28:14-29:4.

  1. Following the NYC meeting the agreement was changed "so that now documents were the property of BATCo and BATCo could demand the return of the documents at any time." Id. at 27:23-28:2. The BAT Group companies' cost-sharing agreements were re-written to "recognize[] [each] company's claim to ownership/confidentiality of its research reports" and to provide for the "return of all copies of these [research] documents upon demand." 202347085-7086 (US 22032). "[T]he cost sharing agreement set forth an arrangement by which the various Cigarette Affiliated Companies (CAC) shared the cost for the Fundamental Research Center in Southampton, England." Wigand WD, 27:5-8, 27:9-18. In 1992, Brown & Williamson wrote BATCo a letter regarding the revised Cost Sharing Agreement, in which it stated that it would "not . . . return documents if returning the documents would be inconsistent with Brown & Williamson's discovery obligations in pending litigation." (no bates) (JE 021689 at 682508295); (no bates) (JD 012922 at 682010312-17).

  2. In a May 1991 memorandum from Kendrick Wells to Mick McGraw, B&W General Counsel, Wells wrote:

Jeff [Wigand] believes that he now sends me a copy of all documents from BATCo . . . in the nature of meeting reports and scientific memos. He also sends appropriate scientific research reports. I told him that it was important that we had an opportunity to review the BATCo. materials. As a case in point, I recommended that we should follow up with BATCo. on statements made in a set of studies done

1450

for BATCo. at Harwell. They include statements that means are available which will remove minute foreign materials from tobacco. B&W R&D looked at this question a year or so ago and decided that no such means existed. The question could be involved in a safer product claim. Thus, we should communicate with BATCo. to discuss their assertion that such means are available.

680901663-1665 at 1664 (US 79219); see also Wigand WD, 76:25-77:28.

  1. Brown & Williamson itself suppressed certain scientific research particularly through lawyer oversight and vetting. In an August 1980 memorandum, Kendrick Wells, at that time corporate counsel to B&W, listed numerous edits that would be required before BAT scientist, Dr. Lionel Blackman could publish "Change of Stance on Public Smoking and Health," which Blackman had drafted. In justifying the edits, Wells wrote:

The successful defense of product liability litigation and opposition to adverse legislation in the United States depends upon two essential arguments: (1) The scientific evidence does not prove a causal relationship between smoking and health and (2) the smoker voluntarily encounters the known risks of smoking.

A concession by a cigarette manufacturer to the charge that cigarettes cause human disease or a statement which contradicts the concept of voluntary choice of smoking by the consumer could cripple or destroy B&W's defense to smoking and health lawsuits and opposition to legislative attacks. This would be true even though the statements were made by BAT.

680050985-1001 at 0986 (JD 053700). "Change of Stance on Smoking and Health" as originally drafted by Blackman was never released to the public. Wells WD, 21:6-8.

  1. Wells also advised Dr. Blackman to remove the statement that "cigarettes are harmful to health in proportion to delivery" from a presentation he gave to INFOTAB in 1981 called "Basic

Approach to Government and Medical Authorities," because such a statement "would abandon, in effect, all substantive arguments that the relationship of smoking and health is unproven." After speaking directly to Wells, Blackman removed that language based on Wells's legal advice. 680585041-4042 (US 21006); 680585063-5064 (US 21007); 2024954637 (US 37176); 2024954638 (US 37177). No evidence was offered as to what came of this presentation after it was given to INFOTAB.

1451
  1. B&W edited adverse references to addiction out of another BAT report written by Dr. Blackman, titled "The Controversy on Smoking and Health: Some Facts and Anomalies." By letter dated October 25, 1984, B&W attorney J. Kendrick Wells wrote BAT counsel Alec Morini that "review" of BAT publications by B&W was necessary in light of ongoing smoking and health litigation. Wells went on to provide forty-five paragraphs of revisions to Blackman's draft and a marked-up report, including:
  1. Delete Donald Gould reference. The article identifies cigarettes as a drug. 3. Delete reference to Dr. W.S. Cain. The article identifies short terms and longer term pharmacological and physiological factors as important in the derivation of "habitual cigarette smoking. . . ." 5. Delete. The point made here might be said to run counter to arguments that cigarette smoking is not addictive. . . .

680582499-2507 at 2499-2500 (US 54052).

  1. Wells attached a marked-up copy of Blackman's report to his October 25 cover letter, where he indicated his edits and the corresponding paragraph numbers from his letter. The three paragraphs quoted above were ultimately removed from the report. 680582512-2512 (US 85396).

  2. On May 29 and 30, 1984, attorneys from B&W and BATCo held a conference on United States products liability litigation. During the course of that conference, "Project Rio," a biological testing program to develop cigarettes with less biological activity, was discussed.

1452

According to a memorandum written by Wells, the attorneys

were able to hold significant discussions about implications for U.S. products liability litigation . . . regarding Project Rio. BAT Legal acknowledged the needs for lawyer involvement in the project and for possible restructuring, but there was not enough time to plot a course of action.

Wells considered follow-up and further summarized the meetings in a June 12, 1984 file note:

[W]e should arrange a meeting in London with BAT Legal . . . to delineate more specific counsel to BAT, including proposals for the structure and organization of BAT programs and statements which would hold to the minimum feasible level their potential impact upon U.S. products liability litigation. . . . For example, if Project Rio must continue, restructuring probably will be required to control the risk of generating adverse evidence admissible in U.S. lawsuits.

*** Direct lawyer involvement is needed on all BAT activities pertaining to smoking and health from conception through every step of the activity.

The problem posed by BAT scientists and frequently used consultants, who believe cause is proven [i.e., that smoking causes disease] is difficult.

685092972-2974 at 2973 (US 31031).

  1. Wells edited many more scientific documents to remove material that might be damaging to B&W in litigation. 680583045-3045 (US 85395); 690128746-8921 (US 25461);

680858743-8743 (US 21723); 682000188-0188 (US 89376); see also 680585135-5135 (US 22976).

  1. The Legal Department at B&W generally reviewed scientists' statements on smoking and health before they were made public. The review was conducted in part so that the Law
1453

Department could tell the scientists that these sorts of statements could have adverse consequences for the company in product litigation. Wells WD, 16:4-19.

  1. On some occasions, the legal department at BATCo similarly worked with scientists. On September 18, 1991, Sharon Boyse, Manager of the Smoking Issues Corporate Affairs Department at BATCo, wrote to G. Symmes of W.D. & H.O. Wills in Australia instructing him that the scientific content of a document prepared by the Tobacco Institute of Australia was "NOT acceptable to BAT until those changes are made!" In the letter, Boyse instructed scientists at Wills to remove any suggestion from a document that scientific articles had "claimed a statistical association between ETS exposure and the development of lung cancer." The letter went on to require removal of any suggestion that tobacco smoke contained carcinogens because the studies that suggested that tobacco smoke contained carcinogens "are animal studies. . . ." 750075351-5352 (US 16182); 304002839-2840 (US16183); 304002839-2840 (US 79027).

  2. Richard Binns, the former Manager of BATCo's Group Research & Development Centre at Southampton, complained of the expansive role of lawyers in BATCo's science, writing that:

I am being asked to make significant and sometimes swingeing [sic] changes in documents produced recently by R&D staff. It is suggested that this must be done by finding a "managerial explanation" for the changes, without reference to the involvement of Legal Department. I will find this impossible to do. Senior R&D staff will not be so easily deceived. Personally, I am not prepared to lie to staff for very doubtful reasons. Therefore, the current lack of clarity about the relationship between R&D and Legal Dept. has raised questions which for me are ethically disturbing, particularly if extended beyond the present localized situation.

1454

109878083-8089 at 8089 (US 21767); Read PD, United States v. Philip Morris, 07/25/03,

  1. As Defendants note, it is both reasonable and legitimate for lawyers to advise their clients about the potential use of documents in litigation against them. However, the totality of the Factual Findings demonstrate a pattern of behavior amongst all BAT Group Defendants in which legal considerations and lawyers' strategies dominated both the direction and disclosure of scientific research.

c. Philip Morris 3907. Defendant Philip Morris suppressed and concealed many scientific research

documents, even going so far as to send them to a foreign affiliate in order to prevent the disclosure of documents in litigation and in federal regulatory proceedings.

  1. In 1970, Helmut Wakeham, Philip Morris's Vice President for Research & Development, recommended that Philip Morris purchase INBIFO, a research facility in Cologne Germany, arguing that Germany "is a locale where we might do some of the things which we are reluctant to do in this country. . . ." 2022244451-4453 at 4451 (US 20361).

  2. Philip Morris did in fact purchase INBIFO to conduct its smoking and health research. A 1970 memorandum from Joseph Cullman, President of Philip Morris, discusses the benefits of conducting research overseas: "The possibility of getting answers to certain problems on a contractual basis in Europe appeals to me and I feel presents an opportunity that is relatively lacking in risk and unattractive repercussions in this country." 1000216742-6742 (US 20081). In addition, "[e]xperiments can be terminated at will as required without delay." 1003123055-3094 at 3058 (US

1455
  1. After acquiring INBIFO, Philip Morris tried to avoid any direct contact with the research results that it produced or worked on. Handwritten notes of Thomas Osdene, a senior Philip Morris research official who acted as primary liaison with INBIFO, laid out the method for handling documents related to health and smoking. His notes state as follows:

(1) Ship all documents to Cologne. . . . (2) Keep in Cologne. (3) OK to phone & telex (these will be destroyed). (4) Please make available File Cabinet. Jim will put into shape by end of August or beginning of Sept. (5) We will monitor in person every 2-3 months. (6) If important letters have to be sent please send to home -- I will act on them + destroy.

1000130803-0803 (US 34424). Despite this process, "plenty of telexes" and "lots of communications" went back and forth between INBIFO in Cologne, Germany and Philip Morris USA in Richmond, Virginia. Farone TT, 10/7/04, 1943:18-1944:4.

  1. In 1977 in a letter to Max Hausermann, Philip Morris Vice President of Research & Development in Switzerland, Robert Seligman, Philip Morris Vice President of Research & Development in the United States, confirmed the company's policy of prohibiting direct contact with INBIFO. Seligman wrote:

We have gone to great pains to eliminate any written contact with INBIFO and I would like to maintain that structure. *** Therefore, I am advising Jerry Osmalov to continue sending samples to Neuchatel for transshipment to INBIFO. If this procedure is

1456

unacceptable to you, perhaps we should consider a "dummy" mailing address in Koln for the receipt of samples. The written analytical data will still have to be routed through FTR if we are to avoid direct contact with INBIFO and Philip Morris U.S.A.

2000512794-2795 (US 20295).

  1. In the 1977 letter from Robert Seligman to Max Hausermann, Seligman discusses a letter that had breached the Philip Morris policy. Seligman suggested to Hausermann that he "retrieve [and presumably destroy] the March 24 letter Helmut Gaisch sent to Jerry, including all copies. My copy is returned herewith." 2000512794-2795 (US 20295).

  2. As recently as 1993, Philip Morris maintained a system whereby research documents were "sent to Richmond for a review and [ ] then returned to INBIFO" with all "[s]upporting data and documents . . . kept at INBIFO." 2043725390-5391 (US 20449).

  3. Philip Morris did not want "to have results of animal research in its domestic facilities -- particularly research conducted at a Philip Morris-owned lab -- lest that information get out and undercut Philip Morris' public position that cigarettes were not a health threat." Farone WD, 149:10-152:15.

  4. Dr. DeNoble was hired to establish a behavioral pharmacology laboratory at Philip Morris USA to support the nicotine analogue program. DeNoble WD, 4:23-5:2. The goal of the nicotine analogue program was to develop a substitute for nicotine that would retain the physiological and behavioral effects of nicotine on the central nervous system, specifically nicotine's reinforcing qualities, but would not retain nicotine's adverse effects on the cardiovascular system. Id. at 5:7-11; see also Section V(D)(5)(a)((3)), supra, for more detailed discussion about Philip Morris's nicotine analogue program. In connection with the analogue program, the behavioral pharmacology laboratory "needed to develop a variety of tests that could be used in the characterization of the behavioral effects of nicotine in rats." DeNoble WD, 15:13-22. These test procedures that Drs. DeNoble and Mele developed, and the results of their experiments using them, were written up in various reports. They also sought permission to submit some of their studies to various journals for publication. Philip Morris USA permitted some of these studies to be published, but forbade publication of others. For example, Dr. DeNoble published a paper, titled Behavioral Effects of Intraventricularly Administered (-)-Nicotine on Fixed Ratio Schedules of Food Presentation in Rats, which appeared in Psychopharmacology in 1982. (no bates) (JD 040124).

1457

  1. However, Philip Morris prevented publication of DeNoble's and Mele's research results which were unfavorable to their public positions on nicotine and addiction. One of the studies that Philip Morris USA did not allow to be published demonstrated that rats will self-administer nicotine. Self-administration studies establish whether a stimulus is reinforcing. DeNoble TT, 1/6/05, 9013:8-9014:9. Given the substantial credible evidence that DeNoble's results were noteworthy and significant, the Court does not find that Philip Morris's explanation, that it chose not to publish the report because other scientists had previously shown the same results, to be credible. Henningfield WD, 161:23-165:15.

  2. When Victor DeNoble, former Associate Senior Scientist at Philip Morris, and his fellow researcher, Paul Mele, performed research on rats demonstrating that nicotine caused self-administration and induced tolerance, they initially received Philip Morris's approval to publish their research results. However, following DeNoble's presentation of those results to Philip Morris senior management in New York City, the approval to publish was withdrawn. Farone TT, 10/7/04, 1947:19-1950:20; Farone WD, 156:3-15; Rowell TT, 3/23/05, 16645:15-16646:1, 16654:1216655:15. DeNoble explained that it was clear from a comment made to him at the presentation that Philip Morris senior management would not allow the research results to be disclosed. Ross Millhiser, a Philip Morris executive stated: "Why should I risk a billion-dollar industry on rats pressing a lever to get nicotine?" DeNoble WD, 13:20-15:7, 22:6-25:12; Mele WD, 14:2-14:14, 20:3-22:12.

1458

  1. Philip Morris also denied Drs. DeNoble and Mele permission to publish a paper regarding studies which demonstrated both pharmacological and behavioral tolerance to nicotine in rats. DeNoble WD, 27:1-28:13; Mele WD, 11:13-14:10; (no bates) (US 20100 at 38) (tolerance develops to the behavioral effects of nicotine following chronic administration). Tolerance can demonstrate dependence on a drug. Mele WD, 13:16-14:1. Again, the Court finds Philip Morris's claims that it chose not to publish these results because tolerance to nicotine had already been demonstrated in the same fashion and to the same degree, despite the evidence to the contrary, not credible. Henningfield WD, 161:23-165:15.

  2. Philip Morris also did not allow DeNoble and Mele to publish the results of a study demonstrating that nicotine affects the vestibular nucleus -- the area of the brain that affects balance and coordination. DeNoble WD, 14:11-15:7. Their research demonstrated why nicotine often makes people dizzy when they first start smoking. Id. Philip Morris was the first to make this discovery, but did not allow DeNoble and Mele to publish a paper on the particular brain sites responsible for producing this effect from ingesting nicotine. Id.

  3. Patrick Sirridge of Shook, Hardy & Bacon wrote to Philip Morris's Assistant General Counsel Fredric Newman transmitting an analysis of DeNoble's published literature, unpublished manuscripts, and in-press manuscripts. The analysis concluded that

1459

research engaged in, as well as some possibly under consideration, by Philip Morris has undesirable and dangerous implications for litigation positions the industry takes in regards to smoking behavior. . . . In the final analysis, the performing and publishing of nicotine related research seems ill-advised from a litigation point of view. . . .

2021423403-3461 at 3422 (US 87038*); DeNoble WD, 25:2-25:12, 38:1-39:11.

  1. Ultimately, in 1984, Philip Morris abruptly, with only one day's warning, shut down DeNoble's laboratory, ordering the researchers to terminate their work immediately and to kill the remaining rats that were the subjects of ongoing research. DeNoble was informed that the lab was closed because of the threat their work posed in litigation against Philip Morris. DeNoble WD, 25:2- 25:12, 38:1-39:11. William Farone, former Director of Applied Research, was told by Fred Newman, Philip Morris's Assistant General Counsel, that the DeNoble laboratory was shut down because Philip Morris wanted to bury "any research that showed smoke caused disease or nicotine was addictive." Farone TT, 10/12/04, 2091:23-2092:14; Farone WD, 156:3-15.

  2. Philip Morris's claim that shutting down DeNoble's lab and ending the research was merely a business decision is simply not credible.

  3. After DeNoble and Mele left Philip Morris in 1984, they renewed their attempts to publish their research results concerning nicotine addiction. In 1985, Philip Morris denied DeNoble the permission to publish. Notwithstanding that denial, DeNoble and Mele submitted two papers concerning nicotine addiction for publication. After the first paper was published, DeNoble received a threatening letter from Philip Morris attorneys in April 1986. In August 1986, DeNoble and Mele spoke at an American Psychological Association convention concerning other work that they had done at Philip Morris. Thereafter, in September 1986, DeNoble received a second threatening letter from Altria in-house counsel Eric Tausig. Following receipt of that letter, he called the journal to which he had submitted two papers for publication and sought to have them withdrawn from publication. He was able to pull back only one of them. To the present day, his paper on nicotine self-administration in rats has never been published in a scientific or medical journal. DeNoble WD, 39:12-45:19; DeNoble TT, 01/06/05, 9081:20-9082:14. DeNoble was released from his confidentiality agreement with Philip Morris in 1994. DeNoble TT, 1/6/05, 9043:19-23.

1460

  1. Philip Morris's lawyers exerted significant control over research into nicotine. William L. Dunn, a Philip Morris scientist, wrote in a 1980 document titled "The Nicotine Receptor Program" that, despite the fact that the psychopharmacology of nicotine is "where the action is for those doing fundamental research on smoking," and where "most likely will come significant scientific developments profoundly influencing the industry, . . . it is where our attorneys least want us to be. . . ." 1000127789-7790 at 7789 (US 34442).

  2. According to Dunn, there were two reasons why Philip Morris's lawyers did not want nicotine research conducted. The first reason was so the tobacco companies could claim ignorance "of any relationship between smoking and disease." Such an approach was "implicit in the legal strategy employed over the years in defending corporations within the industry from the claims of heirs and estates of deceased smokers." The second reason for not engaging in nicotine research was that any action by the tobacco industry, including research, that treated nicotine as a drug "could well be viewed as a tacit acknowledgment that nicotine is a drug," which could impact any future regulation of tobacco by the government. 1000127789-7790 at 7789 (US 34422). While nicotine research was permitted, the Company did not want to "be visible about it." 1000127789-7790 at 7789 (US 34422). Because of the commercial necessity of research into nicotine, Dunn acknowledged that "our attorneys . . . will likely continue to insist upon a clandestine effort in order to keep nicotine the drug in low profile." 1000127789-7790 at 7790 (US 34422).

1461
  1. Philip Morris consultants also suppressed certain scientific research. On January 15,

2003, in an appeal from a criminal defamation conviction, a Swiss court sustained two allegations of fraud against Ragnar Rylander, and concluded that he was a covert consultant for Philip Morris and that he had suppressed research findings that were adverse to the tobacco industry. In its findings, the court stated:

Concerning the allegation that the respondent was "secretly employed by Philip Morris," exhibits show that he had entered into a consulting agreement with Philip Morris in 1972 and that he had not made this fact public. Indeed, . . . the respondent did everything not to let his ties to Philip Morris become publicly known in order to, in his own words, "retain as far as possible the image as an independent scientist." In addition, following the publication of an article in the "European Journal of Public Health," he attempted to conceal the existence of a formal contract with Philip Morris, and this led the journal's Committee on Publication Ethics to take an unfavourable decision in his regard.

The respondent has had frequent contacts with Philip Morris for many years. These contacts are troubling for several reasons. In 1991, within the framework of a study on respiratory diseases in children, the respondent modified a data base so that no link could be made between passive smoking and the frequency of respiratory infections. At an international conference in May 1992 he affirmed that no relation had been found between respiratory infections in children and their exposure to smoke. . . . Two months earlier, however, he had agreed to have his name on a document distributed to participants in a meeting of epidemiologists and indicating that a correlation had been found between passive smoking and the frequency of bronchitis in children.

TLT1050091-0101 at 0099-0100 (US 88744).

1462

d. Lorillard 3927. At times, Lorillard suppressed scientific research on smoking and health. In 1977,

Alexander Spears of Lorillard told a scientist that he would not be permitted to deliver a research paper unless he deleted data from a study related to human smoking habits. 01416267-6267 (US 20287); Spears PD, Texas v. American Tobacco, 07/24/97, 216:11-218:23.

  1. In a 1978 handwritten note related to the industry's Scientific Liaison Research Committee, Curtis Judge, Lorillard's Chief Executive Officer, complained that "[w]e have again 'abdicated' the scientific research directional management of the Industry to the 'Lawyers' with virtually no involvement on the part of the scientific or business management side of the business." The note further argued that a reconstituted scientific and policy leadership committee should not "report to the Committee of Counsel. . . ." 01346204-6205 (US 34532) (emphasis in original).