Tobacco.org

Tobacco giants' profits remain golden 

Despite tobacco industry claims that one-third of its market in Ontario and Quebec has been grabbed by smugglers, the cigarette companies' financial reports don't show much impact on their performance.

Healthy results reported by all three major tobacco producers indicate the contraband problem has not been as damaging as the industry is making it out to be. . . .

Most of the illegal tobacco producers are located on the U.S. side of the Akwesasne reserve.

Jerry Montour, chief executive officer of Grand River Enterprises, a federally licensed tobacco producer on the Six Nations reserve near Brantford, Ont., said the simplest way to stop the smuggling is to lay charges against companies that supply tobacco, paper, filters and machines to illegal producers.

"Why are (the suppliers) not held accountable?" he asked. "You know why they aren't? Because they are white."

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JTI-MacDonald Quick Facts 

carried on manufacturing in the Ontario Street, Montreal, building since 1876. (Photo Courtesy Industry Canada)

Company founded in 1858 in Montreal by merchants William C. and Augustine Macdonald as McDonald Brothers and Co. Tobacco Manufacturers.

Company imports tobacco from Kentucky and sells chewing and smoking "plugs."

In 1866, name changed to W. C. McDonald Tobacco Merchants and Manufacturers. They create a heart-shaped logo and launch company slogan "tobacco with a heart."

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Tobacco firm, former CEO to stand trial on fraud and conspiracy 

A judge in Toronto on Wednesday ordered a�tobacco company and a former chief executive to stand trial on charges of fraud and conspiracy.

JTI-MacDonald Corp., formerly known as RJR-MacDonald, and one-time�top executive Edward Lang are alleged to have defrauded Canadian taxpayers of more than $1 billion in taxes and duties.�

A trial date is expected to be set at the end of June.

The judge ruled that there was not enough evidence against six other former executives to commit them to trial, but said the case against�Lang and the company should proceed.

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• JTI-Macdonald faces tobacco smuggling trial  

A Canadian court ruled on Wednesday that JTI-Macdonald Corp. and a former company executive should stand trial for alleged involvement in massive cigarette smuggling scheme in the 1990s.

But the Ontario Court of Justice dismissed charges against six other executives of the cigarette maker, which was previously named RJR-Macdonald and its then-parent, R.J. Reynolds Tobacco International.

JTI-Macdonald is now a unit of Japan Tobacco Inc.

Police have accused JTI-Macdonald of scheming to sell cigarettes to U.S. suppliers from 1991 to 1996, knowing the tobacco was going to be smuggled back into Canada to avoid high taxes that were aimed at reducing smoking. . . .

The court in Toronto issued its ruling after a lengthy preliminary hearing. A standard publication ban prohibits the media from reporting details of the evidence until it is presented in the criminal trial.

In addition to the company, the court ruled there was enough evidence for Edward Lang, who was RJR-Macdonald's chief executive during the 1990s, to stand trial. . . .

Another executive, former RJR-Macdonald vice president Stanley Smith, pleaded guilty to a conspiracy charge during the preliminary hearing and is now cooperating with the prosecution as a witness.

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Tobacco exec to testify as part of plea bargain ($$) 

A senior tobacco company executive who has agreed to testify against major tobacco companies -- in a case involving the alleged smuggling of cigarettes and fraud of more than $1 billion in taxes -- is not going to jail.

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Ex-tobacco exec avoids jail time ($$) 

A former tobacco company executive has reportedly been sentenced to eight months of house arrest for his role in a conspiracy to to smuggle cigarettes. CBC News said Stan Smith's conditional sentence follows his earlier guilty plea. Smith was vice-president of sales for the former RJR-MacDonald company in the early 1990s when high tobacco taxes prompted a surge in cigarette smuggling. Investigators have accused JTI-MacDonald Corp., formerly known as RJR-MacDonald, Inc., and several of its subsidiaries of conspiring to defraud the federal, Quebec and Ontario governments out of $1.2 billion in tax revenue between 1991 and 1996.

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Ottawa appeals ruling David Dodge must testify in cigarette smuggling case 

The federal government is appealing a ruling that the Bank of Canada governor, David Dodge, must testify at the fraud trial of tobacco company JTI-Macdonald Corp.

Ottawa's appeal is slated to be heard Thursday by Justice Marc Labrosse of the Ontario Court of Appeal.

Ontario Superior Court Justice Paul Rivard ruled Dec. 7 that Dodge, who was federal deputy minister of finance from 1992 to 1997, can be called by the company.

Dodge was among 15 former and current lawyers and staff of the governments of Canada and Quebec who were subpoenaed by JTI-Macdonald. Rivard ruled that all but two of the people called must testify.

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• Ottawa appeals ruling David Dodge must testify in cigarette smuggling case 

The federal government is appealing a ruling that the Bank of Canada governor, David Dodge, must testify at the fraud trial of tobacco company JTI-Macdonald Corp.

Ottawa's appeal is slated to be heard Thursday by Justice Marc Labrosse of the Ontario Court of Appeal.

Ontario Superior Court Justice Paul Rivard ruled Dec. 7 that Dodge, who was federal deputy minister of finance from 1992 to 1997, can be called by the company.

Dodge was among 15 former and current lawyers and staff of the governments of Canada and Quebec who were subpoenaed by JTI-Macdonald. Rivard ruled that all but two of the people called must testify.

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• Feds, Dodge try to evade tobacco trial 

The federal government is arguing that JTI-Macdonald Corp. and a number of its former tobacco executives facing fraud charges have no legal grounds to compel Bank of Canada governor David Dodge and other senior civil servants to testify at a preliminary hearing.

The defendants' request "has nothing to do with the preliminary," argued lawyer Ronald Slaght in Ontario Superior Court Monday.

Slaght, who has also been retained by the federal government in its $1.2-billion suit against JTI-Macdonald, suggested the request is a "fishing expedition" to find out information to defend the civil action. . . .

Lawyers for the defendants obtained subpoenas recently for 15 civil servants, including Dodge, a former deputy finance minister.

The other civil servants include the current deputy finance minister Ian Bennett, director general of the Canada Revenue Agency Fred O'Riordan, as well as three senior Ottawa-based Justice Department lawyers.

A number of the civil servants were interviewed by the RCMP during its investigation and made statements that the defendants' lawyers say are helpful to their clients.

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Tobacco firm didn't smuggle, court told 

A Canadian tobacco firm was charged in connection with a massive cigarette smuggling conspiracy even though senior federal bureaucrats told the RCMP the company wasn't involved, according to court documents.

Lawyers representing the federal government and the high-ranking civil servants are now trying to stop a court from hearing their testimony.

Among them is Bank of Canada governor David Dodge, who served as deputy finance minister from 1992 to 1997.

According to documents filed in the Superior Court of Justice, Dodge told the RCMP on Aug. 29, 2001 that Canadian tobacco companies were "quite keen" to deal with the problem of tobacco smuggling.

He also told the Mounties there was no indication that cigarette maker RJR-MacDonald Inc. was involved in cross-border smuggling alleged to have cost the Canadian government $1.2 billion in taxes in the mid-1990s, according to material filed in court by the company.

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• Tobacco firm didn't smuggle, court told 

A Canadian tobacco firm was charged in connection with a massive cigarette smuggling conspiracy even though senior federal bureaucrats told the RCMP the company wasn't involved, according to court documents.

Lawyers representing the federal government and the high-ranking civil servants are now trying to stop a court from hearing their testimony.

Among them is Bank of Canada governor David Dodge, who served as deputy finance minister from 1992 to 1997.

According to documents filed in the Superior Court of Justice, Dodge told the RCMP on Aug. 29, 2001 that Canadian tobacco companies were "quite keen" to deal with the problem of tobacco smuggling.

He also told the Mounties there was no indication that cigarette maker RJR-MacDonald Inc. was involved in cross-border smuggling . . .

Dodge is one of 17 senior government officials and lawyers whose testimony is sought by lawyers representing the former RJR-MacDonald Inc., now known as JTI-Macdonald Corp., at a preliminary hearing in Toronto that's been hearing evidence for almost 100 days.

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Nova Scotia Seeks Tobacco Smuggling Costs from JTI-Macdonald 

The province of Nova Scotia has filed a legal claim against tobacco manufacturer JTI-Macdonald Corporation (JTI) to recover $326 million in taxes given up when taxes were reduced to prevent smuggling in the early 1990s.

A notice of Crown claim was filed Friday, June 24, with Ernst and Young in Toronto, the court-appointed monitor who will evaluate the claims for JTI under provisions of the Companies and Creditors Arrangement Act, a form of bankruptcy protection.

"We reduced taxes to try and curb smuggling in 1994 and gave up hundreds of millions of dollars of revenue as a result," said Finance Minister Peter Christie. "Since JTI Macdonald profited from its participation in a smuggling scheme, we believe they should cover the cost picked up by Nova Scotians."

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Japan Tobacco unveils 13 new brands ($$) 

Japan Tobacco, the world’s third biggest cigarette maker, on Thursday unveiled 13 new tobacco brands to add to its 100-plus stable, marking the single biggest product launch in its history.

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Former RJR executive to testify on smuggling 

A former executive at RJR-Macdonald Corp. has agreed to plead guilty to a criminal charge and testify against tobacco firms over allegations they profited from cigarette smuggling. Stanley Smith, a former vice-president of sales at RJR-MacDonald, will testify at a preliminary hearing in Toronto to determine if the Crown has enough evidence to take its case against Japan Tobacco Inc.'s JTI-MacDonald unit and other firms to trial, Mr. Smith's attorney Brian Heller told an Ontario court judge. . . .

JTI-MacDonald, a successor to RJR-Macdonald, and three companies that were associated with or were units of RJR Nabisco Holdings Corp. are accused of defrauding Ottawa of more than $1.2-billion in taxes and duties by exporting cigarettes to the United States, knowing they would be smuggled back into Canada for sale on the black market.

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• Tobacco Industry Joint Representations On “progressing Toward A Tobacco-free Quebec - Developing Quebec Anti-tobacco Legislation” (PDF) 

There can be no comparison between the potency of nicotine dependence and that of heroine or cocaine dependence.

Denormalization which brands the manufacture and use of products that are otherwise legal as “illegitimate” encourages and sanctions behaviour that is contrary to the law by inciting anti-smoking activists to attack the reputation and integrity of those who smoke or who manufacture tobacco products.

The government is not above the law and any attempt to interfere in the moral choices of citizens by encouraging such serious offences is bound to give rise to legal challenges.

The study cited by the Minister in support of the assertion that environmental tobacco smoke causes diseases such as lung cancer, emphysema or cardiovascular diseases does not bear out such a claim at this time, even according to the author of the study . . .

Rather than multiplying current legal restrictions and prohibitions, we hope that the Minister will recognize the validity of the alternatives proposed in this submission which are respectful of both smokers and non-smokers.

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