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Metro

Cahill witness describes tensions at lottery

Kerri Coyne, assistant to the chief of staff for marketing at the lottery was the first witness at Timothy P. Cahill’s trial.

JOSH REYNOLDS FOR THE BOSTON GLOBE/POOL

Kerri Coyne, assistant to the chief of staff for marketing at the lottery was the first witness at Timothy P. Cahill’s trial.

According to the prosecution’s first witness in the trial of former state treasurer Timothy P. Cahill, the mood at the ­Massachusetts State Lottery turned tense in the summer ­before Cahill’s November 2010 defeat in a bid for governor.

The attorney general alleges that Cahill and campaign treasurer Scott Campbell conspired to coordinate lottery ads with the campaign to aid Cahill, a Democrat turned independent. Both men have pleaded not guilty to two counts of conspiracy and a purchasing violation. Cahill pleaded not guilty to an additional charge of using his official office for an unwarranted privilege.

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Kerri Coyne had only been at the lottery for a few months, begin­ning in April 2010 as ­assistant to Alfred Grazioso Jr., then lottery chief of staff, who is facing related charges, when she witnessed a souring in the relationship between her boss and Mark Cavanagh, then the lottery’s executive director.

Cavanagh, who was usually mild mannered, according to Coyne, emerged irate from an August 2010 meeting soon after Coyne had formatted a spreadsheet showing different multimillion-dollar advertising strategies for the lottery.

“He had almost like a grimace on his face; he looked very irritated,” said Coyne.

Right in front of Coyne’s open doorway, which was across from Grazioso’s door, ­Cavanagh turned and yelled: “I’m not [expletive] signing it. It’s damn near illegal,” according to Coyne. Cavanagh then walked down the hall to his ­office and slammed the door.

Coyne was not sure what ­Cavanagh was angry about, but she surmised it might have to do with the advertising plans, which Coyne said appeared to be over the $2 million advertising budget the Legislature had given the lottery.

Cahill’s lawyer, Brad Bailey, drew out Coyne’s lack of expertise in marketing and her unfamiliarity with the mores of the lottery office.

“Isn’t it true before August 2010, you had no idea what ‘permission’ advertising was?” Bailey asked. Coyne said that was true. “And isn’t it true that even as you sit here today, you’re still not clear what permission advertising is?”

Earlier, during direct examination by prosecutor James O’Brien, Coyne said she knew what “permission” advertising is, and described it as “the agreement to have a TV and a radio ad spot.” During opening statements Monday, Campbell’s lawyer, Charles Rankin, had said that permission ads are ­intended to show the positive aspects of the lottery, thus giving the target audience the feeling they have “permission” to play lottery games.

In his opening statement on Monday, O’Brien described the prosecution’s case, that campaign officials directed the lottery’s advertising firm to develop ads showing the lottery was well managed, ads that would run right before the election.

Coyne said she was surprised by the amount of money the lottery planned to put into the permission ads that fall and said she found it abnormal that Grazioso had wanted to see a copy of the spreadsheet laying out potential advertising strategies because he did not involve himself in the approval of smaller advertisements.

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