[Congressional Record Volume 144, Number 64 (Tuesday, May 19, 1998)]
[Extensions of Remarks]
[Page E887]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




     INTRODUCTION OF THE TRADEMARK ANTI-COUNTERFEITING ACT OF 1998

                                 ______
                                 

                           HON. BOB GOODLATTE

                              of virginia

                    in the house of representatives

                         Tuesday, May 19, 1998

  Mr. GOODLATTE. Mr. Speaker, I rise today to introduce the Trademark 
Anticounterfeiting Act of 1998. This important legislation will provide 
law enforcement the tools they need to combat the growing crime of 
altering or removing product identification codes from goods and 
packaging. This bill will also provide manufacturers and consumers with 
civil and criminal remedies to fight those counterfeiters and illicit 
distributors of goods with altered or removed product codes. Finally, 
this bill will protect consumers from the possible health risks that so 
often accompany tampered goods.
  Most of us think of UPC codes when we think of product identification 
codes--that block of black lines and numbers on the backs of cans and 
other containers. However, product ID codes are much more than simple 
UPC codes. Product ID codes can include various combinations of 
letters, symbols, marks or dates that allow manufacturers to 
``fingerprint'' each product with vital production data, including the 
batch number, the date and place of manufacture, and the expiration 
date. These codes also enable manufacturers to trace the date and 
destination of shipments, if needed.
  Product codes play a critical role in the regulation of goods and 
services. For example, when problems arise over drugs or medical 
devices regulated by the Food and Drug Administration, the product 
codes play a vital role in conducting successful recalls. Similarly, 
the Consumer Product Safety Commission and other regulators rely on 
product codes to conduct recalls of automobiles, dangerous toys and 
other items that pose safety hazards.
  Product codes are frequently used by law enforcement to conduct 
criminal investigations as well. These codes have been used to pinpoint 
the location and sometimes the identity of criminals. Recently, product 
codes aided in the investigation of terrorist acts, including the 
bombing of Olympic Park in Atlanta and the bombing of Pan Am Flight 103 
over Lockerbie, Scotland.
  At the same time, manufacturers have limited weapons to prevent 
unscrupulous distributors from removing the coding to divert products 
to unauthorized retailers or place fake codes on counterfeit products. 
For example, one diverter placed genuine, but outdated, labels of 
brand-name baby formula on substandard baby formula and resold the 
product to retailers. Infants who were fed the formula suffered from 
rashes and seizures.
  We cannot take the chance of any baby being harmed by infant formula 
or any other product that might have been defaced, decoded or otherwise 
tampered with. FDA enforcement of current law has been vigilant and 
thorough, but this potentially serious problem must be dealt will even 
more effectively as counterfeiters and illicit distributors utilize the 
advanced technologies of the digital age in their crimes.
  Manufacturers have attempted, at great expense and with little 
success, to prevent decoding through new technologies designed to 
create ``invisible'' codes, incapable of detection or removal. However, 
decoders have proven to be equally diligent and sophisticated in their 
efforts to identify and defeat new coding techniques. We therefore must 
provide manufacturers with the appropriate legal tools to protect their 
coding systems in order for them to protect the health and safety of 
American consumers.
  Currently, federal law does not adequately address many of the common 
methods of decoding products and only applies to a limited category of 
consumer products, including pharmaceuticals, medical devices and 
specific foods. Moreover, current law only applies if the decoder 
exhibits criminal intent to harm the consumer. It does not address the 
vast majority of decoding cases which are motivated by economic 
considerations, but may ultimately result in harm to the consumer.
  My legislation will provide federal measures which will further 
discourage tampering and protect the ability of manufacturers to 
implement successful recalls and trace product when needed. It would 
prohibit the alteration or removal of product identification codes on 
goods or packaging for sale in interstate or foreign commerce, 
including those held in areas where decoding frequently occurs.
  The legislation will also prohibit goods that have undergone decoding 
from entering the country, prohibit the manufacture and distribution of 
devices primarily used to alter or remove product identification codes, 
and allow the seizure of decoded goods and decoding devices. It will 
require offenders to pay monetary damages and litigation costs, and 
treble damages in the event of repeal violations. The bill will also 
impose criminal sanctions, including fines and imprisonment for 
violators who are knowingly engaged in decoding violations.
  The bill would not require product codes, prevent decoding by 
authorized manufacturers, or prohibit decoding by consumers, It is a 
good approach designed to strengthen the tools of law enforcement, 
provide greater security for the manufacturers or products, and most 
importantly, provide consumers with improved safety from tampered or 
counterfeit goods. I urge my colleagues to join me in supporting 
passage of this bill, which will go a long way toward closing the final 
gap in federal law enforcement tools to protect consumers and the 
products they enjoy.

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