[Congressional Record Volume 144, Number 132 (Monday, September 28, 1998)]
[House]
[Pages H9110-H9117]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
TRADEMARK ANTICOUNTERFEITING ACT OF 1998
Mr. GOODLATTE. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 3891) to amend the Trademark Act of 1946 to prohibit the
unauthorized destruction, modification, or alteration of product
identification codes, and for other purposes, as amended.
The Clerk read as follows:
H.R. 3891
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Trademark Anticounterfeiting
Act of 1998''.
SEC. 2. PROHIBITION AGAINST UNAUTHORIZED ALTERATION OF
PRODUCT IDENTIFICATION CODES.
(a) In General.--Chapter 65 of title 18, United States
Code, is amended by inserting after section 1365 the
following:
``Sec. 1365A. Unauthorized modification of product
identification codes
(a) Definitions.--In this section--
``(1) the term `consumer'--
``(A) means--
``(i) the ultimate user or purchaser of a good; or
``(ii) any hotel, restaurant, or other provider of services
that must remove or alter the container, label, or packaging
of a good in order to make the good available to the ultimate
user or purchaser; and
``(B) does not include any retailer or other distributor
who acquires a good for resale;
``(2) the term `good' means any article, product, or
commodity that is customarily produced or distributed for
sale, rental, or licensing in interstate or foreign commerce,
and any container, packaging, label, or component thereof;
``(3) the term `manufacturer' includes the original
manufacturer of a good and a duly appointed agent or
representative of that manufacturer acting within the scope
of its agency or representation;
``(4) the term `product identification code'--
``(A) includes any number, letter, symbol, marking, date
(including an expiration date), code, software, or other
technology that is affixed to or embedded in any good, by
which the manufacturer of the good may trace the good back to
a particular production lot or batch or date of removal, or
carry out product recalls or otherwise identify the date of
manufacture, the date of expiration, or other comparable
critical data; and
``(B) does not include copyright management information
conveyed in connection with copies or phonorecords of a
copyrighted work or any performance or display of a
copyrighted work;
``(5) the term `Universal Product Code' refers to the
multidigit bar code and number representing goods in retail
applications; and
``(6) the term `value' means the face, par, or market
value, whichever is the greatest.
``(b) Prohibited Acts.--Except as otherwise authorized by
Federal law, it shall be unlawful for any person, other than
the consumer or the manufacturer of a good, knowingly and
without authorization of the manufacturer--
``(1) to directly or indirectly alter, conceal, remove,
obliterate, deface, strip, or peel any product identification
code affixed to or embedded in that good;
``(2) to directly or indirectly affix or embed a product
identification code to or in that good which is intended by
the manufacturer for a different good, such that the code no
longer accurately identifies the source of the good;
``(3) to directly or indirectly affix to or embed in that
good any number, letter, symbol, marking, date, code, or
other technology intended to simulate a product
identification code; or
``(4) to import, export, sell, distribute, or broker that
good, in a case in which the person knows that the product
identification code has been altered, concealed, removed,
obliterated, defaced, stripped, peeled, affixed, or embedded
in violation of paragraph (1) or (2), or in a case in which
the person knows that the good bears an unauthorized number,
letter, symbol, marking, date, or other code in violation of
paragraph (3).
[[Page H9111]]
``(c) Applicability.--The prohibitions set forth in
subsection (b) shall apply to product identification codes
(or simulated product identification codes in a case to which
subsection (b)(3) applies) affixed to, or embedded in, any
good held for sale or distribution in interstate or foreign
commerce or after shipment therein.
``(d) Exclusion.--
``(1) UPC codes.--Nothing in this section prohibits a
retailer or distributor from affixing to a good--
``(A) a Universal Product Code or other legitimate pricing
or inventory codes or information, or
``(B) information required by State or Federal law,
if such code or information does not (or can be removed so as
not to) permanently alter, conceal, remove, obliterate,
deface, strip, or peel any product identification code.
``(2) Repackaging for resale.--(A) Nothing in this section
prohibits a distributor from removing an article, product, or
commodity of retail sale from a shipping container and
placing such article, product, or commodity in another
shipping container for purpose of resale in a quantity
different from the quantity originally provided by the
manufacturer or from replacing a damaged shipping container,
if, except as provided in paragraph (1), such article,
product, or commodity of retail sale retains its original
product identification code, without any obstruction or
alteration, and if--
``(i) such distributor is registered with all applicable
Federal and State agencies;
``(ii) such distributor repackages the article, product, or
commodity in full compliance with all applicable State and
Federal laws and regulations; and
``(iii) the act of repackaging does not result in a
prohibited act under section 301 of the Federal Food, Drug,
and Cosmetic Act or violate any other applicable State or
Federal law or regulation.
``(B) As used in this paragraph, the term `shipping
container' means--
``(i) a container or wrapping used for the transportation
of any article, product, or commodity in bulk or in quantity
to manufacturers, packers, or processors, or to wholesale or
retail distributors thereof; and
``(ii) containers or wrappings used by retailers to ship or
deliver any article, product, or commodity to retail
customers, if such containers and wrappings bear no printed
matter pertaining to any particular article, product, or
commodity.
``(e) Criminal Penalties.--Any person who willfully
violates this section shall--
``(1) be fined under this title, imprisoned not more than 1
year, or both;
``(2) if the total retail value of the good or goods
involved in the violation is greater than $5,000, be fined
under this title, imprisoned not more than 5 years, or both;
``(3) if the person acts with reckless disregard for the
risk that the health or safety of the public would be
threatened and under circumstances manifesting extreme
indifference to such risk, and the violation threatens the
health or safety of the public, be fined under this title,
imprisoned not more than 10 years, or both;
``(4) if the person acts with reckless disregard for the
risk that another person will be placed in danger of death or
bodily injury and under circumstances manifesting extreme
indifference to such risk and--
``(A) serious bodily injury to any individual results, be
fined under this title, imprisoned not more than 20 years, or
both; or
``(B) death of an individual results, be fined under this
title, imprisoned for any term of years or for life, or both;
and
``(5) with respect to any second or subsequent violation,
be subject to twice the maximum term of imprisonment that
would otherwise be imposed under this subsection, fined under
this title, or both.
``(f) Injunctions and Impounding, Forfeiture, and
Disposition of Goods.--
``(1) Injunctions and impounding.--In any prosecution under
this section, upon motion of the United States, the court
may--
``(A) grant 1 or more temporary, preliminary, or permanent
injunctions on such terms as the court determines to be
reasonable to prevent or restrain the alleged violation; and
``(B) at any time during the proceedings, order the
impounding, on such terms as the court determines to be
reasonable, of any good that is in the custody or control of
the defendant and that the court has reasonable cause to
believe was involved in the violation.
``(2) Forfeiture and disposition of goods.--Upon conviction
of any person of a violation of this section, the court
shall--
``(A) order the forfeiture of any good involved in the
violation that is in the custody or control of the defendant
or that has been impounded under paragraph (1)(B); and
``(B) either--
``(i) order the destruction of each good forfeited under
subparagraph (A); or
``(ii) if the court determines that any good forfeited
under subparagraph (A) is not unsafe or a hazard to health,
dispose of the good by delivery to such Federal, State, or
local government agencies as, in the opinion of the court,
have a need for such good, or by gift to such charitable or
nonprofit institutions as, in the opinion of the court, have
a need for such good, if such disposition would not otherwise
be in violation of law and if the manufacturer consents to
such disposition and is given the opportunity to reapply a
product identification code to the good.''.
``(g) Civil Remedies.--
``(1) In general.--Any person who is injured by a violation
of this section, or threatened with such injury, may bring a
civil action in an appropriate United States district court
against the alleged violator.
``(2) Injunctions and impounding and disposition of
goods.--In any action under paragraph (1), the court may--
``(A) grant 1 or more temporary, preliminary, or permanent
injunctions on such terms as the court determines to be
reasonable to prevent or restrain the violation;
``(B) at any time while the action is pending, order the
impounding, on such terms as the court determines to be
reasonable, of any good that is in the custody or control of
the alleged violator and that the court has reasonable cause
to believe was involved in the violation; and
``(C) as part of a final judgment or decree--
``(i) order the destruction of any good involved in the
violation that is in the custody or control of the violator
or that has been impounded under subparagraph (B); or
``(ii) if the court determines that any good impounded
under subparagraph (B) is not unsafe or a hazard to health,
dispose of the good by delivery to such Federal, State, or
local government agencies as, in the opinion of the court,
have a need for such good, or by gift to such charitable or
nonprofit institutions as, in the opinion of the court, have
a need for such good, if such disposition would not otherwise
be in violation of law, and if the manufacturer consents to
such disposition and is given the opportunity to reapply a
product identification code to the good.
``(3) Damages.--
``(A) In general.--Subject to subparagraph (B), in any
action under paragraph (1), the plaintiff shall be entitled
to recover the actual damages suffered by the plaintiff as a
result of the violation, and any profits of the violator that
are attributable to the violation and are not taken into
account in computing the actual damages. In establishing the
violator's profits, the plaintiff shall be required to
present proof only of the violator's sales, and the violator
shall be required to prove all elements of cost or deduction
claimed.
``(B) Statutory damages.--In any action under paragraph
(1), the plaintiff may elect, at any time before final
judgment is rendered, to recover, instead of actual damages
and profits described in subparagraph (A), an award of
statutory damages for any violation under this section in an
amount equal to--
``(i) not less than $500 and not more than $100,000, with
respect to each type of goods involved in the violation; and
``(ii) if the violation threatens the health and safety of
the public, as determined by the court, not less than $5,000
and not more than $1,000,000, with respect to each type of
goods involved in the violation.
``(4) Costs and attorney's fees.--In any action under
paragraph (1)--
``(A) in addition to any damages recovered under paragraph
(3), a prevailing plaintiff may recover the full costs of the
action; and
``(B) the court, in its discretion, may also award
reasonable attorney fees to the prevailing party.
``(5) Repeat violations.--
``(A) Treble damages.--In any case in which a person
violates this section within 3 years after the date on which
a final judgment was entered against that person for a
previous violation of this section, the court, in an action
brought under this subsection, may increase the award of
damages for the later violation to not more than 3 times the
amount that would otherwise be awarded under paragraph (3),
as the court considers appropriate.
``(B) Burden of proof.--A plaintiff that seeks damages as
described in subparagraph (A) shall bear the burden of
proving the existence of the earlier violation.
``(6) Limitations on actions.--No civil action may be
commenced under this section later than 3 years after the
date on which the claimant discovers the violation.
``(7) Innocent violations.--In any action under paragraph
(1), the court in its discretion may reduce or remit the
total award of damages in any case in which the violator
sustains the burden of proving, and the court finds, that the
violator was not aware and had no reason to believe that the
acts of the violator constituted a violation.''.
(b) Conforming Amendment.--The table of sections for
chapter 65 of title 18, United States Code, is amended by
inserting after the item relating to section 1365 the
following:
``1365A. Unauthorized modification of product identification codes.''.
SEC. 3. ATTORNEY GENERAL REPORTING REQUIREMENTS.
Section 2320(f) of title 18, United States Code, is
amended--
(1) by inserting ``unauthorized modification of product
identification codes under section 1365A,'' after
``involve''; and
(2) in paragraph (4), by inserting ``1365A,'' after
``sections''.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Virginia (Mr. Goodlatte) and the gentleman from Michigan (Mr. Conyers)
each will control 20 minutes.
The Chair recognizes the gentleman from Virginia (Mr. Goodlatte).
General Leave
Mr. GOODLATTE. Mr. Speaker, I ask unanimous consent that all Members
may have 5 legislative days within
[[Page H9112]]
which to revise and extend their remarks on H.R. 3891, the bill under
consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Virginia?
There was no objection.
Mr. GOODLATTE. Mr. Speaker, I yield myself such time as he may
consume.
Mr. Speaker, I rise today in support of 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.
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 Lockerbee, 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.
{time} 1345
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 be defaced, decoded
or otherwise tampered with. FDA enforcement of current law has been
vigilant and thorough, but this potentially serious problem must be
dealt with even more effectively as counterfeiters and illicit
distributors utilize the advanced technologies of a digital age in
their crimes.
Mr. Speaker, 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 damages in the
event of repeat 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 also includes language offered by my colleague, the gentleman from
Florida (Mr. Wexler) that would allow for repackaging of products for
legitimate resale purposes. The bill also includes language to address
concerns raised by the gentleman from Arkansas, (Mr. Hutchinson), on
behalf of Wal-Mart, to protect those who unknowingly had violated any
portion of the bill.
This legislation is a good approach designed to strengthen the tools
of law enforcement, provide greater security for the manufacturers of
products, and most importantly, provide consumers with improved safety
from tampered with or counterfeit goods.
Mr. Speaker, 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.
Mr. Speaker, I reserve the balance of my time.
Mr. CONYERS. Mr. Speaker, I yield myself 1 minute.
I greet my dear colleagues on the other side, the distinguished
members of the Committee on the Judiciary, with a question or two that
makes this anticounterfeiting act a little bit suspect.
Now, there is nobody in the Congress supporting counterfeiting, but
this legislation and its claim to help consumers by assisting in the
recall of defective merchandise falls on its face, because the problem
is, not only is this information already protected by current law, but
the bill is not limited to products which implicate public health, nor
is it limited to recall information. Instead, it covers any product
sold in the country from books to perfume, and I think it is quite
broad.
Mr. Speaker, I yield such time as he may consume to the gentleman
from New York (Mr. Forbes) who, along with the gentleman from New York
(Mr. Schumer), has worked on this matter.
Mr. FORBES. Mr. Speaker, I thank the gentleman from Michigan for
yielding me this time.
I rise to strongly oppose H.R. 3891 because of its effects on the
retail sector of our economy and on American consumers seeking quality
products at discount prices. This bill, unfortunately, does nothing to
stop counterfeiting of goods. Instead, it stops legal sales by discount
retailers.
If made law, H.R. 3891 will have a substantial negative impact on the
United States economy, preventing millions of dollars in legitimate
sales. Numerous products like cameras, watches and name brand clothing
and electronics presently available at discount prices will disappear,
if this bill becomes law, from discount shelves. Consumer prices will
rise and jobs will be lost among retailers, distributors and importers.
H.R. 3891 purports to eliminate counterfeit goods. I support that
most worthy objective. But I regrettably have to conclude that the bill
does not further that goal. Despite the fact that it is named the
Trademark Anticounterfeiting Act, the legislation does not prohibit or
discourage the manufacture, sale or distribution of counterfeit goods,
nor does it punish the use of phoney product identification codes.
Instead, the bill prohibits the removal of genuine product
identification codes from products. Because the bill deals only with
the removal of genuine manufactured goods, by definition, it could have
little or no effect on stopping or discouraging counterfeit goods.
Mr. Speaker, the true effect of H.R. 3891 will be to limit the
distribution of genuine goods to discount stores. Brand name products
are often sold in what is called the parallel market or the gray
market. Legitimacy of this multibillion dollar market, which
encompasses a wide variety of products such as cameras, clothing,
electronic products, perfume and watches, has been upheld by numerous
Federal courts, including the Supreme Court. Parallel market imports
constitute, at retail, a multibillion dollar industry.
The billions of dollars in savings enjoyed by American consumers
because of the parallel market has been well chronicled. Parallel or
gray market imports are responsible for increasing the buying power of
U.S. consumers over the last decade by preventing foreign manufacturers
from monopolizing the distribution of products to U.S. retailers.
Americans will pay hundreds of millions of dollars more,
unfortunately, each year to foreign manufacturers if this bill becomes
law. Even though the parallel market is completely legal and benefits
in a great way consumers, some product manufacturers believe that the
parallel market is not in their best interests. So if they have these
great lots of unsold products that they want to move in the discount
area, manufacturers, by virtue of enactment
[[Page H9113]]
of this bill, would really have the ability to go after the
manufacturer of these products and in a subtle way either limit their
distribution or certainly limit the consumers' benefit, that being a
reduction in cost.
The ultimate goal of manufacturers is to control the final retail
price of their products. When done explicitly, the practice known as
resale price maintenance has been plainly illegal under antitrust laws
since the beginning of this century. The reason resale price
maintenance is illegal is because we want retail outlets to compete on
price when competition yields the best deal for consumers.
Manufacturers' use of product identification codes as cutoff access
to the parallel market is simply resale price maintenance in disguise,
and while I certainly appreciate the worthy nature, perhaps the goal of
the authors of this legislation, I would suggest that this bill is far
too broad. Proponents claim it will protect consumers by assisting the
recall of defective merchandise; certainly a worthy goal, but if this
is the purpose, the bill could easily be limited to products which
implicate real public health and safety concerns, such as food,
medicine and children's car seats and baby pajamas.
Mr. Speaker, numerous laws are already on the books that regulate the
marketing of products which are of special concern for public safety:
The Federal Food, Drug and Cosmetic Act, the Consumer Product Safety
Act, Federal Meat Inspection Act, the Tariff Act, the Lanham Act, and
the Anticounterfeiting Consumer Protection Act of 1996.
Mr. CONYERS. Mr. Speaker, will the gentleman yield?
Mr. FORBES. I yield to the gentleman from Michigan.
Mr. CONYERS. Mr. Speaker, I want to thank the gentleman for his very
thoughtful introduction into this discussion, pointing out that we are
all against counterfeiting, that there are all kinds of laws which I am
going to point out to my friends on the other side, and suggest a way
that we could remedy this.
Mr. FORBES. Mr. Speaker, I rise to express my strong opposition to
the ``Trademark Anti-counterfeiting Act'' (H.R. 3892) because of its
effects on the retail sector of our economy and on American Consumers
seeking quality products at discount prices.
This bill does nothing to stop counterfeiting of goods. Instead it
stops legal sales by discount retailers.
If made law, the ``Trademark Anti-counterfeiting Act'' will have a
substantial negative impact on the U.S. economy preventing millions of
dollars in legitimate sales. Numerous products like cameras, watches
and name brand clothing and electronics presently available at discount
prices will disappear from discount shelves. Consumer prices will rise
and jobs will be lost among retailers, distributors and importers.
The bill purports to eliminate counterfeit goods. I support this
objective, but the bill does not further that goal.
Despite the fact that it is named the ``Trademark Anti-counterfeiting
Act,'' this legislation does not prohibit or discourage the
manufacture, sale or distribution of counterfeit goods, nor does it
punish the use of phony product identification codes.
Instead, this bill prohibits the removal of genuine product
identification codes from products.
Because the bill deals only with the removal of genuine manufacturer
codes, by definition it can have no effect on stopping or discouraging
counterfeit goods.
The true effect of H.R. 3891 will be to limit the distribution of
genuine goods in discount stores. Brand-name products are often sold in
what is called the ``parallel market'' or the ``gray market.''
The legitimacy of this multi-billion dollar market, which encompasses
a wide variety of products, such as cameras, clothing, electronic
products, perfume and watches, has been upheld by numerous federal
courts, including the U.S. Supreme Court.
In March of this year, the U.S. Supreme Court ruled In Quality King
Distributors, Inc. v. L'anza Research Int'l, Inc. that the ``parallel
market'' is protected under our copyright laws. Similarly, as far back
as 1987, the U.S. Supreme Court rejected an attack on the ``parallel
market'' under our trademark law.
``Parallel Market'' imports constitute at retail a multi-billion
dollar industry. Parallel or ``Gray Market'' imports were responsible
for increasing the buying power of U.S. consumers over the last 10
years, by preventing foreign manufacturers from monopolizing the
distribution of their products to U.S. retailers.
The billions of dollars in savings enjoyed by American consumers
because of the ``parallel market'' have been well chronicled in
nationally recognized trade publications like the Chain Store Age
Executive and the Discount Store News.
Americans will pay hundreds of millions of dollars more each year to
foreign manufacturers if this bill is made law. Even though the
``parallel market'' is completely legal and benefits consumers, some
product manufacturers believe that the parallel market is not in their
interest.
In an effort to keep their products out of discount stores, some
place codes on the products that enable them to trace the chain of
distribution of a particular item and then retaliate against
distributors that sell goods into the ``parallel market.''
The ultimate goal of these manufacturers is to control the final
retail price of their products. When done explicitly, this practice,
known as ``resale price maintenance,'' has been plainly illegal under
antitrust laws since 1908. The reason resale price maintenance is
illegal is because we want retail outlets to compete on price--that
competition yields the best deals for customers.
Manufacturers' use of product identification codes to cut off access
to the parallel market is simply resale price maintenance in disguise.
We should not change Federal law to assist manufacturers in this
anticonsumer practice, yet that would be the effect of H.R. 3891.
I am also very concerned that the ``Trademark Anti-competitiveness
Act'' is far too broad. Proponents claim it will protect consumers by
assisting recall of defective merchandise. If this is the purpose, the
bill can easily be limited to products which implicate real public
health and safety concerns, such as food, medicine and children's car
seats and baby pajamas.
Instead this bill covers any product sold in the U.S., no matter how
benign, including such harmless items as books, clothing and furniture.
There is no reason for including these everyday, innocuous products
within the scope of the bill.
In addition, the bill addresses a problem that is already addressed
by other, more comprehensive statutes.
Numerous laws already regulate the marking of products which are of
special concern for public safety. Some of these laws include: the
Federal Food, Drug & Cosmetic Act; the Consumer Product Safety Act; the
Federal Meat Inspection Act; the Tariff Act of 1930; the Lanham Act;
and the Anti-counterfeiting Consumer Protection Act of 1996 that
applies Racketeer Influenced and Corrupt Organizations Act (RICO)
penalties to counterfeiters.
Finally, this bill would have disastrous impacts on interstate
commerce and on our legal system. It renders billions of dollars worth
of merchandise illegal overnight.
The legislation criminalizes the act of decoding products and
mandates the seizure and destruction of these decoded products. The
avalanche of litigation that would follow between manufacturers and
resellers and between retailers and their suppliers would be enormous.
If the bill is meant to avoid counterfeiting, then it should not
apply to genuine products. If the bill seeks to address the issue of
consumer protection in recalls, then it should do so without granting a
limited group of product manufacturers broad anti-competitive powers.
Many parties that will be affected by H.R. 3891 have not had their
concerns heard by this House. If made law, this bill will result in
serious unforeseen hardships to consumers and businesses alike. I
strongly urge that this bill be amended to avoid these negative
consequences.
I urge my colleagues to vote against this bill, and I reserve the
balance of my time.
Mr. CONYERS. Mr. Speaker, I reserve the balance of my time.
Mr. GOODLATTE. Mr. Speaker, I yield such time as he may consume to
the gentleman from North Carolina (Mr. Coble), the chairman of the
Subcommittee on Intellectual Property.
Mr. COBLE. Mr. Speaker, I thank the gentleman from Virginia and
commend him for the diligent hard work that he has put forward on this
bill, and I urge my colleagues to support it.
Mr. Speaker, H.R. 3891 safeguards the ability of manufacturers to
control the use of their products with which valuable marks are
associated by protecting the integrity of corresponding ``product
identification codes'' contained in product packaging. These codes, Mr.
Speaker, comprised of numbers, letters, symbols, or expiration markings
affixed to goods, enable manufacturers, it seems to me, to trace
products back to a particular production lot, batch, or date of
removal. In my opinion, this bill will further legitimate commercial
interests, maintain the value of trademarks affiliated with goods, and
promote public health and safety.
[[Page H9114]]
Finally I should note, and I am not sure this has been mentioned yet,
that H.R. 3891 contains an ``innocent infringer'' exception to the bill
adopted during subcommittee markup, and other changes which the
gentleman from Virginia (Mr. Goodlatte) has authored to preserve the
ability of distributors to engage in lawful diversion of products.
These additions to the bill, it seems to me, will ensure that public
health and safety will be advanced on the one hand, but not on the
other hand, at the expense of lawful commercial practices.
Mr. Speaker, I again thank the gentleman from Virginia for his work
in bringing the bill to the floor, and I urge its adoption today.
Mr. CONYERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, this discussion on the floor is tracking the same
discussion that we had in the Committee on the Judiciary, and so
perhaps we are so absorbed with the presidential scandal that maybe the
members on the committee just cannot focus on this subject.
What is the matter, I say to my colleagues? We already told my
colleagues that there are six Federal food, drug and cosmetic laws
already on the books regulating for public inspection, plus the Federal
Meat Inspection Act, the Tariff Act of 1930, the Lanham Act,
Anticounterfeiting Consumer Protection Act of 1996, and the Consumer
Product Safety Act.
My colleagues get on the floor, and I do not want to say they are
taking advantage of the lack of knowledge of the rest of the Members of
the House, but my colleagues know that there are dozens of bills
fighting counterfeiting and that the real problem, I say to my
colleague from Virginia (Mr. Goodlatte), is that they are not being
properly enforced; and that if the gentleman would have tailored his
bill in a reasonable way to limit recall information, to protect the
bar code issue, but just to open it up, I am going to have to say
something here as politely as I am able to.
What the gentleman is doing is attacking the parallel market. The
gentleman is going after the wholesalers, and wait until the citizens
find out about this. What the gentleman is saying is that all the
companies that sell below the wholesale houses, the pharmaceuticals,
the TJ Maxxes, the RiteAids, all of them are going to be wiped out by a
very cute way that the gentleman is handling this, because I think
there is a motive here.
If the gentleman was really after counterfeiting, the gentleman would
tailor it so that we can all get it.
{time} 1400
What the gentleman from Virginia (Mr. Goodlatte) is doing is
protecting the high end retailers in America. I think we went through
this in the Committee on the Judiciary. Why does the gentleman not come
clean and say it?
They deserve congressional representation, but to mask it into an
anti-counterfeiting act, where we pick up designer jeans, cameras,
perfumes, and all of these items that are sold in cut rate and
wholesale situations, the gentleman knows that that is what the goal of
this is. So why do we not just call it for what it is?
I am protecting the people in America that want to go to the malls
and get a good deal. I am protecting the people that want to buy at
discounted prices. What the gentleman is doing is putting the parallel
market out of business. Why does the gentleman not come clean and admit
it, or concede it, or maybe we will stipulate it? But do not talk about
this as an anticrime issue. It is simply not that.
Mr. Speaker, I reserve the balance of my time.
Mr. GOODLATTE. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, I certainly hope that the gentleman from Michigan (Mr.
Conyers) is not attempting to protect those folks who are violating the
law and attempting to defraud consumers in this country.
Let me just point out who it is that supports this bill. The
gentleman says we are attacking the gray market, but the National
Association of Mass Retailers does not oppose this bill. It is
supported by the United States Chamber of Commerce. It is supported by
the AFL-CIO. It is supported by the National Association of
Manufacturers, and it is supported by the National Consumers League.
We are protecting consumers here, and we are not doing anything to
affect those people who legitimately sell in the parallel market. I
hope they continue to do so. That is certainly not what we are trying
to affect here.
We are trying to help law enforcement be able to trace product codes.
It would be a shame if the batteries sold to the perpetrator of the
Atlanta bombings were tampered with by somebody because it was not
against the law to tamper with the identification code, and the FBI was
not able to trace, as they were in that case, those products back to
where they were sold to help identify the perpetrators.
The same thing with the bombing over Lockerbie, Scotland. We do not
know what kind of product may be used in a law enforcement
investigation. It might be something related to a product that is for
health and safety, but it might not be.
If Members were to, for example, exempt clothing from this, there are
all kinds of product defects that take place with clothing. They can
catch on fire, and people need to have the ability to be contacted and
notified that there is a problem.
Limiting it to health and safety does not take into consideration
products like baby toys, batteries. Where do we draw the line?
Predatory pricing can be addressed through current antitrust laws.
Those laws exist on the books. There are not laws on the books today
prohibiting fraud from taking place when somebody tampers with or
removes a code. That is why we make this distinction.
In response to retail concerns, we have added language making the
bill only applicable to those who knowingly perform one of the
prohibited acts, so I cannot imagine why there would be any effort to
protect those people who knowingly want to perpetrate a fraud like
this. That is why we have the support of groups like the National
Consumers League.
The bill also includes additional protections in the bill for
innocent infringers. We are not targeting those folks. The current law
does not adequately address the problem of product code tampering. That
is what we are addressing in this bill. We are not addressing the
parallel market.
Those who were concerned about that entered into detailed
negotiations with us with other members of the committee. I am sorry
that the gentleman did not choose to participate in those negotiations,
but we worked with several members of the committee on both sides of
the aisle to make changes to address those concerns. Those concerns
have been addressed.
We are simply going after the bad guys, I would say to the gentleman
from Michigan. I would hope that he would change his mind about the
importance of this bill, both from the standpoint of protecting
consumers, and from the standpoint of helping law enforcement address a
serious problem.
Mr. Speaker, I reserve the balance of my time.
Mr. CONYERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, does the gentleman know what I am going to do? I am
going to see that the gentleman does not get two-thirds on the vote
today, that is what I am going to do for this bill, because the
gentleman is misrepresenting the fact that there is no protection
against trademark counterfeiting. May I refer the gentleman to the law?
The gentleman has been on the committee some number of years now.
The Federal Food, Drug, and Cosmetic Act, 21 United States Code,
annotated Section 301. Section 331 deals with adulteration and
misbranding. How can the gentleman say there is nothing protecting us
against counterfeiting? Section 333 provides for seizure of adulterated
drugs or cosmetics. Has the gentleman ever heard of the law? Section
342 addresses false or misleading labels. Section 350-A regulates
infant formula.
The gentleman did not come to the floor not knowing this. The
gentleman knew this, because the gentleman from New York (Mr. Schumer)
took 30 minutes explaining it, and the gentleman said we would work it
out. We have not worked anything out. That is why I am opposed to it.
By the way, since the Chamber of Commerce supports this, the discount
[[Page H9115]]
drugstores do not support it, the Price Club does not support it, Rite
Aid does not support it. The discounters and the parallel market are
going to get wiped out, and the gentleman knows it. The gentleman knows
it.
We have got all of these counterfeiting laws. Sections 351 and 352
govern adulterated or misbranded drugs or devices. Section 361 and 362
addresses cosmetics that are adulterated or misbranded. We have a
Federal Meat Inspection Act, a Tariff Act, an anti-counterfeiting
Consumer Protection Act of 1996. The gentleman was in on it. The
gentleman helped pass it.
Now the gentleman is coming here arguing that this is for the benefit
of the good guys, and the gentleman does not want me helping the bad
guys. I want to suggest to the gentleman that it may be just the
opposite.
Mr. Speaker, I reserve the balance of my time.
Mr. GOODLATTE. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, I would say to the gentleman from Michigan (Mr. Conyers)
that the legislation that he cited, some of which I authored and he
supported, does not address issues where the law is intended to apply
for reasons other than harm to the consumer. So if it is a matter of
law enforcement, tracing the location of a product, it does not apply.
This legislation makes it clear that we cannot tamper with a product
code because doing so is perpetrating a fraud, for one reason or
another. But secondly, keeping that code on the product helps us to
give law enforcement the tools they need to track down criminals.
In many, many cases criminals use products in the commission of a
crime. When we can trace those products back to what store they were
purchased from, where they were distributed from, we have a much
greater chance of narrowing the field of suspects and tracking down who
it was who actually purchased that product.
For that reason, and the others that I have already cited, the bill
has strong support from a wide array of groups, from labor unions to
retailers to manufacturers to law enforcement to consumers, and ought
to deserve the same kind of broad-based bipartisan support here on the
floor of the House of Representatives.
We did conduct further discussions with the gentleman from New York
(Mr. Schumer) and others in the committee following the markup in the
committee, and we reached agreement with a number of folks about
changes which were made and incorporated into the legislation. Did we
make everybody happy? No, because there are some folks out there who
want to take labels off of products or change the labels in order to
mislead folks about what is going on. That is simply what this
legislation is directed at attacking.
Mr. Speaker, I would ask the gentleman to reconsider his opposition
to the bill. I would love to have his support for the bill, but I think
he is on the wrong side of what is in the best interests of consumers,
law enforcement, manufacturers, retailers, all across the board.
Mr. Speaker, I would again reserve the balance of my time, and urge
the Members to support this legislation.
Mr. CONYERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, let me say to my good friend, the gentleman from
Virginia, I have never been, nor my staff, invited to participate in
one single negotiation. If the gentleman from New York (Mr. Schumer)
has, that would be almost unbelievable. I know he has not, either. Does
the gentleman say he has?
Mr. GOODLATTE. Mr. Speaker, will the gentleman yield?
Mr. CONYERS. No, not at this point.
Mr. GOODLATTE. The gentleman asked the question. I will be happy to
answer it.
Mr. CONYERS. Does the gentleman remember what he told me earlier,
that he has time that he can yield to himself?
Mr. Speaker, the point that I am making is that I have never been in
any negotiations. I voted against this measure. It is a funny thing
about this big rush on the bill, and there was not much notice about
this bill. It came up at the last minute with no notice. There has been
no opportunity to amend the bill, I say to the gentleman from Virginia
(Mr. Goodlatte). Why not? Because the gentleman does not think he needs
to, because he can get two-thirds. I have news for the gentleman.
The fact of the matter is that this bill will allow all kinds of
manufacturers to terminate distributors who sell their goods at a deep
discount. We know that is what is behind it. And citing the Chamber of
Commerce and my friends in labor, and by the way, I would love to
compare my labor record with the gentleman's some day off the floor, we
have groups of consumers, working people, discount organizations, that
do not think we need a bill with this latitude.
We have been through this, so the gentleman is going to railroad it
through on a suspension: perfume, cameras, designer jeans, jewelry,
watches, shirts. I ask the gentleman to tell me, why do those items
need to be covered?
Mr. GOODLATTE. Mr. Speaker, will the gentleman yield?
Mr. CONYERS. I yield to the gentleman from Virginia.
Mr. GOODLATTE. Mr. Speaker, I thank the gentleman for yielding. The
reason why items need to be covered is----
Mr. CONYERS. These items.
Mr. GOODLATTE. Any item is potentially left at the scene of a crime.
Any item could be left at the scene of a crime and could be traced to
determine who it was that committed the crime.
Mr. CONYERS. Reclaiming my time, now the gentleman has said something
that the gentleman never said in the committee, and certainly it goes
against any negotiations with whomever the gentleman entered into them
with.
If the gentleman is now telling me we should cover all items in the
market, then I guess, if I can quote the gentleman on that in my
handout, I think that will take care of it for today. The gentleman
thinks everything should be covered; not just these items not covered,
but all items should be covered, everything in commerce? If that is the
gentleman's position, that just reinforces my opposition to it.
Mr. Speaker, I reserve the balance of my time.
Mr. GOODLATTE. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, let me first say to the gentleman from Michigan, nothing
is being railroaded. As the gentleman has quite accurately pointed out,
for something to pass on suspension, it requires a two-thirds vote. If
it were brought up under a rule it would only take a majority vote, so
we are not trying to put anything over on anybody.
Frankly, it surprised me that the gentleman came down here to oppose
it. We had no idea that the gentleman was opposed to the legislation at
this point. The gentleman never indicated any reservations about the
bill. If he had done so, we would have wanted to include him in any
negotiations that we had, because we were working very diligently to
pull together the support necessary to pass this important legislation.
But the gentleman is entirely inaccurate when he says there is no
opportunity for amendment. The bill itself at the desk is a manager's
amendment taken from suggestions made by those who had concerns in the
Committee on the Judiciary meeting, and we did not reach agreement with
everybody. It is hard to reach agreement with everybody. But we reached
agreement with some of those who raised reservations, and we changed
the bill accordingly.
Mr. Speaker, I am sorry that the gentleman has the opposition. I
would love to have sat down with him ahead of time and attempted to
work those matters out, if it were possible. But I was never notified
that the gentleman was going to oppose the legislation. I do not
believe the basis on which the gentleman is opposing it is appropriate.
It is simply not the case that this is going to damage the parallel
markets or the so-called gray markets.
{time} 1415
We have addressed concerns raised by a number of folks to make sure
that that in fact would not be the case.
Mr. Speaker, I reserve the balance of my time.
Mr. CONYERS. Mr. Speaker, how much time remains?
The SPEAKER pro tempore (Mr. Sununu). The gentleman from Michigan
(Mr. Conyers) has 3\1/2\ minutes remaining. The gentleman from Virginia
[[Page H9116]]
(Mr. Goodlatte) has 5\1/2\ minutes remaining.
Mr. CONYERS. Mr. Speaker, could we even up the time a little bit.
Mr. GOODLATTE. Mr. Speaker, I yield 30 seconds to the gentleman from
Michigan (Mr. Conyers) since he was kind enough to yield to me a little
while ago.
Mr. CONYERS. Mr. Speaker, I would like to introduce myself to the
gentleman from Virginia (Mr. Goodlatte). I am the ranking member of the
committee. I had no notice that the bill was being brought up. The
information was delivered through the minority leadership of the House.
So to tell me that I should have been following my colleague all
along is a little bit odd. What we are trying to say here is that we
never had a chance to amend the bill. And to tell me that there is a
manager's amendment at the desk that I never participated in now shows
that the bill was amended without me is not insulting, but it almost
suggests that I don't understand the process.
The SPEAKER pro tempore. The time of the gentleman from Michigan (Mr.
Conyers) has expired.
Mr. CONYERS. Mr. Speaker, I yield myself 2 additional minutes.
The problem is this, why do we need the gentleman from Virginia (Mr.
Goodlatte) to apply anticounterfeiting provisions to general items like
jeans and perfume? Could the gentleman tell me what health problems he
has discovered that makes them to be included. It is not a crime to
sell these goods in the parallel market. The gentleman knows the case
law on this as well as I.
Mr. Speaker, I yield to the gentleman from Virginia (Mr. Goodlatte).
Mr. GOODLATTE. Mr. Speaker, in the case of perfume, it is easy to
have a product that the code can be tampered with and put in a product
that came in the original bottle that has been tampered with,
adulterated, could cause harm when applied to the skin. With regard to
blue jeans, they might be flammable. They might be in a suitcase in an
airplane that is blown up in the sky and could help to identify where
it came from.
Mr. CONYERS. Mr. Speaker, reclaiming my time, we had hearings, and
there were no cases like these hypotheticals cited. So what is the
gentleman doing? I mean, is this reality legislation or what? Can the
gentleman tell me the jeans and perfume, one might be adulterated and
the other might be flammable? I have the transcript of the hearings,
and there is nothing in them about that. Now, maybe yes; but in
reality, no.
So I think there is an economic motivation that is not going to be
good for the parallel market. Is the gentleman's constituents not like
mine? They like to go and shop for discounts sometimes. What is the
gentleman telling them?
Mr. GOODLATTE. Mr. Speaker, will the gentleman yield?
Mr. CONYERS. I yield to the gentleman from Virginia.
Mr. GOODLATTE. Mr. Speaker, I like to shop for discounts myself.
Mr. CONYERS. Then why is the gentleman doing this to the parallel
market?
Mr. Speaker, I reserve the balance of my time.
Mr. GOODLATTE. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, I would just say to the gentleman that it is impossible
to define what products might be used by law enforcement at some point
in time to trace a product code.
Mr. FORBES. Mr. Speaker, will the gentleman yield?
Mr. GOODLATTE. I yield to the gentleman from New York.
Mr. FORBES. Mr. Speaker, is my good friend the gentleman from
Virginia (Mr. Goodlatte) making a case that everything that is sold in
the United States should have a product code so we can trace all goods?
Mr. GOODLATTE. Reclaiming my time, no, I am only making a case that
if a code is put on the product by the manufacturer, the Congress, the
people should not be questioning the reason for doing that by allowing
the removal of that code for various reasons, one of which is tracing
products that may have been adulterated and need to be recalled, may
have defects and need to be recalled, products that may be used by law
enforcement, may be discovered at the scene of the crime and can trace
a crime.
There is no compelling argument why somebody should be able to pull
the code off the product and continue to sell the product without
having that kind of consumer protection. That is why the National
Consumer League supports the bill.
Mr. FORBES. Mr. Speaker, will the gentleman yield?
Mr. GOODLATTE. I yield further to the gentleman from New York.
Mr. FORBES. Mr. Speaker, would the gentleman not agree that there is
an attempt by some manufacturers when they are tracing products at
discount houses and they see those same products are in competition
with their own sales that they cut off distribution to those discount
houses?
Mr. GOODLATTE. Mr. Speaker, reclaiming my time, that is against the
law, and we have antitrust laws that prohibit that very activity that
the gentleman has just described. And when that occurs, I have seen
many instances where cases are brought for that kind of discriminatory
treatment in the marketplace, and those laws should be enforced.
But it certainly should not interfere with a manufacturer's
legitimate need and law enforcement's legitimate need to have those
product codes not tampered with, falsified on the product. I think that
is outrageous.
Mr. FORBES. Mr. Speaker, will the gentleman further yield?
Mr. GOODLATTE. I yield further to the gentleman from New York.
Mr. FORBES. Mr. Speaker, is the gentleman aware that there are
representatives of various manufacturers that do go into these discount
houses and they look at these product lines and they look at the
labeling and they have taken, in the past, action against some of these
folks that are working in the parallel market?
Mr. GOODLATTE. Mr. Speaker, reclaiming my time, if they do so, then
they should be prosecuted under the laws that already exist on the
books if they are doing so in the discriminatory manner that the
gentleman describes.
Mr. Speaker, I reserve the balance of my time, and I inquire how much
time is remaining.
The SPEAKER pro tempore. The gentleman from Virginia (Mr. Goodlatte)
has 2 minutes remaining. The gentleman from Michigan (Mr. Conyers) has
90 seconds remaining.
Mr. CONYERS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I am in a state of exhaustion now. The rational
processes have taken flight in this discussion. We get no notice. We
found out about it this morning. The bill is too broad. That was
complained of in the committee.
The gentleman has introduced a manager's amendment and said, well, we
amended the bill. We gave our colleagues a unilateral manager's
amendment. Are they not happy?
This bill would make it easier for manufacturers to terminate
discounters. That is the economic question underneath it. Let us not
fool ourselves. There is no question this bill would lead to less
discounting. I hope the gentleman's constituents would be happy to find
that out in the event that this bill becomes law.
Let us send the bill back to committee so that we can get a narrow
bill that will really be good for the consumers.
Mr. Speaker, I yield such time as he may consume to the distinguished
gentleman from New York (Mr. Forbes) for any closing comments if he has
any.
Mr. FORBES. Mr. Speaker, I thank the gentleman from Michigan, and I
would just urge my colleagues to oppose this measure. If our attempt is
to be able to trace consumer products, then let us call it what it is
and let us get a bill on the floor that labels every product ever sold
in the United States of America. Unfortunately, I think this is a back-
door attempt to really raise the price of consumer goods, to thwart the
discount market, and to make it tougher on consumers.
I am sorry for that. I would urge my colleagues to please reject this
bill.
Mr. GOODLATTE. Mr. Speaker, I yield myself the balance of my time to
close.
Mr. Speaker, let me just say, in response to the gentleman from New
York (Mr. Forbes), that if his statement were accurate, then
organizations like the National Association of
[[Page H9117]]
Mass Retailers and the National Consumers League would oppose this
legislation, and they do not.
The reason they do not is that they share the concerns that many have
about product safety. They share the concerns that many have about law
enforcement and they share the concerns that many have about what
motivations somebody has for pulling off the product identification
code from a product and then wanting to resale it.
What are they hiding from? I would suggest to my colleagues that they
are hiding from the fact that there are criminal activities that take
place by those who adulterate products, who change products, and they
should not be allowed to do that by altering or removing these codes.
That is what this legislation clearly addresses.
It is clearly needed because all the laws cited by the gentleman from
Michigan (Mr. Conyers), which are very good laws, some of which I
introduced myself, do not cover the specific facts and the specific
instances of removing and tampering with labels that are addressed in
this bill, and that is why the legislation is supported by the AFL-CIO.
I am pleased to have their support for this legislation. It is not
often that they come together and agree with manufacturers, and the
United States Chamber of Commerce and consumers, but when we have that
kind of collection of support, and the needs of law enforcement, we
ought to take advantage of the opportunity to pass a very good bill and
ignore the concerns of a very narrow, limited group of people who are
not just in the gray market, which we support, but which are involved
in criminal activity in the gray market, which we do not support and
which this bill attacks. I urge my colleagues to support this
legislation.
Mr. SCHUMER. Mr. Speaker, I rise in strong opposition to H.R. 3891,
the Trademark Anticounterfeiting Act. In my view, this legislation
would be devastating to consumers seeking quality products at discount
prices.
H.R. 3891 will have a substantial negative impact on the U.S.
economy. It will preclude millions of dollars in legitimate sales.
Numerous products presently available at discount prices will disappear
from discount shelves. Consumer prices will rise and jobs will be lost
among retailers, distributors, and importers.
Furthermore, H.R. 3891 will place additional burdens on law
enforcement and on the courts. This legislation, however, provides no
funding for these additional enforcement responsibilities.
The Trademark Anticounterfeiting Act, H.R. 3891, is intended to
eliminate counterfeit goods from the marketplace. I support this goal;
however, we find nothing in this bill to further this goal. This
legislation does not prohibit or discourage the manufacture, sale, or
distribution of counterfeit goods.
The real goal of this bill is to stop the legitimate practice known
as the ``parallel market'' or ``gray market.'' This is a perfectly
legal market where middle men buy overstock from high end retail
stores, and resell the goods to discount retailers. The high end
manufacturers of these products have decided that too many consumers
are buying their goods at discount stores and want to use this bill to
cut off the middle men who supply discount stores.
In an effort to keep their products out of discount stores, some
manufacturers place codes on the products. These codes are used to
trace the product through its chain of distribution for ammunition
against the distributors that sell their goods in the parallel market.
The goal of these manufacturers is to control the final retail price of
their products. When done explicitly, ``resale price maintenance'' has
been plainly illegal under antitrust laws since 1908. The manufacturers
use of product identification codes to cut off access to parallel
markets is simply resale price maintenance in disguise.
The proponents of this bill have claimed that it will protect
consumers by assisting in the recall of defective merchandise. If this
is the purpose, the bill can easily be limited to products which
implicate real public health and safety concerns, such as food,
medicine, and products for children (like car seats and baby pajamas).
Alternatively, parallel market resellers could be given some of the
responsibility for enabling recalls.
But instead of these sensible, targeted approaches, the bill as
written is astonishingly sweeping. It covers any product sold in the
U.S.--from books to clothing to furniture. No reason whatever has been
articulated for including these everyday, non-threatening products
within the scope of the bill.
As a result of the broadly defined ``product identification code'',
resellers will have no way to determine upon looking at a product which
codes or markings constitute a product identification code. The
language of H.R. 3891 is far too vague and it needs to be refined.
In addition, the bill addresses a problem that is already addressed
by other, more comprehensive statutes. Numerous laws already regulate
the marking of products which are of special concern for public safety.
Finally, H.R. 3891 would impose broad new burdens on law enforcement
and the judiciary. By failing to provide a transition period, this law
would render billions of dollars worth of merchandise illegal
overnight. The avalanche of litigation that is likely to follow between
manufacturers and resellers and between retailers and their suppliers
is likely to be enormous due to the broad impact of this bill on the
U.S. marketplace.
Further, this legislation criminalizes the act of decoding products
and mandates the seizure and destruction of these decoded products.
Presumably, the burden of investigating and prosecuting such acts will
fall to our law enforcement agencies. No funding has been allocated to
defray the extra burden on these agencies or to employ additional
personnel.
Once again, I strongly oppose this bill. If this bill is meant to
avoid counterfeiting, then it should not apply to genuine products. If
this bill seeks to address the issue of consumer protection in recalls,
then it should do so without granting a limited group of product
manufacturers broad anti-competitive powers.
Mr. Speaker, I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Virginia (Mr. Goodlatte) that the House suspend the
rules and pass the bill, H.R. 3891, as amended.
The question was taken.
Mr. FORBES. Mr. Speaker, I object to the vote on the ground that a
quorum is not present and make the point of order that a quorum is not
present.
The SPEAKER pro tempore. Pursuant to clause 5, rule I, and the
Chair's prior announcement, further proceedings on this motion will be
postponed.
The point of no quorum is considered withdrawn.
____________________