[Congressional Record (Bound Edition), Volume 150 (2004), Part 14]
[House]
[Pages 18796-18799]
[From the U.S. Government Publishing Office, www.gpo.gov]




   INTELLECTUAL PROPERTY PROTECTION AND COURTS AMENDMENTS ACT OF 2004

  Mr. SENSENBRENNER. Mr. Speaker, I move to suspend the rules and pass 
the bill (H.R. 3632) to prevent and punish counterfeiting of 
copyrighted copies and phonorecords, and for other purposes, as 
amended.
  The Clerk read as follows:

                               H.R. 3632

       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 ``Intellectual Property 
     Protection and Courts Amendments Act of 2004''.

                TITLE I--ANTI-COUNTERFEITING PROVISIONS

     SEC. 101. SHORT TITLE.

       This title may be cited as the ``Anti-counterfeiting 
     Amendments Act of 2004''.

     SEC. 102. PROHIBITION AGAINST TRAFFICKING IN COUNTERFEIT 
                   COMPONENTS.

       (a) In General.--Section 2318 of title 18, United States 
     Code, is amended--
       (1) by striking the section heading and inserting the 
     following:

     ``Sec. 2318. Trafficking in counterfeit labels, illicit 
       labels, or counterfeit documentation or packaging'';

       (2) by striking subsection (a) and inserting the following:
       ``(a) Whoever, in any of the circumstances described in 
     subsection (c), knowingly traffics in--
       ``(1) a counterfeit label or illicit label affixed to, 
     enclosing, or accompanying, or designed to be affixed to, 
     enclose, or accompany--
       ``(A) a phonorecord;
       ``(B) a copy of a computer program;
       ``(C) a copy of a motion picture or other audiovisual work;
       ``(D) a copy of a literary work;
       ``(E) a copy of a pictorial, graphic, or sculptural work;
       ``(F) a work of visual art; or
       ``(G) documentation or packaging; or
       ``(2) counterfeit documentation or packaging,

     shall be fined under this title or imprisoned for not more 
     than 5 years, or both.'';
       (3) in subsection (b)--
       (A) in paragraph (2), by striking ``and'' after the 
     semicolon;
       (B) in paragraph (3)--
       (i) by striking ``and `audiovisual work' have'' and 
     inserting the following: ```audiovisual work', `literary 
     work', `pictorial, graphic, or sculptural work', `sound 
     recording', `work of visual art', and `copyright owner' 
     have''; and
       (ii) by striking the period at the end and inserting a 
     semicolon; and
       (C) by adding at the end the following:
       ``(4) the term `illicit label' means a genuine certificate, 
     licensing document, registration card, or similar labeling 
     component--
       ``(A) that is used by the copyright owner to verify that a 
     phonorecord, a copy of a computer program, a copy of a motion 
     picture or other audiovisual work, a copy of a literary work, 
     a copy of a pictorial, graphic, or sculptural work, a work of 
     visual art, or documentation or packaging is not counterfeit 
     or infringing of any copyright; and
       ``(B) that is, without the authorization of the copyright 
     owner--
       ``(i) distributed or intended for distribution not in 
     connection with the copy, phonorecord, or work of visual art 
     to which such labeling component was intended to be affixed 
     by the respective copyright owner; or
       ``(ii) in connection with a genuine certificate or 
     licensing document, knowingly falsified in order to designate 
     a higher number of licensed users or copies than authorized 
     by the copyright owner, unless that certificate or document 
     is used by the copyright

[[Page 18797]]

     owner solely for the purpose of monitoring or tracking the 
     copyright owner's distribution channel and not for the 
     purpose of verifying that a copy or phonorecord is 
     noninfringing;
       ``(5) the term `documentation or packaging' means 
     documentation or packaging, in physical form, for a 
     phonorecord, copy of a computer program, copy of a motion 
     picture or other audiovisual work, copy of a literary work, 
     copy of a pictorial, graphic, or sculptural work, or work of 
     visual art; and
       ``(6) the term `counterfeit documentation or packaging' 
     means documentation or packaging that appears to be genuine, 
     but is not.'';
       (4) in subsection (c)--
       (A) by striking paragraph (3) and inserting the following:
       ``(3) the counterfeit label or illicit label is affixed to, 
     encloses, or accompanies, or is designed to be affixed to, 
     enclose, or accompany--
       ``(A) a phonorecord of a copyrighted sound recording or 
     copyrighted musical work;
       ``(B) a copy of a copyrighted computer program;
       ``(C) a copy of a copyrighted motion picture or other 
     audiovisual work;
       ``(D) a copy of a literary work;
       ``(E) a copy of a pictorial, graphic, or sculptural work;
       ``(F) a work of visual art; or
       ``(G) copyrighted documentation or packaging; or''; and
       (B) in paragraph (4), by striking ``for a computer 
     program''; and
       (5) in subsection (d)--
       (A) by inserting ``or illicit labels'' after ``counterfeit 
     labels'' each place it appears; and
       (B) by inserting before the period at the end the 
     following: ``, and of any equipment, device, or material used 
     to manufacture, reproduce, or assemble the counterfeit labels 
     or illicit labels''.
       (b) Civil Remedies.--Section 2318 of title 18, United 
     States Code, is further amended by adding at the end the 
     following:
       ``(f) Civil Remedies.--
       ``(1) In general.--Any copyright owner who is injured, or 
     is threatened with injury, by a violation of subsection (a) 
     may bring a civil action in an appropriate United States 
     district court.
       ``(2) Discretion of court.--In any action brought under 
     paragraph (1), the court--
       ``(A) may grant 1 or more temporary or permanent 
     injunctions on such terms as the court determines to be 
     reasonable to prevent or restrain a violation of subsection 
     (a);
       ``(B) at any time while the action is pending, may order 
     the impounding, on such terms as the court determines to be 
     reasonable, of any article that is in the custody or control 
     of the alleged violator and that the court has reasonable 
     cause to believe was involved in a violation of subsection 
     (a); and
       ``(C) may award to the injured party--
       ``(i) reasonable attorney fees and costs; and
       ``(ii)(I) actual damages and any additional profits of the 
     violator, as provided in paragraph (3); or
       ``(II) statutory damages, as provided in paragraph (4).
       ``(3) Actual damages and profits.--
       ``(A) In general.--The injured party is entitled to 
     recover--
       ``(i) the actual damages suffered by the injured party as a 
     result of a violation of subsection (a), as provided in 
     subparagraph (B) of this paragraph; and
       ``(ii) any profits of the violator that are attributable to 
     a violation of subsection (a) and are not taken into account 
     in computing the actual damages.
       ``(B) Calculation of damages.--The court shall calculate 
     actual damages by multiplying--
       ``(i) the value of the phonorecords, copies, or works of 
     visual art which are, or are intended to be, affixed with, 
     enclosed in, or accompanied by any counterfeit labels, 
     illicit labels, or counterfeit documentation or packaging, by
       ``(ii) the number of phonorecords, copies, or works of 
     visual art which are, or are intended to be, affixed with, 
     enclosed in, or accompanied by any counterfeit labels, 
     illicit labels, or counterfeit documentation or packaging.
       ``(C) Definition.--For purposes of this paragraph, the 
     `value' of a phonorecord, copy, or work of visual art is--
       ``(i) in the case of a copyrighted sound recording or 
     copyrighted musical work, the retail value of an authorized 
     phonorecord of that sound recording or musical work;
       ``(ii) in the case of a copyrighted computer program, the 
     retail value of an authorized copy of that computer program;
       ``(iii) in the case of a copyrighted motion picture or 
     other audiovisual work, the retail value of an authorized 
     copy of that motion picture or audiovisual work;
       ``(iv) in the case of a copyrighted literary work, the 
     retail value of an authorized copy of that literary work;
       ``(v) in the case of a pictorial, graphic, or sculptural 
     work, the retail value of an authorized copy of that work; 
     and
       ``(vi) in the case of a work of visual art, the retail 
     value of that work.
       ``(4) Statutory damages.--The injured party may elect, at 
     any time before final judgment is rendered, to recover, 
     instead of actual damages and profits, an award of statutory 
     damages for each violation of subsection (a) in a sum of not 
     less than $2,500 or more than $25,000, as the court considers 
     appropriate.
       ``(5) Subsequent violation.--The court may increase an 
     award of damages under this subsection by 3 times the amount 
     that would otherwise be awarded, as the court considers 
     appropriate, if the court finds that a person has 
     subsequently violated subsection (a) within 3 years after a 
     final judgment was entered against that person for a 
     violation of that subsection.
       ``(6) Limitation on actions.--A civil action may not be 
     commenced under section unless it is commenced within 3 years 
     after the date on which the claimant discovers the violation 
     of subsection (a).''.
       (c) Conforming Amendment.--The item relating to section 
     2318 in the table of sections for chapter 113 of title 18, 
     United States Code, is amended to read as follows:

``2318. Trafficking in counterfeit labels, illicit labels, or 
              counterfeit documentation or packaging.''.

     SEC. 103. OTHER RIGHTS NOT AFFECTED.

       (a) Chapters 5 and 12 of Title 17; Electronic 
     Transmissions.--The amendments made by this title--
       (1) shall not enlarge, diminish, or otherwise affect any 
     liability or limitations on liability under sections 512, 
     1201 or 1202 of title 17, United States Code; and
       (2) shall not be construed to apply--
       (A) in any case, to the electronic transmission of a 
     genuine certificate, licensing document, registration card, 
     similar labeling component, or documentation or packaging 
     described in paragraph (4) or (5) of section 2318(b) of title 
     18, United States Code, as amended by this title; and
       (B) in the case of a civil action under section 2318(f) of 
     title 18, United States Code, to the electronic transmission 
     of a counterfeit label or counterfeit documentation or 
     packaging defined in paragraph (1) or (6) of section 2318(b) 
     of title 18, United States Code.
       (b) Fair Use.--The amendments made by this title shall not 
     affect the fair use, under section 107 of title 17, United 
     States Code, of a genuine certificate, licensing document, 
     registration card, similar labeling component, or 
     documentation or packaging described in paragraph (4) or (5) 
     of section 2318(b) of title 18, United States Code, as 
     amended by this title.

             TITLE II--FRAUDULENT ONLINE IDENTITY SANCTIONS

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``Fraudulent Online Identity 
     Sanctions Act''.

     SEC. 202. AMENDMENT TO TRADEMARK ACT OF 1946.

       Section 35 of the Act entitled ``An Act to provide for the 
     registration and protection of trademarks used in commerce, 
     to carry out the provisions of certain international 
     conventions, and for other purposes'', approved July 5, 1946 
     (commonly referred to as the ``Trademark Act of 1946''; 15 
     U.S.C. 1117), is amended by adding at the end the following 
     new subsection:
       ``(e) In the case of a violation referred to in this 
     section, it shall be a rebuttable presumption that the 
     violation is willful for purposes of determining relief if 
     the violator, or a person acting in concert with the 
     violator, knowingly provided or knowingly caused to be 
     provided materially false contact information to a domain 
     name registrar, domain name registry, or other domain name 
     registration authority in registering, maintaining, or 
     renewing a domain name used in connection with the violation. 
     Nothing in this subsection limits what may be considered a 
     willful violation under this section.''.

     SEC. 203. AMENDMENT TO TITLE 17, UNITED STATES CODE.

       Section 504(c) of title 17, United States Code, is amended 
     by adding at the end the following new paragraph:
       ``(3) (A) In a case of infringement, it shall be a 
     rebuttable presumption that the infringement was committed 
     willfully for purposes of determining relief if the violator, 
     or a person acting in concert with the violator, knowingly 
     provided or knowingly caused to be provided materially false 
     contact information to a domain name registrar, domain name 
     registry, or other domain name registration authority in 
     registering, maintaining, or renewing a domain name used in 
     connection with the infringement.
       ``(B) Nothing in this paragraph limits what may be 
     considered willful infringement under this subsection.
       ``(C) For purposes of this paragraph, the term `domain 
     name' has the meaning given that term in section 45 of the 
     Act entitled `An Act to provide for the registration and 
     protection of trademarks used in commerce, to carry out the 
     provisions of certain international conventions, and for 
     other purposes' approved July 5, 1946 (commonly referred to 
     as the `Trademark Act of 1946'; 15 U.S.C. 1127).''.

     SEC. 204. AMENDMENT TO TITLE 18, UNITED STATES CODE.

       (a) Sentencing Enhancement.--Section 3559 of title 18, 
     United States Code, is amended by adding at the end the 
     following:
       ``(f)(1) If a defendant who is convicted of a felony 
     offense (other than offense of which an element is the false 
     registration of a domain name) knowingly falsely registered a

[[Page 18798]]

     domain name and knowingly used that domain name in the course 
     of that offense, the maximum imprisonment otherwise provided 
     by law for that offense shall be doubled or increased by 7 
     years, whichever is less.
       ``(2) As used in this section--
       ``(A) the term `falsely registers' means registers in a 
     manner that prevents the effective identification of or 
     contact with the person who registers; and
       ``(B) the term `domain name' has the meaning given that 
     term is section 45 of the Act entitled `An Act to provide for 
     the registration and protection of trademarks used in 
     commerce, to carry out the provisions of certain 
     international conventions, and for other purposes' approved 
     July 5, 1946 (commonly referred to as the `Trademark Act of 
     1946') (15 U.S.C. 1127).''.
       (b) United States Sentencing Commission.--
       (1) Directive.--Pursuant to its authority under section 
     994(p) of title 28, United States Code, and in accordance 
     with this section, the United States Sentencing Commission 
     shall review and amend the sentencing guidelines and policy 
     statements to ensure that the applicable guideline range for 
     a defendant convicted of any felony offense carried out 
     online that may be facilitated through the use of a domain 
     name registered with materially false contact information is 
     sufficiently stringent to deter commission of such acts.
       (2) Requirements.--In carrying out this subsection, the 
     Sentencing Commission shall provide sentencing enhancements 
     for anyone convicted of any felony offense furthered through 
     knowingly providing or knowingly causing to be provided 
     materially false contact information to a domain name 
     registrar, domain name registry, or other domain name 
     registration authority in registering, maintaining, or 
     renewing a domain name used in connection with the violation.
       (3) Definition.--For purposes of this subsection, the term 
     ``domain name'' has the meaning given that term in section 45 
     of the Act entitled ``An Act to provide for the registration 
     and protection of trademarks used in commerce, to carry out 
     the provisions of certain international conventions, and for 
     other purposes'', approved July 5, 1946 (commonly referred to 
     as the ``Trademark Act of 1946''; 15 U.S.C. 1127).

     SEC. 205. CONSTRUCTION.

       (a) Free Speech and Press.--Nothing in this title shall 
     enlarge or diminish any rights of free speech or of the press 
     for activities related to the registration or use of domain 
     names.
       (b) Discretion of Courts in Determining Relief.--Nothing in 
     this title shall restrict the discretion of a court in 
     determining damages or other relief to be assessed against a 
     person found liable for the infringement of intellectual 
     property rights.
       (c) Discretion of Courts in Determining Terms of 
     Imprisonment.--Nothing in this title shall be construed to 
     limit the discretion of a court to determine the appropriate 
     term of imprisonment for an offense under applicable law.

                           TITLE III--COURTS

     SEC. 301. ADDITIONAL PLACE OF HOLDING COURT IN THE DISTRICT 
                   OF COLORADO.

       Section 85 of title 28, United States Code, is amended by 
     inserting ``Colorado Springs,'' after ``Boulder,''.

     SEC. 302. PLACE OF HOLDING COURT IN THE NORTHERN DISTRICT OF 
                   NEW YORK.

       Section 112(a) of title 28, United States Code, is amended 
     by inserting ``Plattsburgh,'' after ``Malone,''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Wisconsin (Mr. Sensenbrenner) and the gentlewoman from the Virgin 
Islands (Mrs. Christensen) each will control 20 minutes.
  The Chair recognizes the gentleman from Wisconsin (Mr. 
Sensenbrenner).


                             General Leave

  Mr. SENSENBRENNER. Mr. Speaker, I ask unanimous consent that all 
Members may have 5 legislative days within which to revise and extend 
their remarks and include extraneous material on H.R. 3632, the bill 
currently under consideration.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Wisconsin?
  There was no objection.
  Mr. SENSENBRENNER. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, this legislation addresses a growing problem facing our 
Nation's creative community. Efforts to ensure that consumers are able 
to know whether they are buying legitimate software, music, movies, or 
other forms of intellectual property are being subverted by those who 
counterfeit authentication labels and steal legitimate ones. These 
counterfeited and illicit labels are then attached to counterfeit 
products defrauding consumers into thinking they have purchased a 
legitimate copy of the product when they have not.
  The committee has been made aware of numerous efforts by organized 
groups to counterfeit authentication labels and to traffic in illicit 
ones. The activity is highly profitable and less likely to lead to 
arrest than for dealing in drugs; and until this legislation is signed 
into law, subject to a loophole in the existing law that allows those 
who traffic in such labels to face no criminal penalties. The middleman 
who traffics in illicit and counterfeit labels can walk away from his 
crime with no penalties. The bill would close this loophole and ensure 
that everyone who undertakes a scheme to defraud consumers faces 
criminal penalties.
  Because of the short time remaining in this session, H.R. 3632 also 
incorporates the text of three other noncontroversial bills, H.R. 3754, 
H.R. 112, and H.R. 4646, in the manager's amendment. H.R. 3754 provides 
for additional penalties for those who use false domain name contact 
information to commit crimes. As Internet-based crimes continue to 
increase in number, updated laws are needed to stop this growth. H.R. 
112 and H.R. 4646 provide for a new place of holding Federal district 
court in Colorado Springs, Colorado, and Plattsburgh, New York, 
respectively.
  H.R. 112 is cosponsored by both Republican and Democratic members of 
the Colorado delegation. The 10th Circuit Court of Appeals, the 
Administrative Office of the U.S. Courts have stated they support 
enactment of the bill. H.R. 4646 is similarly supported by the U.S. 
Judicial Conference and the U.S. Attorney for the Northern District of 
New York.
  Mr. Speaker, I reserve the balance of my time.
  Mrs. CHRISTENSEN. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I rise in support of H.R. 3632, as amended, today by the 
gentleman from Wisconsin (Mr. Sensenbrenner), chairman of the Committee 
on the Judiciary.
  As amended, H.R. 3632 is a combination of several bills reported by 
the Committee on the Judiciary after full consideration. I believe this 
amalgam of bills is largely noncontroversial and thus ask my colleagues 
to join me in supporting its passage.
  Title I is designed to deter counterfeiting of U.S. copyrighted 
works. Such counterfeiting is an enormous and growing problem. It costs 
U.S. software companies alone approximately $11 billion a year and, as 
a result, costs the U.S. economy thousands of high-tech jobs in the 
software industry. The impact on other American copyright holders is 
equally devastating.
  Recent events have underscored the scope of the counterfeiting 
problem as well as the need for title I of this bill. Just last week, a 
Los Angeles grand jury indicted 11 individuals for conspiring to 
distribute more than $30 million of counterfeit software. The 
counterfeiting ring possessed 15,929 genuine stand-alone certificates 
of authenticity. Those known as COAs are authentication features, like 
holograms, used to distinguish genuine goods.
  Because many COAs are difficult to convincingly reproduce, 
counterfeiters have become an eager and lucrative market for 
misappropriated, genuine COAs. And, in fact, the COAs seized last week 
have an estimated retail value of approximately $1.7 million.
  While current law prohibits trafficking in counterfeit software and 
fake COAs, it provides no sanction against the traffic in genuine COAs. 
Thus the counterfeiting ring busted last week will escape liability for 
the almost 20,000 genuine COAs they misappropriated.

                              {time}  1500

  Title I remedies this situation. It expands the current prohibitions 
on trafficking and labels to include genuine labeling components, such 
as certificates of authenticity.
  Title II of the bill before us contains the provisions of H.R. 3754, 
a largely uncontroversial bill reported out by the Committee on the 
Judiciary on a voice vote in June of this year. Title II is designed to 
improve the accuracy and completeness of the Whois database by 
providing additional civil and

[[Page 18799]]

criminal remedies for domain name fraud.
  The Whois database contains the names, street and e-mail addresses 
and other contact information of domain name registrants. While all 
domain name registrants are required to submit information for the 
Whois database, there are no processes to ensure that this information 
is either accurate or complete. Inaccurate Whois data hampers law 
enforcement investigations, facilitates consumer fraud, impairs 
copyright and trademark protection, imperils computer security, enables 
identity theft and weakens privacy protection efforts.
  Title II seeks to rectify this growing problem through narrow 
amendments to current law. Title II provides a rebuttable presumption 
of willfulness with regard to a civil trademark or copyright 
infringement, if in connection with the infringement the infringer 
registers a domain name with materially false contact information. 
Additionally, the bill increases the maximum possible imprisonment for 
a Federal felony offense when the offender knowingly provided 
materially false domain name contact information in connection with the 
offense.
  Title III contains the text of H.R. 112 and H.R. 4646, two minor and 
entirely non-controversial bills previously reported by the Committee 
on the Judiciary. Section 301 adds Colorado Springs as a place of 
holding court in the District of Colorado. Section 302 adds Plattsburgh 
as a place of holding court in the Northern District of New York. Both 
changes were requested by their respective Congressional delegations 
and have been supported by the administrative office of the U.S. 
courts.
  Mr. Speaker, in conclusion, I urge my colleagues to support this 
legislation.
  Mr. Speaker, I reserve the balance of my time.
  Mr. SENSENBRENNER. Mr. Speaker, I yield such time as he may consume 
to the gentleman from Texas (Mr. Smith).
  Mr. SMITH of Texas. Mr. Speaker, I thank the gentleman from 
Wisconsin, the chairman of the Committee on the Judiciary, for yielding 
me time.
  Mr. Speaker, product names are a key part of the American economy, 
not only to boost sales of a product, but also to assure that consumers 
have some assurances about the identity of the manufacturer of the 
product they are interested in buying.
  Counterfeiting, the effort to deceive consumers into buying lower 
quality goods instead of the high quality goods they want, is now a 
real problem for high-tech companies.
  For many years, software publishers have attempted to thwart 
counterfeiting activity by developing physical authentication 
components, called COAs, that help consumers and law enforcement 
agencies distinguish between genuine software and sophisticated 
counterfeits.
  Counterfeits are now combining pirated CD-ROMs and packaging with 
genuine components obtained through theft or fraud. Multiplied by 
millions of transactions, the result to legitimate businesses is lost 
jobs, lost profits and lost tax revenue on a scale that compromises the 
health of otherwise vibrant industries.
  Last week, a Federal indictment charged 11 people with conspiring to 
distribute more than $56 million in counterfeit software and products. 
However, due to a loophole in existing laws, charges could not be 
brought concerning over 20,000 illicit COAs that were seized.
  Until H.R. 3632 is enacted, Federal law does not prohibit trafficking 
in genuine physical authentication components. Prosecutors find it 
impossible to take any legal action in such situations. As a result, 
this activity has become a highly profitable and largely risk-free 
elicit business.
  The legislation will close this loophole and empower Federal 
authorities to prosecute counterfeiting activity on a greater scale 
with better results. Americans will be better protected from those who 
attempt to deceive them into spending their money on counterfeit 
products.
  The text of H.R. 3754, the Fraudulent Online Identity Sanctions Act, 
has also been included in the underlying legislation. The Fraudulent 
Online Identity Sanctions Act assures those that use false identities 
in conjunction with a domain name face additional penalties for other 
crimes they commit.
  To ensure that online anonymity is protected, the mere act of using 
an alias online is not penalized. A savings clause assures that first 
amendment rights are not impacted by the legislation. This legislation, 
though, will ensure that those who deceive others as they commit crimes 
online are, in fact, subject to additional criminal penalties for such 
deceit.
  Two Federal Court bills also have been added to the underlying 
legislation, H.R. 112 and H.R. 4646. These bills create new places of 
holding U.S. Federal District Court in Colorado Springs, Colorado, and 
in Plattsburgh, New York. Americans seeking their constitutional right 
to be heard in Federal Court will find it easier to do so once this 
legislation is enacted.
  H.R. 112 is cosponsored by both Republican and Democratic members of 
the Colorado delegation.
  Mr. Speaker, I urge my colleagues to support this legislation.
  Ms. JACKSON-LEE of Texas. Mr. Speaker, I rise in support of the bill 
before the House, H.R. 3632, the Anti-Counterfeiting Amendments of 
2003. Fortunately, the Subcommittee on Courts, the Internet and 
Intellectual Property successfully marked this bill up and reported it 
out favorably on March 31, 2004, as its provisions will address some 
serious concerns.
  The trafficking of security components, for example Certificates of 
Authenticity (COAs) is a problem that the current law does not 
adequately address. Logistically, since the security components are 
useless without the actual product, such action serves no legitimate 
business purpose. Furthermore, criminal prosecutors have a hard time 
attaching crimes to the counterfeit sales made by these traffickers.
  Nevertheless, the COA is like currency because it gives the real 
value to the product to which it is attached. The prohibitions found in 
this legislation will discourage piracy.
  To address this problem, H.R. 3632 would amend Section 2318 of Title 
18 to prohibit trafficking of these products. With this narrowly-
tailored amendment to Section 2318, federal law enforcement and 
copyright owners will have the tools needed to prevent trafficking in 
genuine physical security components.
  The Anticounterfeiting Amendments will help combat the growing threat 
of international counterfeiting crimes by ensuring that U.S. laws 
address all aspects of counterfeiting activities.
  In Texas, a crime ring was implicated that was believed to have 
imported over 100 million counterfeit cigarettes, mislabeling shipping 
documents by indicating that they were importing toys or plastic parts.
  Passage of this important bill with the amendments that will be 
offered to improve its scope will, in the long run, improve the quality 
of our intellectual property and technological developments. Moreover, 
with adequate legal checks put in place to reduce trafficking of 
security products will foster a more competitive environment. For the 
above reasons, Mr. Speaker, I support this legislation.
  Mrs. CHRISTENSEN. Mr. Speaker, I have no further requests for time, 
and I yield back the balance of my time.
  Mr. SENSENBRENNER. Mr. Speaker, I have no further speakers, and I 
yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Boozman). The question is on the motion 
offered by the gentleman from Wisconsin (Mr. Sensenbrenner) that the 
House suspend the rules and pass the bill, H.R. 3632, as amended.
  The question was taken; and (two-thirds having voted in favor 
thereof) the rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

                          ____________________