Opening Statement by Rep. Bob Goodlatte (R-VA). Re: HR 2100, a product identification number bill. Event: House Courts and Intellectual Property Subcommittee meeting. Date: March 23, 2000. Source: Tech Law Journal transcribed from its audio recording. See also, TLJ summary of HR 2100.

Mr. Chairman, thank you very much for holding this markup. As you know, the bipartisan legislation that we are considering today, was introduced by Congresswoman Lofgren and myself because we see a gaping hole in the fabric of our federal laws insuring product safety and consumer protection. HR 2100, the Antitampering Amendments Act, will provide law enforcement tools they to combat the growing crime of altering or removing product identification codes from goods and packaging. This bill will also ensure that manufacturers will also have the ability to police their distribution channels, and enforce their contract rights they are currently entitled to. Finally, this bill will protect consumers from the possible health and safety risks that so often accompany tampered goods.

Most of us think of UPC codes when we think of product identification codes. The block of black lines and numbers on the backs of cans and other containers. Product identification codes are different than UPC codes. Product id codes can include various combinations of letters, symbols, marks, or dates that allow manufacturers to fingerprint each product with vital production data, including the batch number, the date and place of manufacture, and the expiration date. These codes also enable manufacturers to trace the date and destination of shipment if needed.

Product codes play a critical role in the regulation of goods and services. For example, when problems arise over drugs or medical devices regulated by the Food and Drug Administration, the product codes play a vital role in conducting successful recall. Similarly, the Consumer Product Safety Commission and other regulators, rely on product codes to conduct recalls of automobiles, dangerous toys, and other items that pose safety hazards.

Product codes are frequently used by law enforcement to conduct criminal investigations as well. These codes have been used to pinpoint the location and sometimes the identity of criminals. Recently, product codes aided in the investigation of terrorist acts, including the bombing of Olympic Park in Atlanta, and the bombing of Pan Am flight 103 over Lockerbie, Scotland.

At the same time, manufacturers have limited weapons to prevent unscrupulous distributors from removing the coding to divert products to unauthorized retailers, or to place fake codes on counterfeit products. For example, one diverter placed genuine, but outdated labels of brand name baby formula on substandard baby formula, and resold the products to retailers. Infants who were fed the formula suffered from rashes and seizures.

We cannot take the chance of any baby being harmed by infant formula, or any other product that might have been defaced, decoded, or otherwise be 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 the digital age in their crime. We must provide manufacturers with the appropriate legal tools to protect their coding systems in order for them to protect the health and safety of American consumers.

Currently, federal law does not adequately address many of the common methods of decoding products, and only applies to a limited category of consumer products, including pharmaceuticals, medical devices, and specific food. Moreover, current law only applies if the decoder exhibits criminal intent to harm the consumer. It does not address the vast majority of decoding cases, which are motivated by economic considerations, but may ultimately result in harm to the consumer.

My legislation will provide several measures which will further discourage tampering and protect the ability of manufacturers to implement successful recalls and trade products when needed. It would further prohibit the alteration or removal of product identification codes on codes 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 decoding goods and decoding devices.

It will require offenders to pay monetary damages, and increased damages in the event of repeat violations. The bill will also impose criminal sanctions, including fines and imprisonment for violators who knowingly are engaged in decoding violations. The bill would not require product codes -- prevent decoding by authorized manufacturers, or prohibit decoding by consumers.

It is a reasonable approach designed to strengthen the tools of law enforcement, provide greater security for the manufacture of products, and most importantly provide consumers with improved safety from tampered or counterfeit goods. That is why HR 2100 is supported by a broad array of manufacturers, consumers, unions, and law enforcement. I urge my colleagues to join me in supporting this bill which will go a long way towards closing the final gap in federal law enforcement tools to protect consumers and the product safety.