II

106TH CONGRESS

2D SESSION S. 2105

To amend chapter 65 of title 18, United States Code, to prohibit the unauthorized destruction, modification, or alteration of product identification

codes used in consumer product recalls, for law enforcement, and for

other purposes.

IN THE SENATE OF THE UNITED STATES

FEBRUARY 24, 2000

Mr. HATCH (for himself and Mr. LEAHY) introduced the following bill; which

was read twice and referred to the Committee on the Judiciary

A BILL

To amend chapter 65 of title 18, United States Code, to

prohibit the unauthorized destruction, modification, or

alteration of product identification codes used in consumer product recalls, for law enforcement, and for other

purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Antitampering Act of

5 2000’’.
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1 SEC. 2. PROHIBITION OF UNAUTHORIZED ALTERATION OF

2 PRODUCT IDENTIFICATION CODES.

3 (a) IN GENERAL.—Chapter 65 of title 18, United

4 States Code, is amended by inserting after section 1365

5 the following:

6 ‘‘§ 1365A. Tampering with product identification

7 codes

8 ‘‘(a) DEFINITIONS.—In this section—

9 ‘‘(1) the term ‘consumer’—

10 ‘‘(A) means—

11 ‘‘(i) the ultimate user or purchaser of

12 a good; or

13 ‘‘(ii) any hotel, restaurant, or other

14 provider of services that must remove or

15 alter the container, label, or packaging of

16 a good in order to make the good available

17 to the ultimate user or purchaser; and

18 ‘‘(B) does not include any retailer or other

19 distributor who acquires a good for resale;

20 ‘‘(2) the term ‘flea market’ means any location,

21 other than a permanent retail store, at which space

22 is rented or otherwise made available for the conduct

23 of business of a transient or limited vendor;

24 ‘‘(3) the term ‘good’ means any article, product,

25 or commodity that is customarily produced or dis26 tributed for sale, rental, or licensing in interstate or
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1 foreign commerce, and any container, packaging,

2 label, or component thereof;

3 ‘‘(4) the term ‘manufacturer’ means—

4 ‘‘(A) the original manufacturer of a good;

5 and

6 ‘‘(B) any duly appointed agent or rep7 resentative of that manufacturer acting within

8 the scope of its agency or representation;

9 ‘‘(5) the term ‘product identification code’—

10 ‘‘(A) means any visible number, letter,

11 symbol, marking, date (including an expiration

12 date), or code that is affixed to or embedded in

13 any good, by which the manufacturer of the

14 good may trace the good back to a particular

15 lot, batch, date of production, or date of re16 moval;

17 ‘‘(B) does not include—

18 ‘‘(i) copyright management informa19 tion (as defined in section 1202(c) of title

20 17) conveyed in connection with copies or

21 phonorecords of a copyrighted work or any

22 performance or display of a copyrighted

23 work;

24 ‘‘(ii) other codes or markings on the

25 good; or
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1 ‘‘(iii) a Universal Product Code; and

2 ‘‘(C) does not include any trademark or

3 copyright notice by itself or any item listed in

4 subparagraph (A) that is affixed to, super5 imposed on, or embedded in a trademark or

6 copyright notice;

7 ‘‘(6) the term ‘transient or limited vendor’ does

8 not include a person who sells by sample, catalog, or

9 brochure for future delivery to the purchaser;

10 ‘‘(7) the term ‘Universal Product Code’ means

11 a 12-digit, all numeric code that identifies the con12 sumer package consisting of—

13 ‘‘(A) a 1-digit number system character;

14 ‘‘(B) a 5-digit manufacturer identification

15 number;

16 ‘‘(C) a 5-digit item code;

17 ‘‘(D) a 1-digit check number; and

18 ‘‘(E) the bar code symbol that encodes the

19 12-digit Universal Product Code; and

20 ‘‘(8) the term ‘value’ means the face, par, or

21 market value, whichever is the greatest.

22 ‘‘(b) PROHIBITED ACTS.—Except as provided in sub23 section (d) or as otherwise expressly authorized under any

24 other provision of Federal law, it shall be unlawful for any

25 person, other than the consumer or the manufacturer of
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1 a good, knowingly and without the authorization of the

2 manufacturer—

3 ‘‘(1) to directly or indirectly alter, conceal, re4 move, obliterate, deface, strip, or peel any product

5 identification code affixed to or embedded in a good

6 and visible to the consumer;

7 ‘‘(2) to directly or indirectly affix to or embed

8 in a good a product identification code that is visible

9 to the consumer and that is intended by the manu10 facturer for a different good, such that the code no

11 longer accurately identifies the lot, batch, date of

12 production, or date of removal of the good;

13 ‘‘(3) to directly or indirectly affix to or embed

14 in a good any number, letter, symbol, marking, date,

15 or code intended to simulate a product identification

16 code that is otherwise visible to the consumer;

17 ‘‘(4) to import, reimport, export, sell, offer for

18 sale, hold for sale, distribute, or broker a good—

19 ‘‘(A) in a case in which the person knows

20 that the product identification code, which oth21 erwise would be visible to the consumer, has

22 been altered, concealed, removed, obliterated,

23 defaced, stripped, peeled, affixed, or embedded

24 in violation of paragraph (1) or (2); or
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1 ‘‘(B) in a case in which the person knows

2 that the good bears a number, letter, symbol,

3 marking, date, or code in violation of paragraph

4 (3); or

5 ‘‘(5) to sell, offer for sale, or knowingly permit

6 the sale at a flea market of—

7 ‘‘(A) baby food, infant formula, or any

8 other similar product manufactured and pack9 aged for sale for consumption by a child who is

10 less than 3 years of age; or

11 ‘‘(B) any food, drug, device, or cosmetic

12 (as those terms are defined in section 201 of

13 the Federal Food, Drug, and Cosmetic Act (21

14 U.S.C. 321));

15 unless that person keeps for public inspection writ16 ten documentation identifying such person as an au17 thorized representative of the manufacturer or dis18 tributor of the food, drug, device, or cosmetic.

19 ‘‘(c) APPLICABILITY.—The prohibitions set forth in

20 paragraphs (1) through (4) of subsection (b) shall apply

21 to visible product identification codes (or simulated prod22 uct identification codes in a case to which subsection

23 (b)(3) applies) affixed to, or embedded in, any good held

24 for sale or distribution in interstate or foreign commerce

25 or after shipment therein, including any good held in a
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1 United States Customs Service bonded warehouse or for2 eign trade zone.

3 ‘‘(d) EXCEPTIONS.—

4 ‘‘(1) UNIVERSAL PRODUCT CODE CODES.—

5 Nothing in this section prohibits a person from

6 affixing a Universal Product Code, security tag, or

7 other legitimate pricing or inventory code or other

8 information required by Federal or State law, if

9 such code or information does not (or can be re10 moved so as not to) permanently alter, conceal, re11 move, obliterate, deface, strip, or peel any product

12 identification code.

13 ‘‘(2) REPACKAGING FOR RESALE.—Nothing in

14 this section prohibits a person from removing a good

15 from a primary package or container and repack16 aging the good in another package or container, or

17 from placing a good and its original packaging with18 in new packaging, if—

19 ‘‘(A) the good retains its original product

20 identification code, which has not been perma21 nently altered, concealed, or removed;

22 ‘‘(B) the repackaging is in full compliance

23 with all applicable Federal laws and regula24 tions, including section 301 of the Federal
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1 Food, Drug, and Cosmetic Act (21 U.S.C.

2 331); and

3 ‘‘(C) a new package includes a label that

4 clearly states—

5 ‘‘(i) that the good has been repack6 aged; and

7 ‘‘(ii) the name of the repacker.

8 ‘‘(e) CRIMINAL PENALTIES.—Any person who will9 fully violates this section—

10 ‘‘(1) shall be fined under this title, imprisoned

11 not more than 1 year, or both;

12 ‘‘(2) shall be fined under this title, imprisoned

13 not more than 5 years, or both, if the total value of

14 the good or goods involved in the violation is greater

15 than $10,000;

16 ‘‘(3) shall be fined under this title, imprisoned

17 not more than 10 years, or both, if—

18 ‘‘(A) the person acts with reckless dis19 regard for the health or safety of the public and

20 under circumstances manifesting extreme indif21 ference to such risk; and

22 ‘‘(B) the violation threatens the health or

23 safety of the public;

24 ‘‘(4) shall be fined under this title, imprisoned

25 not more than 20 years, or both, if—
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1 ‘‘(A) the person acts with reckless dis2 regard for the risk that another person will be

3 placed in danger of death or bodily injury and

4 under circumstances manifesting extreme indif5 ference to such risk; and

6 ‘‘(B) serious bodily injury to any individual

7 results;

8 ‘‘(5) shall be fined under this title, imprisoned

9 for any term of years or for life, or both, if—

10 ‘‘(A) the person acts with reckless dis11 regard for the risk that another person will be

12 placed in danger of death or bodily injury and

13 under circumstances manifesting extreme indif14 ference to such risk; and

15 ‘‘(B) the death of an individual results;

16 and

17 ‘‘(6) with respect to any second or subsequent

18 violation of this section, be convicted of a felony, and

19 be subject to twice the maximum term of imprison20 ment that would otherwise be imposed under this

21 subsection, fined under this title, or both.

22 ‘‘(f) INJUNCTIONS AND IMPOUNDING, FORFEITURE,

23 AND DISPOSITION OF GOODS.—
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1 ‘‘(1) INJUNCTIONS AND IMPOUNDING.—In any

2 prosecution under this section, upon motion of the

3 United States, the court may—

4 ‘‘(A) grant 1 or more temporary, prelimi5 nary, or permanent injunctions on such terms

6 as the court determines to be reasonable to pre7 vent or restrain the alleged violation; and

8 ‘‘(B) at any time during the proceedings,

9 order the impounding, on such terms as the

10 court determines to be reasonable, of any good

11 that the court has reasonable cause to believe

12 was involved in the violation.

13 ‘‘(2) FORFEITURE AND DISPOSITION OF

14 GOODS.—Upon conviction of any person of a viola15 tion of this section, the court shall—

16 ‘‘(A) order the forfeiture of any good in17 volved in the violation or that has been im18 pounded under paragraph (1)(B); and

19 ‘‘(B) either—

20 ‘‘(i) order the destruction of each

21 good forfeited under subparagraph (A);

22 ‘‘(ii) order the disposal of the good by

23 delivery to such Federal, State, or local

24 government agencies as, in the opinion of

25 the court, have a need for such good, or by
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1 gift to such charitable or nonprofit institu2 tions as, in the opinion of the court, have

3 a need for such good; or

4 ‘‘(iii) order the return of the goods in5 volved upon the request of any interested

6 party.

7 ‘‘(g) CIVIL REMEDIES.—

8 ‘‘(1) IN GENERAL.—Any person who is injured

9 by a violation of this section, or demonstrates the

10 likelihood of such injury, may bring a civil action in

11 an appropriate district court of the United States

12 against the alleged violator.

13 ‘‘(2) INJUNCTIONS AND IMPOUNDING AND DIS14 POSITION OF GOODS.—In any action under para15 graph (1), the court may—

16 ‘‘(A) grant 1 or more temporary, prelimi17 nary, or permanent injunctions upon the post18 ing of a bond at least equal to the value of the

19 goods affected on such terms as the court de20 termines to be reasonable to prevent or restrain

21 the violation;

22 ‘‘(B) at any time while the action is pend23 ing, order the impounding of the goods

24 affected—
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1 ‘‘(i) if the court has reasonable cause

2 to believe the goods were involved in the

3 violation;

4 ‘‘(ii) upon the posting of a bond at

5 least equal to the value of the goods af6 fected; and

7 ‘‘(iii) on other terms such as the court

8 determines to be reasonable; and

9 ‘‘(C) as part of a final judgment or decree,

10 in the court’s discretion—

11 ‘‘(i) order the destruction of any good

12 involved in the violation or that has been

13 impounded under subparagraph (B);

14 ‘‘(ii) order the disposal of the good—

15 ‘‘(I) by delivery to such Federal,

16 State, or local government agencies

17 as, in the opinion of the court, have a

18 need for such good; or

19 ‘‘(II) by gift to such charitable or

20 nonprofit institutions as, in the opin21 ion of the court, have a need for such

22 good, if such disposition would not

23 otherwise be in violation of law, and if

24 the manufacturer consents to such

25 disposition; or
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1 ‘‘(iii) order the return of the goods in2 volved in the violation to the manufacturer

3 upon the request of any interested party.

4 ‘‘(3) DAMAGES.—

5 ‘‘(A) IN GENERAL.—Subject to subpara6 graph (B), in any action under paragraph (1),

7 the plaintiff shall be entitled to recover—

8 ‘‘(i) the actual damages suffered by

9 the plaintiff as a result of the violation,

10 and;

11 ‘‘(ii) any profits of the violator that

12 are attributable to the violation and are

13 not taken into account in computing the

14 actual damages.

15 ‘‘(B) STATUTORY DAMAGES.—In any ac16 tion under paragraph (1), the plaintiff may

17 elect, at any time before final judgment is ren18 dered, to recover, instead of actual damages

19 and profits described in subparagraph (A), an

20 award of statutory damages for any violation

21 under this section in an amount equal to—

22 ‘‘(i) not less than $500 and not more

23 than $100,000, with respect to each type

24 of goods involved in the violation; and
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1 ‘‘(ii) if the court finds that the viola2 tion threatens the health and safety of the

3 public, not less than $5,000 and not more

4 than $1,000,000, with respect to each type

5 of good involved in the violation.

6 ‘‘(C) PROOF OF DAMAGES.—In estab7 lishing the violator’s profits, the plaintiff shall

8 be required to present proof only of the viola9 tor’s sales, and the violator shall be required to

10 prove all elements of cost or deduction claimed.

11 ‘‘(4) COSTS AND ATTORNEY’S FEES.—In any

12 action under paragraph (1), in addition to any dam13 ages recovered under paragraph (3), the court in its

14 discretion may award the prevailing party its costs

15 of the action and its reasonable attorney’s fees.

16 ‘‘(5) REPEAT VIOLATIONS.—

17 ‘‘(A) TREBLE DAMAGES.—In any case in

18 which a person violates this section within 3

19 years after the date on which a final judgment

20 was entered against that person for a previous

21 violation of this section, the court, in an action

22 brought under this subsection, may increase the

23 award of damages for the later violation to not

24 more than 3 times the amount that would oth-
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1 erwise be awarded under paragraph (3), as the

2 court considers appropriate.

3 ‘‘(B) BURDEN OF PROOF.—A plaintiff that

4 seeks damages as described in subparagraph

5 (A) shall bear the burden of proving the exist6 ence of the earlier violation.

7 ‘‘(6) LIMITATIONS ON ACTIONS.—No civil ac8 tion may be commenced under this section later than

9 3 years after the date on which the claimant dis10 covers or has reason to know of the violation.

11 ‘‘(7) INNOCENT VIOLATIONS.—In any action

12 under paragraph (1), the court in its discretion may

13 reduce or remit the total award of damages or award

14 no damages in any case in which the violator sus15 tains the burden of proving, and the court finds,

16 that the violator was not aware and had no reason

17 to believe that the acts of the violator constituted a

18 violation.

19 ‘‘(h) ENFORCEMENT ACTIONS.—

20 ‘‘(1) IN GENERAL.—Subject to paragraphs (2)

21 and (3), the Attorney General and the Secretary of

22 the Treasury shall enforce the requirements of this

23 section.

24 ‘‘(2) AGENCY DISCRETION.—The head of a de25 partment or agency of the Federal Government (in-
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1 cluding the Commissioner of Food and Drugs and

2 the Secretary of Agriculture) may investigate any

3 violation of this section involving a good that is reg4 ulated by a provision of law administered by that de5 partment or agency.

6 ‘‘(3) CUSTOMS SERVICE.—

7 ‘‘(A) IN GENERAL.—The United States

8 Customs Service shall—

9 ‘‘(i) seize any good imported, re10 imported, or offered for import into the

11 United States in violation of subsection

12 (b)(4);

13 ‘‘(ii) promptly notify the manufac14 turer or duly appointed agent or represent15 ative of the seizure; and

16 ‘‘(iii) destroy or dispose of the goods

17 in accordance with the procedures set forth

18 in section 526(e) of Tariff Act of 1930 (19

19 U.S.C. 1526(e)).

20 ‘‘(B) VOLUNTARY DISCLOSURES.—In order

21 to assist the United States Customs Service in

22 carrying out its obligations under this para23 graph, any domestic or foreign manufacturer

24 may voluntarily record with the United States

25 Customs Service—
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1 ‘‘(i) its name and address;

2 ‘‘(ii) a description of its goods and

3 product identification codes; and

4 ‘‘(iii) such other information as may

5 facilitate the enforcement of this section.’’.

6 (b) CONFORMING AMENDMENT.—The table of sec7 tions for chapter 65 of title 18, United States Code, is

8 amended by inserting after the item relating to section

9 1365 the following:

‘‘1365A. Tampering with product identification codes.’’.

10 (c) REGULATORY AUTHORITY.—Not later than 6

11 months after the date of enactment of this Act, the Attor12 ney General, after consultation with the Secretary of the

13 Treasury, the Commissioner of Food and Drugs, and the

14 head of any other department or agency of the Federal

15 Government that the Attorney General determines to be

16 appropriate, shall issue such rules and regulations as may

17 be necessary to implement section 1365A of title 18,

18 United States Code, as added by this section.

19 SEC. 3. ATTORNEY GENERAL REPORTING REQUIREMENTS.

20 Section 2320(f) of title 18, United States Code, is

21 amended—

22 (1) by striking ‘‘of title 18’’ each place that

23 term appears;
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1 (2) by inserting ‘‘tampering with product iden2 tification codes (as defined in section 1365A),’’ after

3 ‘‘involve’’; and

4 (3) in paragraph (4), by inserting ‘‘1365A,’’

5 after ‘‘sections’’.

6 SEC. 4. EFFECTIVE DATE.

7 This Act and the amendments made by this Act shall

8 take effect 6 months after the date of enactment of this

9 Act.

Æ