I
105TH CONGRESS
2D SESSION
H. R. 3891
To amend the Trademark Act of 1946 to prohibit the unauthorized destruc-
tion, modification, or alteration of product identification codes, and for
other purposes.
IN THE HOUSE OF REPRESENTATIVES
MAY 19, 1998
Mr. GOODLATTE introduced the following bill; which was referred to the
Committee on the Judiciary
A BILL
To amend the Trademark Act of 1946 to prohibit the unau-
thorized destruction, modification, or alteration of prod-
uct identification codes, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives 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 ALTER-
ATION OF PRODUCT IDENTIFICATION CODES.
(a) IN GENERAL.—Title VIII of the Act entitled ‘‘An
Act to provide for the registration and protection of trade-
marks used in commerce, to carry out the provisions of
certain international conventions, and for other pur-
poses.’’, approved July 5, 1946 (commonly referred to as
the ‘‘Lanham Act’’ and the ‘‘Trademark Act of 1946’’)
is amended by inserting after section 43 (15 U.S.C. 1125)
the following:
‘‘UNAUTHORIZED MODIFICATIONS OF PRODUCT
IDENTIFICATION CODES
‘‘SEC. 43A. (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 affects interstate or foreign com-
merce and that is customarily produced or distrib-
uted for consumption by individuals or use by indi-
viduals, and any container, packaging, label, or com-
ponent thereof;
‘‘(3) the term ‘manufacturer’ includes the origi-
nal 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,
mark, date (including an expiration date), code,
software, or other technology that is affixed to
or embedded in any good, by which the manu-
facturer may trace a product back to a particu-
lar production lot or batch or date of removal,
or otherwise identify the source of the product;
and
‘‘(B) does not include copyright manage-
ment 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 au-
thorized by Federal law, it shall be unlawful for any per-
son, other than the consumer or the manufacturer of a
good, knowingly and without authorization of the manu-
facturer—
‘‘(1) to directly or indirectly alter, conceal, re-
move, obliterate, deface, strip, or peel any product
identification code affixed to or embedded in any
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, mark, date,
code, or other technology intended to simulate a
product identification code; or
‘‘(4) to import, export, sell, distribute, or broker
that good, the product identification code for which
has been altered, concealed, removed, obliterated, de-
faced, stripped, peeled, affixed, or embedded in viola-
tion of paragraph (1) or (2), or that bears an unau-
thorized number, letter, symbol, mark, date, or other
code in violation of paragraph (3).
‘‘(c) APPLICABILITY.—The prohibitions set forth in
subsection (b) shall apply to product identification codes
(or simulated product identification codes with respect to
subsection (b)(3)) affixed to, or embedded in, any good
held for sale or distribution in interstate or foreign com-
merce or after shipment therein, including any good held
in a bonded warehouse designated under section 555 of
the Tariff Act of 1930 or in a foreign trade zone estab-
lished under the Foreign Trade Zones Act.
‘‘(d) EXCLUSION.—Nothing in this section prohibits
a retailer from affixing a Universal Product Code or other
electronic pricing code to a good if that code does not (or
can be removed so as not to) permanently alter, conceal,
remove, obliterate, deface, strip, or peel any product iden-
tification code.
‘‘(e) CRIMINAL PENALTIES.—Any person who know-
ingly violates this section shall be punished as provided
in section 1365A of title 18.
‘‘(f) 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 appro-
priate United States district court against the al-
leged violator.
‘‘(2) 
IMPOUNDING
AND
DISPOSITION
OF
GOODS.—In any action under paragraph (1), the
court may—
‘‘(A) grant 1 or more temporary, prelimi-
nary, or permanent injunctions on such terms
as the court determines to be reasonable to pre-
vent or restrain the violation;
‘‘(B) at any time while the action is pend-
ing, 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 al-
leged violator and that the court has reasonable
cause to believe was involved in the violation;
and
‘‘(C) as part of a final judgment or de-
cree—
‘‘(i) order the destruction of any good
involved in the violation that is in the cus-
tody or control of the violator or that has
been impounded under subparagraph (B);
or
‘‘(ii) if the court determines that any
good is not unsafe or a hazard to health,
dispose of the good by delivery to such
Federal, State, or local government agen-
cies as, in the opinion of the court, have a
need for such good, or by gift to such char-
itable or nonprofit institutions as, in the
opinion of the court, have a need for such
good, if such disposition would not other-
wise be in violation of law, and if the man-
ufacturer consents to such disposition and
is given the opportunity to recode the
good.
‘‘(3) DAMAGES.—
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), in any action under paragraph (1),
the plaintiff shall be entitled to recover the ac-
tual damages suffered by the plaintiff as a re-
sult of the violation, and any profits of the vio-
lator that are attributable to the violation and
are not taken into account in computing the ac-
tual damages. In establishing the violator’s
profits, the plaintiff shall be required to present
proof only of the violator’s sales, and the viola-
tor shall be required to prove all elements of
cost or deduction claimed.
‘‘(B) STATUTORY DAMAGES.—In any ac-
tion under paragraph (1), the plaintiff may
elect, at any time before final judgment is ren-
dered, 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 deter-
mined by the court, not less than $5,000
and not more than $1,000,000, with re-
spect 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 of the date on which a final judgment was
entered against that person for a previous viola-
tion 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 oth-
erwise 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 exist-
ence of the earlier violation.
‘‘(6) LIMITATIONS ON ACTIONS.—No civil ac-
tion may be commenced under this section later than
3 years after the date on which the claimant discov-
ers the violation.
‘‘(g) ENFORCEMENT ACTIONS.—
‘‘(1) IN GENERAL.—The Attorney General and
the Secretary of the Treasury shall enforce the re-
quirements of this section. In addition, the head of
a department or agency of the Federal Government
(including the Commissioner of Food and Drugs and
the Secretary of Agriculture) may investigate any
violation of this section involving a good that is reg-
ulated by a provision of law administered by that de-
partment or agency.’’.
(b) CONFORMING AMENDMENT.—The heading for
title VIII of the Act of July 5, 1946, is amended by strik-
ing ‘‘AND DILUTION’’ and inserting ‘‘DILUTION,
AND 
ADULTERATION 
OF 
PRODUCT
CODES’’.
SEC. 3. CRIMINAL PENALTIES.
(a) IN GENERAL.—Chapter 65 of title 18, United
States Code, is amended by inserting after section 1365
the following:
‘‘§ 1365A. Unauthorized modification of product iden-
tification codes
‘‘(a) CRIMINAL PENALTIES.—Any person who know-
ingly violates section 43A of the Act of July 5, 1946 (com-
monly referred to as the ‘Trademark Act of 1946’) 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 mani-
festing 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 cir-
cumstances 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.
‘‘(b) IMPOUNDING, FORFEITURE, AND DISPOSITION
OF GOODS.—
‘‘(1) IMPOUNDING.—In any prosecution under
this section, upon motion of the United States, the
court may—
‘‘(A) grant 1 or more temporary, prelimi-
nary, or permanent injunctions on such terms
as the court determines to be reasonable to pre-
vent 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 defend-
ant 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 viola-
tion of this section, the court shall—
‘‘(A) order the forfeiture of any good in-
volved in the violation that is in the custody or
control of the defendant or that has been im-
pounded 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 the
manufacturer consents to such disposition
and is given the opportunity to recode the
good.’’.
(b) CONFORMING AMENDMENT.—The table of sec-
tions 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. 4. ATTORNEY GENERAL REPORTING REQUIREMENTS.
Section 2320(f) of title 18, United States Code, is
amended—
(1) by inserting ‘‘criminal tampering with prod-
uct identification codes (as defined in section
1365A),’’ after ‘‘involve’’; and
(2) in paragraph (4), by inserting ‘‘1365A,’’
after ‘‘sections’’.
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