Our attitude here is based on concern, both for the possibility of inadvertent revealing of confidential material, and also for the possibility of deliberate abuse of such confidential information. In some cases, the key to a particularly valuable formula may involve the use of only one or two unusual or unexpected substances. A premeditated attempt to gain such information is not necessarily implied, but one cannot wipe out key recollections from a man's brain. Officials of the Food and Drug Administration have occasionally pointed out, in justifying this request for information, that no known case of the release or abuse of confidentially submitted information has even occurred. Such a statement, however, merely serves to illustrate the difficulty of proving such an occurrence, rather than the fact that the event has not occurred. We are not imputing any bad faith, past or present, to Food and Drug Administration employees. We are merely saying that they are human. Many former employees of the Food and Drug Administration have left Government service for industrial and academic posts. Others have established themselves in consulting firms or in private legal practice. The opportunity for abuses exists, and we are simply concerned to see that that opportunity is kept to the absolute minimum unavoidable in effective administration of the act.

One of the bases cited by the Food and Drug Administration in support of their request for this legislation is that such extensive inspection powers are necessary to police the use of food additives. While there are many different flavoring ingredients in use, their usages, with few exceptions, are, in the words of the food additives amendment, "generally recognized as safe." Because of this, they are legally not food additives, and they do not come under the specific regulatory provisions of the food additives amendment. Hence, no regulations involving tolerances apply. Their use is governed instead by other provisions of the basic Food and Drug Act. Since there are no tolerances, there has been no necessity to develop analytical methods.

On the other hand, when a food additive, in the legal sense, is involved, the Food and Drug Administration issues a food-additive regulation. This states how a substance may safely be used, and usually contains a tolerance or limitation on maximum use. The regulation and the petition for the regulation must also include a practicable analytical method, so that the Food and Drug Administration may be certain that the tolerance is not being exceeded. It is apparent that the results of an analysis are vastly more useful than the self-serving records of a company. If the Food and Drug Administration were concerned about the use of a specific substance, they certainly would not be so easily satisfied as to stop with consideration of a company's formula, but would analyze the product in any event. That is, and must remain the only effective determination of whether the provisions of the food additives amendment have been fulfilled. The important point concerns what is in the final food as eaten. The composition of an intermediate product, such as a flavor formulation, may be relevant, but certainly is not final. Thus, when a food additive is not involved, there is no tolerance because there is no significant hazard, and formula inspection is unnecessary. Where a tolerance and analytical method for a food additive are involved, analysis is needed in any case. Formula inspection is unnecessary because it is superfluous.

We are further concerned at the provision which would permit inspectors to inquire about the qualifications of technical and production employees. There are no standards in this field, and even professional associations have not been able to arrive at effective standards. In the absence of standards, such judgments would be personal and arbitrary at best, and it is appropriate for us to ask, and to doubt the qualifications of Food and Drug inspectors who would make such judgments.

Finally, we wish to join in the views of others who have opposed the inclusion of the records of consulting laboratories in this legislation. We agree, of course, that the files of consulting laboratories, dealing with quality control and product characteristics, are pertinent to the enforcement of the act, and should be available through normal judicial processes, just as are the records of the company itself. But the proposed legislation even fails to distinguish between records dealing with research and development on new products and quality control on present ones. We feel that this is so patent a flaw that it could not intentionally have been included in the proposed legislation.

We have dealt in this statement with those aspects of H.R. 11581 of particular interest and concern to the flavor industry. In general, however, we wish to associate ourselves with the views expressed by Mr. Samuel A. McCain in

articles in the March 1962, issue of Food Processing and the April 1962, issue of The Business Lawyer. We are grateful for this opportunity of presenting our position.

STATEMENT OF THE NATIONAL HAIRDRESSERS AND COSMETOLOGISTS ASSOCIATION IN OPPOSITION TO SECTION 201(a) oF H.R. 11581, SUBMITTED BY ROBERT A. COLLIER, COUNSEL

This statement is submitted by the National Hairdressers and Cosmetologists Association, Inc., in opposition to section 201(a) of H.R. 11581, the "Drug and Factory Inspection Amendments of 1962." The association represents more than 65,000 beauty salon owners and operators with a total employment of more than 150,000 trained and licensed cosmetologists.

The present inspection provisions of section 704 of the Food, Drug, and Cosmetic Act authorize Government agents to enter any establishment, including beauty salons, in which cosmetics are held. Section 201 of H.R. 11581 would expand this authority to permit inspection of "all things therein (including records, files, papers, processes, controls, and facilities) bearing on whether articles which are adulterated or misbranded within the meaning of the act, or which may not be manufactured, introduced into interstate commerce, or sold or offered for sale by reason of any provision of this act, have been or are being manufactured, processed, packed, transported, or held in any such place, or otherwise bearing on violations of this act." The effect of this section of the bill is to provide carte blanche inspection. Under such broad language, it would not be possible for anyone to refuse inspection of anything.

We are not opposed to inspection per se. However, we do feel that any statute which imposes criminal penalties upon an unknowing violator, as does the Food, Drug, and Cosmetic Act, should provide for limitation upon unwarranted Government fishing expeditions. Not only does this proposal authorize an invasion of the business privacy of beauty salon operators, but it would also raise serious questions as to whether it is unconstitutional under the fourth amendment as an unlimited, and therefore unreasonable search and seizure.

We recognize that some legislation may be necessary to permit inspection of those few businesses who have been able to successfully evade it. However, we respectfully submit that any such need is not based upon any alleged violations of the Food, Drug, and Cosmetic Act by NHCA members. To include these beauty shop owners within the coverage of this bill would be an unjustified and unwise extension of governmental inspection authority.

STATEMENT OF PINEAPPLE GROWERS ASSOCIATION OF HAWAII ON H.R. 11581, SUBMITTED BY R. L. CUSHING, PRESIDENT

This statement is submitted on behalf of the Pineapple Growers Association of Hawaii, the members of the association being Baldwin Packers, Ltd., California Packing Corp., Dole Corp., Hawaiian Fruit Packers, Ltd., Kauai Pineapple Co., Libby, McNeill & Libby and Maui Pineapple Co., Ltd.

The member companies operate eight pineapple canneries in Hawaii. An affiliated company of one of the members operates a pineapple cannery in Puerto Rico. The companies produce all but a small part of the U.S. annual production of approximately 18.5 million cases of canned pineapple and 12.3 million cases of canned pineapple juice, a total of 30.8 million cases. The canned pineapple pack is approximately 15 percent of the total U.S. canned fruit pack and the canned pineapple juice pack is approximately 23 percent of the total U.S. canned fruit juice pack.

As producers of a major canned fruit product, the pineapple canners are concerned over the additional, and, we believe, unwarranted factory inspection authority proposed for the Food and Drug Administration under title II of H.R. 11581.

We are advised that Commissioner Larrick of the Food and Drug Administration stated before the Senate Appropriations Subcommittee:

"A few years ago the Food and Drug Administration submitted a bill to the Congress which was believed to provide for inspection authority permitting FDA to make complete studies of the production procedures and controls employed by firms, the complaints received concerning their products, and the

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qualifications of their employees (especially scientists) * * * However, the legislative history of the bill indicated that it was not the intention of the law to give FDA access to this type of information. Consequently, FDA has had to operate with rather serious limitations ever since."

The pineapple canning industry in Hawaii has a long history of cooperation with the Food and Drug Administration and has consistently supported legislation which appeared to be reasonable and necessary for that Administration to discharge its responsibilities.

The Food and Drug Administration now has authority to inspect food factories, warehouses, establishments, and vehicles used in transporting the products of such factories, and to inspect all pertinent equipment, finished and unfinished materials, containers and labeling, and to take samples of products for analysis. The Secretary of Health, Education, and Welfare, under whose jurisdiction the Food and Drug Administration operates, has power of seizure of adulterated or misbranded products. The Secretary may publicize the facts in any case in which he believes there is danger to the public health, as was done in the cranberry incident. Furthermore, there is available the search warrant procedure whereby the Food and Drug Administration, upon presentation of reasonable evidence of a violation in a food-making establishment, may obtain a search warrant which will enable the FDA to obtain all files, records, documents, formulas, and anything else relating to the violation which FDA believes is being committed. After the search, FDA could have the factory padlocked if it can convince the judge this is a proper procedure.

The additional authority which would be granted FDA under title II of H.R. 11581 would empower it to have access, on a routine basis, to all things in a food factory, including records, files, papers, processes, controls, and facilities.

We do not believe there is any demonstrated need for such unrestricted governmental access to food plant files and records of production procedures and quality controls. Existing authority of the FDA to inspect plants, to draw random samples of the product, to subject such samples to any analyses seen fit, and to seize products it determines do not meet the standards, provides sufficient authority for the FDA to insure the purity and conformity with standards of quality of canned goods.

Commissioner Larrick cites the greatly increased use of food additives as a new argument for the increased factory inspection authority. The safeguards of the additive law itself and the FDA regulations on its administration reveal no need for additional legislation to protect the public health.

The preservation of competition between companies manufacturing canned goods depends upon the maintenance of competitive advantages based on production methods, production equipment, and product formulae. Unrestricted access by the FDA to the confidential records covering these matters could result in, although possibly inadvertently, the disclosure of proprietary production methods and could thereby lessen competition.

Access to personnel records would be, presumably, to determine the qualifications of a food processor's employees as Commissioner Larrick had indicated that the FDA inspectors should be able to determine that an employee is qualified to do his job. The specialized skills and knowledge required in the food-processing business are such that only those directly and finally responsible for operation of the business can evaluate the qualifications and day-by-day performance of their employees.

As food manufacturers we object to the proposal which would subject our confidential records to search under inquisitorial powers just as, as individuals, we would not want to be denied the benefits of the fourth amendment to the Constitution which insures us protection in our persons, houses, papers, and effects against unreasonable searches and seizures.

STATEMENT OF THE U.S. TRADEMARK ASSOCIATION IN OPPOSITION TO THE TRADEMARK ASPECTS OF H.R. 11581, SUBMITTED BY MR. THACHER H. FISK The U.S. Trademark Association opposes H.R. 11581 insofar as its provisions have some impact upon the entire field of trademark law and practice.

The association is a membership corporation organized under the laws of the State of New York, with offices located at 6 East 45th Street in the city of New York. Its membership comprises regular (or voting) members, who are owners of trademarks, and associate members, who are lawyers, advertising firms, pub

lishers, and others interested in trademark law, trademark protection, and trademark practice. A printed list of members as of August 1, 1961, is attached.

The association now has 264 regular (or voting) members. Thirty-one of them are pharmaceutical manufacturers; and of the 33 members of the board of directors under whose direction the association operates, 5 are executives of pharmaceutical manufacturers. These data are given because of the short title of the bill under consideration, the "Drug and Factory Inspection Amendments of 1962."

The association is 84 years old, having been founded in 1878. Its purpose, generally stated, is to aid in the dissemination of information pertaining to trademarks and to afford a means of cooperative activity in protecting them. It publishes the Trademark Reporter®, a monthly journal containing judicial opinions in litigated cases and articles of research and commentary. The association has worked for uniform State trademark legislation, which has been adopted in many States.

Although the position of the association as presented here is limited to what might be termed the trademark aspects of H.R. 11581, failure to comment upon other aspects of the bill is not to be construed as approving or disapproving such other aspects.

Specifically, the U.S. Trademark Association is opposed to section 112(a) (4) of H.R. 11581. The section, if enacted, would require the manufacturer of a drug to use the drug's "established name" in a position of precedence over and in type of equal size and prominence as the drug's trademark on labels and in informational and promotional material. This subordination of the trademark, if accomplished, would profoundly alter and seriously abridge the fundamental legal and economic principles upon which the trademark system of product identification is founded.

The trademark system, possessing both a rich history and a great contemporary importance, enables merchants and manufacturers to compete vigorously and encourages them to endeavor to earn the fair competitive advantages that stem from creativity and quality. Therefore, the association strongly urges that the system be preserved from the dangerous sort of incursion embodied in H.R. 11581, and to support its position presents these reasons:

In the first place, the trademark-related provisions of H.R. 11581 discriminate against the pharmaceutical industry. No other industry is subject to comparable restrictions having to do with product identification. And the association believes that the splendid achievements of drug manufacturers deserves congratulation and not discrimination. Moreover, the precedence in position and equal prominence requirements appear to be outside the ambit of the Federal Food, Drug, and Cosmetic Act. The act properly deals with important matters of public health and safety, but its focus should not be made less clear by seeking also to deal with independent commercial practices.

Shifting to broader considerations, however, and apart from the possible particular consequences for the one industry, the association is genuinely concerned that the trademark-related provisions of H.R. 11581 might establish a perilous legislative precedent. They contain the genesis of the erroneous notion that trademarks are superfluous or inappropriate whereas experience and commonsense show the contrary to be true. Indeed, by identifying and distinguishing the worthy product, a trademark provides a true form of protection for the public. The precedence in position and equal prominence requirements would emphasize the generic name every time the trademark for the worthy product is promoted. The result will be at least as much public acceptance for the generic name as for the trademark. Thus, the requirements of H.R. 11581 with respect to use of the generic name will provide a means by which the marketer of an inferior product may confuse and deceive the public as to the quality and source of his product.

Then, too, any legislation of this character would dilute or discount the important identificatory values that established trademarks represent. In a very real sense there would be effected an uncompensated taking of the valuable goodwill that resides in these business assets.

If the product identification theory of H.R. 11581 were generally accepted, an incentive to promote a superior product and inform the public of its availability would be destroyed. Two consequences would be the reduction of quality of products to the lowest common denominator and the discouragement of new product development.

The association realizes, of course, that nonproprietary nonmenclature can and does fulfill an important function and that, in the pharmaceutical industry as is true for nearly all industries, the disclosure of generic or common descriptive names is legally sound and advisable. It is not, however, in the best interest of the general purchasing public or trademark owners for the Government to coerce its citizens against the use of trademarks or brand names either with respect to drugs or any other commodity.

STATEMENT OF JAMES F. FORT, COUNSEL, PUBLIC AFFAIRS, AMERICAN TRUCKING ASSOCIATIONS, INC., ON H.R. 11581

Mr. Chairman and gentlemen of the committee, my name is James F. Fort. I am counsel, public affairs, of the American Trucking Associations, Inc., with offices at 1616 P. Street, NW., Washington, D.C. The association, as most of you know, is a national federation representing all forms of motor carriers, both private and for hire, and having affiliated associations in 49 States and the District of Columbia.

We appear today in support of part C of title I of H.R. 11581 which relates to the control of amphetamine and other stimulant habit-forming drugs.

In 1954 the trucking industry first obtained concrete evidence that amphetamine drugs were being sold illegally at highway stops and establishments near highways. Since that time we have cooperated with the Food and Drug Administration, we have conducted extensive educational campaigns among our employees, and we have for a number of years sought legislation similar to that before you today to effectively control these drugs.

The committee has already heard testimony as to the detailed provisions of the bill and as to the improper uses which are made of stimulant drugs, so it is not our purpose today to review these technical points. Rather, we think that the committee would be more interested in a brief description of the problems which we have had in this area.

It is our wish initially to make it clear to the committee that the use of amphetamines by truckdrivers is far more of a health problem than it is a safety problem. We have followed closely over the years the Interstate Commerce Commission's investigations of motor-vehicle accidents, and of their many, many investigations we are able to find less than 10 Commission proceedings in which the use of amphetamines has been held to be the cause of a highway accident. This is not to minimize the problem, for it is a problem and it has been our effort for a number of years to educate our drivers on the dangers to their overall health, as well as to educate them as to the driving hazard which may result from unsupervised or excessive use of these drugs.

According to published reports, the Food and Drug Administration estimates that production of amphetamine drugs annually is sufficient to produce about 5 billion pills or capsules. Commissioner Larrick has stated that a large proportion of these go into illicit channels. Against this background it is obviously illogical to assume that the truckdrivers of the Nation's approximately 700,000 tractor-semitrailer trucks could conceivably be the prime users. Further, National Safety Council and ICC statistics substantiate the fact that truckdrivers, as a group, have the finest safety record of any type of drivers. This record is steadily improving. Let me cite just one statistic to verify this: Trucks constitute a little over 16 percent of all registered motor vehicles. However, they comprise only 11 percent of vehicles involved in accidents. This is involvement, not necessarily fault. A major insurance company several years ago made a study of 100,000 truck-involved accidents and found that in 70 percent of the cases the truck was not at fault, so obviously our record is one of which we are very proud.

The committee knows that under the ICC's safety regulations all interstate drivers must meet, periodically, the strict physical qualifications established by the ICC. They must have in their possession at all times, when driving, a copy of the medical certificate issued by a doctor at the time of their most recent examination. Habitual use of amphetamines or related drugs obviously would keep any driver eventually from passing his physical examination. Also, as the committee knows, the ICC has very strict regulations which govern the amount of time which a driver may spend on the road. Currently this requirement is 10 hours of driving time between minimum &-hour off-duty periods with