This is with reference to your colloquy with Associate Deputy Attorney General Tim Finn during the November 3 hearing on trademark counterfeiting legislation. You suggested a need for additional federal investigators and prosecutors. - - While we are, of course, sympathetic with your goal of expanded federal law enforcement resources, I would respectfully suggest that the facts do not support an implication that this Administration has been insensitive to law enforcement needs. In this regard, you should be aware that largely due to the Organized Crime Drug Enforcement Task Force Program the number of FBI agents has increased by 496, the number of DEA agents has increased by 157 and the number of attorneys in U. S. Attorney's offices has increased by 218 as of September 30, 1983, compared with September 30, 1980, the end of the last fiscal year before this Administration took office. These figures are for attorneys and agents actually on board and represent an aggregate increase of more than 7.5 percent. Moreover these figures are for agents and prosecutors only and do not include increases in paralegal, clerical and other support personnel. */ */ The numbers of agents and prosecutors actually on board were as follows: Although we appreciate that some may feel that even larger increases should have been made, the level of growth which has occurred seems highly significant coming as it did during a period of budget austerity when many departments and agencies were experiencing substantial resource reductions. I should also note that concerns seem to arise in professional law enforcement personnel when there is a substantial increase in personnel during a short period of time. The concerns arise from bringing personnel on board at a rapid pace. It is possible that such action might result in sacrificing quality in the selection process. In this regard, DEA has raised its standards for Special Agents in an effort to recruit persons with college degrees and, to the extent possible, post-graduate degrees in fields such as accounting, law and pharmacy. As a result, DEA is now, like the FBI, drawing from a more limited pool of applicants. While we are very pleased with our hirings and the quality of training we are providing our new personnel, there are sound reasons for controlling carefully any major expansion in resources. Finally, I would note, as U. S. Attorney Stanley Marcus pointed out during his testimony before you in Ft. Lauderdale, that there is necessarily a correlation between the number of federal investigators and prosecutors and the number of federal judgeships. It would be an exercise in futility to develop great numbers of additional federal criminal cases if there are not enough courts to hear them. In this area, the Administration has endorsed and the Senate has approved legislation authorizing the creation of 51 additional federal district court judgeships, three of which are for the Southern District of Florida, as well as 24 additional circuit judgeships. Unfortunately, the House has not acted. Needless to say, any assistance you can provide will be appreciated. Again, I recognize that we share a common goal of enhanced law enforcement. At the same time, I wanted you to be aware of the information set out above as I believe very sincerely that it establishes that the record of the last couple of years is a good one. I truly believe that it is inaccurate and unfair to suggest that the Department of Justice or the Administration is not fully committed to strengthened law enforcement. Sincerely, CC: Congressman Harold Sawyer Robert A. McConnell Assistant Attorney General STATEMENT OF JULIAN C. MORRIS PRESIDENT OF THE AUTOMOTIVE PARTS AND ACCESSORIES ASSOCIATION, INC. Mr. Chairman and Members of the Committee: The Automotive Parts and Accessories Association (APAA) is an international association located in Washington, D.C. We have more than 1,500 members who are manufacturers, manufacturers' representatives, retailers, distributors, wholesalers and others engaged in marketing automotive products here and around the world. These products are sold primarily, but not exclusively, in the "aftermarket. The aftermarket consists of products manufactured for and services provided to automobiles by manufacturers, distributors and retailers that are independent of the vehicle manufacturers. The aftermarket is vital to the nation's economy, providing at least double the employment of the vehicle manufacturers and their dealers. We are hundreds of thousands of medium and large, but mainly small, manufacturers and others located in every state of the Union, producing and selling domestically in excess of $54 billion of parts, accessories and chemicals annually. As the leading parts and accessories suppliers for the world, industry firms exported $10.6 billion of automotive products in 1982. Mr. Chairman, APAA vigorously supports passage of the Trademark Counterfeiting Act of 1983, H.R. 2447. APAA believes that its enactment will facilitate our campaign both at home and abroad to take the profit out of what has become a highly lucrative business. SCOPE OF THE COUNTERFEITING PROBLEM APAA's concerns about the burgeoning counterfeiting menace and our support for H.R.2447 are raised from our perspective as the representative for the entire aftermarket distribution chain from the point of manufacture to the retailer or service garage. Reports from our members underscore the toll counterfeits have taken on their sales, reputations, and market shares. Product pirates have made a multi-billion dollar business out of stealing the good names of American parts and accessories manufacturers. Some experts have estimated the loss of legitimate parts and accessories sales at $12 billion internationally, with $3 billion of the total representing lost domestic sales. We would note, however, that the first hard figures on the extent of the damage will not be available until the International Trade Commission (ITC) investigation is completed. The Commission designed its survey to find out what American firms in a host of industries are up against; how their sales, goodwill and workers have suffered; and what they want government to do about it. COUNTERFEITING CRIPPLES U.S. EXPORTS We have found that counterfeiters hit parts companies and accessories companies, large companies and small alike. The only common denominator seems to be high quality products that enjoy good reputations. The same good will that made America the leading parts and accessories manufacturer for the world now renders U.S. companies particularly vulnerable to foreign usurpers. Transitions in the vehicle making industry, particularly moves by domestic auto producers toward world car production, greater foreign sourcing necessary to contain costs, and a shrinking domestic market leave only one way for automotive parts and accessories suppliers to meet the bottom line--we must export more. Counterfeiters stand in the way of our meeting this challenge. Their nefarious and unfair competition is pushing the world's emerging growth markets beyond our grasp and decimating market shares that took years to build. - We believe the lion's share of the problems at least 75 percent now takes place overseas, where we lose market share for one reason alone: price. Our firms simply cannot beat the price sheets of counterfeiters who use inferior materials, cheap labor, shoddy construction, and who never paid a dime for research and development costs. Markets that took years of American spade work to open all of the innovation, design, quality control, and marketing can be foreclosed by low cost counterfeits in just one marketing blitz. - COUNTERFEITING'S TOLL ON AMERICAN WORKERS APAA believes that the most tragic consequences of counterfeiting have been borne by American workers. In the process of idling our plant capacity, product pirates have stolen or prevented the creation of hundreds of thousands of jobs for Americans. One small APAA member, a manufacturer of interior lighting, has been ripped off for nearly four years by an overseas manufacturer that has virtually eliminated the firm's sales outside the U.S., particularly in Japan, Europe and Canada. Now the products are entering this country too. As a result, the company expects to drop 12 to 20 people from its payroll this year. |