John Conyers

Mr. CONYERS

Mr. CONYERS. Mr. Chairman, I yield 4 minutes to the gentleman from Ohio (Mr. Kucinich), who has worked on labor issues and is the former mayor of the largest city in Ohio.

Mr. CONYERS. Mr. Chairman, I am pleased to yield 2 minutes to the distinguished gentleman from California (Mr. Becerra), a former member of the Committee on the Judiciary.

Mr. CONYERS. Mr. Speaker, I object to the vote on the ground that a quorum is not present and make the point of order that a quorum is not present.

Mr. CONYERS

Mr. CONYERS. Mr. Speaker, today I am pleased to submit for the Record a memorandum on the importance of the rule of law in our constitutional democracy written by Professor Harold Norris. Widely regarded as one of our Nation's foremost constitutional law experts, Professor Norris is an emeritus professor of constitutional law at the Detroit College of Law at Michigan State University. A man of honor and great integrity, Professor Norris shaped the careers of many of Michigan's foremost attorneys and members of the State and Federal judiciary. Throughout his long life, Professor Norris has been an indefatigable defender of the Bill of Rights and the equality under law of all persons. Among his many accomplishments was the pivotal role he played in the writing of Michigan's revised State constitution in 1963. Professor Norris has provided insight on constitutional issues throughout my congressional career, most recently during the impeachment proceedings against President Clinton. Professor Norris' commitment to the spirit of our Constitution and the Bill of Rights and his zealous defense of our civil liberties should be heeded by all Americans. [From the Bradenton Herald, Oct. 19, 1998] The Issue Is Protecting the Rule of Law (By Professor Harold Norris) On two separate occasions, the American people have decided that William Jefferson Clinton is fit to be President of the United States by electing him to that office. To proceed to nullify a presidential election on the basis of authoritarian, privacy-invading questions about sex, questions the government does not have the legal power to ask, is producing irreparable harm to our nation and to its Constitution. There is no crime of perjury arising out of questions the government doesn't have and should not have the legal authority to ask. We must stop this terrible carnal carnival, this tragic, malevolent, partisan, anguishing national experience. Electing a president under our Constitution is the most important expression of the political sovereignty of the whole of the American people. To diminish, countermand or nullify the legitimacy of a presidential election for behavior rooted in personal private conduct diminishes, debases and abuses our Constitution, our nation, the office of the president, the rule of law itself. The purpose of the Constitution to unify the nation in opposing to autocracy and to abuse of constitutional authority is being dangerously undermined and diminished by the presently-invoked processes of political and unconstitutional impeachment. Perjury and subornation of perjury, rooted and based exclusively upon an illegal invasion of personal privacy like sex, is not ``treason, bribery, or high crimes and misdemeanors.'' Elizabeth Holtzman, former U.S. representative and former New York City prosecutor, concluded in an Op-Ed in the New York Times that perjury in the Clinton matter is a ``manufactured'' crime. She wrote (Aug. 10): ``As one of the authors of the original Independent Counsel Act, I never dreamed that a special prosecutor would be using his enormous powers to investigate accusations about a president's private (and legal) sexual conduct. Starr is manufacturing the circumstances in which criminal conduct may occur. . .;'' Moreover the investigation and prosecution of Mr. Starr using methods short of due process has undermined the credibility of the fact-finding process itself. The President of the United States should be as protected by the Bill of Rights as any person, or else faith and confidence in our law will be seriously damaged. Upon assuming office, President Clinton took an oath, as provided by the Constitution, that he would faithfully execute the Office of President and that he would preserve, protect, and defend the Constitution. Since the president is elected by all the people to a four- year term of office, the framers made it very difficult for him to be removed from office. According to Article II, Section 4 of the Constitution, the president may only be removed from office upon impeachment and conviction for ``treason, bribery, or other high crimes and misdemeanors.'' The term ``high crimes and misdemeanors'' had a very clear meaning for the framers. It meant a serious abuse of the president's official power or a serious breach of the president's discharge of the official duties of office. Those duties are set forth in Article II, Sections 2 and 3 of the Constitution. The framers were acutely aware that abuse of the impeachment process by Congress would upset the balance of power between the three branches of American government if any president could be toppled at will by the Congress. The Supreme Court determined in the Paula Jones case that a distinction must be drawn between incidents involving the president in his capacity as a private citizen and those occurring in the course of the exercise of his constitutional duties. Everything connected with Monica Lewinsky and Paula Jones involved the president as a private individual and had nothing whatsoever to do with the presidential office. As President Theodore Roosevelt cogently observed, ``in the United States, no person can be above the law but no person can be below the law, either.'' The president must therefore be judged according to constitutional principles and the rule of law, nothing else. There has been no suggestion that anything the independent counsel is investigating involves the president's constitutional duties. Unless the independent counsel has substantial evidence that President Clinton has violated his constitutional duties, Mr. Starr has no basis whatsoever for making a report to Congress suggesting that impeachment be contemplated. Any suggestion that the president could be impeached for conduct occurring as a private individual or because some members of Congress might dislike his character or image and consider him ``unfit for office'' is clearly contrary to the intent of the framers and the explicit language of the Constitution. We must resist as vigorously and effectively as possible any effort by the independent counsel to rewrite the Constitution to serve a palpable political end. The ultimate sacrifice made by millions of men and women to preserve the integrity of the Constitution for more than 200 years requires nothing less. There has been a tabloidization of the whole range of the American press and television. In a full self-mesmerized frenzy on the possibilities of titillation, the constitutional requirements of due process in grand juries, investigations and impeachments have been ignored, and fairness has been subordinated to a persistent partisan political purpose. Trial by and for the sex-focused press has displaced decency, dignity, civility and respect. Unless the Constitution and rule of law genuinely prevail, the country will inexorably move to continual constitutional crises and indeed, disunity and disintegration. Only a citizenry aware of the Constitution's priorities can prevent the unraveling of the nation and preserve its sovereignty. Our Constitution will not survive the criminalization of the privacy of a president. In a democratic non-totalitarian country that protects the liberty, privacy, and dignity of a person, there can be no crime of perjury for failing or refusing to answer question about sex, questions the government has no right to ask. As a 34-year veterans member of Congress, John Conyers of Michigan, devoted constitutionalist and Democratic leader of the House Judiciary Committee, put the question before Congress and the country: ``The issue is not Mr. Clinton; the issue is to preserve, protect, and defend the rule of law and the integrity of the Constitution. Without law, there is tyranny and anarchy.''

Mr. CONYERS

Mr. CONYERS. Madam Speaker, I am very delighted today to rise to honor Richard Masur who on November 12, 1999, completed his second term as president of the Screen Actors Guild, the world's largest union of professional performers. Richard Masur was first elected to the Screen Actors Guild board of directors in 1989. He then went to vice president. In 1995, he became president and was then again reelected in 1997. He is well known to film and television audiences. He starred in over 35 television movies, including the highly acclaimed chronicle of the AIDS epidemic and his Emmy-nominated performance in The Burning Bed. Three of his films are among the top 10 rated TV movies of all time. He has also taken a turn as the distinguished director of many productions. In his role as the Screen Actors Guild president and a leader in the American labor movement, he participated actively in the Guild's international work as a member of the International Federation of Actors, assisting other performers' unions throughout the world in their struggle for recognition and the achievement of fair wages and working conditions. One of the primary goals was to strengthen the international protections against the exploitation of performance images and performance in cyberspace. He urged Congress to pass the World Intellectual Property Copyright treaties, which applied the international copyright law to on-line violations. Also, under his leadership, the Screen Actors Guild became a national leader in the debate over actor diversity in the entertainment industry. He passionately advocated for the accurate portrayal of the true American scene, for color-blind casting and nontraditional thinking where it was appropriate so that the diverse American audience would see itself reflected on the screen in the stories that we tell. As the Screen Actors Guild president, he established the Guild's first government relations department. In its first 2 years of operation, he was the principal voice and primary advocate in a successful Federal and State legislative agenda, which included a number of issues, including legislation that would provide the first ever legal protections for performers residual compensation, the economic rights of senior performers, the protection of both compensation, education, and the working conditions of child performers, and the right to personal privacy for the Guild's highest profile performers. Over his 25 years performing as a professional actor, Richard Masur has sustained his activist commitments to issues of political and social justice, ranging from universal health care to international human rights. He has established an unassailable reputation for honesty, integrity, and selfless commitment, not only to his fellow performers, but to all of his fellow citizens as well. His creative and innovative approaches to problem solving has set him apart as a leader in the entertainment community. He has been a bridge builder between diverse communities and diverse interests, illuminating our understanding of many issues by drawing the common threads together. All in all, he has added to our culture. We respect and revere him. At this point, we salute our dear friend, Richard Masur, for his services to the Screen Actors Guild and to our citizenry at large. I am sure many of my colleagues will join me in wishing him much success in his future endeavors.

Mr. CONYERS

Mr. CONYERS. Mr. Speaker, I support the motion to go to conference on the ``Multidistrict, Multiparty, Multiforum Jurisdiction Act of 1999.'' I would like to begin by expressing thanks to Chairman Coble and Ranking Member Berman as well as Representative Sensenbrenner for their hard work and on this legislation which is being sought by the federal judiciary. The most important provision of the bill is section 2 which overturns the recent Supreme Court decision in Lexecon v. Milberg Weiss, which held that a transferee court assigned to hear pretrial matters must remand all cases back for trial to the districts which they were originally filed, regardless of the views of the parties. This decision conflicts with some 30 years of practice by which transferee courts were able to retain such jurisdiction under Title 28. The Judicial Conference has testified that the previous process has worked well and served the interest of efficiency and judicial expedience. There was a concern raised at the Subcommittee hearing that as originally drafted this provision would have gone far beyond simply permitting a transferee court to conduct a liability trial, but instead, allowed the court to also determine compensatory and punitive damages. This could be extremely inconvenient for harmed victims who would need to testify at the damages phase of the trial. As a result of discussions between the minority and majority, Rep. Berman successfully offered an amendment addressing this concern at the Full Committee markup. Section 3 of the bill also expands federal court jurisdiction for single accidents involving at least 25 people having damages in excess of $75,000 per claim and establishes new federal procedures in these limited cases for selection of venue, service of process, issuance of subpoenas and choice of law. The types of cases that would be included under this provision would be plane, train, bus, boat accidents and environmental spills, many of which are already brought in federal court. However, the provision would not apply to mass tort injuries that involve the same injury over and over again such as asbestos and breast implant cases. While I traditionally oppose having federal courts decide state tort issues, and disfavor the expansion of the jurisdiction of the already- overloaded district courts, I have been willing to support this provision because it would only expand federal court jurisdiction in a very narrow class of actions and is being affirmatively sought for efficiency purposes by the federal courts. This is in stark contrast to the class action bill, which would completely federalize state law and was strongly opposed by the federal and state courts. Section 3 was not included in the Senate passed bill, so I am hopeful that we can reach an accommodation which satisfies all of the interested parties and allows the more important Lexecon provision to proceed. I would also note that the federal judiciary is also seeking to address a number of additional procedural matters, and I would hope that this body would take the time to enact these measures as well.

Mr. CONYERS

Mr. CONYERS. Mr. Speaker, I would like to take this opportunity to congratulate a former employee of mine. Frances Colbert Terrell retired from the Federal Government on January 2, 1999, after 30 years of faithful and loyal service to the Legislative and Executive branches of government. Twenty-three of those years were spent right here in these ``Hallowed Halls of Congress.'' Fran, an alumnus of Hampton University, where she majored in business education, joined me in January 1989 when I became Chairman of the Government Operations Committee. Having begun her career on Capitol Hill in January 1972 as staff assistant to the Government Operations Committee, then chaired by the late Honorable Chet Holifield, Fran had come full circle and brought to my staff a wealth of administrative, management, and policy expertise on how to get things done in a Congressional Committee. Prior to joining me, Fran worked on the Small Business Committee under the chairmanship of former Rep. Parren J. Mitchell (D-MD) and the Banking and Finance Committee with former Rep. Henry S. Reuss (D-Wis) as chairman. She played a large part with my investigative staff in putting together its hearings, legislation and report for my 1994 Procurement Reform Legislation which streamlined the Government's $200 billion per-year acquisition system and allows ``off- the-shelf'' commercial purchases whenever possible after my investigation had revealed major abuses in military procurement. Fran, a native Alexandrian, came to the Hill at a critical and interesting time for African Americans. The country was still reeling from the assassinations of President Kennedy, Bobby Kennedy, Malcolm X, Martin Luther King, Jr., the March on Washington and the Poor Peoples' Campaign March. Major civil rights legislation had just been passed and an historic influx of Afro Americans had, for the first time, been elected to the House of Representatives. Fran says, ``I still remember the awe and pride I felt working for Congress. There were few African American staffers in 1972, and I was sure my tenure wouldn't last any longer than 4 years at the most. You can imagine my own surprise at lasting for 23 years. Why, that's 11 terms!'' Fran left the Hill for the Department of Agriculture in 1995 when the Republicans gained control of the House. However, she couldn't avoid politics. She ended her career with a former colleague from Indiana, the Honorable Jill Long Thompson, Under Secretary of Agriculture in the Clinton Administration. Fran says her plans now are to rest, relax and travel. She and her husband, Calvin, have already traveled to France, England, Greece and Italy. Her next adventure will be a cross country journey through the USA. I wish you the very best in your retirement and in whatever the future holds for you and your family.

Mr. CONYERS

Mr. CONYERS. Mr. Speaker, today I am proud to reintroduce, with my good friend from North Carolina, Mr. Coble, the Small Business Franchise Act. This legislation represents hard work, and a good faith effort to strike an appropriate, bipartisan balance between the rights of franchisors and franchisees. These issues have been the subject of a hearing in this Judiciary Committee earlier this year, and the issues merit action by this Congress. Protecting the rights of franchisees is ultimately about protecting the rights of small business. They often face enormous odds and a daunting inequality of bargaining power when dealing with national franchisors. Unfortunately, the law often offers little recourse in the face of great harm. There is currently no federal law establishing standards of conduct for parties to a franchise contract. The Federal Trade Commission rule promulgated in 1979, (16 CFR Sec. 436), was designed to deter fraud and misrepresentation in the re-sales process and provide disclosure requirements and prohibitions concerning franchise agreements. The FTC maintains, however, that it has no jurisdiction after the franchise agreement is signed. As a result, in the absence of any Federal regulation, a number of complaints have been lodged in recent years, principally stemming from the fact that franchisees do not have equal bargaining power with large franchisors. The concerns include the following: (1) Taking of Property without Compensation. Franchise agreements generally include a covenant not-to-compete that prohibits the franchisee from becoming an independent business owner in a similar business upon expiration of the contract. This can appropriate to the franchisor all of the equity built up by the franchisee without compensation. (2) Devaluation of Assets. Franchisors often induce a franchisee to invest in creating a business and then establish a competing outlet in such proximity to the franchisee that the franchisee suffers economic harm. (3) Restraint of Trade. Most franchise relationships mandate that franchisees purchase supplies, furniture, etc. from the franchisor or sources approved by the franchisor. While it may be appropriate for franchisors to exercise some control concerning the products or services offered to franchisees, tying franchisees to certain vendors can cost franchisees millions of dollars, prevents competition among vendors, and can have an adverse impact upon consumers. (4) Inflated Pricing. Many franchise agreements specify that the franchisor has the right to enter into contractual arrangements with vendors who sell goods and services to franchisees that are mandated by the franchise agreement. It has been alleged that these vendors often provide kickbacks and commissions to the franchisor in return for being allowed to sell their products and services to a captive market. Instead of passing these kickbacks and commissions on to the franchisee to reduce their cost of goods sold and increase their margin, these payments, it is asserted, benefit the franchisor. While our nation has enjoyed an unprecedented economic boom, it is essential that Congress ensure that prosperity reaches down to the small businesses that make up the heart and soul of our economy. We have an obligation to ensure that the law governing this segment of the economy, which every American patronizes routinely is fair and balanced. I urge my colleagues to join with me and the gentleman from North Carolina in supporting this overdue and needed reform. The following is a section-by-section description of the legislation: Section 1. Short Title; Table of Contents. Sets forth the short title of the Act and the table of contents. Section 2. Findings and Purpose. Subsection (a) specifies a series of Congressional findings. Subsection (b) states that the purpose of the Act is to promote fair and equitable franchise agreements, to establish uniform standards of conduct in franchise relationships, and to create uniform private Federal remedies for violations of Federal law. Section 3. Franchise Sales Practices. Subsection (a) prohibits any person, in connection with the advertising, offering, or sale of any franchise, from (1) employing a device, scheme, or artifice to defraud; (2) engaging in an act, practice, course of business, or pattern of conduct which operates or is intended to operate as a fraud upon any prospective franchisee; and (3) obtaining property, or assisting others in doing so, by making an untrue statement of a material fact or failing to state a material fact. Subsection (b) prohibits franchisors, sub franchisors, and franchise brokers, in connection with any disclosure document, notice, or report required by any law, from (i) making an untrue statement of material fact, (ii) failing to state a material fact, or (iii) failing to state any fact which would render any required statement or disclosure either untrue or misleading. The subsection also prohibits franchisors, sub franchisors, and franchise brokers from failing to furnish any prospective franchisee with all information required to be disclosed by law and at the time and in the manner required and from making any claim or representation to a prospective franchisee, whether orally or in writing, which is inconsistent with or contradicts such disclosure document. ``Disclosure document'' is defined as the disclosure statement required by the Federal Trade Commission in Trade Regulation Rule 436 (16 CFR 436) or an offering circular prepared in accordance with Uniform Franchise Offering Circular guidelines as adopted and amended by the North American Securities Administrators Association, Inc. or its successor. Section 4. Unfair Franchise Practices. Subsection (a) prohibits any franchisor or subfranchisor, in connection with the performance, enforcement, renewal and termination of any franchise agreement, from (1) engaging in an act, practice, course of business, or pattern of conduct which operates as a fraud upon any person; (2) hindering, prohibiting, or penalizing, either directly or indirectly, the free association of franchisees for any lawful purpose, including the formation of or participation in any trade association made up of franchisees or of associations of franchises; and (3) discriminating against a franchisee by imposing requirements not imposed on other similarly situated franchisees or otherwise retaliating, directly or indirectly, against any franchisee for membership or participation in a franchisee association. Subsection (b) prohibits a franchisor from terminating a franchise agreement prior to its expiration without good cause. Subsection (c) prohibits a franchisor from prohibiting, or enforcing a prohibition against, any franchisee from engaging in any business at any location after expiration of a franchise agreement. This subsection does not prohibit enforcement of a franchise contract obligating a franchisee after expiration or termination of a franchise to (i) cease or refrain from using a trademark, trade secret or other intellectual property owned by the franchisor or its affiliate, (ii) alter the appearance of the business premises so that it is not substantially similar to the standard design, decor criteria, or motif in use by other franchisees using the same name or trademarks within the proximate trade or market area of the business, or (iii) modify the manner or mode of business operations so as to avoid any substantial confusion with the manner or mode of operations which are unique to the franchisor and commonly in practice by other franchisees using the same name or trademarks within the proximate trade or market area of the business. Section 5. Standards of Conduct. Subsection (a) imposes a duty to act in good faith in the performance and enforcement of a franchise contract on each party to the contract. Subsection (b) imposes a nonwaivable duty of due care on the franchisor. Unless the franchisor represents that it has greater skill or knowledge in its undertaking with its franchisees, or conspicuously disclaims that it has skill or knowledge, the franchisor is required to exercise the skill and knowledge normally possessed by franchisors in good standing in the same or similar types of business. Subsection (c) imposes a fiduciary duty on the franchisor when the franchisor undertake to perform bookkeeping, collection, payroll, or accounting services on behalf of the franchisee, or when the franchisor requires franchisees to make contributions to any pooled advertising, marketing, or promotional fund which is administered, controlled, or supervised by the franchisor. A franchisor that administers or supervises the administration of a pooled advertising or promotional fund must (i) keep all pooled funds in a segregated account that is not subject to the claims of creditors of the franchisor, (ii) provide an independent certified audit of such pooled funds within sixty days following the close of the franchisor's fiscal year, and (iii) disclose the source and amount of, and deliver to the fund or program, any discount, rebate, compensation, or payment of any kind from any person or entity with whom such fund or program transacts. Section 6. Procedural Fairness Subsection (a) prohibits a franchisor from requiring any term or condition in a franchise agreement, or in any agreement ancillary or collateral to a franchise, which violates the Act. It also prohibits a franchisor from requiring that a franchisee relieve any person from a duty imposed by the Act, except as part of a settlement of a bona fide dispute, or assent to any provision which would protect any person against any liability to which he would otherwise be subject under the Act by reason of willful misfeasance, bad faith, or gross negligence in the performance of duties, or by reason of reckless disregard of obligations and duties under the franchise agreement. Nor may a franchisor require that a franchisee agree to not make any oral or written statement relating to the franchise business, the operation of the franchise system, or the franchisee's experience with the franchise business. Subsection (b) makes void and unenforceable any provision of a franchise agreement, or of any agreement ancillary or collateral to a franchise, which would purport to waive or restrict any right granted under the Act. Subsection (c) forbids any stipulation or provision of a franchise agreement or of an agreement ancillary or collateral to a franchise from (i) depriving a franchisee of the application and benefits of the Act or any Federal law or any law of the State in which the franchisee's principal place of business is located, (ii) depriving a franchisee of the right to commence an action or arbitration against the franchisor for violation of the Act, or for breach of the franchise agreement or of any agreement or stipulation ancillary or collateral to the franchise, in a court or arbitration forum in the State of the franchisee's principal place of business, or (iii) excluding collective action by franchisees to settle like disputes arising from violation of the Act by civil action or arbitration. Subsection (d) states that compliance with the Act or with an applicable State franchise law is not waived, excused or avoided, and evidence of violation of the Act or State law shall not be excluded, by virtue of an integration clause, any provision of a franchise agreement or an agreement ancillary or collateral to a franchise, the parol evidence rule, or any other rule of evidence purporting to exclude consideration of matters outside the franchise agreement. Section 7. Actions by State Attorneys General Subsection (a) permits a State attorney general to bring an action under the Act in an appropriate United States district court using the powers conferred on the attorney general by the laws of his State. Subsection (b) states that this section does not prohibit a State attorney general from exercising the powers conferred on him by the laws of his State to conduct investigations or to administer oaths or affirmations or to compel the attendance of witnesses or the production of documentary and other evidence. Subsection (c) states that any civil action brought under subsection (a) in a United States district court may be brought in the district in which the defendant is found, is an inhabitant, or transacts business, or wherever venue is proper under 28 U.S.C. 1391 which establishes general venue rules. Process may be served in any district in which the defendant is an inhabitant or in which he may be found. Subsection (d) states that nothing in this section shall prohibit an authorized State official from proceeding in State court on the basis of an alleged violation of any civil or criminal statute of such State. Section 8. Transfer of a Franchise Subsection (a) permits a franchisee to assign an interest in a franchised business and franchise to a transferee if the transferee satisfies the reasonable qualifications generally applied in determining whether or not a current franchisee is eligible for renewal. If the franchisor does not renew a significant number of its franchisees, then the transferee may be required to satisfy the reasonable conditions generally applied to new franchisees. The qualifications must be based upon legitimate business reasons. If the qualifications are not met, the franchisor may refuse to permit the transfer, provided that the refusal is not arbitrary or capricious and the franchisor states the grounds for its refusal in writing to the franchisee. Subsection (b) requires that a franchisee give the franchisor at least thirty days' written notice of a proposed transfer, and that a franchisee, upon request, will provide in writing to the franchisor a list of the ownership interests of all persons holding or claiming an equitable or beneficial interest in the franchise subsequent to the transfer. Subsection (c) states that a franchisor is deemed to have consented to a transfer thirty days after the request for consent is submitted, unless the franchisor withholds consent in writing during that time period specifying the reasons for doing so. Any such notice is privileged against a claim of defamation. Subsection (d) establishes that a franchisor may require the following four conditions before consenting to a transfer: (1) the transferee successfully complete a reasonable training program, (2) payment of a reasonable transfer fee, (3) the franchisee pay or make reasonable provisions to pay any amount due the franchisor or the franchisor's affiliate, (4) the financial terms of the transfer at the time of the transfer comply with the franchisor's current financial requirements for franchisees. A franchisor may not condition its consent to a transfer on (1) a franchisee forgoing existing rights other than those contained in the franchise agreement, (2) entering into a release of claims broader in scope than a counterpart release of claims offered by the franchisor to the franchisee, or (3) requiring the franchisee or transferee to make, or agree to make, capital improvements, reinvestments, or purchases in an amount greater than the franchisor could have reasonably required under the terms of the franchisee's existing franchise agreement. Subsection (e) permits a franchisee to assign his interest for the unexpired term of the franchise agreement and prohibits the franchisor from requiring the franchisee or transferee to enter an agreement which has different material terms or financial requirements as a condition of the transfer. Subsection (f) prohibits a franchisor from withholding its consent without good cause to a franchisee making a public offering of its securities if the franchisee or owner of the franchisee's interest retains control over more than 25 percent of the voting power as the franchisee. Subsection (g) prohibits a franchisor from withholding its consent to a pooling of interests, to a sale or exchange of assets or securities, or to any other business consolidation among its existing franchisees, provided the constituents are each in material compliance with their respective obligations to the franchisor. Subsection (h) establishes six occurrences which shall not be considered transfers requiring the consent of the franchisor under a franchise agreement and for which the franchisor shall not impose any fees or payments or changes in excess of the franchisor's cost to review the matter. Subsection (i) prohibits a franchisor from enforcing against the transferor any covenant of the franchise purporting to prohibit the transferor from engaging in any lawful occupation or enterprise after the transfer of a transferor's complete interest in a franchise. This subsection does not limit the franchisor from enforcing a contractual covenant against the transferor not to exploit the franchisor's trade secrets or intellectual property rights except by agreement with the franchisor. Section 9. Transfer of Franchise By Franchisor Subsection (1) prohibits a franchisor from transferring interest in a franchise by sale or in any other manner unless he gives notice thirty days prior to the effective date of the transfer to every franchisee of his intent to transfer the interest. Subsection (2) requires that the notice given contains a complete description of the business and financial terms of the proposed transfer or transfers. Subsection (3) requires that the entity assuming the franchisor's obligations have the business experience and financial means necessary to perform the franchisor's obligations. Section 10. Independent Sourcing of Goods and Services Subsection (a) prohibits a franchisor from prohibiting or restricting a franchisee from obtaining equipment, fixtures, supplies, goods or services used in the establishment or operation of the franchised business from sources of the franchisee's choosing, except that such goods or services may be required to meet established uniform system-wide quality standards promulgated or enforced by the franchisor. Subsection (b) requires that if the franchisor approves vendors of equipment, fixtures, supplies, goods, or services used in the establishment or operation of the franchised business, the franchisor will provide and continuously update an inclusive list of approved vendors and will promptly evaluate and respond to reasonable requests by franchisees for approval of competitive sources of supply. The franchisor shall approve not fewer than two vendors for each piece of equipment, each fixture, each supply, good, or service unless otherwise agreed to by both the franchisor and a majority of the franchisees. Subsection (c) requires a franchisor and its affiliates officers and/or its managing agents, must fully disclose whether or not it receives any rebates, commissions, payments, or other benefits from vendors as a result of the purchase of goods or services by franchisees and requires a franchisor to pass all such rebates, commissions, payments, and other benefits directly to the franchisee. Subsection (d) requires a franchisor to report not less frequently than annually, using generally accepted accounting principles, the amount of revenue and profit it earns from the sale of equipment, fixtures, supplies, goods, or services to the franchisee. Subsection (e) excepts reasonable quantities of goods and services that the franchisor requires the franchisee to obtain from the franchisor or its affiliate from the requirements of subsection (a), but only if the goods and services are central to the franchised business and either are actually manufactured or produced by the franchisor or its affiliate, or incorporate a trade secret or other intellectual property owned by the franchisor or its affiliate. Section 11. Encroachment Subsection (a) prohibits a franchisor from placing, or licensing another to place, one or more, new outlet(s) in unreasonable proximity to an established outlet, if (i) the intent or probable effect of establishing the new outlet(s) is to cause a diminution of gross sales by the established outlet of more than five percent in the twelve months immediately following establishment of the new outlet(s), and (ii) the established franchisee offers goods or services identified by the same trademark as those offered by the new outlet(s), or has premises that are identified by the same trademark as the new outlet(s). Subsection (b) creates an exception to this section if, before a new outlet(s) opens for business, a franchisor offers in writing to each franchisee of an established outlet concerned to pay to the franchisee an amount equal to fifty percent of the gross sales of the new outlet(s), for the first twenty-four months of operation of the new outlet(s), if the sales of the established outlet decline by more than five percent in the twelve months immediately following establishment of the new outlet(s), as a consequence of the opening of such outlet(s). Subsection (c) places upon the franchisor the burden of proof to show that, or the extent to which, a decline in sales of an established franchised outlet occurred for reasons other than the opening of the new outlet(s), if the franchisor makes a written offer under subsection (b) or in an action or proceeding brought under section 12. Section 12. Private Right of Action Subsection (a) gives a party to a franchise who is injured by a violation or impending violation of this Act a right of action for all damages caused by the violation, including costs of litigation and reasonable attorney's fees, against any person found to be liable for such violation. Subsection (b) makes jointly and severally liable every person who directly or indirectly controls a person liable under subsection (a), every partner in a firm so liable, every principal executive officer or director of a corporation so liable, every person occupying a similar status or performing similar functions and every employee of a person so liable who materially aids in the act or transaction constituting the violation, unless the person who would otherwise be liable hereunder had no knowledge of or reasonable grounds to know of the existence of the facts by reason of which the liability is alleged to exist. Subsection (c) states that nothing in the Act shall be construed to limit the right of a franchisor and a franchisee to engage in arbitration, mediation, or other nonjudicial dispute resolution, either in advance or after a dispute arises, provided that the standards and protections applied in any binding nonjudicial procedure agreed to by the parties are not less than the requirements set forth in the Act. Subsection (d) prohibits an action from being commenced more than five years after the date on which the violation occurs, or three years after the date on which the violation is discovered or should have been discovered through exercise of reasonable diligence. Subsection (e) provides for venue in the jurisdiction where the franchise business is located. Subsection (f) states that the private rights created by the Act are in addition, to, and not in lieu of, other rights or remedies created by Federal or State law. Section 13. Scope and Applicability Subsection (a) applies the requirements of the Act to franchise agreements entered into, amended, exchanged, or renewed after the date of enactment of the Act, except as provided in subsection (b). Subsection (b) delays implementation of Section 3 of the act until ninety days after the date of enactment of the Act and applies Section 3's requirements only to actions, practices, disclosures, and statements occurring on or after such date. Section 14. Definitions Defines terms used in the Act.

Mr. CONYERS

Mr. CONYERS. Mr. Speaker, a recent study by the National Institute of Justice found that stalking is a crime that will victimize far too many in this country: 8% of American women and 2% of American men will be stalked in their lifetimes. In fact, 1.4 million Americans are stalked every year. While I am pleased that we have been able to work with the majority to craft a stalking bill that strikes the correct balance between the need to protect stalking victims and the constitutional due process rights of all accused persons, I am disappointed that we are still addressing domestic violence issues in fits and starts. The Violence Against Women Act of 1999, H.R. 37, which I have sponsored and which has 175 co-sponsors, addresses the continuing problem of domestic violence in a comprehensive fashion. H.R. 357 goes beyond merely expanding the federal definition of stalking and would reauthorize the important programs to stop sexual assault and domestic violence that Congress funded in the 1994 Violence Against Women Act. H.R. 357 would also build on the good work we did in 1994 and expand funding to other areas such as violence against children, sexual assault prevention, domestic violence prevention, violence against women in the military system, and many others. Stalking is a serious problem that deserves our attention, but we cannot shut our eyes to the broader problems of domestic violence. Studies show that women and girls annually experience approximately 960,000 incidents of assault, rape, and murder at the hands of a current or former spouse or intimate partner. It is ironic, indeed, that we had people on the other side of the aisle decrying violence against fetuses several weeks ago, but they have still been unable to hold hearings on H.R. 357, which addresses domestic violence against women, children, and men. I am happy that H.R. 1869 will allow for prosecution of stalking where a stalker transmits a threatening communication over the telephone, through the mail, or by email. I also support provisions in the bill that make it clear that at the time of sentencing, the court should issue an appropriate protective order designed to protect the victim from further stalking by the convicted person. Under the bill, this order will remain in effect for as long as the court deems it necessary in order to prevent the stalking victim from being harassed after the person is released from prison. In addition, we have seen far too many instances where an arrest will not make a stalker stop threatening a victim or will even result in a stalker escalating his stalking to a point that is life-endangering to the victim. While I certainly believe that everyone is innocent until proven guilty and that bail should be granted to the accused in as many cases as possible, it is also necessary in certain cases to detain alleged stalkers before trial. By defining stalking as a ``crime of violence'' under our criminal laws, H.R. 1869 will permit a federal court to detain an alleged stalker pending trial in order to assure the safety of the community or the defendant's appearance at trial. While I applaud these changes in our stalking laws, we still need to do more. I encourage Congress to make this stalking bill only the first step in a broader battle against domestic violence. We should hold hearings on H.R. 357 and, at a minimum, continue the good work we began in the 1994 Violence Against Women Act, by reauthorizing those programs.

Mr. CONYERS

Mr. CONYERS. Mr. Chairman, I yield myself 2 minutes. My colleagues, this substitute is just what we need. It has come not a moment too soon, because I think we can now bring a marriage to the rights of consumers and the high-tech necessities of e-signature. It satisfies the need of the high-tech community by recognizing the validity of the electronic signatures in contracts, but it does not go as far as the base bill in getting into the controversial issue of other electronic records that might arise from electronic contract formation. In other words, this steers a midcourse. It has a counterpart in the United States Senate. And it also has the assurance that the President will sign it into law. So I am asking my colleagues, please, if we are supporting e- signatures and want to move high tech forward, here is the substitute that we can do this by. The substitute deals only with the formation of electronic contracts and not other types of records. It does not undermine the important consumer protection laws. For example, regulations implementing the Truth in Lending Act require creditors to provide consumers with periodic statements that include information essential to a consumer in managing a credit card account. Now, this cannot be accomplished unless we have the substitute. Creditors could request on a consumer's consent to receive all disclosures electronically under H.R. 1714. That is exactly what we are trying to make the distinction between the substitute and the base bill. Please support this substitute.

Mr. CONYERS. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, I would like to begin by thanking the gentleman from Michigan (Mr. Dingell), dean of the House and the ranking member of the Committee on Commerce, for sharing the time in general debate with the Committee on the Judiciary that I represent on this side. Now, Mr. Chairman, we all know there are millions of Internet users and millions of consumers, and that this number increases daily. It has been said here earlier, electronic commerce is the future of our economy. As more and more people buy and sell merchandise on-line, we find that e-commerce has made life easier for people as well as improved our overall economy by making shopping and other commercial transactions far more convenient. I want to enact Federal legislation that would facilitate electronic signatures and make e-commerce more robust. We need to ensure that contracts are not denied validity that they otherwise would have simply because they are in electronic form or signed electronically. Now, if the measure before us did this without doing violence to our most cherished and long-fought consumer protections, I would be supporting it without reservation. Now, especially with the recent decision in the Microsoft case, which suggests that a high-tech giant may not always be friendly to consumers, it makes it even more important than ever that consumers have confidence in the Internet and that they believe it is friendly and a friendly place to do business. This is critical to the future of this whole industry. It is only when consumers have confidence in on-line transactions that it will become the vibrant marketplace that it can be. The high- tech community should not let itself be hijacked by security firms or banks or the insurance industry whose history with respect to consumers has not always been what we would wish it to be. The on-line community should be in the forefront of consumer protection. Instead, they are being dragged backwards by special interests. That is where I hope that I may be able to be of some small help in this debate, because this measure, as it is written, goes far beyond the needs of the vast majority of on-line businesses. H.R. 1714 has become an 11th hour grab bag for our special interests to hurt consumers by undermining critical laws that require notice of rights and that prevent unscrupulous business people, of which, unfortunately, there are some, from cheating unsuspecting customers. Because of the special interests overreaching, what started as an uncontroversial bill to validate electronic signatures and contracts has turned into a battle over the electronic records of every type imaginable. Let us try to rescue this measure from that kind of a result. So for this reason, instead of considering a bill that should be a win-win situation, both for consumers and e-commerce, we are now being pressured into voting on a bill that pits the opportunities of one against the rights of the other. It is, therefore, no surprise that the bill is opposed by our administration. It is opposed by consumer groups. It is opposed by the National Conference of State Legislatures and the United Automobile Workers and many others. So what we have here is, unfortunately, a very good idea that has attached to it provisions that undermine consumer protection laws that would require notice, warranties, and disclosures to be in writing because it permits consumers to unwittingly click away many of these rights. For example, critical notices regarding the cancellation or change in terms of insurance agreements or a change in the interest rate or the service or the change of a servicer of a mortgage, of recall notices, and other warranty information could be sent electronically or posted on a Web site regardless of whether the person owns a computer, which it may not come as news to you, many people do not, or whether the consumer has an e-mail account, which they may not, or whether they know how to navigate the World Wide Web even if they have the technology, some of which do not. Furthermore, this measure stands for the proposition that the States somehow do not have the ability to enact their own electronic commerce laws or to reinstate many additional consumer protections. So rather than respecting the tradition in our country of hundreds of years that reserves contract law to the States, the bill says that the States, that they may only reenact supplemental consumer legislation if it fits into a narrowly described category. So far, thus, even if a State wanted to maintain its protections against fraudulent or deceptive practices and automobile sales, for example, the Federal Government would in effect tell the State that it cannot do so. So for these and other reasons, we have created, along with the gentleman from Michigan (Mr. Dingell) and the other Members, a substitute that represents the bipartisan language agreed on by Members of the other body, Members, Senator Abraham and Senator Leahy, that satisfies the needs of the high-tech community which we laud without sacrificing consumers in the process. So I urge that my colleagues reserve their support for this substitute. Mr. Chairman, I reserve the balance of my time.

Mr. CONYERS. Mr. Chairman, I yield 2 minutes to the gentlewoman from California (Ms. Lofgren), a member of the Committee on the Judiciary.

Mr. CONYERS. Mr. Chairman, I yield 4 minutes to the gentleman from California (Mr. Berman).

Mr. CONYERS. Mr. Chairman, I yield 1\1/2\ minutes to the gentleman from Massachusetts (Mr. Delahunt), my colleague on the Committee on the Judiciary.

Mr. CONYERS. Mr. Chairman, I yield myself 3 minutes. I want to start off by commending my friends that are with the gentleman from Washington (Mr. Inslee) on his amendment. This is an important step forward. The problem is, it is still a half a loaf, and I appreciate the Democrats that are trying to improve it. This amendment makes minor improvements in the underlying bill but, indeed, it makes it worse in several respects. That is why it is quite clear why financial services, industries and banks are supporting it and consumer groups are opposing it. Here is why it is a backward step. It leaves to the courts to determine who bears the burden when an electronic disclosure notice is not received. The bill does that. The Inslee amendment puts the burden squarely on the consumer's shoulders. Mr. Chairman, H.R. 1714, the Bliley bill leaves it to the courts; the Inslee amendment leaves it to the consumer the responsibility of creating an affirmative obligation to notify a provider of a change of e-mail address. Now, in addition, this will not be corrected by the Inslee amendment. No requirement that the consumer be told what legal rights he is waiving or to what types of records that is the notices, disclosures and statements, that the waiver applies to. Because both the bill and the amendment permit a consumer to waive writing requirements for groups, ``groups of records,'' and there is no requirement that the record be similar or relate to the same transaction. The consumer can, without any prior knowledge, waive all the future notices with one click. This, I say to my colleagues, is the substance of what leads me to regretfully not be able to support the Inslee amendment. It does help in some respects, but in other respects, it is worse. For that reason I would urge that we think very carefully about this so-called improvement. The amendment improves the opt-in by requiring it to be conspicuous and visually separate. But there is still no requirement that the consumer be told what legal rights he or she is waiving or what types of notices and disclosures the waiver applies to. The Inslee amendment narrows the States' ability to reenact supplemental protective legislation for their citizens. This is not good. For that reason I ask that my colleagues critically evaluate this supposed improvement in the bill. While I appreciate the efforts of my fellow Democrats to improve H.R. 1714, this amendment is merely an industry-drafted cosmetic fix that makes only minor improvements to the underlying bill, and indeed, makes it worse in several respects. Furthermore, it leaves unaddressed many fundamental problems of H.R. 1714. It is therefore no surprise--and is quite telling, in fact--that this amendment is supported by the banks and financial services industries, but is opposed by the consumer groups. The Inslee amendment is a step backwards for consumers in many ways. Unlike H.R. 1714, which leaves it to the courts to determine who bears the burden when an electronic disclosure or notice is not received, the Inslee amendment puts the burden squarely on consumers' shoulders by creating an affirmative obligation for consumers to notify a provider of a change of email address. The U.S. Postal Service has standardized procedures for address changes, forwarding mail, and returning mail to the sender that currently are not present in the on-line world. Without these real-world ``back-up'' mechanisms, this amendment simply creates a defense for merchant in cyberspace that it would not have in the physical world. The Inslee amendment also is a step backward from H.R. 1714 because it takes away the requirement that when a contract is required by law to be in writing, the electronic record of the contract must: (1) accurately set forth the information in contract after it was first generated, and (2) remain accessible for later reference, transmission and printing. Under the amendment, these standards apply only where a law requires a record to be retained. This significantly undercuts the reach of H.R. 1714. In addition, the Inslee amendment narrows the states' ability to reenact supplemental protective legislation for their citizens. Instead of allowing the states to enact laws for the safety or health of an individual consumer, the amendment permits the states to legislate only where it is necessary for the protection of ``public health or safety of consumers.'' Thus, if certain notices and disclosures are not for the benefit of the public health or safety and only benefit individual consumers--such as notices to individuals about changes in their insurance policies, or a specific consumer's late payment on his utilities--the state cannot enact or reenact supplemental laws for this purpose. Furthermore, the Inslee amendment leaves in place many of the most troubling aspects of H.R. 1714. For instance, although the amendment improves the opt-in by making requiring it to be ``conspicuous'' and ``visually separate,'' there is still no requirement that the consumer be told what legal rights she is waiving or what types of notices and disclosures the waiver applies to. In addition, the consumer can still waive ``groups of records'' with one click, regardless of whether or not they are related to each other or if they are similar in nature. The Inslee amendment also maintains the bill's broad preemption of state laws. In order for a state to avoid preemption by the federal statute, the Uniform Electronic Transactions Act, or UETA, must be consistent with the electronic contracts and records provisions of this bill. This does not give the states sufficient flexibility to exempt necessary state writing requirements. Ironically, even if a state adopted UETA without excepting any of its laws. The state would still be preempted by the federal law, because UETA does not provide for an opt-in, and that would make the state law inconsistent with--and therefore preempted by--the federal law. Another flaw with the Inslee amendment is that it does not address the regulatory and supervisory problems with H.R. 1714. Under this amendment, regulated industries such as the banking and insurance industries would still be relieved from their legal requirements to maintain paper records. How can a state insurance regulator determine if an insurance company is properly capitalized, or if it has the proper reinsurance it cannot access the company's electronic records, or if the regulator can not require that the company keep its records in a tamper-proof format? I understand my colleagues' desire to improve H.R. 1714--because it needs much improvement. But the Inslee amendment just scratches the surface of what's needed to make the necessary improvements in H.R. 1714. Indeed, the amendment makes the bill worse in several respects. Mr. Chairman, I reserve the balance of my time.

Mr. CONYERS. Mr. Chairman, I yield 2 minutes to the gentleman from New York (Mr. LaFalce), the distinguished ranking member of the Committee on Banking and Financial Services. (Mr. LaFALCE asked and was given permission to revise and extend his remarks.)

Mr. CONYERS. Mr. Chairman, I yield 2\1/2\ minutes to the gentleman from California (Mr. Berman), a distinguished member of the Committee on the Judiciary.

Mr. CONYERS. Mr. Chairman, I am pleased to yield 3 minutes to the gentleman from Minnesota (Mr. Vento).

Mr. CONYERS. Mr. Chairman, I yield 30 second to the gentleman from New York (Mr. LaFalce).

Mr. CONYERS. Mr. Chairman, I yield 2 minutes to the gentleman from Michigan (Mr. Dingell), the dean of the House and the ranking member of the Committee on Commerce.

Mr. CONYERS. Mr. Chairman, I yield the balance of my time to the gentlewoman from Texas (Ms. Jackson-Lee), a distinguished member of the Committee on the Judiciary. (Ms. JACKSON-LEE of Texas asked and was given permission to revise and extend her remarks.)

Mr. CONYERS

Mr. CONYERS. Mr. Speaker, I yield myself 2\1/2\ minutes. Mr. Speaker, paying due deference to all of the saints responsible for the bill listed by the gentleman from Louisiana (Chairman Tauzin), the gentleman from North Carolina (Chairman Coble), the gentleman from Massachusetts (Mr. Markey), the ranking member, and our colleagues on both committees, the gentleman from California (Mr. Berman) and the gentleman from Virginia (Mr. Boucher), this conference report has finally reached the floor. Some think it may be the signal that we will be released soon because this is a bill that had to go through. It represents the culmination of several years of debate on intellectual property issues that affect both consumers, broadcasters, satellite companies, domain name holders, and patent holders. The most important change the bill makes is allowing satellite carriers to offer local-to-local service. As we know, under current law, consumers may not receive local network signals along satellite services unless they are in a service area where local reception is blocked. By eliminating this restriction, we will allow the satellite companies to provide more viable competition with cable, which will enhance consumer choice and services. This is good. At the same time we are eliminating the barriers to entry by satellite, the bill also helps ensure that there is a level playing field between cable and satellite. This is good. Under current law, cable is subject to legal must-carry requirements, which ensure that they carry all local service channels. This bill provides for a mechanism for importing this requirement on satellite companies, which again will serve to broaden the choices consumers have in programming. Another important reform included in the bill includes loan guarantees provided for companies that want to retransmit local signals to rural markets. Far too much of the information revolution has passed by rural America. On our committee, the gentleman from Virginia (Mr. Boucher) has done an excellent job in this regard and has helped the bill immeasurably. Telecommunication firms have argued that it is not economically feasible to offer satellite and other advanced services in these areas. We have done differently. The conference report will help to ensure that the capital exists to offer rural America access to their local signals. I urge support of the measure before us. Mr. Speaker, I reserve the balance of my time.

Mr. CONYERS. Mr. Speaker, I also yield 2 minutes to the gentleman from Virginia (Mr. Boucher).

Mr. CONYERS. Mr. Speaker, I am pleased to yield 3 minutes to the gentleman from California (Mr. Berman), the ranking member on our subcommittee; and I thank him for his excellent work.

Mr. CONYERS. Mr. Speaker, I am pleased to yield 1 minute to the gentlewoman from California (Ms. Lofgren).