The contention that the Food and Drugs Act as written fails because fraud cannot be proven is fantastic. Fraud can be established, as stated by Judge Covington, by attending facts and circumstances, and conviction in proper cases are comparatively sure.

These decisions disclose exactly what the sponsors of the Food and Drugs bill have in mind in the proposed changes in the provisions of the law regulating the sale of drugs. It is apparent that they are quite dissatisfied and are wholly impatient with the decisions of the Supreme Court of the United States. That great court recognizes the truth-that there is a wide divergence of opinion with respect to the effectiveness of medicinal agents. It also recognizes the truth that fraud may be established in proper cases.

The courts can be trusted. Therefore the views of the court should not be swept aside, and Congress asked against the facts to declare that there is an agreement of medical opinion and to set aside the well-known rules of law, so that the guiltless as well as the guilty may be punished and property destroyed by the ukase of a satrap.

In a recent release, among other things, appeared the following language:

Any intelligent conception of modern governmental functions must embrace the idea of effective consumer protection. The scope of such protective action must be progressively enlarged as population and the complexity of our social and economic life are increased. Thus, the protection afforded by the Federal Food and Drugs Act when passed in 1906 is radically insufficient today."

The decisions of the Supreme Court probably account for the contention that the present law is insufficient.

Courts other than the Supreme Court have disagreed with the interpretations both of the language of the act and of representations upon packages and labels insisted upon by the Drug Administration. The failure of the courts to agree

with such interpretations does not necessarily mean that the law is radically insufficient. My view is that the action of the courts was based upon the idea that the Administration was wrong.

In the October 1933 number of Good Housekeeping, on page 94, appears an evidently inspired article by one Dr. Walter H. Eddy, in which he used the following language:

"The bill emanates from the office of the Secretary of Agriculture. It is primarily the expression of view of the public officials who under the direction of the present Chief of the Food and Drug Administration, W. G. Campbell, have had the burden of prosecuting violators of the old law. In their conduct of prosecutions designed to protect the consumer, these officials have met with situations that are not covered by the old law.

They have seen their efforts nullified and thrown out of court in certain instances, not because the violation wasn't real but because legally there was lacking provision necessary to enforcement of their measures of public relief and protection. *** In its present form it" (the proposed measure) "expresses the viewpoint of the enforcement officers as to what they need in order to render more efficient service to the consumer, and to protect the Government from criticism of laxity."

Here we have it

(a) The bill emanates from the office of the Secretary of Agriculture.

(b) It is primarily the expression of view of the Food and Drug Administration of what it needs.

(c) The officials have had their efforts nullified and thrown out of court in certain instances, not because the violation wasn't real but because legally there was lacking provision necessary to enforce their measures of public relief and protection. It is a pertinent inquiry as to how there can be a violation without a prohibition. One has to study this suggestion for a minute before we catch exactly what is meant. It does not mean that there was any violation of law but that there was a violations of the opinions entertained by the Drug Administration.

It is assumed that the protection afforded by the present act is radically insufficient and that the efforts of the Administration have been nullified and thrown out of court upon the ground that there were lacking necessary provisions. Such assumptions are not supported by the facts.

It is true that some efforts of the Administration have been nullified, and in certain instances their cases have been thrown out of court.

Cases are frequently thrown out of court because they are sometimes without merit, sometimes not well prepared, and sometimes not well tried.

In cases under the Food and Drugs Act the Government has lost in some instances for the following reasons:

1. The Government was unable to obtain conviction because suit was not brought in what Judge Covington describes as a proper case.

2. Failure upon the part of the Government to establish by the introduction of evidence applicable to the case the necessary facts and circumstances upon which wrongful motive may be proven.

3. Because the action was grounded upon a distorted inference rather than upon the fair import of the language used in the representations.

4. Refusal in proper cases to grant a hearing as contemplated by the provisions of the act.

5. Unsound interpretations of the language of the act as expressed by the Congress of the United States.

6. Neglect to make such records that a review may be had in courts of superior jurisdiction.

Again using the above a quoted languagee-under the present law the offense may be established by the ordinary criminal evidence applicable to the cases, and convictions are consequently comparatively sure when proper cases are brought, and such cases well prepared, and well tried.

NOTE: Except for the words "and fraudulent" italicized in the partly quoted opinion of Mr. Justice Hughes, italics have been supplied.

IV

THE NEW DESPOTISM

In a recent article which has been accredited to Prof. Rexford G. Tugwell, it is announced that the Copeland bill, S. 1944, has been designed to stop loopholes in the old act and to throughly "modernize" it.

It is further stated "it corrects or amends those provisions which prove ineffective in the light of judicial interpretations." That is, the loopholes are shown and the inefficiencies of the old act proven because the courts have not interpreted the act the way the Drug Administration would like to have it interpreted.

Therefore, if the courts can be ignored, the opportunity for judicial interpretation destroyed and complete control of the great food and drug manufacturing and purveying industry be placed in the hands of officials of the Department who may know little or nothing about the problems of manufacturing or purveying, the present law will be thoroughly "modernized."

The Food and Drug Administration likes to refer to a decision of the Supreme Court of the United States in the case of U.S. v. 95 Barrels, 265 U.S. 438. What the court decided in that case was that if an article is not the identical thing which the brand indicates it to be, it is misbranded, and by the same token if the thing is the identical thing it is indicated to be in that respect, it is not misbranded. In that case the Court in part said:

"The statute is plain and direct. Its comprehensive terms condemn every statement, design, and device which may mislead or deceive. Deception may result from the use of statements not technically false, or which may be literally true. The aim of the statute is to prevent that resulting from indirection and ambiguity, as well as from statements which are false. It is not difficult to choose statements, designs, and devices which will not deceive. Those which are ambiguous and liable to mislead should be read favorably to the accomplishment of the purpose of the act. The statute applies to food and the ingredients and substances contained therein. It was enacted to enable purchasers to buy food for what it really is."

Statements that are misleading, resulting from indirection and ambiguity, may be in violation of the present law, and if so the language used should be read favorably to the accomplishment of the purposes of the act.

One thing the Food and Drug Administration has constantly ignored is the following language used by the Court in the same case:

"The statute is plain and direct. Its comprehensive terms condemn every statement, design, and device which may mislead or deceive."

The Court is talking about the label requirements of the present law-that it is plain, direct, and comprehensive. Why then the "additional label requirements of the revision"? I'll tell you. It is that the Food and Drug Administration may be relieved of the necessity of proving their case in a court of law.

Courts are to be deprived of the opportunity of determining whether the language is ambiguous or by inference may be misleading. These matters are to be determined wholly by the Food and Drug Administration.

Again, in this article reference is made to poisons. The article states:

"The Government is forced to prove that an added, not a naturally occurring poison (for that does not count), is present in a specific consignment of food in such quantity that the food may be deleterious to health if consumed. It is therefore open to the manufacturer or shipper to prove that this particular lot of food may not be deleterious to health if so consumed. Each court case stands by itself and the consumer is inadequately protected."

The matter of added poisons has always been well understood. The word appears in the present law.

The Supreme Court of the United States in U.S. v. 40 Barrels, 241 U.S. 265, pointed out that the word "added" was used to distinguish between deleterious ingredients that might be found in an article and put there by man, from deleterious ingredients which might be found in nature's products as she produces them.

The difficulties which, in the opinion of Professor Tugwell, apparently result in the insufficiencies of the present law, is disclosed in the following language used by him in the article referred to:

"The Government is forced to prove" and "it is * * * open to the manufacturer or shipper to prove that this particular lot of food may not be deleterious to health if so consumed. Each court case stands by itself and the consumer is inadequately protected.'

Why should not the Government be forced to prove the facts it alleges? Why should property be destroyed without such proof? If a particular lot of food does not contain added poisons deleterious to health, why should not the manufacturer be permitted to meet the charge and prove that his article is a wholesome article of food containing no such poisonous or deleterious substances?

I take it that what the good professor desires is that the manufacturer be not permitted to prove his innocence or that his preparation is a good food article. The article contends that the consumer is inadequately protected if any appeal may be made to the courts. That is the sum and substance of it.

Another matter appearing in the Tugwell article to which I wish to advert: "It does not give undue dictatorial powers to so-called Government bureaucrats. While it does grant the Secretary of Agriculture certain new authorities, it is very specific in these grants, and protects legitimate business interests effectually. Any attempt at the abuse of such authority by an arbitrary or capricious exercise of it will not succeed, because the courts, in the long run, refuse to sustain any requirements too far divergent from the ordinary community standards of good conduct and fair practice.

Notwithstanding that in one paragraph the statement is made that the grants of power to the Secretary of Agriculture are confined within narrow limits, in the very next paragraph appears the statement:

"A law must be sufficiently broad and flexible to effect the conviction of offenders whose conduct has fallen below the standards demanded by both consumers and ethical competitors. But if the language of the statute restricts itself merely to specific antisocial acts that its drafters anticipate, the discovery of loopholes in that law is inevitable, and the difficulties of its enforcement multiply endlessly."

The declaration that the grant is limited to a narrow scope is disposed of in the language which I have last quoted. The law must be so broad and flexible that the language is not restricted to specific violation for fear that loopholes may be discovered and difficulties of enforcement multiplied. Interesting, isn't it? In other words, bureaucracy is not to be limited.` It is not to be confined within narrow limits. Powers must be so broad and flexible that these powers may not be challenged in court by an interested party who may feeel his rights have been invaded.

The Congress is now being asked to so rewrite the Food and Drugs Act that commerce in drugs be the subject of edict and decree and that action need not be limited to proper cases nor necessary care be taken in the preparation and trial. NOTE.-Italics supplied.

V

The bills introduced declare among other things that their purpose is "to prevent the false advertisement of foods, drugs, and cosmetics."

There has been a persistent effort to show that there is no regulation of advertising in the field of foods, drugs, and cosmetics. You will see from what follows that there is both law and efficient enforcement. I quote from the annual report of the Federal Trade Commission, released December 12, 1932, for the fiscal year

ending June 30, 1932, and addressed to the Senate and House of Representatives of the United States, pages 46 and 47:

"During the fiscal year ending June 30, 1932, the special board concluded the investigation of and reported to the Commission 406 cases. Of these, 341 were against advertisers, 57 against publishers, and 8 against advertising agencies.

"In 45 cases the advertisers discontinued business, 12 more were forced out by post-office fraud orders, 3 discontinued false and misleading advertising before complaints were made, 42 cases were dismissed for lack of evidence or jurisdiction, 18 were referred to other divisions, 233 were disposed of by stipulation and prosecution of formal proceedings was recommended in 9 cases. In 44 cases investigations were completed, reported to the Commission, and await further orders.

"While it is impossible to state accurately the number of false and misleading advertisements that have been discontinued entirely or revised to check fairly with the truth, it is estimated that such number for last year, considered as being directly due to the Commission's activities, exceeds 20,000. The money saved to the purchasing public amounts to many millions of dollars."

You will please note the extraordinary activities of the Federal Trade Commission, together with their estimate that the number of false and misleading advertisements which have been either discontinued entirely or revised to check with the truth and resulting from the Commission's activities, exceeds 20,000. In addition to the above, the so-called "Printer's ink law" prohibiting false advertising has been enacted by the legislatures of all of the States and the District of Columbia, except Arkansas, Delaware, Georgia, Maine, Mississippi, and Texas. The desire for new legislation in this behalf is the wish to extend the new despotism.

The CHAIRMAN. Every effort will be made to accomodate everyone. The next statement that we have is that by Mr. Huston Thompson.

STATEMENT OF HUSTON THOMPSON

Mr. HUSTON THOMPSON. Gentlemen of the committee, having been before committees a number of times, I think I had better state specifically just whom I represent, so there will be no question as to my position. I am here as the executor and trustee of the estate of Carl H. White. The Carl H. White Co. is vendor of certain products. Carl H. White was the founder of the Health Products Corporation. This corporation produces a number of medicinal articles. Among those articles are what is known as "White's Concentrate," and a laxative chewing gum called Feenamint. In looking over the bill, it seems to me that there should be an amendment or inclusion or a proviso that will cover articles of this kind; that is, articles such as Feenamint being a laxative chewing gum, and "White's Concentrate." The bill, as it now stands, has a definition.

The CHAIRMAN. On page 2?

Those

Mr. THOMPSON. Yes. On page 2 there is a definition of the term "drugs." On page 1 there is a definition of the word "food." articles of which I speak, and there are many others, of course, on the market of a similar nature, which are composed of both food and drug. So that so far as this bill is concerned, they are in a twilight zone, being covered by neither group.

It is my suggestion that we have a proviso by inserting the words, after the word "animals", on the last line-no, it is on line 11 of page 2-that will cover articles where the article is both a food and a drug. I have a draft of this proviso to follow the word "animals" on line 11 on page 2, in paragraph B.

The CHAIRMAN. Just read it.

Mr. THOMPSON. This is an amendment offered by Houston Thompson to this bill. I offer the following language as an amendment in the form of a proviso to be placed after the period following the word "animals" on the eleventh line under (3) of paragraph B, page 2, of the said bill.

Provided, That any substance or preparation which may be a combination of a food and drug shall be deemed and classified only as to food or drug, dependent upon its intended and/or actual use, which shall be clearly expressed on the carton containing the said combination, or on the label marking.

The CHAIRMAN. I do not understand the last part of that. Mr. THOMPSON. That should be "which shall be clearly expressed in or on the carton containing the label marking the said combination." My reason for that is this: This bill merely leaves a great discretion to the author of the bill or its administrator in connection with that, without being at all specific. It does not provide for it as specifically as would be desirable. For instance, if you turn over, for example, to the section covering tolerances, section 10, page 14, at the bottom of the page, you will find the subject of tolerances for poisonous ingredients in food and cosmetics and certification of coal-tar colors. Also you give discretion, as I understand this bill, to the Secretary to determine on the question, for example, of poisons and of antideleterious substances. If this were a food in all cases and there were used this element in there, as, for example, phenolphthalein, the question will arise as to whether there was injected a deleterious substance. You are in a position, if you leave the definition as it is now covering simply the question of food and drugs, that the strict interpretator would have the power over such a combination or such a product that might be a very serious one.

The CHAIRMAN. I see your point, and on page 2, between lines 11 and 12, you wish to have inserted the material which you have given us.

Mr. W. Bruce Philip, of Washington, D.C., counsel for the Association of National Retail Druggists, one of our 5-minute speakers, will now state his views in connection with this matter.

STATEMENT OF W. BRUCE PHILIP

Mr. PHILIP. The National Association of Retail Druggists has for over 25 years represented the interests of 60,000 retail druggists in the United States.

We wish to subscribe to Dr. Beal's analysis of the Tugwell bill. We wish also to subscribe to the suggested amendment to the present Food and Drugs Act that will be presented.

Briefly, the problem of the retail druggist is quite different from the problem of the large manufacturer. On the druggists special subjects I would like to give you a little information and some experiences.

It is easy enough to say that if the laws or regulations are not satisfactory you can go to court. The average retail druggist cannot afford to go to court, in fact, the druggists, I should say, over 59,000 of the 60,000, will be forced to accept the regulation, regardless of whether they are in accordance with the law or in accordance with their rights. It is almost impossible for the average retail druggist to protect himself against the regulations. This bill, as I read itand I have read it carefully-is a skeleton bill that gives to the