The Quality Parts Coalition (QPC) applauds Rep. Darrell Issa (R-CA) for hosting a hearing Feb. 2 as chairman of the House Judiciary Subcommittee on the Courts, Intellectual Property, and the Internet to discuss H.R. 1057, the “Promoting Automotive Repair, Trade, and Sales Act” or PARTS Act.
Chairman Issa introduced this bipartisan and bicameral legislation with fellow subcommittee member Rep. Zoe Lofgren (D-CA) in the first session of the 114th Congress. The Quality Parts Coalition said its sole mission is to get this legislation passed in Congress to protect consumers’ access to competitive replacement parts when repairing their cars after an accident.
During his opening statement, Chairman Issa explained why the PARTS Act is important to American drivers: “The consumer has a reasonable expectation that there will be a competitive market for repair parts for their automobile. There certainly is for brake pads. Why wouldn’t there be for a bent fender?” He also noted: “A healthy aftermarket means more affordable parts for everyone.”
Chairman Issa concluded his remarks with an optimistic outlook on this bill: “I look forward to working with the Chairman and Ranking Member on this area as we move forward with the PARTS Act and to get signed into law.” The QPC said it is encouraged by this statement and that of House Judiciary Committee Chairman Bob Goodlatte (R-VA) that he remains open-minded on this issue. The PARTS Act is also co-sponsored by the following House Judiciary Committee members: David Cicilline (D-RI), Hank Johnson (D-GA), Jim Sensenbrenner (R-WI), Steve Cohen (D-TN) and Blake Farenthold (R-TX).
QPC Executive Director Ed Salamy heralded the hearing as an important step to spark consideration in Congress. “The Quality Parts Coalition thanks both chairmen for their continued leadership and is committed to working with the House and Senate to move this legislation forward in Congress,” said Salamy.
During the hearing, subcommittee members listened to testimony from two witnesses in support of the PARTS Act: Pat Felder, a small business owner of Felder’s Collision Parts in Baton Rouge, LA., on behalf of the QPC and the Auto Body Parts Association; and Jack Gillis, Director of Public Affairs of the Consumer Federation of America (CFA), on behalf of CFA, Advocates for Highway and Auto Safety, Center for Auto Safety, Consumers Union and Public Citizen.
Both witnesses highlighted the trend by major companies to use design patents to stifle competition at the expense of consumers. Felder said, “Some car companies appear to have created a business strategy to eliminate competition and expand their already dominant share of the market by obtaining 14-year design patents on their collision parts and enforcing them against alternative suppliers.”
Meanwhile, Gillis sounded the alarm from the consumer’s perspective: “Unless Congress addresses the automakers’ misuse of design patents on their crash replacement parts, consumers will be faced with mounting repair bills, more ‘totaled’ vehicles, increasing insurance costs, and deferring necessary repairs affecting safety.”
There was an unsubstantiated claim made during the hearing that the PARTS Act would be detrimental to innovation in the auto industry. The QPC contends that the PARTS Act would not change the incentive of the car companies to innovate. While protecting competition in the repair parts market, the PARTS Act would do nothing to stop car companies from getting 14-year design patents on their collision parts and enforcing them for up to 14 years against other car companies to prevent them from copying one another’s vehicle designs in the new car sales market.
Another claim brought up during the hearing was that this bill would harm industrial engineers’ job security. The QPC contends that competition has existed in the collision repair marketplace for decades and this legislation would protect the status quo rather than add new entrants to the marketplace. The QPC further contends that the car companies’ anti-competitive behavior has adversely harmed the aftermarket industry.
Felder said that independent suppliers across the nation have already gone out of business or will soon. In her area alone, four other shops have closed and she’s down to four employees from 25. “We cannot sit and simply cross our fingers and hope that the car companies will simply ignore future opportunities to eliminate or diminish competition through design patent enforcement,” Felder said.
To see the full hearing, watch the recording on YouTube posted by the House Judiciary Committee.
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