SEC. 2. It shall be unlawful knowingly to transport or cause to be transported in interstate or foreign commerce any gambling device, or knowingly to take, receive, possess, or dispose of any gambling device transported in violation of this Act: Provided, That the provisions of this section shall not apply to the course of unbroken interstate transportation of any gambling device into any State where the use of such device is legal, as certified by the governor of the State to the Attorney General of the United States and published by the Attorney General in the Federal Register. In the absence of such certification and publication, the use of gambling devices in any State shall, for the purposes of this Act, be presumed to be illegal; and all persons and officials affected by the provisions of this Act shall be entitled to act in reliance upon the presumption. Nothing in this Act shall be construed to interfere with or reduce the authority, or the existing interpretations of the authority, of the Federal Trade Commission under the Federal Trade Commission Act, as amended (15 U. S. C. 41-58). SEC. 3. Upon first engaging in business, and thereafter on or before the 1st day of July of each year, every manufacturer of and dealer in gambling devices shall register with the collector of internal revenue for each district in which such business is to be carried on, his name or trade name, the address of his principal place of business, and the address of his places of business in such district. On or before the last day of each month every manufacturer of and dealer in gambling devices shall file with the collector of internal revenue for each district in which he maintains a place or places of business and inventory and record of all sales and deliveries of gambling devices as of the close of the preceding calendar month for the place or places of business in the district. The monthly record of sales and deliveries of such gambling devices shall show the mark and number identifying each article together with the name and address of the buyer or consignee thereof and the name and address of the carrier. Duplicate bills or invoices, if complete in the foregoing respects, may be used in filing the record of sales and deliveries. For the purposes of this Act, every manufacturer or dealer shall mark and number each gambling device so that it is individually identifiable. In cases of sale, delivery, or shipment of gambling devices in unassembled form, the manufacturer or dealer shall separately mark and number the components of each gambling device with a common mark and number as if it were an assembled gambling device. It shall be unlawful for any manufacturer or dealer to sell, deliver, or ship any gambling device which is not marked and numbered for identification as herein provided; and it shall be unlawful for any manufacturer or dealer to manufacture, recondition, repair, sell, deliver, or ship any gambling device without having registered as required by this section, or without filing monthly the required inventories and records of sales and deliveries. SEC. 4. All gambling devices, and all packages containing any such, when shipped or transported shall be plainly and clearly labeled or marked so that the name and address of the shipper and of the consignee, and the nature of the article or the contents of the package may be readily ascertained on an inspection of the outside of the article of package. SEC. 5. It shall be unlawful to manufacture, recondition, repair, sell, transport, possess, or use any gambling device in the District of Columbia, the Territories and possessions of the United States, on any lands reserved or acquired for the use of the United States and under the exclusive or concurrent jurisdiction thereof or within Indian country as defined in 18 United States Code 1151. SEC. 6. Whoever violates any of the provisions of section 2 or 5 of this Act shall be fined not more than $5,000 or imprisoned not more than two years, or both. Whoever violates any of the provisions of section 3 or 4 of this Act shall be fined not more than $2,000 or imprisoned not more than one year, or both. SEC. 7. Any gambling device transported, delivered, shipped, manufactured, reconditioned, repaired, sold, disposed of, received, possessed, or used in violation of the provisions of this Act shall be seized and forfeited to the United States. All provisions of law relating to the seizure, summary and judicial forfeiture, and condemnation of vessels, vehicles, merchandise, and baggage for violation of the customs laws; the disposition of such vessels, vehicles, merchandise, and baggage or the proceeds from the sale thereof; the remission or mitigation of such forfeitures; and the compromise of claims and the award of compensation to informers in respect of such forfeitures shall apply to seizures and forfeitures incurred, or alleged to have been incurred, under the provisions of this Act, insofar as applicable and not inconsistent with the provisions hereof: Provided, That such duties as are imposed upon the collector of customs or any other person with respect to the seizure and forfeiture of vessels, vehicles, merchandise, and baggage under the customs laws shall be performed with respect to seizures and forfeitures of gambling devices under this Act by such officers, agents, or other persons as may be authorized or designated for that purpose by the Attorney General. SEC. 8. If any provision of this Act or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of the Act which can be given effect without the invalid provision or application, and to this end the provisions of this Act are declared to be severable. Passed the Senate April 19 (legislative day, March 29), 1950. LESLIE L. BIFFLE, Secretary. [H. R. 6736, 81st Cong., 2d sess.] A BILL To prohibit the transportation or receipt of gambling devices in interstate and foreign commerce, and for other purposes Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That whoever shall knowingly transport or cause to be transported in interstate and foreign commerce any machine, apparatus, mechanical device, or any parts thereof, designed or adapted for the playing of any game of chance for money or other thing of value, or whoever shall receive, possess, or dispose of any article which has been transported in violation of this Act, knowing the same to have been transported, shall be guilty of a felony and upon conviction thereof shall be subject to a fine of not more than $5,000 or imprisonment for not more than two years, or both fine and imprisonment. As used in this Act the term "interstate and foreign commerce" means com-merce between any State, District, Territory or possession of the United States and any place outside of the State, District, Territory, or possession. Mr. BECKWORTH. I know Mr. Crosser, our chairman, regrets his inability to be here and I am sure that just as soon as circumstances will permit him to return he will return and help us give this vital question his attention, as he always endeavors to give every bill which comes before this committee. The first witness we shall have this morning will be Hon. Prince H. Preston, Jr., author of one of the bills. Mr. Preston, we are pleased to have you with us. Before you proceed, without objection, the Chair will include at this point in the record certain communications which have come to the committee from the departments of government in connection with the legislation. (The reports referred to are as follows:) INTERSTATE COMMERCE COMMISSION, Hon. ROBERT CROSSER, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D. C. MY DEAR CHAIRMAN CROSSER: Your letter of January 13, 1950, addressed to the Chairman of the Commission and requesting a report and comment on H. R. 6736, introduced by Congressman Preston, to prohibit the transportation or receipt of gambling devices in interstate and foreign commerce, and for other purposes, has been referred to our legislative committee. After careful consideration by that committee, I am authorized to submit the following comments in its behalf: The bill is so broad that it would establish a criminal liability on the part of any public carrier which transported machinery with knowledge of its intended use for the playing of any game of chance for money. While such knowledge would be an essential element of the crime and there might be difficulty in proving that element in a prosecution of a carrier nevertheless carriers might be put to a considerable burden in trying to avoid possible prosecutions for violations of a statute worded as proposed in this bill. In other instances where Congress has prohibited movement of certain articles in interstate commerce the acts have been made expressly inapplicable to carriers. For example, in the statute in volving misbranded woolen goods the following provision was included (15 U. S. C. 682): "This section shall not apply to any common carrier or contract carrier in respect to a wool product shipped or delivered for shipment in commerce in the ordinary course of business." We respectfully suggest that, in the event your committee should decide to report H. R. 6736, the following sentence be added to the bill: "This act shall not apply to any common carrier or contract carrier in respect to machinery shipped or delivered for shipment in commerce in the ordinary course of business." Respectfully submitted. Hon. ROBERT CROSSER, WALTER M. W. SPLAWN, Chairman, Legislative Committee. JOHN L. ROGERS. FEDERAL TRADE COMMISSION, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D. C. MY DEAR MR. CHAIRMAN: This is with reference to your letter of January 13, 1950, enclosing a copy of H. R. 6736, Eighty-first Congress, second session, entitled "A bill to prohibit the transportation or receipt of gambling devices in interstate and foreign commerce, and for other purposes," introduced January 12, 1950, by Representative Prince H. Preston, Jr., of Georgia, and requesting a prompt report, together with such comment as the Commission may desire to make concerning the proposed legislation. In response thereto I wish to advise that the bill does not purport to amend any of the acts or statutes administered by this Commission and, if enacted, would not affect its duties and functions. However, in studying the measure, consideration has been given to the power of Congress to pass such legislation in the exercise of its authority to regulate interstate commerce. It is our opinion that "Congress is free to exclude from interstate commerce articles whose use in the States for which they are destined it may reasonably conceive to be injurious to the public health, morals, or welfare, or which contravene the policy of the State of their destination." (United States v. Carolene Products Co., 304 U. S. 144, 147.) Again, "Congress can certainly regulate interstate commerce to the extent of forbidding and punishing the use of such commerce as an agency to promote immorality, dishonesty, or the spread of any evil or harm to the people of other States from the State of origin. In doing this it is merely exercising the police power, for the benefit of the public, within the field of interstate commerce." (Brooks v. United States, 267 U. S. 432, 436.) In the Lottery Case (188 U. S. 321) it was held that Congress might pass a law prohibiting the carriage of such tickets from one State to another. By direction of the Commission. LOWELL B. MASON, Acting Chairman. N. B. Pursuant to regulations, this report was submitted to the Bureau of the Budget on February 1, and on February 2, 1950, the Commission was advised that there would be no objection to the submission of the report to the committee. LOWELL B. MASON, Acting Chairman. OFFICE OF THE ATTORNEY GENERAL, Hon. ROBERT CROSSER, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D. C. MY DEAR MR. CHAIRMAN: I was most gratified at the prompt action of the Senate on the bill (S. 3357), to prohibit transportation of gambling devices in interstate and foreign commerce, which bill was passed by that body yesterday, April 19, and is presently pending with your committee. The measure is one of vital importance for which reason I strongly urge its prompt consideration and favorable report by the Committee on Interstate and Foreign Commerce. This measure was transmitted to the Congress by me on April 1, 1950, pursuant to a resolution adopted on February 15, 1950, by the Attorney General's Conference on Organized Crime. That resolution read as follows: "Be it resolved, That this conference endorse the idea of Federal legislation to prohibit the shipment of gambling devices into or out of any State where the possession or use of such devices is illegal. Further, requiring Federal registration of all such machines sold within States and prohibiting foreign export of such devices." The bill's purpose is to support the basic policy of the States, which outlaws slot machines and similar gambling devices, by prohibiting the interstate shipment of such machines except into States where their use is legal. Briefly, the measure may be analyzed as follows: Section 1 defines the term "gambling device." Section 2 makes it unlawful knowingly to transport or cause to be transported in interstate or foreign commerce any gambling device, or knowingly to take, receive, possess, or dispose of any gambling device transported in violation of the measure. The section excepts, however, from its prohibition gambling devices which are in the course of unbroken interstate transportation into any State where the use of such device is legal. Section 3 requires manufacturers of and dealers in gambling devices to register with the Federal Government and to file monthly inventories and records of sales and deliveries. It also requires each manufacturer or dealer to mark each gambling device so that it is individually identifiable. Section 4 prescribes labeling requirements for gambling devices and packages containing the same. Section 5 prohibits the manufacture, reconditioning, repair, sale, transportation, possession or use of gambling devices in places under the exclusive or concurrent jurisdiction of the Federal Government. Section 6 prescribes the criminal penalties for violations of sections 2, 3, 4, and 5 of the act. Section 7 provides for the seizure and forfeiture to the United States of gambling devices transported, possessed or used in violation of the act. It prescribes the procedures for such seizure and forfeiture to be those prescribed for violations of the customs laws. Lastly, section 8 contains the usual severability clause. In the history of Federal-State relationships, the use of Federal power to support State policies has had a number of important precedents. For example, in the field of liquor law enforcement Congress enacted the Wilson Act (26 Stat. 313, now 27 U. S. C. 121), held valid In re Rahrer (140 U. S. 545; followed by the Webb-Kenyon law of 1913, 37 Stat. 699, now 27 U. S. C. 122), held valid in Clark Distilling Co. v. Western Maryland Railway (242 U. S. 311); supplemented by the Reed amendment of 1917 (39 Stat. 1069), upheld in United States v. Hill (248 U. S. 420, 424 (amendment repealed in 1936 by 49 Stat., pt. I, 1930, sec. 9)); and followed still later by the Liquor Enforcement Act of 1936 (49 Stat., pt. I, 1928, now 18 U. S. C. 1261–1264, 3615). By these statutes, Congress prohibited the interstate transportation of intoxicating liquor into a State where the law forbade the bringing in of intoxicating liquor (but allowing for continuous interstate transportation through the State, 18 U. S. C. 1262) or where it was to be used in violation of the law of the State (27 U. S. C. 122); and subjected to the laws of the State intoxicating liquor which was transported there for use (27 U. S. C. 121). As the Court said in the Clark Distilling Co. case, supra: "In view of the conceded power on the part of Congress to prohibit the movement of intoxicants in interstate commerce, we cannot admit that because it did not exert its authority to the full limit, but simply regulated to the extent of permitting the prohibitions in one State to prevent the use of interstate commerce to ship liquor from another State, Congress exceeded its authority to regulate" (242 U. S. 311, 327). And again "Congress ** * * considered the nature and character of our dual system of government, State and Nation, and instead of absolutely prohibiting, had so conformed its regulation as to produce cooperation between the local and national forces of government to the end of preserving the rights of all * * *"" (242 U. S. 311, 331). In the field of prison-made goods Congress enacted the Hawes-Cooper Act of 1929 (45 Stat. 1084), held valid in Whitfield v. Ohio (297 U. S. 431), and later the Ashurst-Sumners Act (49 Stat. 494 (since revised and merged into 18 U. S. C. volving misbranded woolen goods the following provision was included (15 U. S. C. 682): "This section shall not apply to any common carrier or contract carrier in respect to a wool product shipped or delivered for shipment in commerce in the ordinary course of business." We respectfully suggest that, in the event your committee should decide to report H. R. 6736, the following sentence be added to the bill: "This act shall not apply to any common carrier or contract carrier in respect to machinery shipped or delivered for shipment in commerce in the ordinary course of business." Respectfully submitted. WALTER M. W. SPLAWN, Chairman, Legislative Committee. JOHN L. ROGERS. Hon. ROBERT CROSSER, FEDERAL TRADE COMMISSION, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D. C. MY DEAR MR. CHAIRMAN: This is with reference to your letter of January 13, 1950, enclosing a copy of H. R. 6736, Eighty-first Congress, second session, entitled "A bill to prohibit the transportation or receipt of gambling devices in interstate and foreign commerce, and for other purposes," introduced January 12, 1950, by Representative Prince H. Preston, Jr., of Georgia, and requesting a prompt report, together with such comment as the Commission may desire to make concerning the proposed legislation. In response thereto I wish to advise that the bill does not purport to amend any of the acts or statutes administered by this Commission and, if enacted, would not affect its duties and functions. However, in studying the measure, consideration has been given to the power of Congress to pass such legislation in the exercise of its authority to regulate interstate commerce. It is our opinion that "Congress is free to exclude from interstate commerce articles whose use in the States for which they are destined it may reasonably conceive to be injurious to the public health, morals, or welfare, or which contravene the policy of the State of their destination." (United States v. Carolene Products Co., 304 U. S. 144, 147.) Again, "Congress can certainly regulate interstate commerce to the extent of forbidding and punishing the use of such commerce as an agency to promote immorality, dishonesty, or the spread of any evil or harm to the people of other States from the State of origin. In doing this it is merely exercising the police power, for the benefit of the public, within the field of interstate commerce." (Brooks v. United States, 267 U. S. 432, 436.) In the Lottery Case (188 U. S. 321) it was held that Congress might pass a law prohibiting the carriage of such tickets from one State to another. By direction of the Commission. Sincerely yours, LOWELL B. MASON, Acting Chairman. N. B. Pursuant to regulations, this report was submitted to the Bureau of the Budget on February 1, and on February 2, 1950, the Commission was advised that there would be no objection to the submission of the report to the committee. LOWELL B. MASON, Acting Chairman. OFFICE OF THE ATTORNEY GENERAL, Hon. ROBERT CROSSER, Chairman, Committee on Interstate and Foreign Commerce, House of Representatives, Washington, D. C. MY DEAR MR. CHAIRMAN: I was most gratified at the prompt action of the Senate on the bill (S. 3357), to prohibit transportation of gambling devices in |