Mr. EBERHARTER. That is all, Mr. Chairman.

Mrs. BOLTON. Mr. Stern, I do happen to be a woman, and I do hear a good deal of conversation on the subject of shoes, and it has been my experience to find that a great many women who have not been accustomed to buying Red Cross shoes when they buy them the first time they are very apt to buy them because it has the red cross there, they think that it has the endorsement of the Red Cross from the point of view of a shoe which is good for the foot, and when they get to the time when their arches begin to drop, and their feet begin to hurt them, they go in with the idea that the Red Cross certainly must know about feet, and therefore the Red Cross shoe must be the answer.

That is just a comment on your saying that you think that that never is the case. It has been my experience to find that it has been the case with a great many women.

Mr. STERN. Might I interrupt you and answer that, please?

I am sure that the women come in and ask for a Red Cross shoe, but I will leave it up to your good sober judgment. Here is a typical advertisement that I think just was in Vogue. I think it is in Vogue this month. Could there be any possible connection with the statement that these women that you have stated made to them between shoes of this kind, in smart summery Red Cross shoes.

Now, these certainly are not the types of shoes to which you were referring, and this is a typical Red Cross shoe advertisement.

Yes; they will come in and ask for Red Cross shoes, and that is the point I have been trying to make, and they will ask for Red Cross shoes in preference to any shoe on the market, because they have read about Red Cross shoes in the advertisements, their friends have told them about them, and they are good shoes.

Mr. EBERHARTER. In other words, the indication that I get from your display of that advertisement is that if anybody looks at the advertisement they will immediately conclude that you cannot have stylish shoes and classy shoes and healthy shoes at the same time?

Mr. STERN. That probably would answer Mrs. Bolton much better than I can, but certainly there is not anything in our business-you see, I am an ingenue at this. I do not know anything about committee hearings.

The CHAIRMAN. I think that you are a prima donna.

Mr. STERN. I wish that that might go into the record for my wife. We know that a demand has been created because of this Red Cross shoe, and we know what would happen to our business, I am not concerned about myself, nor are you concerned about yourself, you are concerned about others, and to justice. I know that this faith and good will has been built into the minds of millions of women, and those women who spoke to you said that they had heard about the Red Cross shoe, and if they look at our advertising, which goes on month after month in many leading women's magazines, we are the largest national advertisers of any shoe in the world, bar none, and I venture to say that you know many shoes better than you do the Red Cross shoe, but we cater to the masses, and I can tell you over 2,500,000 pairs of Red Cross shoes are sold annually, and you can see the kind of person whom we cater to.

Mrs. BOLTON. May I ask you if you do make a comfortable health shoe?

Mr. STERN. All of our shoes are comfortable.

Mrs. BOLTON. How about answering the health end of it? Mr. STERN. I would like to answer that facetiously. There are lines of shoes that are so-called corrective shoes which people think need a lot of correction. As to the health angle of shoes, between you and me, unless the shoes are made to order, it is the bunk.

A shoe is only as good as the last on which that shoe is made-and the work on it; just remember that, and you too, gentlemen, when you are buying a pair of shoes.

Mrs. BOLTON. Your original shoes were not then built on the idea of really comfort, weren't they comfort shoes?

Mr. STERN. As I said before, Mrs. Bolton, back in 1898 I imagine all shoes were of that kind, but still, look at how this shapes up here. Mrs. BOLTON. I know, because I used to wear them.

Mr. STERN. Look at how this came into fashion, how could a shoe like this be comfortable—just think of it but this came into fashion. Mrs. BOLTON. But you are not answering my question, or I have not put it very plainly, there was a shoe which was known as the Comfort shoe, was there not?

Mr. STERN. Every factory made a comfort shoe, I would say; every factory made a comfort shoe; yes. It was a general name, the same as walking shoes.

!

Mrs. BOLTON. You had nothing to do with that.

Mr. STERN. You mean nothing to do with comfort?
Mrs. BOLTON. Yes.

Mr. STERN. I do not want to evade your question, but

Mrs. BOLTON. I do not mean to be quibbling at all, I am really asking for a purpose.

Mr. STERN. But the primary shoes did two things in 1898. One, they gave comfort, and the other, they wore. Shoes back in 1898 wore like iron, they were good, fine shoes, and the other thing they did was to give comfort.

As you know-I do not mean as you know-but in those days shoes were made on what you called D and E lasts, and today we make them from AAAAA's all the way down to EEE's.

Now, they try to give comfort in this D and E lasts, they were broadtoed shoes-look at some of the advertisements; that might answer your question.

Mrs. BOLTON. I do not mean to spend undue time on this, but I do have another question which I think perhaps is more to the point on the whole matter under discussion. You sell to other countries, not?

do

you

Mr. STERN. No; we only sell to retail stores.

Mrs. BOLTON. You only sell to retail stores?

Mr. STERN. Yes; in the United States.

Mrs. BOLTON. You have no foreign trade whatsoever?

Mr. STERN. None at all, in Red Cross shoes.

Mr. JONKMAN. Just to keep the record straight, I would like to ask Mr. Stern if you were to use a trade-mark which was Red Star shoes, formerly the Red Cross shoe, would not you be guilty of just as palpable a violation of the law as you are now, assuming that it is unlawful? Mr. STERN. My guess would be "Yes."

Mr. EATON. If 44 years ago your organization had chosen Blue Cross instead of Red Cross, would that have been as effective?

Mr. STERN. If we would have continued to advertise Blue Cross shoes in the same manner which we have advertised Red Cross shoes, and had the same management, it would have been equally as effective, just as well. It would be the same with any name of shoes, take the names of shoes that you know such as Walk-Over shoes, you know the Walk-Over shoe, and if you take that name off the shoe what have they got? They have nothing.

You probably wear I. Miller shoes, and if you take the name off the shoe what have you got? If any of you men wear Stetson shoes, if you take the name Stetson away, you would not go in and pay the same price for that shoe unbranded even though you were told it was a Stetson shoe.

We could have Blue Cross, Red Circle, or anything, and spent the millions of dollars that we did in building up the goodwill on that mark, and the business would have been the same today in my judgment.

Mr. EATON. Just when did you turn over from comfortable shoes to making uncomfortable shoes?

Mr. STERN. As the times demanded it.

The CHAIRMAN. Are there any further questions?

Mr. VORYS. Do you authorize or direct department stores to be called the Red Cross Shoe Shop, or when you see a store that is labeled Red Cross Shoe Shop, do you grant a franchise to that effect?

Mr. STERN. Well, now, that is an interesting question. That was brought up by Mr. Hughs to us, and probably Mr. Allen, our counsel, can answer that considerably better than I can. What I can tell you and what I want to tell you is this, and get it straight: We try to play the game square.

Mr. KEE. Do you have any stores that handle your line exclusively? Mr. STERN. Yes, sir.

Mr. KEE. And they are known as a Red Cross Shoe Store?

Mr. STERN. Yes, sir.

Mr. KEE. That is all.

The CHAIRMAN. Are there any further questions?

Mr. JOHNSON. I have one question.. As I interpret the testimony, the success of the Red Cross shoes have been dependent upon quality and advertising rather than on the name, has it not?

Mr. STERN. Absolutely, sir.

Mr. JOHNSON. That is all. Thank you.

Mr. STERN. I appreciate your asking that question, because it says everything that I have tried to say in all of these 12 or 13 minutes. The CHAIRMAN. If there are no further questions, we thank you very much.

STATEMENT OF DWIGHT G. W. HOLLISTER, PRESIDENT OF A. P. W. PAPER CO., ALBANY, N. Y.

Mr. HOLLISTER. Mr. Chairman and members of the Foreign Affairs Committee, my name is Dwight G. W. Hollister; I am a legal resident of Wellesley Hills, Mass.; and I am president of the A. P. W. Paper Co., of Albany, N. Y. I am down here at the invitation of your chairman without counsel.

The A. P. W. Paper Co., a New York corporation, was established in 1877. It is engaged in the manufacture and sale of toilet papers

that is, toilet tissues and paper towels. It has approximately 600 employees, approximately 500 of whom are members of the International Brotherhood of Paper Makers. The other 100 are supervisors, office employees, and salesmen. Our total annual pay roll is nearly $1,000,000 annually. Our total assets are over $5,000,000.

Our assessed valuation is approximately $1,000,000. Our total local taxes in Albany are approximately $30,000.

We are also interested in a pulp company at Sheet Harbor, Nova Scotia, employing approximately 125 men, who are members of the International Brotherhood of Pulp Mill and Sulphite Workers.

This company supplies the A. P. W. Paper Co. with a portion of its raw material and also supplies a substantial tonnage to England.

The present volume of business of the A. P. W. Paper Co. falls into the following classifications: It is 7 percent for direct defense, for the Army and Navy, and 53 percent for indirect defense; that is, war plants, and so forth; and 5 percent to hospitals and office buildings; and 35 percent to housewives.

We have been using continuously since 1897 the red-cross trademark on toilet paper. That mark was registered in 1911. This mark was associated with our products long before the present Red Cross Society came into being. To use it now means we had to use it before 1905; as a matter of fact, we have used the mark for over 45 years, and the public has associated our mark on our goods as A. P. W. products. prior to the organization of the present Red Cross Society.

I can see no reason why Congress should interfere further than it has already gone, since the Red Cross Society, in my opinion, is adequately protected by the present acts. To now interfere as proposed you would be driving out of business many old-established concerns employing thousands of workers.

I say this for the following reasons: First, no new enterprise after 1905 could use the trade-mark. Those using it now had to have used it before 1905. Also, anyone who starts to use the red-cross trade-mark today can be adequately stopped under the present acts. Also, Congress established the policy in 1905, and the courts have given intelligent definition of it.

In view of the 1905 act, it does not seem fair for the Red Cross Society to come in now and attempt to take away the trade-mark from reputable people who have had the mark for at least 37 years. Our red-cross mark attaches to the reputation and quality of our goods and the inherent goodwill of our company.

The red-cross mark has been associated with our products for 45 years and it has not meant the Red Cross Society, nor is it our intention or desire to have our trade-mark so considered. We are not spending our money to advertise the Red Cross Society. We are spending our money to advertise the products of the A. P. W. Paper Co. We have also spent considerable money in policing our right to use the trade-mark, and our files will indicate over 70 violations. After having used the mark for two generations, I feel that we are entitled to continue its use. Today the only people that can use the mark are those that have survived two generations, for any business to have survived the past two generations means that its product must. be meritorious, and no business can survive two generations unless it. is meritorious.

To the best of my knowledge, there are not over seven companies in the United States using the red-cross trade-mark in interstate commerce. To my mind we are spending altogether too much time and energy on things foreign to the most important thing that faces this country today, winning the war.

A great deal has been said about the general Geneva Convention of 1929. I enlisted and served in the last war, and I am anxious to do everything I can to help win the present conflict. I do not think discussing the merits or demerits of the red-cross trade-mark will win this war. I should like to say that in my judgment Congress has observed the requirements of the Geneva Convention, but I do not think that several other signatory powers have. Hospitals and wounded men have been bombed, women and children have been ravaged, newspapers and periodicals are filled with accounts of nonobservance of the human things that the American Red Cross stands for.

I think it also important to impress upon this committee the fact that the red-cross trade-mark cannot be used for export. At least I may say that that has been the policy of the A. P. W. Paper Co., and all of this talk about bombing hospitals and things that I have heard in these hearings seems to me to be terribly foreign to the immediate situation.

Our products or no other person's products, to the best of my knowledge, can go out of this country and be used.

In conclusion I shuld like to offer what I believe to be a constructive suggestion for the committee's consideration.

Congress in 1905 forbade the further use of the red-cross mark except as to the "same class of goods." The construction placed on this phrase seems to me to be the crux of the entire discussion.

I should like to suggest that if it is thought desirable after all persons have been heard, that this phrase "same class of goods," be narrowed, and perhaps the words, "same goods" be substituted therefor, effective as the Congress may direct.

The CHAIRMAN. Would you kindly elaborate on that suggestion, please.

Mr. HOLLISTER. Well, I think that in the testimony of last Monday it was said that there were some 3,500 different products being used, or that had the right to use the mark. I may be wrong in that, I think it was complaints, or there was a large number.

Under the existing law, as I understand it, and I read from the section IV of the act of 1905, as amended June 23, 1910.

Provided, however, That no person, corporation, or association that actually used or whose assignor actually used the said emblem, sign, insignia, or words for any lawful purpose prior to January 5, 1905, shall be deemed forbidden by this act to continue the use thereof for the same purpose and for the same class of goods.

Now, if you will project your thinking into other acts, as I understand it, I am not a lawyer, so I am at a disadvantage in using laws or acts or whatnot, but I am thinking of the Patent Office.

It is possible to extend the use of the mark under certain circumstances, as I understand it, for the same class of goods, and the same class of goods could, perhaps, be a very long list of goods.

In our own case, the A. P. W. Paper Co., toilet tissues and towels are the same class of goods. If I were making stockings, for ex