[Congressional Record Volume 144, Number 136 (Friday, October 2, 1998)]
[Extensions of Remarks]
[Page E1893]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




           YEAR 2000 INFORMATION AND READINESS DISCLOSURE ACT

                                 ______
                                 

                               speech of

                       HON. CONSTANCE A. MORELLA

                              of maryland

                    in the house of representatives

                       Thursday, October 1, 1998

  Mrs. MORELLA. Mr. Speaker, over 2\1/2\ years ago, my Technology 
Subcommittee first began our review of the Year 2000 problem and 
discovered that the fear of potential legal liability created a 
disturbing chilling effect that froze private industry from sharing 
important Y2K information with each other and with the American public.
  As a result, instead of working together on an industry-wide basis to 
craft common solutions to expedite effective Year 2000 assessment, 
remediation, and validation efforts, many companies have simply chosen 
to not publicly discuss their Y2K situation. With just 450 days before 
January 1, 2000, clearly this needs to change. In the short time 
remaining, we must foster a climate of greater collaboration and not 
one of silence and uncooperation.
  That is why passage of S. 2392, the Year 2000 Information and 
Readiness Disclosure Act, the bill we passed late last night, is so 
very important. As the Co-Chair of the House Year 2000 Task Force and 
the Chair of the Technology Subcommittee, I was very pleased to be an 
original House sponsor of the bill, to help address some of the 
industry concerns in the original version of the bill, and to work 
towards its enactment.
  Mr. Speaker, in one of the series of Year 2000 hearings conducted by 
my Technology Subcommittee, witnesses testified that the risk of 
failure and its liability consequences, including both punitive and 
compensatory damages, has created a large Year 2000 cottage industry 
for lawyers waiting to file suits. Some are even speculating that the 
cost of legal damages could ultimately exceed the total cost for 
actually fixing the Year 2000 problem.
  It should then come as no surprise that certain industries have 
refused to acknowledge or share Year 2000 information for fear that 
such disclosure could ultimately leave them vulnerable to negligence 
and warranty suits. Many companies have resisted exchanging technical 
advice with one another, delaying the pace of repair work, because they 
fear costly litigation if the information they provide inadvertently 
turns out to be inaccurate.
  The goal of S. 2392 is to encourage the widest possible dissemination 
of Y2K information so that organizations can move effectively to 
remediation by immunizing businesses from lawsuits if they share 
information about the problem. By incorporating certain provisions of 
H.R. 4455, the Year 2000 Readiness Disclosure Act, of which I am also 
an original sponsor, into S. 2392 the private-sector should now have 
the legal protection needed to share Y2K information.
  The current language in the bill reflects changes to accommodate the 
concern of a number of industries that the original bill was crafted 
too narrowly and did not go far enough to achieve its stated goal. For 
example, the bill as originally introduced only protected companies 
from liability lawsuits based on unknowingly false Year 2000 
information disclosures.
  Many companies, however, feared that their accurate Y2K statements 
would be used against them as evidence in liability lawsuits. S. 2392, 
as amended in the Senate, addresses the full range of concerns 
regarding Y2K information-sharing by permitting private-sector entities 
to release ``Year 2000 Information Disclosures,'' as contained in H.R. 
4455. Accurate information in these written, labeled statements would 
be protected from use in any civil litigation related to Y2K failures.
  Mr. Speaker, while S. 2392 is narrowly tailored to just the issue of 
information exchange and does not affect the greater liability 
questions, I believe that we must fully explore the legal liability 
issues and discuss the policy implications of creating liability caps, 
safe harbors, immunity protection, and alternative dispute resolution 
mechanisms, among other provisions, in the near future.
  While I look forward to engaging in this debate in the upcoming 106th 
Congress, addressing legal liability will not be an easy task. We must 
continue to encourage all businesses to devote their full resources and 
commitment to solving the Year 2000 problem, and not to sit around in 
expectation of enacted legislation which has the potential of 
unburdening them from taking any corrective action. If we are to 
eventually enact liability legislation, we should not be providing 
companies an easy out for failing to engaging in Y2K remediation in a 
timely and effective manner.
  It concerns me that the legal battles have already begun. A Michigan 
grocery store is suing the manufacturer of its cash registers because 
the machines reject credit cards with year 2000 expiration dates. 
Several software companies are facing lawsuits for breach of warranty, 
fraud, and unfair business practices because they charge clients for 
the upgrades necessary to correct the millennium bug. According to the 
Gartner Group, some 200 disputes have already been settled out of court 
across the country.
  Mr. Speaker, S. 2392 is a necessary first step in the congressional 
review of Year 2000 liability issue and will play a significant role in 
helping the private sector in addressing the Year 2000 computer 
problem. I am pleased to support its enactment and I look forward to 
its signature into law by the President.

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