[Congressional Record (Bound Edition), Volume 145 (1999), Part 5]
[Senate]
[Pages 7454-7462]
[From the U.S. Government Publishing Office, www.gpo.gov]



                                Y2K ACT

  The Senate continued with the consideration of the bill.
  Mr. LOTT. Mr. President, I ask unanimous consent that all remaining 
amendments in order to S. 96 be relevant to the pending McCain 
amendment.
  The PRESIDING OFFICER. Is there objection?
  Mr. HOLLINGS. I object.
  The PRESIDING OFFICER. Objection is heard.


                             Cloture Motion

  Mr. LOTT. Mr. President, I regret having to file a cloture motion. I 
hoped we would not have to do that, that we could get an agreement on 
how to proceed, and that the amendments would be relevant. But since we 
have not been able to, with the objection just heard, I have no 
alternative. Therefore, I send a cloture motion to the desk.
  The PRESIDING OFFICER. The cloture motion having been presented under 
rule XXII, the Chair directs the clerk to read the motion.
  The legislative clerk read as follows:

                             Cloture Motion

       We, the undersigned Senators, in accordance with the 
     provisions of Rule XXII of the Standing Rules of the Senate, 
     do hereby move to bring to a close debate on the pending 
     amendment to Calendar No. 34, S.96, the Y2K legislation:
         Senators Trent Lott, John McCain, Rick Santorum, Spence 
           Abraham, Judd Gregg, Pat Roberts, Wayne Allard, Rod 
           Grams, Jon Kyl, Larry Craig, Bob Smith, Craig Thomas, 
           Paul Coverdell, Pete Domenici, Don Nickles, and Phil 
           Gramm.

  Mr. LOTT. Mr. President, I know there is a sincere effort underway on 
both sides of the aisle to work out an agreement on this Y2K 
legislation. I know that will continue. But we need to make progress, 
or have the opportunity for a cloture vote in the meantime, or, in case 
that doesn't work out, you always have the option, if we get everything 
worked out, to vitiate the cloture vote, or we could move to a 
conclusion earlier. If we can get an agreement worked out and 
conclusion on Wednesday, that would be ideal.
  But, barring that, a cloture vote will occur on Thursday. As soon as 
the time for the vote has been determined, after consultation with the 
Democratic leader, all Senators will be notified.


                            Call Of The Roll

  In the meantime, I ask unanimous consent that the mandatory quorum 
under rule XXII be waived.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                 Amendment No. 268 to Amendment No. 267

   (Purpose: To regulate interstate commerce by making provision for 
    dealing with losses arising from the year 2000 problem, related 
 failures that may disrupt communications, intermodal transportation, 
            and other matters affecting interstate commerce)

  Mr. LOTT. I send a first-degree amendment to the pending amendment to 
the desk.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Mississippi (Mr. LOTT) proposes an 
     amendment numbered 268 to amendment No. 267.

  Mr. LOTT. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The text of the amendment is printed in today's Record under 
``Amendments Submitted.'')
  Mr. LOTT. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.


                 Amendment No. 269 to Amendment No. 268

   (Purpose: To regulate interstate commerce by making provision for 
    dealing with losses arising from the year 2000 problem, related 
 failures that may disrupt communications, intermodal transportation, 
            and other matters affecting interstate commerce)

  Mr. LOTT. Mr. President, I send a second-degree amendment to the 
pending first-degree amendment to the desk.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Mississippi (Mr. Lott) proposes an 
     amendment numbered 269 to amendment No. 268.

  Mr. LOTT. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The text of the amendment is printed in today's Record under 
``Amendments Submitted.'')


                 Amendment No. 270 to Amendment No. 267

   (Purpose: To regulate interstate commerce by making provision for 
    dealing with losses arising from the year 2000 problem, related 
 failures that may disrupt communications, intermodal transportation, 
            and other matters affecting interstate commerce)

  Mr. LOTT. Mr. President, I send a first-degree amendment to the 
language proposed to be stricken.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Mississippi (Mr. Lott) proposes an 
     amendment numbered 270 to amendment No. 267.

  Mr. LOTT. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The text of the amendment is printed in today's Record under 
``Amendments Submitted.'')
  Mr. LOTT. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.


                 Amendment No. 271 to Amendment No. 270

   (Purpose: To regulate interstate commerce by making provision for 
    dealing with losses arising from the year 2000 problem, related 
 failures that may disrupt communications, intermodal transportation, 
            and other matters affecting interstate commerce)

  Mr. LOTT. I send a second-degree amendment to the language proposed 
to be stricken.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Mississippi (Mr. Lott) proposes an 
     amendment numbered 271 to Amendment No. 270.

  Mr. LOTT. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The text of the amendment is printed in today's Record under 
``Amendments Submitted.'')
  Mr. LOTT. Mr. President, if I could make a couple of observations 
with regard to the schedule, I know Members are interested in a variety 
of very important issues they wish to be heard on. I have to be 
sympathetic to those requests. We don't have it worked out yet.
  But I am discussing with Senator Daschle the possibility of having 
some measure on the floor of the Senate later on this week which would 
be an opportunity for further discussion and perhaps votes with regard 
to the Kosovo matter. We wish it to be a bipartisan resolution that 
allows Senators to state their position and to allow the Senate to take 
a vote on exactly how they wish to proceed at this point with regard to 
Kosovo. We will have to work through that. Hopefully, we can take it up 
Thursday and complete it Thursday night, or Friday, or later, if the 
Senators so desire.
  On another matter, I know there are Senators who have a real desire 
to say something and have a policy discussion about what has happened 
in Colorado. I ask my colleagues, let's give this a moment. Let's allow 
a period of mourning

[[Page 7455]]

and grief. Let's allow these families to bury their children. Let's all 
wait to see more about what happened and ask not only what but why.
  Then 2 weeks from today, if the Senate thinks well of it, we will 
look for a vehicle--and we have one in mind, perhaps a juvenile justice 
bill--that we could take up, and the Senate would then have an 
opportunity for debate, have amendments, and have votes.
  I think we need a period of time to think this through and allow our 
country, collectively, to have a period of mourning and then see if 
there is something we can do. I don't think the answer is here. I think 
the answer is out across America.
  I wanted the Senators to know I recognize their desires and I am 
trying to find a way to accommodate those desires. I ask, also, that we 
must continue to work on Y2K and find a way to complete it without 
getting into a myriad of subsidiary issues and complete our work by 
Wednesday.
  Mr. KENNEDY. Will the Senator yield?
  Mr. LOTT. Mr. President, I am happy to yield to the Senator.
  Mr. KENNEDY. Mr. President, I heard the majority leader. There are 
many Members who, obviously, agree with the majority leader and share 
the sentiments expressed here on the floor of the Senate a few moments 
ago in the moments of silence, and the very superb prayer of the 
chaplain in reaching out to those families. However, there are Members 
who want to at least consider some legislation dealing with 
responsibility in the area of firearms.
  Is the leader now indicating to Members he will give us the 
opportunity to have some debate on those measures, and other measures, 
as well, within a period of 2 weeks? Measures that could help and 
assist parents, families and schools. Measures that are balanced and 
permit Members to reach across the aisle to try and work out bipartisan 
approaches? Could the majority leader indicate now whether we will have 
that opportunity and give assurance to the American people that the 
subject matter which is No. 1 in the minds of all families and children 
across this country--at least we will have the opportunity in the U.S. 
Senate to debate some proposals and to reach resolutions of those.
  Mr. LOTT. Mr. President, in response to the Senator's question, I 
think it is always incumbent upon the leadership to make sure we 
proceed in an appropriate way and that Senators have an opportunity to 
express their views and offer amendments on issues of policy. I think 
we are doing that. We have appropriately had a moment of silence and a 
prayer for the children and the families, and for our country. We are 
going to have a resolution this afternoon officially expressing our 
regret and sympathy.
  I have asked that we have a brief period of mourning where we don't 
rush to judgment before we start flinging amendments at each other. I 
mentioned the idea to Senator Daschle moments ago in which I said that 
2 weeks from today we will look at bringing up a particular piece of 
legislation. I don't want to say it will be exactly that day or exactly 
that piece of legislation because Senator Daschle needs to confer with 
a lot of Members on that side.
  However, it is my intent, that 2 weeks from today we give Senators an 
opportunity to offer amendments, thoughts and policy issues they wish 
to have addressed. I think the timing would be appropriate and I think 
that the issue or the issues are appropriate for Members to debate and 
vote on.
  Mr. KENNEDY. If the Senator will yield for a moment, with those 
assurances, I have worked with a number of our colleagues--they may 
have differing views--and I think the assurances of the majority leader 
that the Senate would have an opportunity to debate legislation with 
regard to the limitations on weapons and also support and assistance 
for families and schools, and that we will have debate and resolution 
of some of those measures, then, I think at least I will look forward 
to that opportunity.
  I think with the assurance of the majority leader--I know the Senate 
Democratic leader wanted to talk to colleagues--it is my certain belief 
the Democratic leader would support the majority leader in that 
undertaking. I think the message will go out this afternoon to families 
across the country that the Senate of the United States--hopefully, in 
a bipartisan way--will give focus and attention to different ideas, 
recommendations and suggestions of Members of this body, and hopefully 
from others, to try to see what we can do not only about the problems 
of the schools but the inner cities and other communities affected by 
guns, as well.
  Mr. LOTT. I yield the floor.
  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. McCAIN. Mr. President, I thank the distinguished chair.
  First, I thank Senator Lott and Senator Daschle for their commitment 
to try to work out a resolution, a Lott-Daschle amendment on the Kosovo 
issue. I have been saying, as have many others, that we as U.S. 
Senators, individually and as a body, have a duty to be on record on 
this issue. Those who oppose our involvement, I believe, should be on 
record in that fashion as well as those who are in favor.
  I think it is well-known by most observers of the U.S. Senate that 
the 1991 debate that took place in this Chamber on the Persian Gulf war 
resolution was one of the more enlightened and, frankly, sterling 
moments of this Senate. It was a very close vote, 53-47. I remember it 
very well. At that time, Senators on both sides of the aisle and both 
sides of this United States were heard. They were on record and the 
U.S. Senate was on record, as well.
  I point out that immediately following that very close vote there was 
a unanimous vote in support of the men and women in the military who 
were conducting that conflict.
  I thank Senator Lott and Senator Daschle. I am pleased to work out 
the details of this resolution. I know it is a very, very contentious 
and difficult issue that we will be debating. I have heard allegations 
that some Senators don't wish to risk a vote on this issue. I don't 
believe that is the case. If it were the case, we have young men and 
women right now who are risking their lives. It is incumbent upon us as 
a body to act.
  Second, I say to my friend from South Carolina, I am sorry that we 
have to go through the filling up of the tree and filing a cloture 
motion on this bill. I prefer the normal amending process.
  I believe the pending legislation is the Y2K substitute. What is the 
pending business before the Senate?
  The PRESIDING OFFICER. The pending business is amendment No. 271, a 
second-degree amendment offered by the majority leader.
  Mr. McCAIN. Mr. President, if there is an amendment that is germane 
that the Senator from South Carolina or anyone else would like to bring 
up, I believe we could by unanimous consent vacate the final amendment 
of the majority leader so that we can debate and vote on that 
amendment.
  The purpose of filling up the tree was, clearly, to prevent 
nongermane amendments from clogging up this process.
  I say to my friend from South Carolina, I think we should debate 
amendments. We should move forward as quickly as possible and get this 
issue resolved as quickly as possible.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from South Carolina.
  Mr. HOLLINGS. Mr. President, I was compelled momentarily to object to 
the request of our distinguished leader that the amendments be germane. 
I think a word is in order to understand my objection.
  What happens is, No. 1, we have tried our dead-level best to 
compromise and move this particular piece of legislation along. My 
Intel friends wrote us a letter to the effect that there were four 
demands. I contacted Mr. Grove by phone and told him that of the four, 
I could agree to the waiting time period, to the materiality and the 
specificity, but the joint and several went to the heart of tort law 
and trials and I could not agree to that.
  My understanding is and I am willing to fill out the record on this, 
our

[[Page 7456]]

Chamber of Commerce friend, Tom Donohue and NAM downtown, Victor 
Schwartz, have been working this thing for years. When we are asked 
about germane amendments, I think of the opportunity that I have in 
this perilous position, so to speak, with respect to the legislation.
  Realizing that they are willing to amend the Constitution, article 
VII, taking away a trial by jury, and they are willing to amend article 
X of the rights of the States with respect to tort law, then I thought 
maybe at the moment it would be good to amend article II with respect 
to the bearing of arms.
  Yes, Mr. President, I do have an amendment, and it is at the desk. It 
is very germane to our interest in real things. We are not really 
concerned at this minute, because the system is working. According to 
Business Week, according to the testimony, according to the evidence, 
according to the editorials, our tort system is working to protect 
doctors, small business folks and everyone else. What is not working in 
Colorado is this inordinate number of pistols and firearms in our 
society.
  I came to the Senate as a strong-headed States righter and still try 
my best to follow that principle because I believe in it very, very 
strongly. However, I have had to yield with respect to that particular 
position when it came to the Saturday night specials. We had the FBI 
come with that. The States could not control that. We had the matter of 
assault weapons, and the States could not control that.
  Then watching over the years, the States' response, instead of going 
in the direction of control, they actually are in the direction of 
running around with concealed weapons. All the States now are going in 
that direction. That is why the NRA, the National Rifle Association, 
was ready to meet in Denver last week. I figured we ought to bring this 
up for immediate discussion.
  Rush to judgment? No; no. I have been there 33 years. I have watched 
this debate, I have listened, and I watched our society. It is not a 
rush to judgment. It is a judgment that I had a misgiving about over 
many years waiting on the States to respond.
  I put at the desk the Chafee amendment relative to handgun control. I 
will be prepared later on, if we are allowed and we get into the 
debate, to bring that up, because I think it is very timely. It is not 
a rush to judgment. It is far more important to our society. According 
to Computerworld, according to the Oregonian, according to the New York 
Times, according to the witnesses, it is far more important than Y2K 
which may occur 7 or 8 months from now. Come; come.
  We know good and well that everybody is getting ready. We have, in a 
bipartisan fashion, set aside the antitrust restrictions so that they 
could collaborate.
  We have positive evidence of a young doctor in New Jersey who in 1996 
bought a computer, and the salesman bragged how it can last for more 
than 10 years, that it was Y2K compliant. He gave references. By 
happenstance, they did go to one of the references and found out it was 
not Y2K compliant.
  The young doctor then said: I need to get this thing modified and 
made compliant. The company that sold it to him said: Gladly, for 
$25,000. The main instrument itself was only $13,000.
  What did he do? He wrote a letter and asked, and then he asked the 
second time. Months passed. He finally went to a lawyer. People do not 
like to go to lawyers and get involved in court. I hear all about 
frivolous lawsuits, frivolous, frivolous. Nobody has time for frivolous 
lawsuits. The real lawyer does not get paid unless he gets a result.
  Finally, he did get a lawyer, and the lawyer was smart enough to put 
it on the Internet. The next thing you know, there were 17,000 doctors 
in a similar situation with the same company, and they finally reached 
a settlement and got it replaced and made compliant--free. That was all 
that was necessary.
  The system is working now. There have been 44 cases. Over half of 
them have been thrown out as frivolous; half of the remaining cases 
have been settled. There are only eight or nine pending Y2K cases. The 
problem is real. You do not have to wait if you are going to have those 
supplies. It is like an automobile dealer faced every year with a new 
model and has to get rid of the old.
  You will find some of the various entities will come around and 
offload and misrepresent. That is why we have the tort system at the 
State level, and that is why it works, and that is why we have this 
wonderful economic boom.
  There is a conspiracy. They call it a bunch of associations that have 
endorsed the legislation. They have come around now and said this is a 
wonderful opportunity, we can just ask them for tort reform, and here 
it is going to save them from lawyers and frivolous lawsuits.
  If I was an innocent doctor in regular practice with no time to study 
and pay attention to these matters, I would say, ``Sure, put me on, 
that sounds good to me. I am having troubles enough now with Medicare 
and HCFA and all of these rules and regulations made ex post facto 
about charges for my particular treatments.''
  That is why it all builds and it mushrooms on the floor of the 
Senate. The Senator from South Carolina has been in the vineyards now 
20 years on this one issue relative to trial lawyers and tort reform. 
He can see it like pornography. You understand it and know it when you 
see it, and I see this.
  I was constrained on yesterday to not only put up the Chafee 
amendment relative to gun control, but more particularly, Mr. 
President, with respect to the violence in the schools. I know one of 
the causes. I have been fighting in that vineyard all during the 
nineties. We have had hearings on TV violence, and we have had study 
after study after study. They put us off again and again with another 
study. So in the Congress before last, we reported it out of committee 
19 to 1 on barring gratuitous violence in these shows, excessive 
gratuitous violence.
  When you run a Civil War series, necessarily you are going to have to 
have violent films and shots made and scenes that will appeal. But we 
got into the excessive gratuitous violence that they control in Europe, 
down in New Zealand and Australia. They use the one example, of course, 
in Scotland where they had the poor fellow who was estranged and insane 
come in and shoot up the little children. But they don't have this 
happening in Arkansas like it did or happening in Kentucky like it did.
  You can see this occurring over the years. Monkey see, monkey do--
youngsters emulate and they see more than anything else, not excessive 
gratuitous violence, but no cost, no result, no injury to the violence. 
Seemingly, it happens and you move right on. They become hardened. Then 
they go to the computer games shooting each other.
  I called that bill up the Congress before last. We got it reported to 
the floor. I went to my friend, Senator Dole, who was running for 
President. He just returned from the west coast, and he had given the 
producers a fit. He said, ``You have to act more responsibly.''
  I said, ``Bob, why don't I step aside and you offer the bill and let 
it just be the Dole-Hollings bill? It is out here and reported. You put 
up one. You are the leader, and we can get a vote on that right 
quick.''
  We got a 19-to-1 vote in the committee. I never did get a response. 
So I put it in again, and in the last Congress it was reported out 20 
to 1. But I cannot get the distinguished leader who wants to be oh so 
reasonable and everybody working together, and let's don't rush to 
judgment on TV violence--I have a judgment, and it is not a rush to it. 
It has been learned over the many, many years, looking at the 
experience of other countries, looking at the need in our society, 
having listened to the witnesses, the Attorney General saying this 
would pass constitutional muster with respect to the freedom of speech. 
I wanted to bring that up. That amendment sat at the desk. That is 
important, far more important than Y2K.
  And otherwise we have hard experiences. We Senators do get home from 
time to time, and we do politic. And it was about 4 years ago when I 
got back to Richland County where I met my friend, the sheriff, Senator 
Leon Lott.

[[Page 7457]]

And he said, I want to show you a school out here that was the most 
violent, was infested with drugs and trouble and everything else of 
that kind.
  He said, Senator, I took one of your cops on the beat. I put him in 
the classroom, in uniform, teaching classes, law, respect for the law, 
the penalties in driving for young folks coming along, the penalties, 
and why the controls in relation to respect and the severe penalties 
relative to drugs, so they would understand.
  Now, that was in the classroom. He was not in the parking lot waiting 
for somebody to steal a car. Rather, he was teaching respect for the 
law. And then, in the afternoon, this particular officer was associated 
with the athletic activities, and in the evening with the civic 
activities. He became a role model.
  I say this advisedly because I think about that poor security officer 
who did not know from ``sic em'' out there in the Columbine school in 
Colorado. Here they could unload pipe bombs, all kinds of pistols, all 
kinds of this, that, and everything else, like that going on the 
Internet, running down the halls in trench coats, butt everybody out of 
the way, and everything else. They were surprised by what happened.
  So, yes, I have an amendment at the desk relative to our safe schools 
safety initiative because Senator Gregg, the chairman of our 
Subcommittee on State, Justice and Commerce--we put $160 million in the 
appropriations bill last year, and it is being used and employed with 
tremendous success all over the country.
  The emphasis should be not as I heard on TV last night, where they 
said this law enforcement officer would be directly connected with law 
enforcement; I want him connected with the students. I want him to 
become a role model. I want him to understand and know the students and 
know the teachers. And the teachers know when they have a troublemaker, 
or whatever it is--a poor lad maybe does not have a mama or does not 
have a daddy, he is totally lost, so he brings about all kinds of 
extreme activity to get recognition.
  But that officer can work. And we also added in counseling. I cannot 
have him do all the counseling and all the role modeling and everything 
else at once, as well as law enforcement, as well as instruction. So we 
included, after the advice from hearings, that we put in counseling; 
and we got a measure. It is on the statute books. It ought to be 
embellished and enlarged.
  These are the kinds of things we ought to be talking about this 
afternoon rather than this bum's rush about a crisis that is going to 
happen 7 months from now. Come on. Here it is happening right 
underneath us and all we do is pray. We are the board of directors of 
corporate United States of America, and we are flunking our particular 
duties; we cannot pay any bills.
  We talked all last week--and it is still on the calendar right now, 
and regular order--of saving 100 percent of Social Security, a lockbox. 
Then I heard instead the distinguished leader say, oh, no. He said, 
this money we are going to add on to the President's request for 
Kosovo--another $6 billion. When asked, where is it going to come from, 
he said, from Social Security.
  The truth of the matter is, they say that is the only surplus, but it 
is not. Social Security is $720 billion shy. And with the estimation--
and I have it by the Congressional Budget Office--at the end of 
September this year we will owe--not surplus--Social Security $837 
billion, because what we have been doing is we have been paying down 
the debt.
  It is like taking two credit cards, having a Visa card and 
MasterCard, and saying, ``I'll pay off my MasterCard with the Visa 
card. It looks pretty good for the MasterCard debt--the public debt--
but it increases the Visa debt over here--it increases the Social 
Security debt. So it has. And we owe Social Security $837 billion. The 
$137 billion in excess of what is required to be paid out this 
particular year is not surplus.
  Under the law, 13301 of the Budget Act, it should go in reserve for 
Social Security for the baby boomers, but we are all talking about; oh, 
the President; oh, the Congress; no, the Congress; no, the President. 
Nobody wants to get a plan to save Social Security; and all the time we 
are stealing, we are looting the fund. It is a shame. It is a show. It 
is a spin. It is the message nonsense that you have up here in the 
Senate.
  So let's get real now and let's get these issues out. Let's talk 
about handguns. Let's talk about Kosovo. Let's talk about TV violence. 
We have some real problems. Let's talk about paying the bill, and not 
any ``Mickey Mouse'' of one day it is going to be a lockbox and no one 
can get to it and 48 hours later saying, no, no, I'm going to use that 
lockbox for a $12 billion payment on Kosovo. We have to get honest with 
the American people.
  I yield the floor.
  Mr. WYDEN addressed the Chair.
  The PRESIDING OFFICER (Mr. Crapo). The Senator from Oregon.
  Mr. WYDEN. I thank the Chair.
  I have been here many fewer years than the Senator from South 
Carolina, but I can tell you, just listening to him over the last few 
minutes, I sure agree with what he has to say about Social Security, I 
sure agree with what he has to say about school violence and the 
connections that are so important in the community between law 
enforcement, counselors, and the students. I could go on and on. I have 
supported him on many of those issues in the past and am planning to do 
so in the future.
  But I did want to take the floor for just a moment and address a 
couple of the points that were made with respect to the Y2K issue 
specifically.
  I am very hopeful that we can still see the Senate come together on a 
bipartisan basis to deal with this issue. The fact of the matter is 
that the year 2000 problem is essentially not even a design flaw. It is 
a problem because a number of years ago, to get more space on a disc 
and in memory, the precision of century indicators was abandoned. And 
it is hard for all of us today to believe that disc and memory space 
used to be at a premium, but it was back then, and that is why we have 
this problem today.
  So what a number of us in the Senate want is to do everything we 
possibly can to ensure companies comply with the standards that are 
necessary to be fair in the marketplace, but also to provide a safety 
net if we see problems develop and particularly frivolous, 
nonmeritorious suits.
  Now, with respect to a couple of the points that have been made on 
the record, this notion that the sponsors, particularly Senator McCain 
and I, are trying to rewrite tort law for all time is simply not borne 
out by the language of this bill. This is a bill which is going to 
sunset in 2003. It is not a set of legal changes for all time. It is an 
effort to deal in a short period of time with what we think are 
potentially very serious problems.
  In fact, the American Bar Association--this is not a group of people 
who are against lawyers, but the American Bar Association itself has 
said this could affect billions and billions of dollars in our economy. 
So this bill will last for a short period of time. It doesn't apply to 
personal injuries, whatever. If a person, for example, is injured as a 
result of an elevator falling because the computer system broke down 
and is tragically injured or killed, all of the legal remedies in tort 
law remain.
  This is a bill that essentially involves contractual rights of 
businesses. We respect those rights first, and only when the 
marketplace breaks down would this law apply.
  We have heard a number of comments in the last few hours that this 
legislation throws out the window the principle of joint and several 
liability, a legal doctrine that I, following the lead of the Senator 
from South Carolina, have supported in many instances, particularly 
when it relates to vulnerable individuals who might be the victim of 
personal injuries. But this legislation specifically says that joint 
and several liability will, in fact, apply if you have egregious or 
fraudulent conduct on the part of the defendant. And, second, it will 
apply if you have an insolvent defendant so there will be an 
opportunity for the plaintiff to be made whole. We also make

[[Page 7458]]

changes relating to directors and officers to ensure that they have to 
be held accountable.
  As to the evidentiary standard, the sponsors of this legislation have 
made it clear that they want to work with Senator Hollings and others 
who have questions about this standard to change it. What we wish to do 
is make it comply with the earlier legislation we overwhelmingly passed 
on Y2K.
  There have been a number of comments made today about the Intel 
Corporation and their views. I ask unanimous consent that a letter from 
the CEO of the Intel Corporation be printed in the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:


                                            Intel Corporation,

                                  Santa Clara, CA, April 19, 1999.
     Re Y2000 legislation.


     Hon. Ron Wyden,
     U.S. Senate,
     Washington, DC.
       Dear Senator Wyden: I write to ask for your help in 
     enacting legislation designed to provide guidance to our 
     state and federal courts in managing litigation that may 
     arise out of the transition to Year 2000-compliant computer 
     hardware and software systems. This week, the Senate is 
     expected to vote upon a bipartisan substitute text for S. 96, 
     the ``Y2K Act'', which we strongly support.
       Parties who are economically damaged by a Year 2000 failure 
     must have the ability to seek redress where traditional legal 
     principles would provide a remedy for such injury. At the 
     same time, it is vital that limited resources be devoted as 
     much as possible to fixing the problems, not litigating. Our 
     legal system must encourage parties to engage in cooperative 
     remediation efforts before taking complaints to the courts, 
     which could be overwhelmed by Year 2000 lawsuits.
       The consensus text that has evolved from continuing, 
     bipartisan discussions would substantially encourage 
     cooperative action and discourage frivolous lawsuits. 
     Included in its provisions are several key measures that are 
     essential to ensure fair treatment of all parties under the 
     law:
       Procedural incentives--such as a requirement of notice and 
     an opportunity to cure defects before suit is filed, and 
     encouragement for engaging in alternative dispute 
     resolution--that will lead parties to identify solutions 
     before pursuing grievances in court;
       A requirement that courts respect the provisions of 
     contracts--particularly important in preserving agreements of 
     the parties on such matters as warranty obligations and 
     definition of recoverable damages;
       Threshold pleading provisions requiring particularity as to 
     the nature, amount, and factual basis for damages and 
     materiality of defects, that will help constrain class action 
     suits brought on behalf of parties that have suffered no 
     significant injury;
       Apportionment of liability according to fault, on 
     principles approved by the Senate in two previous measures 
     enacted in the area of securities reform.
       This legislation--which will apply only to Y2K suits, and 
     only for a limited period of time--will allow plaintiffs with 
     real grievances to obtain relief under the law, while 
     protecting the judicial system from a flood of suits that 
     have no objective other than the obtainment of high-dollar 
     settlements for speculative or de minimus injuries. 
     Importantly, it does not apply to cases that arise out of 
     personal injury.
       At Intel, we are devoting considerable resources to Y2K 
     remediation. Our efforts are focused not only on our internal 
     systems, but also those of our suppliers, both domestic and 
     foreign. Moreover, we have taken advantage of the important 
     protections for disclosure of product information that 
     Congress enacted last year to ensure that our customers are 
     fully informed as to issues that may be present with legacy 
     products. What is true for Intel is true for all companies: 
     time and resources must be devoted as much as possible to 
     fixing the Y2K problem and not pointing fingers of blame.
       For these reasons, we urge you to vote in favor of 
     responsible legislation that will protect legitimately 
     aggrieved parties while providing a stable, uniform legal 
     playing field within which these matters can be handled by 
     state and federal courts with fairness and efficiency.
           Sincerely,
                                                 Craig R. Barrett,
                                           CEO, Intel Corporation.

  Mr. WYDEN. I thank the Chair.
  The key sentence is, the Senate is expected to vote upon a bipartisan 
text for S. 96, the Y2K Act, which we will strongly support. There is 
no question about the position of the company on this legislation.
  Finally, we have made nine major changes in this legislation since it 
passed the committee. I voted against it in the committee because I 
thought Senator Hollings was absolutely right--that the legislation at 
that time was not fair to consumers and to plaintiffs. But as a result 
of the changes that were made, I believed it was appropriate to try to 
come up with an approach that was fair to consumers and to plaintiffs 
as well as the small companies involved.
  There are other negotiations that are still going forward. Senator 
Dodd, for example, who is the leader on our side on the Y2K issue, has 
a number of good and practical suggestions. Senator Kerry has some 
thoughtful ideas on this as well.
  I am very hopeful that we can resolve the procedural quagmire on this 
issue and quickly get to a vote, up or down. Then as a result of the 
very useful discussion that we had between the majority leader, Mr. 
Lott, and Senator Kennedy and others, we can move on to the juvenile 
justice issue. Because I can assure you, as a result of what we saw in 
Springfield, OR, last year, we wish to have some positive contributions 
on that.
  Senator Gordon Smith and I have a bipartisan bill which has already 
passed the Senate once. I am hopeful we can deal with this Y2K issue 
expeditiously and then go on to the topic that millions of Americans, 
just as Senator Hollings has said this afternoon, are talking about and 
want to see the Senate respond to.
  Mr. President, I yield the floor.
  Mr. SESSIONS. Mr. President, I am pleased to rise and make some 
comments about the Y2K legislation designed to make sure that we spend 
our time and effort fixing this problem and not suing one another.
  I really believe in the legal system. I had served as a lawyer my 
entire adult life, until 2 years ago, when I joined this Senate. I 
served as attorney general of Alabama. I was in private practice 12 
years as U.S. attorney for the southern district of Alabama. During 
that time, I was involved in a lot of important legal issues.
  I respect the law. I believe in our Constitution and our legal 
system. I have been to China, and I have heard the people in China say 
that what they need most of all right now for a modern economy is a 
good legal system.
  I have been to Russia. I have heard the people in Russia talk about 
their need for an honest, fair, and efficient legal system.
  We have a great legal system. We certainly ought not, as the Senator 
from South Carolina suggests, have a rush to judgment. But the problems 
that have occurred over a period of years involving excess litigation 
are not new. It has been occurring for a number of years, and it calls 
on us to think objectively and fairly as to how we are going to handle 
disputes.
  This piece of legislation involves, as the Senator from Oregon just 
noted, one problem, a Y2K computer problem. It will terminate itself 
when that problem is over. But most of all, it is a commonsense and 
reasonable way for us to get through this problem without damaging our 
economy.
  Let me share this story. These numbers that I am about to give were 
produced during a hearing at the Judiciary Committee not too long ago. 
We had some inquiry about the litigation involving asbestos and people 
at shipyards, and so forth, who breathe asbestos and had their health 
adversely affected.
  What we learned was that over 200,000 cases had been filed, many of 
them taking years to reach conclusion. Two hundred thousand more were 
pending, and it was expected that another 200,000 would be filed out of 
that tragic problem.
  What we also found was, when we made inquiry, we asked how much of 
the money actually paid by those defendant corporations got to the 
victims of asbestos. I am a person who believes in the legal system. I 
respect it. I was shocked and embarrassed to find out that the expert 
testimony was that only 40 percent of the money paid out by the 
asbestos companies actually got to the people who needed it, who were 
sick because of it. The legal fees are 30 and 40 percent. Court fees 
and costs all added to it take up 60 percent.
  This is not acceptable. It is not acceptable if we care about a 
problem and how to fix it. That figure did not count the court systems 
that were clogged

[[Page 7459]]

and remain clogged to this day by hundreds, even thousands of asbestos 
lawsuits.
  I say to the Senate, we are facing a crisis.
  These are some of the comments at the recent ABA, American Bar 
Association, convention in Toronto last August. A panel of experts 
predicted that the legal costs associated with the Y2K would exceed 
that of asbestos, breast implants, tobacco, and Superfund litigation 
combined. By the way, with regard to these asbestos companies, even 
with regard to big companies, there are limits to how much they can 
pay. Every single asbestos company in America that is still in business 
is in bankruptcy. Every asbestos company still in business is in 
bankruptcy. These are tremendous costs.
  What this American Bar Association study showed was that the cost of 
this litigation would exceed asbestos, breast implants, a huge amount 
of litigation, tobacco, and Superfund combined. They note that this is 
more than three times the total annual estimated cost of all civil 
litigation in the United States.
  We have too much litigation now. Seminars on how to try a Y2K case--
these are lawyers' seminars, trying to teach each other how to file 
them--are well underway. Approximately 500 law firms across the country 
have put together Y2K litigation teams to capitalize on the event. They 
can't wait. Also, several lawsuits have already been filed, making 
trial attorneys confident that a large number of businesses, big and 
small, will end up in court as both plaintiffs and defendants. They are 
going to be suing because something went wrong with their computer, and 
the people they sold the computer to, or are doing business with, are 
going to be suing them for problems arising from the computers. We are 
going to be spending more money on litigation than on fixing the 
problem. This report indicates this litigation problem ``would reduce 
investment and slow income growth for American workers. Indeed, 
innovation and economic growth would be stifled by the rapacity of 
strident litigators.''
  Well, I would say it is not a matter of whether there is a problem. 
There have been estimates of $1 trillion in legal costs for this thing. 
I think we do have a problem.
  What is needed? I think this legislation goes a long way in meeting 
what is needed. What is needed is to spend our time and effort fixing 
the problem promptly. If we have all of our computer companies spending 
time hiring $500-per-hour lawyers to defend them in court, draining 
their resources from which to actually fix the problem, that is not the 
right direction to go in, I submit. In addition to that, when you are 
in litigation, you are not as open and willing to discuss the problem 
honestly with somebody because you are afraid anything you say and do 
will be used against you in a lawsuit. Lawyers are always saying, 
``Don't talk about it.''
  What we really want is the computer companies to get in there with 
the businesses that are relying on the computers and try to fix the 
problem at the lowest possible cost.
  Now, we had one witness who didn't favor this in the Judiciary 
Committee. The Judiciary Committee voted out a bill very similar to 
Senator McCain's bill. I am pleased to support his bill, as well as the 
one in the Judiciary Committee. But this company that filed a lawsuit 
and received a substantial verdict was not in favor of the legislation, 
he said. I asked him how long it took to get his case over. He said 2 
years. It took him 2 years to get the case to a conclusion.
  Now, we are going to have hundreds of thousands of lawsuits in every 
county in America, every Federal court, clogged up with these kinds of 
cases, and it will take years to get to a conclusion, and that is not a 
healthy circumstance for America. I really mean that. That is not good 
for us, if we care about the American economy. So we need to do that. 
We need to get compensation to people who suffer losses promptly, with 
the least possible overhead, the least possible need to pay attorney 
fees, the least possible need to have expert witnesses and prolonged 
times to get to it. We need to get it promptly and effectively, and we 
need to make sure that people who have been fraudulent and 
irresponsible can be sued and can be taken to court and taken to trial. 
That will happen in this case.
  Now, some have suggested that we are violating the Constitution if we 
do that. Well, that is not so. We believe in litigation and in being 
able to get redress in court. This law would provide for that. 
Historically, the U.S. Senate and the State legislatures, every day, 
set standards for lawsuits. They set the bases of liability. They say 
how long it takes before you can file a lawsuit. Sometimes the statute 
of limitations is 2 years, sometimes it is 1 year, sometimes it is 6 
years. Legislatures set standards for litigation. That is what they do. 
We are a legislative body and we have a right and an obligation to 
consider what is best for America in the face of this unique crisis and 
to deal with it effectively.
  Let me ask, if we don't have such a law as this, what will happen? 
Well, I submit that there will be thousands of lawsuits filed. You may 
file it in one court and maybe they don't have many cases; maybe you 
have an expeditious judge and you get to trial within a matter of 6 
months. Maybe in another court, it takes 2 years because they have a 
backlog. But you get to trial within 6 months. And say two people in 
that court get to trial within 6 months. One of them goes to a jury and 
the jury says, wait a minute, computer companies can't be responsible 
for all this; we don't think they are liable. No verdict. Down the 
hall, where another trial is going on, they come forward with a verdict 
of $10 million, or whatever, for this lawsuit.
  Lawsuits are wonderful things for redressing wrongs, but in mass 
difficulties like this, they tend to promote aberrational distributions 
of limited amounts of resources. So we have a limited amount of 
resources and, as far as possible, we ought to create a legal system 
that gets prompt payment, consistently evaluating the kind of people 
who ought to get it. In some States, you will be able to recover huge 
verdicts because the State law would be very favorable. In other 
States, it would not be.
  Some have suggested that it would be a horrendous retreat to 
eliminate joint and several liability. That is, if six people are 
involved in producing and distributing this computer system--six 
different defendants--and one is 5 percent at fault, one of them is 60 
percent at fault and the others are somewhere in between, and the ones 
most at fault are bankrupt, they want the one least at fault to pay it 
all if they have the money to do so.
  Now, people argue about that. That is a major legal policy debate 
throughout America today. Many States limit joint and several 
liability. Others have it in its entirety, and many are in between. So 
for us to make a decision on that with regard to this unique problem of 
computer Y2K is certainly not irrational. It is important for us.
  Now, I say to you that the more lawsuits are filed, the longer the 
delays will be in actually getting compensation to the people who need 
it. Literally, when you talk to people in your hometown and they are 
involved in litigation, ask them about major litigation and they will 
tell you it would be unusual, in most circumstances, to get a case 
disposed of and tried within 1 year. Sometimes it is 3, 4, and 5 years 
before they are brought to a conclusion.
  So I say that a system that promotes prompt payment of damages and 
prompt resolution of the matter is good for everyone. Allocating funds 
to fix this problem is a difficult thing. But the way you do it through 
the lawsuit system is not good in a situation where we have a massive 
nationwide problem. It is not a good way to do it. We are, again, 
talking about extraordinary costs and the clogging of courts. So the 
focus is taken away from actually fixing the problem and more to 
assigning blame, trying to encourage a jury to render the largest 
possible verdict.
  Now, some would say, why do you have to limit the amount of punitive

[[Page 7460]]

damages? Well, three times the amount of damages under this bill--
damages are limited to three times the actual damages incurred for 
punitive, or $250,000, whichever is greater. They say, why do you want 
to do that? As long as there is a possibility that a jury might render 
a verdict for $10 million, lawyers have an incentive not to settle and 
take that case to a jury.
  I have talked to lawyers. I know how they think. They say, well, we 
can settle this case for $200,000. They have offered that. I don't 
think we are likely to get much more than that, but there is a chance 
that we can get $1 million or $2 million. I believe we have a couple of 
jurors there who are sympathetic with us, and I am inclined to say, 
let's roll the dice and see. We are not likely to get a whole lot less, 
but we can get 5 or 10 times as much. That is what I advise you, Mr. 
Client; let's go for it. So what happens is this possibility of 
unlimited verdicts makes it more and more difficult in a practical 
setting for cases to be settled.
  You will have more realistic settlements if you have this kind of 
limitation on the top end of punitive damages.
  This bill will encourage remediation. It actually encourages prompt 
negotiation, consolidation, and problem solving. That is the focus of 
it. That is why I favor it.
  I would just say this. Mr. President, the Y2K problem is a unique 
problem. It has the potential of hurting our economy. One of the 
greatest assets this Nation has--I can't stress this too much--is the 
strength and viability of our computer industry. We are world leaders. 
There is not a State in this Nation that doesn't have some computer 
manufacturing going on, and certainly not a community in America that 
does not depend on the innovation and creativity of the computer 
industry. They benefit from that creativity.


  As a matter of fact, I heard one expert say that his belief is, the 
reason our economy is so strong, the reason inflation is not going up, 
even though salaries of our workers are going up faster than inflation, 
is because computers have made our workers more productive and that 
they can afford to pay them more, because using the high-tech 
computers, that are really just now in America coming on line fully and 
effectively and wisely utilized by American business, is really helping 
us increase productivity.
  This is a marvelous asset for us. Some years ago many of these 
companies focusing on innovation and creativity apparently did not 
fully focus on the problem that is going to happen at the year 2000.
  I mentioned earlier in my remarks how every asbestos company in 
America is now in bankruptcy. Many of those had a lot more business 
than just bankruptcy. They made asbestos. They made a lot more things 
than just asbestos. Yet their whole company was pulled down by this.
  If we don't get a handle on this, think about it. We have the 
capacity to severely damage, by placing in bankruptcy, the most 
innovative, creative, beneficial industry perhaps this Nation has 
today, the thing that is leading us into the 21st century. I think this 
is a matter of critical importance. It is quite appropriate for the 
Congress to legislate on it. It is clearly a matter of interstate 
commerce. These computers are produced in one State and sold in all 50 
States.
  I really believe it is a situation that is appropriate for the 
Congress to respond to. It is appropriate for us to bring some 
rationality to the damages that will be paid out by these companies, to 
limit the amount of money they spend on litigation, to make sure the 
money gets promptly to those who need it, and otherwise to allow them 
to continue as viable entities producing every year more, better, and 
more creative products that make us more competitive in the 
marketplace.
  Mr. President, I don't have any Microsoft business in my State. But I 
know the Department of Justice sued them for antitrust. I think that is 
fine. We will just see how that chase comes out.
  In a way, it is sort of odd. I remember saying at the time that most 
countries which have a strong industry in their nation that is 
exporting and selling all over the world and improving the lives of 
millions of people do not sue them; they support them. But in America 
we tend to sue them when they get big. This idea that you are big, you 
have a deep pocket, and we ought to sue, I think, is not a healthy 
thing at this time.
  Again, I think, as the Senator from Oregon mentioned, this is a one-
time piece of legislation. For those who are troubled about any changes 
in our tort system, I really think that is not a wise approach. We need 
to make some changes. We have always changed our legal system. When 
there is a problem, we ought not hesitate to improve it. But if you 
are, remember, this is just a one-time problem.
  Looking at a report from the Progressive Policy Institute, they 
concluded with these remarks:

       Perhaps the most important big winner from liability 
     limitation [that is, this bill] will be the United States 
     economy and by extension U.S. consumers who will not have to 
     indirectly bear up to $1 trillion in cost with a healthy 
     share going to lawyers.

  I like lawyers. I respect them. But they are not producers. They are 
not making computers. They are not fixing computers. What they are 
doing is filing lawsuits and taking big fees for it. And they will have 
at least a one-third contingent fee and usually maybe more than 40 
percent.

       By promoting attempts to Y2K remediation and lowering the 
     likelihood of litigation, the rules instituted by this 
     legislation will benefit everyone, not just a few. In the 
     last State of the Union address, President Clinton urged 
     Congress to find solutions that would make the Y2K problem 
     the last headache of the 20th century rather than the first 
     crisis of the 21st.

  I think that is a good policy. The President has recognized the need 
for that. It has had bipartisan support in our committee, bipartisan 
support in this Senate--Republicans and Democrats. But there do remain 
a few who, through any way possible, are really frustrated by this 
legislation and are attempting to undo it. In light of the crisis we 
are facing, the threat it poses to small businesses that need their 
systems fixed, and through our creative and imaginative computer 
industry which leads the world, I believe we must act.
  I very much appreciate the leadership of Senator John McCain. He is a 
true leader in every sense of the word. He is a man of courage; he 
understands technology. He has done a great job on it.
  I also express my appreciation to Senator Orrin Hatch and the Members 
of the Judiciary Committee who have likewise worked on this 
legislation.
  There are two separate bills. But they are very similar, and in 
conclusion they are very similar.
  Mr. President, I thank the Members of this body for their attention.
  I yield the floor.
  Mr. DURBIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Illinois.
  Mr. DURBIN. Mr. President, I listened to the debate on this bill, S. 
96. It is an important bill. It is an important bill because it 
protects American business.
  There are elements of this bill which I think are wise policy. I am 
certain that at the end of the debate, if the amendment process is a 
reasonable one, we will pass legislation along these lines protecting 
business.
  Mr. HATCH. Mr. President, I rise to state unequivocally my strong 
support for a Y2K bill.
  Let me begin by stating how important Y2K remediation is to 
consumers, business, and the economy. This problem is of particular 
interest in my State of Utah which has quickly become one of the 
Nation's leading high tech States.
  Working together, Senator Dianne Feinstein and I have produced a 
bill--S. 461, the Year 2000 Fairness and Responsibility Act--that 
encourages Y2K problem-solving rather than a rush to the courthouse. It 
was not our goal to prevent any and all Y2K litigation. It was to 
simply make Y2K problem-solving a more attractive alternative to 
litigation. This benefits consumers, businesses, and the economy. The 
bill was voted out of the Judiciary Committee.

[[Page 7461]]

  But, Senator McCain's bill is the focus of the present debate. With 
some distinctions--this bill accomplishes the same ends as Senator 
Feinstein's and my bill. Let me say that I support a strong bill. I do 
not care who gets the credit. This is of no importance to me. What is 
important is that the Nation needs Y2K legislation. I thus will support 
any mechanism that is able to pass Congress. Let me explain why.
  The main problem that confronts us as legislators and policymakers in 
Washington is one of uniquely national scope. More specifically, what 
we face is the threat that an avalanche of Y2K-related lawsuits will be 
simultaneously filed on or about January 3, 2000, and that this 
unprecedented wave of litigation will overwhelm the computer industry's 
ability to correct the problem. Make no mistake about it, this super-
litigation threat is real; and, if it substantially interferes with the 
computer industry's ongoing Y2K repair efforts, the consequences for 
America could be disastrous.
  Most computer users were not looking into the future while, those who 
did, assumed that existing computer programs would be entirely 
replaced, not continuously modified, as actually happened. What this 
demonstrates is that the two-digit date was the industry standard for 
years and reflected sound business judgment. The two-digit date was not 
even considered a problem until we got to within a decade of the end of 
the century.
  As the Legal Times recently pointed out, ``the conventional wisdom 
[in the computer business was] that most in the industry did not become 
fully aware of the Y2K problem until 1995 or later.'' The Legal Times 
cited a LEXIS search for year 2000 articles in Computerworld magazine 
that turned up only four pieces written between 1982 and 1994 but 786 
pieces between 1995 and January 1999. Contrary to what the programmers 
of the 1950s assumed, their programs were not replaced; rather, new 
programmers built upon the old routines, tweaking and changing them but 
leaving the original two-digit date functions intact.
  As the experts have told us, the logic bomb inherent in a computer 
interpreting the year ``00'' in a programming environment where the 
first two digits are assumed to be ``19'' will cause two kinds of 
problems. Many computers will either produce erroneous calculations--
what is known as a soft crash--or to shut down completely--what is 
known as a hard crash.
  What does all this mean for litigation? As the British magazine The 
Economist so aptly remarked, ``many lawyers have already spotted that 
they may lunch off the millennium bug for the rest of their days.'' 
Others have described this impending wave of litigation as a feeding 
frenzy. Some lawyers themselves see in Y2K the next great opportunity 
for class action litigation after asbestos, tobacco, and breast 
implants. There is no doubt that the issue of who should pay for all 
the damage that Y2K is likely to create will ultimately have to be 
sorted out, often in court.
  But we face the more immediate problem of frivolous litigation that 
seeks recovery even where there is little or no actual harm done. In 
that regard, I am aware of at least 20 Y2K-related class actions that 
are currently pending in courts across the country, with the threat of 
hundreds more to come.
  It is precisely these types of Y2K-related lawsuits that pose the 
greatest danger to industry's efforts to fix the problem. All of us are 
aware that the computer industry is feverishly working to correct--or 
remediate, in industry language--Y2K so as to minimize any disruptions 
that occur early next year.
  What we also know is that every dollar that industry has to spend to 
defend against especially frivolous lawsuits is a dollar that will not 
get spent on fixing the problem and delivering solutions to technology 
consumers. Also, how industry spends its precious time and money 
between now and the end of the year--either litigating or mitigating--
will largely determine how severe Y2K-related damage, disruption, and 
hardship will be.
  To better understand the potential financial magnitude of the Y2K 
litigation problem, we should consider the estimate of Capers Jones, 
chairman of Software Productivity Research, a provider of software 
measurement, assessment and estimation products and services. Mr. Jones 
suggests that ``for every dollar not spent on repairing the Year 2000 
problem, the anticipated costs of litigation and potential damages will 
probably amount to in excess of ten dollars.''
  The Gartner Group estimates that worldwide remediation costs will 
range between $300 billion to $600 billion. Assuming Mr. Jones is only 
partially accurate in his prediction--the litigation costs to society 
will prove staggering. Even if we accept The Giga Information Group's 
more conservative estimate that litigation will cost just $2 to $3 for 
every dollar spent fixing Y2K problems, overall litigation costs may 
total $1 trillion.
  Even then, according to Y2K legal expert Jeff Jinnett, ``this cost 
would greatly exceed the combined estimated legal costs associated with 
Superfund environmental litigation . . . U.S. tort litigation . . . and 
asbestos litigation.''
  Perhaps the best illustration of the sheer dimension of the 
litigation monster that Y2K may create is Mr. Jinnett's suggestion that 
a $1 trillion estimate for Y2K-related litigation costs ``would exceed 
even the estimated total annual direct and indirect costs of--get 
this--all civil litigation in the United States,'' which he says is 
$300 billion per year.
  These figures should give all of us some pause. At this level of 
cost, Y2K-related litigation may well overwhelm the capacity of the 
already crowded court system to deal with it.
  Looking at a rash of lawsuits, we must ask ourselves, what kind of 
signals are we sending to computer companies currently engaged in or 
contemplating massive Y2K remediation? What I fear industry will 
conclude is that remediation is a losing proposition and that doing 
nothing is no worse an option for them than correcting the problem. 
This is exactly the wrong message we want to be sending to the computer 
industry at this critical time.
  I believe Congress should give companies an incentive to fix Y2K 
problems right away, knowing that if they don't make a good-faith 
effort to do so, they will shortly face costly litigation. The natural 
economic incentive of industry is to satisfy their customers and, thus, 
prosper in the competitive environment of the free market. This acts as 
a strong motivation for industry to fix a Y2K problem before any 
dispute becomes a legal one.
  This will be true, however, only as long as businesses are given an 
opportunity to do so and are not forced, at the outset, to divert 
precious resources from the urgent tasks of the repair shop to the 
often unnecessary distractions of the court room. A business and legal 
environment which encourages problem-solving while preserving the 
eventual opportunity to litigate may best insure that consumers and 
other innocent users of Y2K defective products are protected.
  There are not at least 117 bills pending in State legislatures. Each 
bill has differing theories of recovery, limitations on liability, and 
changes in judicial procedures, such as class actions. This creates a 
whole slew of new problems. They include forum shopping. States with 
greater pro-plaintiff laws will attract the bulk of lawsuits and class 
action lawsuits. A patchwork of statutory and case law will also result 
in uneven verdicts and a probable loss of industry productivity, as 
businesses are forced to defend or settle ever-increasing onerous and 
frivolous lawsuits. Small States most likely will set the liability 
standard for larger States. This tail wagging the dog scenario 
undoubtedly will distort our civil justice system.
  Some States are attempting to make it more difficult for plaintiffs 
to recover. Proposals exist to provide qualified immunity while others 
completely bar punitive damages. These proposals go far beyond the 
approach taken in the Judiciary and Commerce Committees' bills of 
setting reasonable limits

[[Page 7462]]

on punitive damages. Other States may spur the growth Y2K litigation by 
providing for recovery without any showing of fault. A variety of 
different and sometimes conflicting liability and damage rules create 
tremendous uncertainty for consumers and businesses. If we want to 
encourage responsible behavior and expeditious correction of a problem 
that is so nationally pervasive, we should impose a reasonable, uniform 
Federal solution that substantially restates tried and true principles 
of contract and tort law. If there is an example for the need for 
national uniformity in rules, this has to be it.
  The most appropriate role we in Washington can play in this crisis is 
to craft and pass legislation that both provides an incentive for 
industry to continue its remediation efforts and that preserves 
industry's accountability for such real harm as it is legally 
responsible for causing.
  This will involve a delicate balancing of two equally legitimate 
public interests: the individual interest in litigating meritorious 
Y2K-related claims and society's collective interest in remediating Y2K 
as quickly and efficiently as possible. We need to provide an incentive 
for technology providers and technology consumers to resolve their 
disputes out of court so that precious resources are not diverted from 
the repair shop to the court room.
  Let's face it, the only way a bill will pass is if it has significant 
bipartisan support. I think Congress can pass a bipartisan bill that is 
both fair and effective. Whatever bill is voted upon by this Chamber, 
it should at a minimum contain the following provisions that:
  Preserves the right to bring a cause of action;
  Requires a ``problem-solving'' period before suits can go forward. 
This delay must be reasonable and if so will spur technology providers 
to spend resources in the repair room instead of diverting needed 
capital;
  Provides that the liability of a defendant would be limited to some 
percentage of the company's fault in causing the harm. This will assure 
fairness and lessen the push to go after deep pockets;
  Allows the parties to a dispute to request alternative dispute 
resolution, or ADR during the problem-solving period;
  Limits onerous punitive damages;
  Contains a duty to mitigate. Plaintiffs should not be able to recover 
for losses they could have prevented;
  Contains a contract preservation provision. This preserves the 
parties' bargain and prevents States from retroactively instituting 
strict liability;
  Codifies the economic loss doctrine. This preserves the restatement 
of torts rule that you cannot get economic loss for tort injuries;
  Allows evidence of reasonable efforts in tort. This section is very 
important because it prevents States from retroactively imposing strict 
liability or negligence per se; and
  Contains a class action provision. The class action provision must 
contain a section that common material defect must be demonstrated to 
certify claims. It should also contain a section that allows for 
removal of State class actions to Federal courts based on minimal 
diversity.
  Let me end by emphasizing that the Y2K problem presents a special 
case. Because of the great dependence of our economy, indeed of our 
whole society, on computerization, Y2K will impact almost every 
American in the same way.
  But the problem and its associated harms will occur only once, all at 
approximately the same time, and will affect virtually every aspect of 
the economy, society, and Government. What we must avoid is creating a 
litigious environment so severe that the computer industry's 
remediation efforts will slacken and retreat at the very moment when 
users and consumers need them to advance with all deliberate speed.
  I recognize that if we are to enact worthwhile Y2K problem-solving 
legislation this year, we must all work together--Democrats and 
Republicans--in a cooperative manner which produces a fair and narrowly 
tailored bill. I think we can do this. We can produce a measure which 
has broad political support, can pass the Congress, and become law.
  I appreciate the efforts of the distinguished Senator from Arizona 
and others to try and get this bill through and will do everything in 
our power to assist him and help him to do so.
  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. McCAIN. Mr. President, all I will say is that we had a couple of 
long meetings of negotiations on this issue. We have still not resolved 
a couple of outstanding problems. They are tough, very difficult. I am 
not sure we will be able to resolve them, but we will continue 
negotiating tonight and into tomorrow. It is my understanding that the 
majority leader will move back on the bill at noon tomorrow, and we 
will have the morning to continue those negotiations.
  I hope we can reasonably sit down together and resolve these 
remaining problems. We have resolved almost all of them, but there are 
two or three very difficult issues remaining. All I can do is assure my 
colleagues, I will make every effort to get them resolved as quickly as 
possible.

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