    [Public Papers of the Presidents of the United States: WILLIAM J. CLINTON (1999, Book II)]
    [July 20, 1999]
    [Pages 1270-1271]
    [From the U.S. Government Publishing Office www.gpo.gov]

    Statement on Signing the Y2K Act
    July 20, 1999

        Today I have signed into law H.R. 775, the ``Y2K Act.'' This is
    extraordinary, time-limited legislation designed to deal with an
    exceptional and unique circumstance of national significance--the Y2K
    computer problem.
        In signing this legislation, I act in the belief and with the
    expectation that companies in the high technology sector and throughout
    the American economy are serious in their remediation efforts and that
    such efforts will continue. Many have worked hard to identify the
    potential for Y2K failures among their systems and products, taken
    reasonable measures to inform those who might be injured from Y2K
    failures of steps they could take to avoid the harm, and fixed those
    systems and products, where feasible. If nonetheless there are
    significant failures or disruptions as we enter the Year 2000,
    plaintiffs will turn to the courts seeking compensation. Responsible
    companies fear that they will spend millions or more defending Y2K
    suits, even if they bear little or no responsibility for the harm
    alleged. Frivolous litigation could burden our courts and delay relief
    for those with legitimate claims. Firms whose productivity is central to
    our economy could be distracted by the defense of unwarranted lawsuits.

    [[Page 1271]]

        My Administration sought changes to make the Y2K Act balanced and
    fair, protecting litigants who are injured and deserve compensation. We
    achieved some additional protections. For example, the Y2K Act was
    modified to ensure that the Federal law leaves intact the State law
    doctrines of unconscionability that protect unwary consumers and small
    businesses against unfair or illegal contracts and that public health,
    safety, and the environment are protected, even if some firms are
    temporarily unable to comply fully with all regulatory requirements due
    to Y2K failures.
        In addition, the Y2K Act expressly exempts Y2K actions involving
    private securities claims arising under the Securities Act of 1933 and
    other Federal securities laws that do not involve actual or constructive
    awareness as an element of the claim (e.g., section 11 of the 1933 Act).
    More generally, actions by the Securities and Exchange Commission are
    excluded from the definition of ``Y2K Action.''
        This is narrow, time-limited legislation aimed at a unique problem.
    The terms of the statute should be construed narrowly to create uniform
    Federal rules for Y2K actions in the areas specified in the bill, and to
    leave in place State law not in direct conflict with the bill's
    provisions. Moreover, my signature today in no way reflects support for
    the Y2K Act's provisions in any other context.
        I hope that we find that the Y2K Act succeeds in helping to screen
    out frivolous claims without blocking or unduly burdening legitimate
    suits. We will be watching to see whether the bill's provisions are
    misused by parties who did little or nothing to remediate in order to
    defeat claims brought by those harmed by irresponsible conduct.
        In the remaining days of 1999, I hope that the business community
    redoubles its efforts at remediation. Preventing problems before they
    start, and developing contingency plans when necessary, are still the
    best solutions to the Y2K problem.

                                                          William J. Clinton

    The White House,

    July 20, 1999.

    Note: H.R. 775, approved July 20, was assigned Public Law No. 106-37.