[Weekly Compilation of Presidential Documents Volume 35, Number 29 (Monday, July 26, 1999)]
[Pages 1431-1432]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
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.
    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.

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