Tech Industry

Conflict over Y2K lawsuit limits

As a Senate-approved Y2K bill moves to the House for a vote, some in the legal sector are voicing concerns that it's too friendly to big business.

As Senate-approved Y2K legislation moves to the House of Representatives for a vote, some in the legal community are voicing concerns that the bill is overly friendly to big business.

A source at the Association of Trial Lawyers of America (ATLA) reaffirmed that the lawyers group will "actively oppose" the bill, which was passed by the Senate yesterday, because they believe it provides too much protection for companies against potential lawsuits from consumers.

But the bill's defenders say it only limits liability against companies to free up information exchange between companies specific to the Year 2000 bug.

According to language within the bill, the legislation will give corporations the "capability" to freely disseminate and exchange information relating to Year 2000 readiness, solutions test practices, and test results with the public and other entities without undue concern about litigation.

Corporate executives have expressed fear that they will be engulfed in multimillion-dollar class-action lawsuits spawned by financial losses from malfunctioning computers, broken contracts, and product liability issues caused by computers' incompatibility with dates in the new millennium.

The legislation, titled the Year 2000 Information and Readiness Disclosure Act, would not stop lawsuits based on Year 2000 computer failures, but instead would make it easier for businesses to have conversations with their suppliers and service companies, according to the legislation.

See related story: 
Senate backs Y2K lawsuit limit But lawyers at the ATLA said that a lot of this protection lies within disclaimers provided on company Web sites already, adding that the legislation is a solution to a nonexistent problem.

Administration officials and industry groups hope the trial lawyers will not make their stand now and instead will wait until next year, when the Senate Judiciary Committee is expected to address broader liability questions.

"I urge the House to pass this critical legislation before the end of the legislative session," President Bill Clinton said in a statement.

The bill provides "limited liability protections to encourage greater information sharing about solutions, while also protecting consumers from misleading advertising or other statements when purchasing products for their own use...I look forward to signing it into law so that Y2K information sharing will enable the nation to prepare for this global challenge," he added.