House Judiciary Committee Passes E-SIGN Bill with Berman Amendment

(October 14, 1999) The House Judiciary Committee approved HR 1714, a bill providing for the acceptance of electronic signatures in interstate commerce, on Wednesday, October 13. The committee adopted an amendment offered by Rep. Berman that allows states wide latitude to adopt legislation limiting the use of electronic signatures. The vote followed partisan lines.

HR 1714, the Electronic Signatures in Global and National Commerce (E-SIGN) Act, was introduced by Rep. Tom Bliley (R-VA), Chairman of the House Commerce Committee, in April. That bill was amended and passed by the Commerce Committee in August.

The Commerce and Judiciary Committee versions of the bill both provide for the acceptance of electronic signatures in interstate commerce. However, they diverge significantly on other points.

The Bliley/Commerce bill would permanently preempt any state laws at variance with its terms. It would provide a single national standard for electronic contracts. The Berman/Judiciary bill allows the states to pass statutes pertaining to electronic commerce, including statutes that require contracts to be in writing.

The Bliley/Commerce bill would extend to contracts to which the government is a party. The Berman/Judiciary bill would exempt such contracts.

Rep. Howard Berman

The House Courts and Intellectual Property Subcommittee reported an amendment in the nature of a substitute at its markup session on October 7. The full House Judiciary Committee markup on October 13 took up this CIP version of the bill. Rep. Coble offered a perfecting amendment, and Rep. Berman offered an amendment to the Coble amendment.

First, the Berman amendment was adopted. Then, the Coble amendment, as amended by the Berman amendment, was adopted. Finally, HR 1714 as amended, was adopted.

The sole roll call vote was on the Berman amendment. It passed by 15 to 14 on a largely party line vote.

The CIP Subcommittee is normally collegial and nonpartisan. So far this year, every vote in the subcommittee has been unanimous. The Subcommittee has been active and productive. The CIP Subcommittee has adopted already this year a major patent reform bill, a database protection bill, an anti-cybersquatter bill, and several technical bills pertaining to trademark law and copyright law. It has also conducted hearings on additional matters.

Rep. Berman became the ranking minority member of the CIP Subcommittee at the beginning of the 106th Congress in January of this year. This is the first issue on which Rep. Coble and Rep. Berman have publicly disagreed. However, unlike some other recent disputes in the Judiciary Committee, the debate on October 13 was civil and dignified.

There is a split between the Commerce Committee and the CIP Committee the electronic signatures bill. There is also a split on database protection bills (CIP wants to protect databases; Commerce does not.) Rep. Rick Boucher (D-VA), a senior member of both committees is a strong supporter of Commerce Committee's bill. He did not attend the CIP meeting when its database bill was approved.

In the end, the vote on the Berman amendment was made almost exclusively on partisan lines. All of the Democrats who voted, except Rep. Boucher, supported the Berman amendment. All of the Republicans who voted, except Rep. Lindsay Graham (R-SC) and Rep. Bob Barr (R-GA), opposed the Berman amendment.

The Republicans, who have a majority on the Committee, lost in part because they had one more defection than the Democrats. But more importantly, many of their members were absent at the time of the vote. All but two of the sixteen Committee Democrats voted: Rep. Marty Meehan (D-MA) and Rep. Wexler (D-FL).

However, only fifteen of the twenty-one Committee Republicans voted. Rep. Bill McCollum (R-FL), Rep. Joe Scarborough (R-FL), and Rep. Spencer Bacchus (R-AL) did not attend any part of the meeting. Rep. Ed Pease (R-IN) , Rep. James Sensenbrenner (R-WI), and Rep. Bill Jenkins (R-TN), who are all members of the CIP Subcommittee, were present at the CIP Subcommittee meeting on October 7, and were present earlier in the full Committee hearing, but were not present for the vote on the Berman amendment.

There were several light moments at the meeting. For example, after the roll had been called on the Berman amendment, it was apparent that its supporters were one vote short. As Chairman Hyde called upon the committee clerk to report the vote, Rep. Berman interrupted to ask the clerk to remind him how he had voted, as he feigned ignorance. Then, Rep. Delahunt, a cosponsor of the amendment, slowly asked the clerk to remind him how he had voted. Both were informed that they had supported their own amendment.

They were delaying for the absent Rep. Rothman, who was on his way to the hearing. When he arrived and voted, memories improved, and the amendment was approved by one vote.

After the vote, some supporters of the Berman amendment appeared surprised.

Supporters of state preemption, and a uniform national standard, will attempt to change the bill back when it goes to the House floor. It may prove significant that the Chairman of the House Rules Committee, Rep. David Dreier (R-CA), which will decide what amendments may be offered on the floor, was one of the original cosponsors of the original Bliley/Commerce bill.