Senate Commerce Committee Passes the McCain Y2K Litigation Bill

(March 4, 1999) The Senate Commerce Committee approved S 96, the Y2K Act, on Wednesday morning, March 3. The bill would limit litigation over Year 2000 technology problems. All eleven committee Republicans voted for the bill. All nine Democrats opposed it.

"There are still a number of refinements which need to be made to the bill, and a number of concerns need to be addressed," said Sen. John McCain (R-AZ), the sponsor of the Y2K Act. "And, I am sorry we have not heard any specific suggestions. But, I still believe we can still work towards bipartisan support. I think it is critical that we keep this process moving. I am committed to working with both sides in trying to resolve the issues that remain on this legislation. I believe it is very important, however, we address this legislation, this compelling issue, before too long."

Sen. Ernest Hollings (D-SC) spoke against the bill. "It is a bad bill, and I hope we can kill it." Sen. Hollings is himself a former trial lawyer, and one of the staunchest supporters of trial lawyers in the Senate. He described the bill as "monkeyshine replacing ordinary contract law."

"The bill in its current form does not help small and medium sized business owners, consumers, and professional service providers like doctors, or accountants," said Sen. Hollings. "In fact, it is little more than an effort to protect big business from their responsibility to ensure that their products work on January 1, 2000."

Sen. McCain and Sen. Hollings are the Chairman and Ranking Minority Member of the Senate Commerce Committee, respectively.

Sen. John Kerry (D-MA) also criticized the bill, although in much milder terms. He suggested that it might inadvertently "protect[] the negligent company that has failed to meet the appropriate standard." He concluded, "I don't think that this bill does what it is supposed to do."

Sen. Jay Rockefeller (D-WV) criticized the bill for being too vague. "I don't know what this bill does." For examples, he suggested that the meaning of what constitutes a Year 2000 claim is not made clear, nor are the damage limits made clear.

Senators John McCain (R-AZ) and Slade Gorton (R-WA) were the only two Senators to speak in favor of the bill. Sen. Sam Brownback (R-KS) stated that he would submit a statement for the record. However, many Senators likely withheld comment because several Democrats were in a hurry to conclude the session, because they had a meeting with President Clinton to attend.

Senators Ernest Hollings (D-SC), Jay Rockefeller (D-WV), and John Kerry (D-MA) all spoke against the bill. Sen. Max Cleland (D-GA) also stated that he would submit a statement for the record.

Senators Voting Yes: John McCain (R-AZ), Conrad Burns (R-MT), Slade Gorton (R-WA), Olympia Snowe (R-ME), John Ashcroft (R-MO), Spencer Abraham (R-MI), and Sam Brownback (R-KS) all voted yes in person. In addition, Senators Ted Stevens (R-AK), Trent Lott (R-MS), Kay Huchison (R-TX), and Bill Frist (R-TN) all voted yes by proxy.

Senators Voting No: Senators Ernest Hollings (D-SC), Jay Rockefeller (D-WV), John Kerry (D-MA), and Max Cleland (D-GA) all voted no in person. In addition, Senators Daniel Inouye (D-HI), John Breaux (D-LA), Byron Dorgan (D-ND), Richard Bryan (D-NV), and Ron Wyden (D-OR) all voted no by proxy.

No amendments to the bill were permitted. Sen. Sam Brownback (R-KS) stated that he had an amendment to limit attorneys fees awards which he would offer on the Senate floor.

To obtain quick passage, supporters of the bill will probably need to win some support from Democrats. Sen. Slade Gorton (R-WA), one of the bill's co-sponsors, conceded: "A bill of this nature is going to require a degree of bipartisan support." Sen. McCain again pledged to work with Democrats to find language that is acceptable to them.

S 303, a satellite television bill sponsored by Sen. McCain, had also been scheduled for markup, but was postponed. Sen. McCain explained:

The Satellite Home Viewers Act was originally slated for action today, as well, and I believe that we have the votes to pass the bill out of committee, but given the narrow window of opportunity today, I have pulled it from the agenda. I am aware that there are several members who want to be able to address amendments to SHVA, and believe that we will be able to address the bill more completely by waiting until next Tuesday, March 9.

Press Release of Senate Commerce Committee.
Re: Committee approval of S 96, the Y2K Act.
Date: March 3, 1999.
Source: Senate Commerce Committee.

FOR IMMEDIATE RELEASE
WEDNESDAY, MARCH 3, 1999
106-25
Contact: Pia Pialorsi (202) 224-2670

COMMITTEE APPROVES Y2K ACT

WASHINGTON, D.C. -- The Committee on Commerce, Science, and Transportation today approved S.96, the Y2K Act, by a 11-9 vote.  The bill would limit litigation arising from Y2K problems by providing incentives for solving the technical issues before failures occur.  The Y2K problem refers to the transition from 1999 to 2000 as computers are programmed to only recognize the last two digits of the year.  Senator John McCain (R-AZ), Chairman of the Committee, introduced the legislation on January 19.  Co-sponsors include Senators Slade Gorton (R-WA), Spencer Abraham (R-MI), Conrad Burns (R-MT), and Bill Frist (R-TN).

“I want to work with my colleagues across the aisle so that we can receive bipartisan support before this bill reaches the floor,” McCain said. “It is important that we address this issue proactively. It is unacceptable that the Y2K problem is being viewed by lawyers as a tremendous business opportunity at the expense of consumers.”

“The bill in its current form does not help small and medium-sized business owners, consumers, and professional service providers like doctors, or accountants. In fact, it is little more than an effort to protect big businesses from their responsibility to ensure that their products work on January 1, 2000,” Senator Fritz Hollings (D-SC) said, Ranking Democrat.

Members approved a manager’s amendment to the bill which requires the consumer to give the business notice of the Y2K failure.  The business would then have 90 days to correct the problem. It also encourages mediation, limits punitive damages for companies which act responsibly, and establishes notice requirements for class-action lawsuits.

Already over 40 lawsuits have been filed either based upon failures or anticipated failures.
 
“Defending lawsuits filed even before 2000 diverts the time, attention, and resources of the companies most able to make January 1 a non-event,” McCain said. “We must require incentives for solutions, and an orderly means of addressing Y2K failures when they do occur.”

Senator Sam Brownback (R-KS) said he will offer an amendment limiting lawyers’ fees on the Senate floor. No other amendments were offered.