Software companies fearing massive potential liabilities from Y2K will sleep easier knowing that damages may be limited by a new bill, introduced into the Senate yesterday. Senate commerce committee chairman John McCain unveiled bill S 96 which he hopes will win support from both sides of the house. It will place a cap on damages of around $300,000. It will also introduce a breathing space for litigating companies, the idea being to reduce unnecessary litigation by encouraging firms to settle out of court. The space is likely to be between 30 and 90 days.
The bill differentiates between suits seeking damages, and more urgent litigation for injunctions to remedy commercial mission critical predicaments where IT and IT firms are at fault. Kirk Ruthenberg, a Y2K specialist with US lawyers Sonnenschein, Nath and Rosendale, says that this is the one favored by the Democrats. What they are trying to do is to water it down to the point where they could attract enough votes from the Democratic side, he said, and the side that didn’t want to offend the trial lawyers.
The Information Technology Association of America (ITAA) is supporting the bill and the American Trial Lawyers Association (ATLA) is on the opposite side. Liberal democrats, says Ruthenberg, have joined the ATLA to fight the bill, but big business has gotten behind it. Ruthenberg warns congress needs to pay closer attention to solutions than addressing litigation that has not yet been brought.
