As the US races to fix the millennium bug as quickly as possible, in as many places as possible, a bipartisan bill that could release critical information needed to eradicate the bug is gaining momentum.
This week, the Year 2000 Readiness Disclosure Act won the endorsement of the US Chamber of Commerce, which represents 3 million businesses.
The legislation, introduced by Representative David Dreier (R-Los Angeles) and Representative Anna Eshoo (D-Palo Alto), comes on the heels of President Clinton's so-called "Good Samaritan" legislation.
Both bills would limit the liability of companies sharing Year 2000-related information among one another -- with one key difference. Supporters of Drier's bill say that it offers companies a greater degree of immunity from Year 2000 bug (Y2K) liability.
"Congress and the president both recognize that this is a top priority," says Brian Faughnan, Dreier's legislative assistant. "We would expect that legislation would be considered in both houses."
The president, members of Congress, and legal experts say companies need to be insulated from lawsuits. Fears of legal action have created a climate in which the companies are reluctant to discuss information about how they are dealing with the bug, which is expected to strike older computer programs and chips that don't support a four-digit date format when the clock rolls over to 1 January 2000.
Companies fear that if they share details of their Y2K troubleshooting, their plans might come back to haunt them them in the courts.
More than a dozen class action Y2K lawsuits have already been filed against software companies. For instance, Milberg, Weiss, Bershad Hynes & Lerach -- a firm that issues the majority of shareholder class-action suits against computer companies -- has filed five actions against large software manufacturers, including Intuit and Symantec.
Experts say those suits have had a chilling effect on circulating information critical to fixing the millennium bug.
Clinton proposed his Good Samaritan legislation -- and publicly acknowledged Y2K for the first time -- during a July address to the National Academy of Sciences. But under the president's bill, accurate Y2K troubleshooting information would still be admissible in liability lawsuits, meaning a shareholder could argue that the company had the facts and failed to act in time.
Clinton's proposal received a mixed reaction from business groups. On the one hand, they were glad that the Oval Office had finally broken its silence on Y2K. On the other, business leaders argued that full Y2K disclosure demands greater liability protection than contained in the bill.
Businesses say Clinton's plan is crafted so narrowly that it won't induce them to release more information on the bug.
"The president's bill would not lead to disclosure," said Jan Amundson, general counsel for the National Association of Manufacturers, a trade group representing 14,000 companies. The group encouraged Dreier to draft a separate plan that addressed the concerns of business.
"The president's bill only protects unintentional errors," said Faughnan.
Dreier's bill would hold companies blameless for possessing accurate Y2K information. False information, or information required in current Securities and Exchange Commission filings, would receive no liability protection under either bill.
Supporters of the bills and Y2K experts say Congress has a one-shot opportunity to pass either the Dreier bill or the president's plan. If Congress fails to act, the disclosure issue would be rendered moot as nationwide efforts to remedy Y2K enter the home stretch in 1999.
By then, most companies will be focused on testing and certifying their newly "Y2K compliant" systems and those of their customers -- the most arduous stage of the massive upgrade effort.
The Dreier bill has received strong support in the business community. In addition to the chamber, it has the backing of the Y2K Industry Working Group, a coalition of 50 major trade associations that includes the American Bankers Association, the Semiconductor Industries Association, and the Edison Electric Institute.
"This is a once-in-a-lifetime occurrence," said Amundson. "It shouldn't be an opportunity for entrepreneurial interests to cash in."
Dreier placed his bill on the fast track, at the expense of his previous Y2K Liability and Anti-Trust Reform bill, which he introduced in July. That bill, a much broader piece of legislation, would seek to limit legal damages stemming from Y2K-related failures, as well as providing certain antitrust exemptions to encourage companies to share bug information.
While Dreier has not abandoned the more expansive liability bill, staff members say he was forced to move that legislation to the back burner because Clinton administration officials balked at the antitrust exemptions and feared the wrath that such legislation would trigger from the powerful trial lawyer's lobby.
It is still unclear which bill -- the Dreier bill, Clinton's bill, or some kind of hybrid -- will be heard, and whether the Senate or House judiciary committee will take up the matter. Backers of Dreier's bill said that strong support from the private sector has put it in the pole position.
Those decisions will be made in the next week or two, when both houses return from recess. After that, Congress has five weeks to act on Y2K before adjourning for the election season.
"We are compressing what many people do in two to five years into two months," said Amundson. "There's a good chance for passing [the Dreier bill] if we get all the players in place."
