Legislature(1999 - 2000)
03/03/1999 03:20 PM House L&C
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 82 - IMMUNITY:CLAIMS ARISING FROM Y2K PROBLEMS Number 1752 CHAIRMAN ROKEBERG announced the next order of business would be HB 82, "An Act relating to immunity for certain claims arising out of or in connection with the year 2000 date change; and providing for an effective date." He pointed out that the new proposed committee substitute (CS), Version I [1-LS0398\I, Ford, 3/2/99], reflects the conceptual amendments adopted by the committee the previous week. He indicated the committee packets additionally contained an executive summary of the Senate Year 2000 Problem report, "Investigating the Impact of the Year 2000 Problem," issued by the United States Senate Special Committee on the Year 2000 Technological Problem; chairman, Senator Bob Bennet; vice-chairman, Senator Chris Dodd. The chairman noted the material provided to the committee contained a web page address for anyone interested in reviewing the entire report [homepage address for the United States Senate special committee, with links to the report: http://www.senate.gov/~y2k/home.html]. The chairman indicated the report was issued on February 24, 1999, and became available March 2 on the Internet. Chairman Rokeberg commented the committee had also received additional information from Scott Thorson who testified on HB 82 on February 26, 1999. He invited Ms. Seitz forward to briefly explain the changes in the proposed Version I CS. Number 1802 JANET SEITZ, Legislative Assistant to Representative Norman Rokeberg, Alaska State Legislature, came forward. She told members that Version I incorporates the three conceptual amendments adopted by the committee on February 26. Amendment 1 added language similar to that contained in S.96, the federal legislation; these changes appear page 1, lines 12 and 13, and page 2, lines 14 through 18. Amendment 2 added "curing" language to give the business an opportunity to cure its problems before any legal action was instituted; this language appears on page 3, lines 7 through 14. Amendment 3 added some language covering people who developed software, firmware, et cetera, and [those] who only sell, rent or lease those items; that language is on page 2, line 20, with the addition of the word "develops", and on line 25, with the addition of the word "sells". Number 1863 REPRESENTATIVE HALCRO made a motion to adopt the proposed committee substitute, 1-LS0398\I, Ford, 3/2/99, as a work draft. There being no objection, Version I was before the committee. Number 1881 CHAIRMAN ROKEBERG confirmed no one wished to testify on HB 82. He thanked members for their work on the bill at the previous hearing. The chairman commented on two areas that had been discussed at that hearing. He indicated Representative Murkowski had expressed some concerns, and that he was also concerned, about "those provisions of a plan of due diligence," page 1, line 14, through page 2, line 13. This language specifies specific steps, making good faith efforts, and demonstrating to the courts what due diligence is. The chairman expressed concern about these provisions; however, he indicated he would like to leave the current language for the House Judiciary Standing Committee, where the provisions as specific steps would probably be removed or possibly modified depending on legal input. Chairman Rokeberg commented he did not think this would hurt the intention of the legislation. He noted he would like to have further discussion of these issues by the public for education purposes. CHAIRMAN ROKEBERG referred to page 2, line 27, subsection (b)(2) ["(b) The defense in (a) of this section may not be asserted ... (2) in an action based on a contract."]. The chairman indicated he believes this section should probably be removed but wishes to allow the House Judiciary Committee to debate the issue regarding the legal aspect of the legislation. He based his reason for removal on allowing the defense contained in the bill to come into action, noting most causes of action brought under this "theory" will be "actions in contract." The chairman expressed his belief in the privy of contract and allowing the agreed performance to take place, but said, conversely, if the action is not allowed the defense the bill's purpose is defeated. Chairman Rokeberg stated he would like to move the current version of the legislation out of committee, asking for recommendations and discussion from the committee. Number 2020 REPRESENTATIVE HALCRO thanked the chairman for his work on the legislation. He commented on large articles in both the February 27 and 28 Seattle Times on year 2000 (Y2K) problems. Representative Halcro noted this is one issue garnering bipartisan support: Dianne Feinstein [Senator, California, Democrat] is working with Orrin Hatch [Senator, Utah, Republican] in addressing this. According to Representative Halcro, both have indicated that if some form of immunity is not granted to businesses "there's just gonna be a flood of litigation that this country has never seen before." Representative Halcro stated he thinks the chairman is "ahead of the curve on this," and he agrees the legislation needs to get moving. REPRESENTATIVE HARRIS said he echoed Representative Halcro's comments. He added that the federal legislation, S.96, is being taken up by the United States Senate, possibly this day on the floor. Number 2076 REPRESENTATIVE MURKOWSKI commended the chairman for getting this moving; however, she noted the somewhat "loose language" in the cure provision, page 3, line 12, gives her some concern although she notes she thinks the provision is absolutely critical [subsection (d)(2)(B), "(B) gives the business the opportunity to fix the problem, including reasonable access to electronic computing devices or software affected by the failure described under (A) of this paragraph;"]. She felt that language should be "tightened up," indicating a business could say it would fix the problem, but never do so. Representative Murkowski further expressed some concern with the itemization in Section 1, the drafter's either/or language: business either does the following six steps or it follows the generally accepted standards of care. Commenting she was somewhat thinking out loud, she questioned whether the specific steps would be construed to be a business's standard of care, indicating the possibility that something critical might be overlooked because it was not included in those six steps, and that the standard of care might be vary by industry. In response to the chairman's comment, she agreed the disjunctive disconnecting subsections (1) and (2) solves a lot of the concerns. She reiterated her own concern, however, that the standard of care within the industry not automatically revert back to the specific steps. Representative Murkowski indicated she is much more comfortable with the flexibility of the "or" language. CHAIRMAN ROKEBERG said he tended to agree regarding the tightness of the language. He inferred that Representative Murkowski, as a member of the House Judiciary Committee along with the chairman, could provide some possible wording. Number 2237 REPRESENTATIVE CISSNA indicated she had missed the majority of the previous hearing, but had listened to a taped copy. She confirmed she was correct in her hearing that the chairman would like to see the contract language deleted. She further confirmed the chairman did not wish to amend the bill in this committee. CHAIRMAN ROKEBERG said he thought the issue needed further discussion and the House Judiciary Committee is the proper place for that discussion. This issue is one of whether or not the defense raised in the bill is defeated, he said, "By having the ... exception of the contract, action (indisc.) contract left in." Noting he is unsure of that dynamic, he believes it is best served by removal, and, as the bill sponsor, he will make sure it is fixed properly before it reaches the House floor. REPRESENTATIVE MURKOWSKI questioned whether the legislation had other committees of referral besides Judiciary. CHAIRMAN ROKEBERG answered in the negative, noting there was a zero fiscal note. Number 2354 REPRESENTATIVE HALCRO made a motion to move the proposed CS for HB 82, Version I, out of committee with the attached two zero fiscal notes and individual recommendations. There being no objections, CSHB 82(L&C) moved out of the House Labor and Commerce Standing Committee.
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