106TH CONGRESS
1ST SESSION
H. R. 775
AN ACT
To establish certain procedures for civil actions brought for
damages relating to the failure of any device or system
to process or otherwise deal with the transition from
the year 1999 to the year 2000, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Year 2000 Readiness
and Responsibility Act’’.
SEC. 2. FINDINGS.
The Congress finds the following:
(1) The Congress seeks to encourage businesses
to concentrate their attention and resources in the
short time remaining before January 1, 2000, on ad-
dressing, assessing, remediating, and testing their
year 2000 problems, and to minimize any possible
business disruptions associated with year 2000
issues.
(2) It is appropriate for the Congress to enact
legislation to assure that year 2000 problems do not
unnecessarily disrupt interstate commerce or create
unnecessary case loads in Federal and State courts
and to provide initiatives to help businesses prepare
and be in a position to withstand the potentially dev-
astating economic impact of the year 2000 problem.
(3) Year 2000 issues will affect practically all
business enterprises to some degree, giving rise to a
large number of disputes.
(4) Resorting to the legal system for resolution
of year 2000 problems is not feasible for many busi-
nesses, particularly small businesses, because of its
complexity and expense.
(5) The delays, expense, uncertainties, loss of
control, adverse publicity and animosities that fre-
quently accompany litigation of business disputes
can only exacerbate the difficulties associated with
the year 2000 date change, and work against the
successful resolution of those difficulties.
(6) The Congress recognizes that every business
in the United States should be concerned that wide-
spread and protracted year 2000 litigation may
threaten the network of valued and trusted business
relationships that are so important to the effective
functioning of the world economy, and which may
put unbearable strains on an overburdened judicial
system.
(7) A proliferation of frivolous year 2000 ac-
tions by opportunistic parties may further limit ac-
cess to courts by straining the resources of the legal
system and depriving deserving parties of their le-
gitimate rights to relief.
(8) The Congress encourages businesses to ap-
proach their year 2000 disputes responsibly, and to
avoid unnecessary, time-consuming and costly litiga-
tion based on year 2000 failures. Congress supports
good faith negotiations between parties when there
is a dispute over a year 2000 problem, and, if nec-
essary, urges the parties to enter into voluntary,
non-binding mediation rather than litigation.
SEC. 3. DEFINITIONS.
In this Act:
(1) CONTRACT.—The term ‘‘contract’’ means a
contract, tariff, license, or warranty.
(2) DAMAGES.—The term ‘‘damages’’ means
punitive, compensatory, and restitutionary relief.
(3) 
DEFENDANT.—The 
term 
‘‘defendant’’
means any person against whom a year 2000 claim
has been asserted.
(4) ECONOMIC
LOSS.—The term ‘‘economic
loss’’—
(A) means any damages other than dam-
ages arising out of personal injury or damage
to tangible property; and
(B) includes, but is not limited to, dam-
ages for lost profits or sales, for business inter-
ruption, for losses indirectly suffered as a result
of the defendant’s wrongful act or omission, for
losses that arise because of the claims of third
parties, for losses that must be pleaded as spe-
cial damages, and consequential damages (as
defined in the Uniform Commercial Code or
analogous State commercial law).
(5) GOVERNMENTAL ENTITY.—The term ‘‘gov-
ernmental entity’’ means an agency, instrumentality,
other entity, or official of Federal, State, or local
government (including multijurisdictional agencies,
instrumentalities, and entities).
(6) MATERIAL DEFECT.—The term ‘‘material
defect’’ means a defect in any item, whether tangible
or intangible, or in the provision of a service, that
substantially prevents the item or service from oper-
ating or functioning as designed or intended. The
term ‘‘material defect’’ does not include a defect
that has an insignificant or de minimis effect on the
operation or functioning of an item, that affects only
a component of an item that, as a whole, substan-
tially operates or functions as designed, or that has
an insignificant or de minimis effect on the efficacy
of the service provided.
(7) PERSON.—The term ‘‘person’’ means any
natural person and any entity, organization, or en-
terprise, including but not limited to corporations,
companies, joint stock companies, associations, part-
nerships, trusts, and governmental entities.
(8) PERSONAL
INJURY.—The term ‘‘personal
injury’’ means any physical injury to a natural per-
son, including death of the person, and mental suf-
fering, emotional distress, or like elements of injury
suffered by a natural person in connection with a
physical injury.
(9) PLAINTIFF.—The term ‘‘plaintiff’’ means
any person who asserts a year 2000 claim.
(10) PUNITIVE DAMAGES.—The term ‘‘punitive
damages’’ means damages that are awarded against
any person to punish such person or to deter such
person, or others, from engaging in similar behavior
in the future.
(11) STATE.—The term ‘‘State’’ means any
State of the United States, the District of Columbia,
the Commonwealth of Puerto Rico, the Northern
Mariana Islands, the United States Virgin Islands,
Guam, American Samoa, and any other territory or
possession of the United States, and any political
subdivision thereof.
(12) YEAR 2000 ACTION.—The term ‘‘year 2000
action’’ means any civil action of any kind brought
in any court under Federal or State law, or an agen-
cy board of contract appeal proceeding, in which a
year 2000 claim is asserted.
(13) YEAR 2000 CLAIM.—The term ‘‘year 2000
claim’’—