This law firm in SV... Fenwick & West... is one of the top ones. Theyll be defending many SV firms next year. Theyre good.

Diane

Published Sunday, June 27, 1999, in the San Jose Mercury News

HOT BUTTON: THE FLIP SIDE
OF THE Y2K PROBLEM Don't
Play Blame Game Software bugs
are inevitable and worth
the price of technological progress

BY CLAUDE M. STERN

http://www.mercurycenter.com/premium/business/docs/hotbutton27.htm

[Fair Use: For Educational/Research Purposes Only]

EVEN before technology customers have been injured by the millennium bug, the blame game is well under way. Some technology users have already expressed outrage with the developers of Y2K sensitive products, by among other things, filing suits before anyone has been injured.

Before jumping on the blame wagon, let's admit that some of the technology claimed to be unfairly Y2K sensitive has improved all of our lives dramatically. We have become dependent on technological advancements, so much so that many now act as if we are entitled to the speed and convenience technology has brought us, with no downside whatsoever.

This claim of entitlement is generally not justified. Here's why:

 1. All software has bugs. The Y2K bug is one particular type of bug (with no single solution). Whether the product is a million dollar customized software package or an off-the-shelf consumer software product, software products have hundreds, and sometimes thousands, of known bugs (and this ignores the unknown bugs) at the time of release. This is the case, despite the fact that, before release, all software goes through quality assurance testing when the software is tested by engineers whose purpose is to crash the product and otherwise identify what sort of user actions will cause the product to perform in unexpected ways.

Software publishers try to identify and eliminate bugs which are show stoppers, those that crash the product or cause the loss of substantial data. But they can't eliminate all bugs. Software is like Jell-O: When you tap it on one side, it responds at another. An attempted cure of one bug might cause five other bugs, some of which are worse than the original. So, unless technology users are prepared to spend substantially more money and wait an indefinite amount of time bugs in technology are part of the environment.

But the Y2K bug has been known for years by everyone in the technology industry, so the problem should have been entirely avoidable, right? Wrong. Most people in the industry -- programmers, users and computer science faculty -- weren't aware of the problem until the last few years. They had no reason to change a long-time programming convention even though restricted capacity -- the reason only two digits were originally used to identify years -- was no longer a problem.

 2. Not all bugs (Y2K or otherwise) are material. Bugs come in many forms. Although some are showstoppers, the vast majority manifest themselves in far more mundane ways. Some merely cause an aesthetic problem (such as a pixel flicker on the screen). Other may cause the temporary dislocation of a particular file. Some might erase the particular data that was the subject of the latest operation (which can be very annoying).

 3. The law doesn't require that technology be perfect, and for good reason. Unless a manufacturer promises particular product functionality (appropriate in complex, customized software systems), any product is subject only to an implied warranty of merchantability, i.e. that the product is generally fit for its intended purpose.

This doesn't mean that the product is perfect. If all products had to be perfect to be merchantable, companies couldn't risk the liability associated with selling them, and consumers couldn't afford buying them. And if the law required that all technology products be bug free, technology users couldn't possibly expect that the rate of technological advancement which as benefited all of us would continue. (Think of the impact such a law would have on the burgeoning world of the Internet.).

The software industry has been at the forefront of creativity in addressing product-glitches that are discovered after sale. Technical support lines, service agreements, help or customer service lines, upgrade programs and releases of product revisions are just some of the measures that allow customers to receive the latest cutting edge product which may still have a few wrinkles at the time of release.

 4. Most technology products are sold subject to warranty disclaimers. Whether you're talking about a Sears toaster or Microsoft's latest software title, most products are sold subject to a warranty disclaimer or limitation. The warranty may be 60 days, 90 days, or 3 years (for cars), but inevitably manufacturers limit the period of time during which they warrant that a product will operate for the product's intended purpose.

The same is true of software. Most consumer software is subject to a 60- to 90-day limited warranty. If the product fails the day after the warranty expires, then, in the absence of any express promises or representations made by the manufacturer concerning the future performance of that product, the manufacturer has no liability whatsoever.

Is this good policy? Sure it is. If Ford had perpetual liability for the sale of each of its cars, it wouldn't sell them for $18,000; it would sell them for $150,000. Warranty disclaimers allow the interests of the consumer in acquiring goods at a reasonable price to be balanced against the manufacturer's interest in limiting its exposure for the sale of less-than-perfect but functional products.

Some think it's unfair that a technology company would sell a product that it knows has a year 2000 bug (or any other bug for that matter) and not disclose that bug to the customer at the time of sale. But then, when was the last time the telephone company disclosed to you all the conditions under which long-distance service is likely to be slower or fail altogether?

In our fast-paced free market system, the purveyor of the best products is most likely to prosper. Businesses which sell products that fail when their competitors sell comparable reliable products will soon find themselves out of business. Although it might be good business for companies to sell technology-based products that contain as few bugs as feasible, it is unfair for customers to expect that technology-based products will perform flawlessly forever.

The year 2000 phenomenon may just be the wake-up call which prompts technology users to develop more realistic expectations about the very technology that enhances our lives.

Claude M. Stern is a partner in the Palo Alto law firm of Fenwick & West.

-- Diane J. Squire (sacredspaces@yahoo.com), June 27, 1999

Answers

BTW, when I used to have my own software development company, they were my lawyers.

They also got HUGE in the Valley in the early days of Apple Computer... pre IPO.. and helped take them public. Fenwick has been around the hi-tech block and are as well-connected as any group of hi- tech lawyers on the planet can be.

Diane

-- Diane J. Squire (sacredspaces@yahoo.com), June 27, 1999.

All software has bugs.

True.

The Y2K bug is one particular type of bug (with no single solution).

False. Y2K is not a bug; Y2K is a design flaw.

(I've probably opened a big can of worms here.)

-- Lane Core Jr. (elcore@sgi.net), June 27, 1999.

Lane,

You may have just fingered the shape of Y2K litigation... to come.

Diane

-- Diane J. Squire (sacredspaces@yahoo.com), June 27, 1999.

"But the Y2K bug has been known for years by everyone in the technology industry, so the problem should have been entirely avoidable, right? Wrong. Most people in the industry -- programmers, users and computer science faculty -- weren't aware of the problem until the last few years."

This is almost a total lie. Only most users were not aware of Y2K. Any professional programmer would quickly recognize that a two-digit year would not work after the rollover to 2000. I am a programmer. My cohorts and I have mentioned over the years that two-digit years would be a terrible problem if they weren't fixed long before the rollover. As for computer science faculty members, most of them are programmers or former programmers.

This article is what I would expect from a shill for the likes of Intel.

-- Mr. Adequate (mr@adequate.com), June 28, 1999.