COUNTDOWN TO Y2K

Businesses Not Ready For Y2K But Lawyers Are

Benny Evangelista, Chronicle Staff Writer

Tuesday, June 29, 1999

)1999 San Francisco Chronicle

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Every business and industry in the United States has companies that still have not done enough of the work needed to fix the Year 2000 computer problem, speakers at a symposium in San Francisco said yesterday.

But there are more than enough lawyers primed and ready to go to handle the flood of lawsuits that are expected if Y2K failures start to appear, said Steven L. Hock, chief executive of Triaxsys Research LLC of Montana.

``If you check the Web pages of major law firms in this country, (at) 99 percent of them, you'll find Y2K featured as a specialty practice area,'' Hock said during the opening day of a Year 2000 conference at the Fairmont Hotel. ``The mere fact they are gearing up for litigation means that there will be lots of it.''

About 150 corporate computer system managers and company executives are attending the three-day National Year 2000 Symposium to hear how their fellow computer professionals are handling the glitch, which could cause computers to run amok on January 1.

Hock said the legal ramifications of the Y2K problem should serve as fair warning for every firm small and large ``to go the extra mile'' to fix its own systems and develop contingency plans to stay in business if there are Y2K failures.

He noted that U.S. companies are making progress but still have far to go. Financial services firms, for example, are regarded as generally far ahead of other industries, yet a Triaxsys study of Fortune 100 companies showed 47 percent had still only done the minimum amount of Y2K work by the first quarter of 1999.

In manufacturing, only 10 percent of the companies had reached that minimum level.

``Every single industry has laggards who have a long way to go,'' Hock said.

Even if a company fixes its own internal computer systems to handle Y2K, it still has the legal duty to investigate how key business partners such as parts suppliers are preparing. Extensive testing and outside audits can help bolster a company's defense in case of lawsuits, he said.

The U.S. House of Representatives and Senate have passed similar

--and controversial -- bills designed to limit corporations' exposure to Year 2000-related suits. Both bodies are trying to hammer out the differences in their bills to send the legislation to President Clinton, who has threatened a veto.

Hock, former managing partner of the law firm of Thelen, Reid & Priest, warned that no matter how the final Y2K law is shaped, companies should not expect to use it as an attorney- proof shield.

``If you think that the legislation is going to deter litigation, then you are laboring under an illusion,'' he said.

Domestic companies are still better off than firms in certain countries in Asia, Eastern Europe and Latin America, said Stephanie Moore, a research director with the Giga Information Group.

One common problem is an ``unbelievable level'' of misunderstanding of the basic Y2K problem by government officials and company executives in those countries, Moore said. A government minister in Mexico recently proclaimed the Y2K problem nearly solved, yet a survey showed only 5 percent of the population knew what the problem was about.

``I have information technology managers in France who are desperately trying to prepare their systems despite the lack of support from their executives,`` she said.

The message, she said, is ``make sure you anticipate the unavoidable and react to the failures.``

)1999 San Francisco Chronicle Page C1

-- Gayla (privacy@please.com), June 30, 1999

Answers

I'd sooner see my sister in a whore-house than my brother as a lawyer!

Lawyer: One of the few no-value-added-to-society occupations around.

-- Buffalo Bob (buff@hal.com), July 01, 1999.

Why did the shark not eat the lawyer?

Professional courtesy......

-- carlie (carlie_scott@yahoo.com), July 01, 1999.

Is Benny Linda's brother ?

Can he get me her phone number ?

Just on the offchance.

-- hoping (just@this.once), July 01, 1999.