The Honorable Casper R. Taylor, Jr.
Speaker of the House
State House
Annapolis MD 21401-1991

Dear Mr. Speaker:

In accordance with Article II, Section 17 of the Maryland Constitution, I today vetoed House Bill 8 - Commercial Law - Year 2000 Commerce Protection Act.

House Bill 8 provides various protections for businesses from liability for damages, personal injury, death and other losses caused by Year 2000 (Y2K) information technology failures. Specifically, the legislation establishes an affirmative defense for businesses that take certain good faith actions to identify and remedy Y2K compliance problems. While the impetus for this bill is understandable, I strongly believe that businesses should not escape responsibility for any personal injuries or death to Maryland citizens that are the result of Y2K technology failures. This is an issue of fundamental fairness and protecting families who have been harmed due to no fault of their own.

The task of ensuring that information technology systems are Year 2000 compliant has been a critical and ongoing endeavor for the State and local governments as well as most companies in Maryland. The State will have appropriated over $97 million between fiscal years 1998 and 2000 to ensure that our information infrastructure and service delivery systems are Y2K compliant. Local governments have likewise spent considerable efforts and resources on their Y2K compliance programs. I have no doubt that many companies in Maryland have done the same.

While I have been very supportive of efforts to bring technology systems into Y2K compliance, I do not believe that businesses should receive the broad protections from liability proposed in House Bill 8. During the 1999 Session, I sent letters to members of the General Assembly outlining my concerns with House Bill 8 and a related bill (House Bill 901) granting similar protections to the public sector. In each case, I strongly urged the General Assembly to exempt from the protections provided in the bill all causes of action arising from personal injury or wrongful death. I further requested that House Bill 8 include a total exemption for causes of action by a consumer, including those related to financial services.

In response to my concerns, the Maryland Association of Counties and Maryland Municipal League worked with legislators to completely exempt personal injury and wrongful death cases from the Y2K protections granted to State and local governments in Housey Billy 901. Based on this safeguard, I will sign the State and local bill into law. At the urging of some business organizations, however, the Legislature chose not to provide the same injury and death exemption for technology failures in the private sector. Instead, only a narrow exception is made for product liability actions against a manufacturer.

The failure to exempt personal injury and wrongful death actions in House Bill 8 places Maryland citizens at unnecessary risk given the uncertainties surrounding Y2K compliance. Our neighboring state Virginia, in related legislation, established the principle that personal injury and wrongful death actions should be exempt from Y2K liability protections. Maryland should do no less. Under House Bill 8, Maryland citizens may have no recourse if they or a family member are injured or killed as a result of certain Y2K failures. The following examples illustrate my concerns: A pharmacy fills a prescription but relies on computer software to check the medication's interaction with other drugs. A Y2K software failure causes the dosage on the prescription to be tripled and the customer lapses into a coma as a result. In such a case, the family may not be able to recover damages from the pharmacy if it implemented a Y2K compliance plan, even though the software it relied on failed.

A hospital hires a consulting company to check all of its systems for Y2K compliancy and prepare an emergency response plan. On New Year's, vital medical equipment fails because of Y2K problems. The hospital does not have extra staff on hand and patients die as a result of the equipment failures. The consulting company hired by the hospital is out of business. Under House Bill 8, a patient's family may not be able to recover damages from the hospital if the hospital followed its Y2K compliance plan.

There are numerous examples of consumers who may be financially harmed by Y2K failures in products and services and cannot recover their losses under House Bill 8. Even though my main concerns lie with personal injury and death cases, the impact on consumers is also very important.

While the goal of protecting businesses from liability for Y2K technology failures is deserving, it should not come at the expense of our citizens when such failures lead to injury and death. Any Maryland family who has a family member harmed or killed because of a Y2K failure should have the right to seek recourse from all responsible parties.

For the above reasons, I have vetoed House Bill 8.

Parris N. Glendening