Two stories in recent issues of PC Dealer caught my attention because of their possible relevance to legal issues which may arise and the impact they could have on the rights and liabilities of, in particular, dealers, with their risk of exposure to disputes with customers, suppliers and manufacturers.
The first of these was an analysis in the 10 June issue about the dispute between Compaq and Prove It 2000. It relates to whether the Compaq advertisement stating that every computer in its range - because they pass the National Software Testing Laboratories' (NTSL) YMark2000 hardware test - is year 2000 compliant, is misleading because the NTSL test misses an essential component.
The complaint has been submitted to the Advertising Standards Authority.
I read about this on a US legal Website, but the article gives much more information. It is interesting, but not surprising, that this matter aroused interest in the US. I do not have the knowledge to form a view on the technical issues, but I'd like to comment on possible legal questions arising from it.
First, it suggests there may be disputes about what is meant by equipment being 'year 2000 compliant' in computer advertising, including the extent of the testing which should be done to justify the term. Also, it raises the possibility that someone relying on that statement who can show the equipment is not, in fact, compliant may be able to claim.
The same phrase will appear as a contractual term in many agreements, so its exact meaning may be crucial to the issue of liability under the contract. This indicates, I'm afraid, an additional area for possible future disputes and suggests that the use of any possible contentious phrase in a contract should be precisely defined.
The US Website also lists all legal cases that have been started there (or as many as the authors know) in which year 2000 compliance claims have commenced. So far, there have been eight actions started, several of which are class actions, where claims are brought on behalf of a large number of plaintiffs. These actions include two lawsuits against Symantec alleging its Norton AntiVirus software prior to version 4 cannot recognise or process dates starting in the year 2000.
There are also three cases against Intuit claiming its Quicken Software, versions 5 or 6 for Windows, contains a year 2000 defect. In the latest of these, it is alleged 'the computer industry in general has been aware of the year 2000 problem since the early 1970s', that 'computer manufacturers of financial software and other programs knew about the year 2000 problem for over 20 years but ignored it because it was simply too expensive to reconfigure two-digit date recognition commands to four-digit date recognition commands', and 'despite knowing, or having been in a position where it should have known of the year 2000 defect inherent in its Quicken versions 5 and 6,' the defendants 'aggressively continued to market and sell these defective Quicken versions'.
I do not know the validity of these allegations, but the fact that they have been made suggests that anyone who has sold this software in the recent past may face claims, and if they are still current, should take care to cover themselves against the risk in the future.
Although to some extent the legal position is different in the US, these early cases illustrate the kind of contentions that will be raised. Critical among these is the issue of the date of knowledge, when the computer industry knew, or should have known of the problem, and when something should have been done about it.
But even if there was knowledge as early as the plaintiffs in that case suggest, it does not follow that four-digit date recognition should have been provided so early, when the probability was that the software in question would be replaced long before the year 2000 arrived.
The other piece in PC Dealer that particularly caught my eye was a Dealer Viewpoint by Nigel Ball in the 17 June issue. It focused on the fact that dealers are likely to be faced with disputes from both sides, their customers demanding guaranteed compliant systems, and the manufacturers who refuse to give the kinds of guarantee that the customer wants.
This means the dealer must try to frame his contracts on both sides to cover the risk. Also, if he cannot ensure protection, for example because the manufacturer won't play ball and the customer won't deal unless he does, he must be aware of the risk and try to protect himself, for example, by insurance.
John Melville Williams is a QC at Old Square Chambers.
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