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1998-05-23 07:27:31


Fear of Litigation Creates Information Blackout



The Chief Information Officers (CIO's) are in charge of y2k repairs. If the project goes wrong, or if their vendors' projects go wrong, or of their suppliers' projects go wrong (if!!!!), then they will find themselves on a witness stand if the court system survives. "Prove that it wasn't your fault!"

This is creating fear among CIO's. They don't want to discuss the status of their y2k projects, even if they think their projects are on schedule.

This leads to an information blackout. Every company is dependent on suppliers and vendors. The suppliers and vendors are also afraid of litigation. So they refuse to answer questions about their y2k progress.

All along the line, nobody will send out anything except what their lawyers have approved. Lawyers approve almost nothing. With qualifications.

This means everyone is flying blind. They know their companies' lawyers recommend stonrewalling and bland form letters. Now they're getting back the same kind of letters.

So, you are not going to get a straight answer about your y2k vulnerability. You will have to make decisions on something other than vague assurances from your own personal suppliers.

The lawyers are now on board. Don't expect the truth.

This is from CIO MAGAZINE (May 1).

* * * * * * * * *

Are CIOs worried? You bet. Greater perhaps than their fear of date-related failures is their fear of date-related lawsuits. As a result, most are reluctant to discuss their plans in public. The CIO of a Fortune 1000 distribution company says simply, "I'm not a lawyer and I don't feel comfortable talking about legal issues."

But you'd better start. If even the mildest predictions come true, you'll need to have a good working relationship with your company's legal team.

Why? Because even companies with perfect conversion projects could be dragged into litigation after the failure of a third-party supplier. Directors and officers at organizations that ignore Y2K can be sued by shareholders for negligence--and held personally liable. Want to hear more? How about the potential for breach of contract cases, fraud accusations and regulatory actions.

And that's just what CIOs face as defendants. There's also the possibility of having to sue vendors. At least three of this kind of Y2K-related lawsuits have already surfaced. "Those are just the tip of the iceberg," observes Diana J.P. McKenzie, a lawyer at Chicago's Gordon & Glickson who coaches IT executives on avoiding Y2K litigation.


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