Your firm represents Mr. O. Julius Bananaberry. You have been asked to sit in on the initial meeting with the client as you will be assisting the attorney who will be assigned to Mr. Bananaberry's case. In the course of the meeting, Mr. Bananaberry tells the following story, which will be focus of the seminar today:

O. Julius Bananaberry was president, general manager, and sole stockholder of the Groovy Mood Ring Company, Inc. By 1998, the Groovy Mood Ring Company (like mood rings in general), had seen better days. The aging workforce was quickly approaching retirement age. As experienced workers left, Mr. Bananaberry found them difficult to replace.

One day at Saxon Heights Country Club, Mr. Bananaberry met Will Robinson. Mr. Robinson was an up-and-coming robotics engineer and computer programmer. Mr. Robinson convinced Mr. Bananaberry that the Groovy Mood Ring operation could be automated. After considerable study and discussion, Mr. Bananaberry and Mr. Robinson reached an agreement. Mr. Robinson would provide new computers and machines. He would do all necessary programming. The upgrade was completed on June 2, 1998. By the end of the year, all of the employees had retired and Mr. Bananaberry was running the operation alone.

On Monday, January 3, 2000, Mr. Bananaberry came into his office. There -- manufactured, packaged, and ready for shipment -- were fifty-two million mood rings. Mr. Bananaberry looked into the factory. He saw that something had gone terribly wrong. Many machines were broken. The remaining machines were running wildly out of control. He looked into the storage room which had once contained an ample supply of phlogiston, the active component of mood rings. Not only was the storage room empty, but where there had once been a floor, there was now a ten-foot-deep hole in which a robot was still desperately seeking phlogiston.

Mr. Bananaberry fainted. While he was unconscious, a UPS delivery man arrived and dutifully loaded the packages into his truck and left.

When he awoke, Mr. Bananaberry called Mr. Robinson to tell him what was happening. Mr. Robinson hurried to the factory. He shut down the operation. After several hours of working on the main computer system, he identified the problem.

The computer that ran the automated manufacturing operation used data and computer instructions from the old system program. Thus, there was continuity between the old system and the new one. The old program, written in COBOL by Zachary Smith over thirty years earlier, used a two digit code for the year. When 1999 became 2000, the computer thought it was 1900. The computer then instructed the robots to make all the mood rings for which orders had been placed. It had essentially filled every order that the Groovy Mood Ring Company had taken since July 13, 1966.

In no instance were serviceable mood rings shipped in response to an outstanding order. The orders were executed in chronological order. The first rings manufactured were shipped to fill orders from the sixties and seventies. Most recipients were no longer in business, and those few that remained had no need for mood rings. As the robots ran out of phlogiston, they used cement from the floor and, after that was exhausted, the dirt beneath the floor. Dirt and cement do not make functional mood rings. Shipments to businesses no longer in existence were returned. Mr. Bananaberry had to field calls from current customers who received shipment of the substandard mood rings.

Bananaberry has now told his tale to his lawyer, Harriet Cheatham, of Cheatham & Howe, where you work. During the initial meeting with Ms. Cheatham, she confessed that she was perplexed by the problem, but that she was unable to program her videocassette recorder, much less understand the intricacies of robotics and programming. Fortunately, your firm has just hired Myron Lerner, a recent law school graduate who had majored in computer science in college. She promised to supervise the legal work, but told Mr. Bananaberry that when it came to high technology, he would have to rely on Myron.