Jones Day Global Privacy & Cybersecurity Update | Vol. 21 – Lexology

Jones Day Cybersecurity, Privacy & Data Protection Attorney Spotlight: Edward S. Chang

Data privacy- and security-related class actions appear to be on the rise, and effectively defending them requires the right mix of substantive and procedural knowledge. Edward Chang is a partner based in Irvine, California, and, for nearly 15 years, has represented institutional clients in a wide array of complex litigation matters, with an emphasis on cybersecurity, privacy, and consumer issues. He has served as lead counsel in hundreds of class and individual actions, complicated business disputes, and regulatory investigations, including bet-the-company matters.

As a leader in Jones Day’s cybersecurity practice in California, Ed advises clients on their most sensitive business and cybersecurity issues. He advises industry leaders on a variety of cyber and privacy matters, including industry standards, cybersecurity management, data governance, third-party management, product liability risk, licensing, and regulatory and litigation risks. Ed also advises clients on data-breach response and data-breach class actions filed in state and federal courts across the country, including working on a team handling more than 47 nationwide data-breach class actions in one of the largest data-breach matters in U.S. history.


Regulatory—Policy, Best Practices, and Standards

NIST Evaluates Advances in Face Recognition Software

On November 30, 2018, the National Institute of Standards and Technology (“NIST”) published a report evaluating the accuracy of facial recognition software. NIST’s study found that between 2014 and 2018, facial recognition software became 20 times better at searching databases to find matching photographs. The evaluation used 127 software algorithms from 39 different developers, which represent the bulk of the industry.

NIST Proposes Steps to Modernize Technology Transfer and Innovation

On December 6, 2018, NIST released a draft green paper with proposed steps to modernize the transfer and commercialization of technology developed through federally funded research and development initiatives. The proposals include updating legal tools for the transfer of technology, such as intellectual property rights for the licensing and commercial development of federal research. The draft green paper includes input from federal stakeholders, such as the National Science and Technology Council’s Lab-to-Market Subcommittee, as well as public comments.

Regulatory—Consumer and Retail

FTC Releases Do Not Call Registry Data for Fiscal Year 2018

On December 6, 2018, the Federal Trade Commission (“FTC”) released the National Do Not Call Registry Data Book for Fiscal Year 2018, along with state-by-state analyses of the data. The number of registrants with the Do Not Call list has increased significantly, while the number of complaints has decreased and the most prevalent types of calls have changed.

FTC Holds Hearings on Data Security

On December 11-12, 2018, the FTC held hearings on data security as part of its examination of consumer protection in the 21st century. The hearings included discussions on incentives to invest in data security, consumer demand for data security, data security assessments, a U.S. consumer framework for data security, and the FTC’s data security enforcement program. Video recordings and transcripts of the hearing are available on the FTC website.

Retailer Discloses Cybersecurity Attack

On December 21, 2018, a retailer disclosed that it was the victim of a cybersecurity attack involving suspicious log-in activity. The retailer planned to notify all customers whose usernames and passwords may have been used to access their accounts, even though there was no indication that the usernames and passwords used in the log-in attempts were obtained from its systems, or that any personal information stored on its customers’ accounts were obtained.

Hotel Discloses Approximately 383 Million Records Affected in 2018 Breach

On January 4, a hotel chain disclosed that up to 383 million guest records were compromised in a breach of its reservation database that began in 2014. This is an increase from the figure reported when the company first announced the existence of the breach on November 30, 2018. The hackers accessed names, addresses, phone numbers, email addresses, and passport numbers stored in the reservation database. The incident affected approximately 8.6 million encrypted payment card numbers, 5.25 million unencrypted passport numbers, and 20.3 million encrypted passport numbers.


FTC Seeks Comments on Identity Theft Detection Requirements

On December 4, 2018, the FTC announced that it is seeking comments on whether it should change rules that currently require financial institutions and creditors to take steps to detect signs of identity theft affecting customers. The FTC is seeking comments on the costs these rules impose on consumers and businesses, whether there is a continuing need for the rules, and whether to expand the types of creditors covered by the rules.

SEC Office of Compliance and Examinations to Focus on Cybersecurity

On December 20, 2018, the SEC’s Office of Compliance Inspections and Examinations (“OCIE”) announced its 2019 examination priorities, which include a focus on cybersecurity and digital assets. The SEC reiterated that all OCIE examination programs “will prioritize cybersecurity with an emphasis on, among other things, proper configuration of network storage devices, information security governance, and policies and procedures related to retail trading information security.”


DOE Announces Cyber Threats Targeting Cloud Services Providers

On December 20, 2018, the United States Department of Energy (“DOE”) announced that a Chinese cyber group is engaging in cyber-enabled theft targeting global managed service providers, cloud service providers, and their clients. The DOE stated that the group operated on behalf of the Chinese Ministry of State Security and used a mix of sophisticated custom malware and off-the-shelf applications to compromise multiple service and cloud providers. The group targeted information from critical infrastructure companies in the areas of information technology, energy, health care, communications, and critical manufacturing.

DOE Announces $40 Million Grid Modernization Initiative

On January 24, the DOE announced a $40 million initiative in Fiscal Year 2019 for its Grid Modernization Initiative. The initiative aims to work with public and private partners to develop tools and technologies for a modern “grid of the future” that is resilient, reliable, and secure. The initiative will leverage subject matter expertise across national laboratories, including on the topics of cybersecurity, resilience modeling, advanced sensors, and energy storage. Additional details are expected to be released by March.


Pennsylvania Criminalizes Drone Misuse

On January 12, Pennsylvania’s law imposing criminal penalties for unlawful use of drones went into effect. The new law prohibits the use of drones to intentionally or knowingly conduct surveillance of another in a private space, or the operation of a drone in a manner that places another person in reasonable fear of bodily injury. The law permits a $300 fine for violations.

Regulatory—Health Care/HIPAA

HHS Releases New Health Industry Cybersecurity Practices

On December 28, 2018, the U.S. Department of Health and Human Services (“HHS”) released the publication of “Health Industry Cybersecurity Practices (HICP): Managing Threats and Protecting Patients.” The publication suggests voluntary cybersecurity practices, resources, and templates for small, medium, and large health care organizations. The publication is the result of a two-year industry-led effort in response to Section 405(d) of the Cybersecurity Act of 2015 mandating the development of practice guidelines to reduce cybersecurity risks for the health care industry.

HHS Seeks Public Input on Modifications to the HIPAA Privacy Rule

On December 12, 2018, HHS issued a Request for Information seeking public input on how the HIPAA Privacy Rule could be modified to further the goal of protecting the privacy and security of individuals’ health information while permitting information-sharing needed for important purposes, such as coordination of treatment and care.

Regulatory—Defense and National Security

Secretaries Issue Joint Statement on Chinese Cyber Attacks

On December 20, 2018, the Secretary of State and Secretary of Homeland issued a joint statement regarding hacks on managed service and cloud service providers by actors linked to the Chinese Ministry of State Security. The statement expressed concern that these hacks may have violated commitments made by China in 2015 to refrain from conducting or knowingly supporting “cyber-enabled theft of intellectual property, including trade secrets or other confidential business information, with the intent of providing competitive advantages to companies or commercial sectors.”

Director of National Intelligence Unveils National Intelligence Strategy

On January 24, the Director of National Intelligence unveiled the National Intelligence Strategy, a quadrennial publication that sets intelligence strategy for the next four years. The strategy calls attention to cyber and space as new domains of warfare. In particular, the strategy notes that the relatively low cost of cyber operations and lack of attribution makes the cyber domain attractive to smaller nations, terror groups, transnational criminal networks, and individuals. The strategy also calls for the United States to be at the forefront of research on artificial intelligence, advanced automation, and nanotechnology.

Litigation, Judicial Rulings, and Agency Enforcement Actions

Hotel Chain Faces Multimillion-Dollar Data Breach Class Action

On December 1, 2018, an individual filed a putative class action complaint in New York federal court against a hotel chain alleging violations of federal securities laws related to a massive data breach that potentially affected up to 500 million hotel guests. The complaint alleges that the company made materially false and misleading statements in SEC filings regarding the security of customer data. The company seeks to combine this case with other class actions filed throughout the United States.

District of Columbia Sues Social Media Company Over Data Harvesting

On December 19, 2018, the Attorney General for the District of Columbia sued a social media company for violations of the District’s Consumer Protection Procedures Act in relation to the harvesting of user data by a third-party application developer who sold the data to a political consulting firm. The complaint alleges that the company engaged in unfair and deceptive trade practices for allegedly failing to inform consumers that their personal information may be shared with third-party applications without their knowledge or consent.

Airline Reaches $2.3M Settlement to End Worker Background Check Class Action

On January 3, an airline agreed to pay $2.3 million to settle a proposed class action brought on behalf of about 44,100 job applicants that claimed the company disregarded federal and California law by including extraneous and misleading information in notifications to prospective employees about background checks, and did not make standalone disclosures in compliance with the Fair Credit Reporting Act.

SEC Charges Hackers of EDGAR System

On January 15, the SEC announced charges against nine defendants for hacking into the SEC’s EDGAR system and extracting nonpublic information. The SEC’s complaint alleges that the hackers gained access to EDGAR in 2016 and extracted files containing nonpublic earnings results, and used the information to make trades and earn at least $4.1 million in illegal profits.

Illinois Supreme Court Issues Highly Anticipated BIPA Decision

On January 25, the Illinois Supreme Court unanimously held that a person has standing to sue under the Biometric Information Privacy Act (“BIPA”) without alleging a separate, real-world harm. BIPA imposes requirements on companies that collect and handle biometric identifiers of Illinois residents, such as notice and consent requirements. BIPA permits an “aggrieved” person to sue for violations of the statute, and the Illinois Supreme Court determined that a plaintiff is “aggrieved” when the individual’s rights have been infringed, without the need to plead an actual injury or adverse effect beyond a technical violation of the statute. For more information, please see our Jones Day Alert.


Senator Calls for Data Minimization Laws

On November 30, 2018, U.S. Senator Mark Warner (D-VA) issued a press release calling for national data privacy legislation to safeguard consumer information. The announcement called for data minimization and retention requirements to limit how much sensitive information companies collect and retain about consumers. The announcement also called for the legislation to hold companies accountable for security costs.


Additional States Propose Bills with CCPA-Like Provisions

Since January 1, a number of states have introduced bills modeled at least in part on California’s Consumer Privacy Act (“CCPA”) and borrow many of the same provisions, such as requiring companies to provide notice of the types of personal information they collect and the categories of third parties to whom they disclose personal information. The bills also would grant individuals certain rights, such as the right to request access to their personal information and the right to opt-out of the sale of personal information. Washington’s bill goes further and proposes requirements closer to the European Union’s GDPR, such as defining roles for controllers and processors and imposing a requirement to correct inaccurate information. Most of these bills have been referred to committees and are under consideration (except for the Mississippi bill, which died in committee on February 5). For more information, please see our Jones Day Alert.

  • On January 2, SB 176 was introduced in New Mexico.
  • On January 9, S00224 was introduced in New York.
  • On January 12, SD 341 was introduced in Massachusetts.
  • On January 14, HB 1485 was introduced in North Dakota.
  • On January 18, SB 418 was introduced in Hawaii.
  • On January 25, HB 1253 was introduced in Mississippi.
  • On January 30, SB 5376 was introduced in Washington.
  • On January 31, S0234 was introduced in Rhode Island.
  • On February 4, SB0613 was introduced in Maryland.

South Carolina Enacts Insurance Data Security Act

On January 1, South Carolina enacted a breach notification and information security law for insurers, agents, and other licensed entities authorized to operate under the state’s insurance laws. The South Carolina Insurance Data Security Act is based on the National Association of Insurance Commissioners’ Insurance Data Security Model Law and includes stringent requirements for investigating and disclosing certain cybersecurity events within 72 hours of discovery.

Vermont Regulates Data Brokers

On January 1, Vermont passed a law to regulate data brokers that collect and sell personal information about consumers. The law requires data brokers to register with the Secretary of State, provide information about the broker’s opt-out policies, maintain a written information security program, and make certain disclosures to consumers. Vermont passed the law in response to reported risks associated with the widespread aggregation and sale of data about consumers.

Massachusetts Amends Data Breach Notification Law

On January 10, the Governor of Massachusetts signed legislation to amend Massachusetts’ data breach notification law to require the sharing of additional information with state regulators, among other changes. Entities must provide information about the nature of the breach, the number of affected state residents, the identity of the person responsible for the breach, and a description of the information compromised. Companies also must disclose whether they have a written information security program and the steps taken after the data breach. The new law goes into effect on April 11.


Canadian Health Department Seeks Comment on Medical Device Cybersecurity Guidance

On December 7, 2018, Health Canada published draft guidance on cybersecurity for medical devices. The guidance recommended the incorporation of cybersecurity into the design of the device and across the device’s lifecycle, and recommended that manufacturers engage in post-market monitoring to identify and address evolving vulnerabilities. Health Canada requested comments from across the industry on the “technical considerations related to cybersecurity of medical devices and the submission requirements for a medical device license.”

The following Jones Day lawyers contributed to this section: Kaeley Brown, Shirley Chan, Jeremy Close, Meredith Collier, Jennifer Everett, Levent Hergüner, Jay Johnson, Christopher Markham, Mallory McKenzie, Mary Alexander Myers, Nicole Perry, and Kerianne Tobitsch.



Agency Approves Guidelines for Binding Corporate Rules

On December 7, 2018, the Access to Public Information Agency (Agencia de Acceso a la Información Pública) issued through an official communication the Guidelines and Basic Contents of Binding Corporate Rules (Lineamientos y Contenidos Básicos de Normas Corporativas Vinculantes), which provides guiding principles of self-regulation standards for personal data protection among entities from the same group of companies (source documents in Spanish). The guidelines allow companies to prove before the Agency that international data transfers are secure and have an adequate level of protection, especially when the recipient country does not have the same security standards for personal data.


Federal District Attorney’s Office Investigates Hotel Data Breach

On December 3, 2018, the Federal District Attorney’s Office in Brasília (Ministério Público do Distrito Federal e Territórios), through its Special Unit for Data Protection and Artificial Intelligence, started an investigation into the potential leak of Brazilians’ personal data stored in the servers of an international hotel chain. The breach potentially exposed the personal data of up to 500 million guests worldwide, including personal information such as full name, passport number, mailing address, email, phone number, date of birth, arrival and departure dates, and, in some cases, credit card information.

Brazil Creates National Data Protection Authority

On December 27, 2018, the former Brazilian President signed Executive Order No. 869/2018, which established the Brazilian National Data Protection Authority (Agência Nacional de Proteção de Dados, or “ANPD”) (source document in Portuguese). Brazil created the ANPD pursuant to the Brazilian General Data Protection Law (Lei Geral de Proteção de Dados Pessoais). The ANPD will regulate data protection issues, oversee persons subject to the Brazilian General Data Protection Law, and enforce penalties for data protection violations.


Ministry Announces Cybersecurity Campaign

On December 28, 2018, the Ministry of the Interior and Public Security (Ministerio del Interior y Seguridad Publica) announced a cybersecurity campaign to promote protection of individuals’ rights in digital environments (source document in Spanish). As part of the campaign, the Ministry issued recommendations for safely navigating the internet, posting on social networks, and using online security settings. The Ministry also issued guidance regarding the sharing of personal information online (source document in Spanish).

Costa Rica

Costa Rica Hosts the Ibero-American Meeting of Data Protection

On December 4, 2018, the Inhabitants Data Protection Agency (Agencia de Protección de Datos de los Habitantes, or “PRODHAB”) issued an official communication stating that Costa Rica hosted the sixth Ibero-American Data Protection Meeting (Encuentro Iberoamericano de Protección de Datos) (source document in Spanish). Experts across the Latin American region came together to discuss actions to protect the security and privacy of personal data. The government’s announcement highlighted the takeaways from the meeting, including the need create a data protection culture, update compliance models, and invest in privacy.


Data Protection Agency Resolves More Than 10,000 Appeals in 2018

On December 30, 2018, the National Institute for Transparency, Access to Information, and Personal Data Protection (Instituto Nacional de Acceso a la Información y Protección de Datos Personales) announced that, between January and November 2018, it had resolved 10,745 appeals related to data protection and access to information (source document in Spanish). Among these appeals, 9,485 (approximately 88%) related to the right to access information, and 1,260 (approximately 12%) related to personal data protection.

Data Protection Agency Hosts International Personal Data Protection Day

On January 28, the Instituto Nacional de Acceso a la Información y Protección de Datos Personaleshosted the International Personal Data Protection Day to discuss significant and controversial issues regarding personal data (source document in Spanish). The topics of discussion included: (i) the personal data protection rights of legal entities and (ii) the legal requirement to obtain a judicial order to use geolocation services to locate possible criminals in Mexico.


Peru Fines Entities More Than US$230M in 2018 for Privacy Violations

On January 1, the Peruvian National Authority of Data Protection (Autoridad Nacional de Protección de Datos) announced that it fined several public and private entities throughout 2018 for violations of the Peruvian Data Privacy Law (source document in Spanish). Peruvian authorities found that these entities should have implemented security measures for the protection of personal data, such as security protocols for access, privileged data management, and periodic review of privileges, among other measures.


Agency Modifies Data Protection Law

On January 28, the Regulatory and Personal Data Control Unit (Unidad Reguladora y de Control de Datos Personales) announced modifications to the Law of Accountability N°19.670 (Ley de Rendición de Cuentas N°19.670) (source documents in Spanish). These modifications include extending the law’s application to the processing of personal data outside of Uruguayan territory in certain circumstances, requiring that entities provide notice of security breaches to data owners and implement remediation steps, and requiring entities that process personal data on a regular basis to designate a data protection official.

The following Jones Day lawyers contributed to this section: Guillermo Larrea, Daniel D’Agostini, and Juan Carlos Quinzaños.


European Council

European Council Publishes New Electronic Communications Code

On December 4, 2018, the European Council adopted the European Electronic Communication Code (“EEOC”), which it published in the Official Journal on December 17, 2018. The EEOC expands the ePrivacy Directive to regulate over-the-top (or OTT) communications services, such as instant messages and email, and to promote the rollout of high-capacity networks, such as 5G and fiber networks. Each EU member state has two years to enact national implementing legislation for the EEOC.

European Court of Justice

Advocate General Makes Recommendation in Case Involving Third-Party Plugin

On December 19, 2018, Advocate General Bobek recommended to the European Court of Justice (“ECJ”) that when a website operator embeds a third-party plugin into its website that collects and transmits a user’s personal data, both the website operator and the third party should be considered joint controllers. This recommendation is limited to circumstances in which both parties co-determine the means and processing of data, but not preceding or subsequent stages of processing. The Advocate General made this recommendation in the context of a case before the ECJ involving a fashion company that embedded on its website a “Like” button from a third-party social media platform.

Advocate General Makes Recommendation on De-Referencing of Sensitive Data

On January 10, Advocate General Szpunar recommended to the ECJ that when the operator of a search engine receives a request to de-reference links displaying sensitive data, the operator must accede to the request as a matter of course. If the issue of the derogation of freedom of expression arises, the Advocate General recommends that the operator balance data protection and respect for private life with the right of the public to access the information and the right to freedom of expression. The Advocate General made this recommendation in the context of a case before the ECJ involving a request by individuals to de-reference a webpage that contained sensitive information and satirized government officials.

Advocate General Recommends that “Right To Be Forgotten” Not Apply to Search Engines Beyond EU Borders

On January 10, Advocate General Szpunar recommended that the ECJ limit the application of the “right to be forgotten” to the territory of the European Union. The Advocate General recommended that a search engine operator responding to a request for de-referencing should not be required to de-reference search results on domains outside of EU borders, although he did not rule out the possibility that there may be some circumstances where de-referencing should occur at a worldwide level. The Advocate General also recommended that search engines must implement all possible measures, including geo-blocking, to enforce effective de-referencing for all IP addresses located in the European Union, regardless of the domain. The Advocate General made this recommendation in the context of a case before the ECJ involving a search engine operator that refused to comply with a demand by the French Data Protection Authority to conduct de-referencing on all of its domain name extensions regardless of location.

European Parliament

EU Negotiators Reach Agreement on Cybersecurity Act

On December 10, 2018, the European Parliament, the EU Council, and the European Commission reached a political agreement on the Cybersecurity Act, which was first introduced by the European Commission on September 13, 2017. The agreement creates the first EU-wide certification scheme to ensure that products and services sold in EU countries meet certain cybersecurity standards. The agreement also upgrades the European Union Agency for Network and Information and Security (“ENISA”) with a permanent grant to coordinate responses to cybersecurity attacks among EU member states and assist EU institutions in developing cybersecurity policies. The new regulation must be formally approved by the European Parliament and the Council of the European Union.

European Data Protection Board

EDPB Adopts Revised Guidelines on Accreditation

On December 4, 2018, the European Data Protection Board (“EDPB”) adopted revised guidelines on accreditation of certification bodies under Article 43 of the GDPR, including a new annex. The document provides guidance on how to interpret and implement Article 43, which requires member states to ensure that certification bodies, which issue certification under Article 42(1) of the GDPR, are accredited by either or both the competent supervisory authority or the national accreditation body. The annex will be subject to public consultation.

EDPB Adopts Opinion on EU-Japan Draft Adequacy Decision

On December 5, 2018, the EDPB published an opinion regarding the European Commission’s draft decision on the adequate protection of personal data by Japan. The EDPB noted the areas of convergence between the legal frameworks of each region but noted several remaining concerns, such as monitoring of compliance, the need to protect personal data transferred from the European Union to Japan throughout the entire data lifecycle, and access by public authorities to data transferred to Japan.


Belgian DPA Publishes GDPR Activity Review

On November 23, 2018, the Belgian Data Protection Authority (“DPA”) published a six-month review of its activities since the GDPR came into effect on May 25, 2018 (source document in French and in Dutch). The review assesses the impact of the GDPR, including the structural changes made to the former Belgian Privacy Commission to accommodate increased demand. Since the GDPR took effect, the Belgian DPA has received 317 reports of data breaches, 3,599 requests for information, and 148 complaints.

Belgium Adopts Law Reforming Belgian Privacy Commission

On January 10, the Law of December 3, 2017, creating the Data Protection Authority, was published in the Belgian Official Gazette (source documents in French and in Dutch). The law aims at reforming the Belgian Privacy Commission, originally established by the Law of December 8, 1992, implementing Directive 95/46/EC, and replaces the Belgian Privacy Commission with the Belgian DPA. The main purpose of the new law is to provide the Belgian DPA with more powers to fulfill its tasks under the GDPR.

Belgian DPA Publishes Prior Consultation Form in Context of DPIAs

In January, the Belgian DPA published a form to be completed for prior consultation in the context of a data protection impact assessment (“DPIA”) under Article 35 of the GDPR (source document in French and in Dutch). The form includes questions regarding details of the processing activity and how to manage risks associated with the processing activity.

Belgian DPA Issues Legal Note Defining Roles of Controllers and Processors

In January, the Belgian DPA published guidance on the role of a data controller versus data processor (source documents in French and Dutch). The guidance sets out the basic principles, definitions, and criteria to help entities identify their status as a controller or processor, as well as the data protection responsibilities of entities in each role.


CNIL Warns about Privacy Risks from Internet-Connected Toys

On December 3, 2018, the French Data Protection Authority (“CNIL”) published an article about the privacy risks that can arise from the use of internet-connected toys (source document in French). The CNIL warned about the types of data processing activities that may be carried out through internet-connected toys, such as targeted advertising directed to children. The CNIL provided guidance to customers on how to secure these toys.

CNIL Issues Guidance on Consent to Data Sharing

On December 28, 2018, the CNIL published guidance on the sharing of personal data with business partners (source document in French). The CNIL stated that companies must inform data subjects of the identity of their business partners and obtain consent before sharing any personal data with their partners. The recipient of the personal data must obtain new consent from the data subject before sharing it with additional business partners.

CNIL Publishes Booklet on Digital Interfaces

On January 18, the CNIL’s Digital Innovation Laboratory published its sixth booklet regarding best practices for the design of a digital service interface, which should incorporate privacy designs (source document in French).

CNIL Fines Internet Search Engine €50 Million

On January 21, the CNIL fined an internet search engine company up to €50 million after investigating data privacy complaints from two associations representing about 10,000 persons (source document in French). The CNIL conducted an investigation of the complaints and found two violations: the company did not provide adequate notice to users and did not have a valid legal basis to process users’ personal data for targeted advertising.

CNIL Releases Guidelines for Social Workers

On January 23, the CNIL published guidelines for social workers who assist individuals in their use of online public services (source document in French). The CNIL stressed that social workers who have access to individuals’ personal data while assisting them should: (i) request only information that is strictly necessary for use of the online public services; (ii) urge the individuals to delete any navigation history when disconnecting; (iii) not keep any information relating to such individuals; and (iv) request a written authorization prior to carrying out any formality on behalf of the individual.


Bavarian DPA to Investigate Deletion Concepts by Enterprises Using SAP Systems

In December 2018, the Data Protection Authority of Bavaria for the Private Sector (“BayLDA”) announced that it will investigate larger enterprises using SAP Enterprise-Resource-Planning systems with respect to their deletion routines. The audits will focus on GDPR compliance and timely deletion of personal data. BayLDA has not yet published selection criteria for the enterprises to be audited.


Italian DPA Verifies that Codes of Conduct Comply with GDPR

On December 24, 2018, the Italian DPA verified that Codes of Conduct issued under the pre-GDPR regime for newspaper activity, scientific and statistic research activity, and defensive investigations are consistent with the GDPR (source document in Italian). The provisions contained in the Codes of Conduct, as revised by the Italian DPA, were published in the Italian Official Gazette in January 2019 and supplement the conditions for lawful processing set forth under the GDPR and the Harmonization Decree No. 101/2018.

Italian DPA Starts Public Consultation on General Authorizations for Processing of Sensitive Data

In December 2018, the Italian DPA identified five provisions under the pre-GDPR regime for the processing of sensitive data that are compatible with the GDPR (source document in Italian). These provisions include the processing of sensitive data in the employment context, for scientific research purposes, and in other circumstances. On January 11, 2019, the DPA made these provisions available for public consultation to gather comments, observations, and proposals from all interested subjects before their final approval.

The Netherlands

DDPA Limits WiFi Tracking to Exceptional Circumstances

On November 30, 2018, the DDPA announced that companies may track people on the street, in shopping centers, or in stations via WiFi tracking or other means on their mobile devices in only a few circumstances and under strict conditions (source document in Dutch). The DDPA published a Q&A on this subject on its website.

DDPA Clarifies “Large-Scale” Processing for Health Care Providers

On December 11, 2018, the DDPA explained that it considers all processing of personal data by hospitals, doctors, and care groups to be processing of personal data on a “large scale” (source document in Dutch). All other health care providers are considered to engage in large-scale processing of personal data if they process data of more than 10,000 patients in one information system.

Banks and Insurance Companies Meet DPO Obligations After DDPA Audit

On January 14, the DDPA completed its audit of banks and insurance companies and determined that all 45 banks and 93 insurance companies have registered a data protection officer (“DPO”) with the DDPA and published contact information for their DPO on their websites (source document in Dutch).


Spain Approves National Law Implementing GDPR

On December 5, 2018, Spain’s Parliament approved the Organic Law 3/2018 for the Protection of Personal Data and the Guarantee of Digital Rights (“LOPDGDD”), which implements the GDPR in Spain. The LOPDGDD creates rules for notifying citizens about the processing of their personal data, sets the age of consent at 14 years old, provides for the right to be forgotten on social networks or similar services, and updates the right to privacy against the use of video surveillance and sound recording in the workplace.

SDPA Publishes Data Protection Officers Registry

On December 11, 2018, the Spanish Data Protection Agency (“SDPA”) published the registry of DPOs. The registry contains the contact data of nearly 20,000 entities, of which approximately 3,000 correspond to the public sector and the rest to the private sector. Citizens who want to exercise their rights can find contact details of the DPO on the registry by searching by the company name or tax identification number.

SDPA Publishes Report on Processing of Personal Data Related to Political Opinions

On December 19, 2018, the SDPA published a report analyzing the processing by political parties of personal data related to political opinions. The report states that political parties, federations, coalitions, and constituencies can process political opinions only when they have been freely expressed by people in the exercise of their right to freedom of expression and their ideological freedom. The report also states that the processing must be proportional to the objective.

United Kingdom

Survey Shows Increase in Data Subject Access Requests to Medical Providers

On December 14, 2018, the British Medical Association released the results of an online survey showing a more than 30 percent increase in the number of subject access requests that UK doctors are receiving each month from patients or their representatives after implementation of the GDPR. Though doctors previously were allowed to charge a reasonable fee to cover the administrative costs of completing subject access requests, the GDPR now requires that these be free of charge unless the request is “manifestly unfounded” or “excessive.” The survey also found that, on average, more than three-quarters of requests were made by companies acting on behalf of patients, such as solicitors, compared to 22 percent made by patients themselves.

Government Appoints Chair of New Geospatial Commission

On December 19, 2018, Sir Andrew Dilnot was appointed Chair of the UK Government’s new Geospatial Commission. The Commission was established in 2018 to set geospatial strategy, policy, and data standards and encourage more productive use of location-linked data. Unlike the independent Information Commissioner’s Office, the Geospatial Commission is part of the UK Government and sits within the Cabinet Office, the governmental body responsible for coordinating government policy.

The following Jones Day lawyers contributed to this section: Laurent De Muyter, Undine von Diemar, Olivier Haas, Jörg Hladjk, Levent Herguner, Bastiaan Kout, Jonathon Little, Martin Lotz, Hatziri Minaudier, Selma Olthof, Audrey Paquet, Sara Rizzon, Irene Robledo, Elizabeth Robertson, Lucia Stoican, Rhys Thomas, and Kerianne Tobitsch.


Hong Kong

Privacy Commissioner Receives Notification of Data Breach

On November 28, 2018, Hong Kong’s Privacy Commissioner for Personal Data (“Privacy Commissioner”) received a data breach notification from a consumer credit reporting agency regarding suspected security loopholes in its application procedures for credit reports. The Privacy Commissioner initiated a compliance check, and the company took immediate remedial actions to mitigate any possible losses, including freezing the affected online accounts and notifying affected individuals.

Privacy Commissioner Releases Inspection Report on Private Tutorial Services Industry

On December 28, 2018, the Privacy Commissioner released a report with the results of its inspections of the personal data systems of companies in the private tutorial services industry. While the Commissioner found that personal data protection measures are generally acceptable in the industry, there are still some inadequacies, such as unnecessary or excessive collection of personal data, indefinite data retention, improper use of personal data, and inadequate personal data security.


European Commission Adopts Adequacy Decision on Japan

On January 23, the European Commission adopted its adequacy decision on Japan, which allows personal data to flow freely under adequate data protection guarantees between the two regions. The decision includes a set of rules that will bridge several differences between the two data protection systems and a complaint mechanism for Europeans regarding access to their data by Japanese public authorities. The decision went into effect on the day of adoption.

People’s Republic of China

Committee Releases National Standard for Health Information

On December 26, 2018, the National Information Security Standardization Technical Committee released a national standard for the handling of health information called “Information Security Technology Health and Medical Information Security Guide” (“Standard”) (source document in Chinese). The Standard defines “personal health information” and requires controllers to obtain authorization from the individuals when using or disclosing their personal health information. The Standard provides measures that controllers can implement to protect personal health information, including employee training and assessment, data system management, data categorization, access control, user restrictions, and encryption.

Cyberspace Administration Approves New Rules for Blockchain Service Providers

On January 10, the Cyberspace Administration of China approved new rules for blockchain service providers called the “Provisions on the Administration of Blockchain Information Services,” which will take effect on February 15 (source document in Chinese). The Provisions require blockchain service providers to register with the Cyberspace Administration of China and be subject to regular monitoring. Blockchain service providers must implement comprehensive measures, such as user registration and identity verification, and report to the government any new products, applications, or functions before launching them.

Government to Inspect Data Collection through Mobile Applications

On January 25, four government agencies announced a campaign to inspect mobile applications that obtain personal information (source documents in Chinese). Between January and December, the government will inspect mobile applications to ensure that they comply with cybersecurity laws when collecting or processing personal information. The campaign will evaluate data privacy policies on the applications and the type and amount of personal information collected through the applications. The campaign will focus on applications that have a large number of users or are closely related to users’ daily life. Applications that pass the inspection will receive verification certificates, while those that fail will be referred to law enforcement.


IMDA Launches Data Protection Trustmark Certification

On January 9, the Infocomm Media Development Authority (“IMDA”) announced that its Data Protection Trustmark (“DPTM”) certification was available for applicants. DPTM is a voluntary enterprise-wide certification of a company’s data protection policies, processes, and accountability practices that is meant to help companies build trust with consumers by demonstrating accountable data protection practices. The certification is valid for three years.

The following Jones Day lawyers contributed to this section: Michiru Takahashi, Sharon Yiu, and Grace Zhang.


New Legislation Provides Law Enforcement Access to Communications

On December 6, 2018, Parliament passed the Telecommunications and Other Legislation (Assistance and Access) Act 2018. The Act amended existing legislation to require designated communications providers to grant access to communications on their platforms when requested by law enforcement agencies investigating serious offenses that are punishable by a term of imprisonment of three years or more. The Australian Federal Government has agreed to consider amendments to the Act proposed by the Opposition Labour Party and industry groups in the new legislative session, so the Act may be amended in the short term.

Federal Government Introduces Consumer Data Rights Legislation

On January 13, the Australian Federal Government introduced legislation to Parliament that would establish the Consumer Data Right (“CDR”). The CDR would allow consumers to access data held by businesses about their consumption of goods and services, and would allow consumers to obtain the data directly from businesses in a standard format. If the Australian Parliament passes the legislation, the CDR will apply to the banking sector incrementally starting on July 1, 2019.

The following Jones Day lawyers contributed to this section: Adam Salter and Drew Broadfoot.

Artificial intelligence: Opportunity or job-killer? – Modern Diplomacy

Theneologism -Fourth Industrial Revolution or Industry 4.0 is not uncommon forpolicymakers and technocrats. Klaus Schwab, founder and executive chairman ofthe World Economic Forum (WEF), published a book titled “The Fourth Industrial Revolution” and coined the term atthe Davos meeting in 2016. Since then, “Industry 4.0” has been a buzzword inall major economic and business summits.

In a papertitled – The Fourth Industrial Revolution:what it means, how to respond, Klaus Schwab, said “thisrevolution is characterized by a fusion of technologies that is blurring thelines between the physical, digital, and biological spheres. There are threereasons why today’s transformations represent not merely a prolongation of theThird Industrial Revolution but rather the arrival of a fourth and distinctone: Velocity, scope, and systems impact.” The world is at the cusp of anunrivalled revolution. The first revolution captivated water and steam tomechanise production, the second exploited electric power and the third reliedon electronics and IT. The fourth one is a conglomeration of various automationtechnologies such as artificial intelligence (AI), the internet of things(IoT), blockchain, fintech, autonomous vehicles, 5G telephony, nanotechnology,biotech, machine learning, robotics, quantum computing and the like.

NicholasDavis, head of Society and Innovation at WEF in this WEF paper, describes this revolution as theemergence of cyber-physical systems which, while being “reliant on the technologies and infrastructure of the third industrialrevolution…, represent entirely new ways in which technology becomes embeddedwithin societies and even our human bodies”.

Industry4.0 is shaped by advanced technologies from different spheres like the physicaland digital worlds that combine to create innovations at a speed and scaleunparalleled in human history. The fourth industrial revolution demandsubiquitous digitization, automatic machine-to-machine (M2M) communication andis constantly transforming how individuals, governments and companies relate toeach other and the world at large. With such sudden disruption, it willradically change macroeconomics and the way the industry responds to the needsof civil society.

Great andsudden change by its very nature is painful to accommodate. Preparing for theFourth Industrial Revolution is a subjective task. Developed economies like theUnited States, Russia, China, etc. will have to frame policies according totheir economic and technological demands. For a growing economy like India withits under utilised population, young age and cultural diversity, a morepeople-intensive approach should be adopted. This will require policymakers toharness the industrial change instead of being a reactive agent. In democracieslike India, it is effective law-making which plays a major role to deliverregulatory frameworks that change often and respond to the stimulus.

The speedof change is unexcelled. It is disrupting almost every industry in everycountry, and it presages the transformation of production and governance. Thegap between the 1st and 2nd industrial revolution was around 100 years, 2nd and3rd was approximately 70 years, 3rd and 4th is 25 years. Analysing this trend,it cannot be ruled out that the next industrial revolution may take placewithin 10-15 years. So, it is very important that economies pool theirresources, take risks, make new investments and come together for betteragility to adapt quickly to make the best use of this global change.

Going intothe history of industrial revolutions, it is apparent from a layman analysisthat whichever country early participated in the industrial process turned outto become world leaders right after that industrial revolution. India is ayoung nation aiming to be the third largest with a10 trillion-dollar economy by2030, India has no option but to not only participate but also be thefrontrunner in the Fourth Industrial Revolution.

In 1750 AD,India’s share of global industrial output was roughly above 25%. India missedthe bus of first industrialisation due to the devious British Raj and by 1900,this had plummeted to 2%. While India’s contribution to the world GDP was 2.6per cent in 2014, it has increased to 3.3 per cent in 2017. Addressing thejoint sitting of the Parliament, the President of India said the country’s GDP has been growing at a rateof 7.3 per cent on an average, making India the sixth largest economy in theworld. India is playing a vital role in international trade in the Asia Pacificregion. The President also noted that this is an opportune moment for thecountry to play a decisive role in the fourth industrial revolution consideringits economic position.

Properchannelling of resources towards Industry 4.0 can help India leapfrogtraditional phases of development and accelerate its metamorphosis to adeveloped nation. Being the fastest growing economy, deploying thesetechnologies optimally and strategically can create more sustainable growth. Aculturally accommodative nation with more than 70% of its population under theage of 32, India’s role is also going to be crucial in shaping the globalFourth Industrial Revolution agenda in a millennial and inclusive manner. Indiahas the potential to be the global hub for the Fourth Industrial Revolution.

Governments,entrepreneurs, business houses and start-ups are rapidly adopting technologiesinvolving AI, the Internet of Things, 3D-printing, advanced robotics andblockchain. Artificial intelligence can be used effectively to reduce poverty,improve the lives of farmers and make the lives of the differently abledsimpler. The application of AI in sectors from health to law, frommanufacturing to finance, from elections to governance, is not an impossiblereality. Blockchain can facilitate cross-border data and technology transfersto support government services and natural resource management. India recentlycame up with its unmanned aircraft systems policy, commonly referred to as drones,having the ability to strengthen defence and security, make dangerous jobssafe, and act as a lifeline for remote populations.

Consideringthe pace of growth of automation technologies, it is absolutely possible thatwe will reach a point called “singularity” where machines become as smartas humans and then keep getting smarter. Repetitive processes are increasingly becoming automated. Digitaltechnologies have the potentiality to bring about the balance between green andgrowth, data and infrastructure, and profits and people. Technology will soonbe able to edit genes to create favourable traits and new life forms. 3DPrinters may become capable to produce fully functional, usable organs.Artificial blood might soon become a reality and the oceans would be harvestedfor food. Banks and financial sectors in India are already using chatbots andhumanoid robots. A Kannada-speaking robot in Canara Bank in Karnataka and Ira robot of the HDFC Bank which helpscustomers choose the right service and financial products are examples oflinguistic coding of automation technologies.

It is estimated that between 2018 and 2022, as many as 75million jobs will be displaced worldwide due to automation; however, as many as133 million new ones would be created. In the United States alone, it is estimated that 1.4 million workerswill be displaced in the coming decade as a result of the introduction of newtechnologies. India’s information technology sector is already witnessingjobless growth and there are various reports showing India unemployment rate hita 45 year high in 2017-18. The biggest concern of Industry 4.0 for everygrowing economy is the loss of jobs. A potential answer to this problem is – smart politics. In a country like Indiawith 1.3 billion people, it is practically impossible for any government in theworld to provide jobs to everyone, what is practical is to engage people. Thisengagement is not only about job creation but also about start-ups, alliances,businesses, offshoring, etc. which will sufficiently help an economy tocapitalise the resource pool.

Like allrevolutions that preceded it, the Fourth Industrial Revolution has thepotential to raise income levels and improve the quality of life globally.Mitigating the relevancy of jobs is not India specific, it is a global issue.But the peculiarity of this problem is the method of tackling it. Smartpolicies and smart thinking can reconstruct these challenges intoopportunities. When the first computer was invented, there was a worldwideoutcry on its impact on jobs, but history is the evidence of the fact thatcomputers created more jobs than it destroyed. India too faced nationalprotests against the computerisation of railway tickets as economists predictedit would take its toll on the jobs. Today, Indian Railways is India’s largestemployer and is about to conduct the world largest employment drive with around 2.37 crore applicantscompeting for 1.27 lakh posts.

Given theFourth Industrial Revolution’s rapid pace of change, it is important forgovernments and international organisations to evaluate whether to createchange or follow the change. Legislatorsand regulators are being challenged to an unprecedented degree and for the mostpart is proving unable to frame a flexible framework. Unconventional challengesneed collaborative efforts. India will have to create a long-term ecosystemwith the right mix of accelerators comprising of regulatory frameworks,educational ecosystems and government incentives that train and educatesprofessionals.

India’sphilosophy “Vasudhaiva Kutumbakam” or“the world is one family”, has guided the nation since Vedic times. It is basedon the blending of science and spirituality for harmonious co-existencereaffirms faith in innovation and adaptability. India can act as a coordinatorto collaborate with global economies to form a joint platform orintergovernmental taskforce involving all stakeholders of the global polity forleveraging most of the Fourth Industrial Revolution technologies.

Stanford Student Calls Out Crypto Professor for Inaccurate Bitcoin Lecture – Bitcoin Magazine

In January of 2019, student Conner Brown attended a guest lecture by a Professor Susan Athey at the Stanford University Graduate School of Business. She gave a presentation to his “Evolution of Finance” class titled “Blockchain and the Future of Finance.” According to Brown, the presentation contained “multiple misstatements” about Bitcoin and its fundamentals.

After the presentation, Brown was dissatisfied with how Bitcoin was referenced by Athey during the lecture to a room comprised (mostly) of people who were unfamiliar with the fundamental concepts behind the technology. This prompted him to write an email to the Stanford Graduate School of Business Advisory Council, expressing his concerns.

Brown says that the only response he has received from the university thus far is an email stating, “We will get back to you on this.” That’s when he posted his complaint on Twitter.

What She Got Wrong

Athey, who Brown told Bitcoin Magazine is also slated to teach an entire course at Stanford next semester called “Cryptocurrencies,” claimed that not only is Bitcoin “controlled by a small group of miners in China,” but that it also “wastes electricity by stealing from rivers to solve useless math problems.” Athey also mentioned that bitcoin is “secured economically and not cryptographically.”

In her presentation degrading the first digital, decentralized currency, Athey drew comparisons to what she considered a better solution in Ripple’s technology, using XRP. Specifically, she cited exchange rate volatility, trust issues with exchanges, and long transaction times as drawbacks to using Bitcoin (stating that, subsequently, exchanges needed to buy bitcoin). Athey then, according to her presentation, explained how Ripple’s XRP, xRapid API, and overall consensus mechanism provide an alternative that is faster, cheaper, more secure, and more energy friendly than Bitcoin.

In protest, Brown composed a letter addressed to the Graduate School of Business, expressing his thoughts that certain statements about Bitcoin should have been subject to “high caliber discussion and peer review.”

In addressing Athey’s claims against Bitcoin, Brown properly explained where Athey missed key concepts.

Addressing her claim on mining centralization by a small group in China, Brown explained that Athey was conflating mining nodes with full nodes and had used this misrepresentation to position Ripple as a better alternative to Bitcoin. He also countered by explaining that miners often compile their resources together in a mining pool, but there are many individual miners in these pools and not one entity can completely control Bitcoin.

To Athey’s claim that Bitcoin is secured economically and not cryptographically, Brown pointed out that she is once again conflating two different things: Stealing funds by cracking the encryption of the wallet and using mining power to 51% attack a network.

Conflict of Interest?

As the matter came to light on Twitter, it was pointed out that Athey was welcomed to the Ripple Labs Board of Directors back in April 2014, where she still maintains an active role. When Nic Carter asked on Twitter if Athey had made any disclosure before her presentation, she replied directly: “Five minute verbal introduction discussing my background in the space — no way to miss it!”

Whether or not Athey had any ill-intent in her presentation, Brown told Bitcoin Magazine that is not what mattered to him.

“It concerns me that my classmates’ first introduction to Bitcoin contained severe factual errors along with strong anti-Bitcoin rhetoric. The academy is not a place for marketing, but rigorously testing ideas. If a professor has a potential conflict of interest, they should be held to the highest standards of scrutiny and peer review.

“That being said, Bitcoin is a creature of the internet. Its properties are difficult for academics to appreciate due to its deeply interdisciplinary and evolutionary nature. This makes it difficult for developing a curriculum because of the siloed design of academic disciplines and the slow pace of the peer review process. The internet will always be the best place to pursue a Bitcoin education.”

Elizabeth Warren Wants to Break Up Big Tech. What Would That Mean for Education? – Education Week

Elizabeth Warren has vowed to take on moneyed interests on Wall Street and in corporate boardrooms if she’s elected to the White House.

It turns out she has Big Tech in her sights, too.

In a recent essay published on Medium, the 2020 presidential candidate and Democratic senator from Massachusetts calls for breaking up Amazon, Facebook, and Google, all of which she describes as monopolies that undermine smaller business and stifle innovation.

All three of those corporations are much better known for their work in the broader consumer space than they are in schools. But they each have a stake in the K-12 marketplace, though they occupy very different places in the world of schools and students.

What might Warren’s campaign pitch mean for those companies’ work in schools?

Getting a gauge on this question requires a ton of speculation. That’s partly because the regulatory regime Warren proposes offers no real details on what her plan might mean for the divisions of the tech giants that are focused on K-12 education.

A core piece of Warren’s plan is a requirement that large tech platforms with annual global revenues of at least $25 billion would be designated “platform utilities” that would be barred from owning both the platform and any participant on the platform. They would be required to “meet a standard of fair, reasonable, and nondiscriminatory dealing” with users on the platform.

Warren vows that her presidential administration would appoint regulators who would break up mergers that reduce competition. Warren says Facebook’s acquisition of Instagram, and Amazon’s acquisition of Whole Foods are examples of deals that should not have been allowed and need to be unwound.

In addition, Warren, says platform utilities would be blocked from transferring or sharing data with third parties. That’s an idea that would seem relevant in the education community, where concerns over data privacy have swirled around Facebook, Google, and other ed-tech providers for years.

Facebook endured a barrage of criticism last year following revelations that it allowed a political consulting firm, Cambridge Analytica, to use data collected through the social-media platform to create voter profiles in the run-up to the 2016 presidential election. Those revelations have led some districts to review their Facebook policies—though, as Education Week reported last year, K-12 systems did not abandon it in large numbers. Many districts rely on Facebook as an online communication hub to get information to parents and others in the community.

Google was sued in federal court in 2014 for building hidden profiles of users on the platform that could be used for targeted advertising. That same year Google told Education Week it had “scanned and indexed” emails from millions of students using the platform, a practice which it has since stopped.

None of the three companies responded to requests for comment.

New Regulation, New Scrutiny

Google also produces G Suite for Education, a classroom-management tool that is a fixture in many schools. That platform and other Google products have won positive reviews from K-12 officials for their cost and usability, according to a 2017 nationwide survey of K-12 officials conducted by EdWeek Market Brief. (The survey is part of a broader report that looked in depth at the ambitions of Google and Amazon in the K-12 market, as well as roles played by similarly huge players Apple and Microsoft.)

If a Warren presidency brought a stricter regulatory environment for Google and Facebook, it would most likely—albeit indirectly—compel K-12 leaders to re-examine their relationships with those companies’ products, said Hal Friedlander, the former chief information officer for the New York City schools.

If the push for regulations brought public hearings and negative press about data privacy practices, for instance, “that would influence public opinion pretty dramatically, and that opinion would show up in the schools,” said Friedlander in an interview. He now leads the Technology for Education Consortium, an organization that seeks to bring more price transparency and quality to ed-tech products.

If a wave of regulation brought new public scrutiny to Facebook’s data practices, “it might make sense for administrators to try to get a pulse on how their school communities think about those services and those communities,” he said. “If I was a CIO, I’d want to get ahead of that as much as I could.”

It’s even more difficult to predict whether Warren’s proposal would compel a company like Google to shed any of its education-related business offerings, such as operating systems or classroom products.

Breaking up big companies in the education spaces might be good for smaller companies trying to break into the market, and it might drive down prices for some products, said Friedlander. But in many cases, districts’ biggest challenge isn’t finding affordable products, but judging the quality of those tools and platforms, he said.

“More competition is good, but terribly confusing for districts,” he said, “Because the crux of the ability is the [struggle] to evaluate products.”

Purchasing Power

Warren’s proposal has drawn a hostile reaction from some conservatives and others scattered across the political spectrum, who question its feasibility or see it as a government overstep into the private sector. It also drew a skeptical response from fellow Democrat and White House hopeful Beto O’Rourke.

“I’m not sure if having five more Facebooks—if you broke up Facebook into five component parts, or any of these other large social media or technology companies— makes as much sense as regulating them, given the power they have [and] the way in which they can be used, wittingly or not, to undermine our democracy and affect the outcomes of our elections,” O’Rourke said at an appearance in New Hampshire.

The other mega-tech company Warren sees a ripe for more regulation is Amazon, which has a growing presence in K-12 business.

Many school districts have come to rely on the online retailer for its cloud-based storage system, Amazon Web Services. And Amazon is playing an increasing role in K-12 purchasing, including through an arrangement with U.S. Communities, a cooperative purchasing program that districts tap into.

Amazon has also sold a math curriculum, TenMarks, to K-12 schools, but the company announced it will end support for the program at the end of this academic year.

The Institute for Local Reliance, an organization that has been critical of Amazon’s dominance in online purchasing, applauded Warren’s proposal. It said in a statement that the senator’s pitch “rightly recognizes that digital platforms have become the core infrastructure of our economy.”

The institute’s statement did not reference Amazon’s work in education, specifically. But in a report released last year, the organization questioned whether Amazon’s role in public-sector purchasing—including school district buys—is hurting local businesses, and resulting in districts overpaying.

“If we’re going to restore competition and protect the free exchange of goods and ideas,” the organization said of Warren’s proposal, “then we cannot allow Amazon and other big tech companies to continue to use their control of this infrastructure to privilege their own goods and services at the expense of their competitors.”

Photo of Elizabeth Warren at a recent congressional hearing by Eman Mohammed for Education Week.

See also:

Seven Generations delivers $1.67 billion of adjusted funds flow, or $4.60 per share, up 36 percent in 2018 – Business Wire


  • 2018 adjusted funds flow of $1.67 billion or $4.60 per share, representing a per share increase of 36 percent compared to 2017.
  • 2018 net income of $440 million, $1.21 per share. Operating income of $574 million, $1.58 per share, up 76 percent versus 2017. As of December 31, 2018, 7G’s trailing 12-month return on capital employed was 12.9 percent and its cash return on invested capital was 19.1 percent.
  • 2018 sales volumes were 16 percent higher than 2017, averaging 202,600 boe/d, with liquids representing 60 percent of 7G’s total production. Condensate sales of 76,400 bbls/d increased by 25 percent in 2018. Fourth quarter condensate sales were 81,800 bbls/d, total liquids sales were 129,200 bbls/d, and total sales were 215,100 boe/d.
  • 7G’s market access initiatives drove fourth quarter natural gas realizations to $4.77 per Mcf due to the company’s marketing arrangements in the US Midwest, Gulf Coast and Eastern Canada.
  • 2018 capital investments were $1.77 billion. Drilling and completion costs per-well were reduced by 10 percent year-over-year.
  • 7G completed its natural gas processing facility at Gold Creek on time and under budget. The facility successfully tested its 250 MMcf/d design capacity during December.
  • Year-end gross proved plus probable (2P) reserves of 1.64 billion boe were valued at $12.3 billion as at December 31, 2018, on a before-tax net present value basis, at a 10 percent discount rate, by McDaniel & Associates Consultants Limited (McDaniel), the company’s independent qualified reserves evaluator. At 2018 production levels, this represents a 22-year reserve life index.

Surpassing the 200,000 boe per day milestone

“Our hard-working team delivered excellent technical, operating and financial performance in 2018, achieving a significant milestone – annual average production that exceeded 200,000 boe/d. Capital investments of $1.77 billion remained within our capital guidance range as we grew daily production by 16 percent to 202,600 boe/d and enhanced the value of our assets through disciplined scientific analysis and successful delineation drilling,” said Marty Proctor, 7G’s President & Chief Executive Officer.

Enhancing asset value with disciplined self-funded investment in 2019

“Assuming a WTI oil price of US$50 per bbl and a Henry Hub natural gas price of US$3.00 per Mcf in 2019, we plan a self-funded capital program of $1.25 billion, about $500 million less than the 2018 program. This 2019 capital plan maintains annual average production above 200,000 boe/d while continuing to enhance the value of our asset base through further delineation of the lower Montney and development of the Nest 3 and Nest 1 areas of our Kakwa River Project. Our strategy in this commodity price environment includes lower growth that mitigates production decline rates and preserves our top-tier drilling inventory, disciplined execution to improve operating and capital cost efficiencies, infrastructure investments to lower operating costs and expand margins, plus delineation drilling to increase our inventory and maximize lower Montney value,” Proctor said.


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Year ended

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($ millions, except boe

and per share amounts)
2018 2017 % Change 2018 % Change 2018 2017 % Change
Sales volumes
Condensate (mbbl/d)(1) 81.8 70.0 17 87.3 (6) 76.4 61.3 25
NGLs (mbbl/d)(1) 47.4 45.1 5 47.3 44.4 41.1 8
Liquids (mbbl/d) 129.2 115.1 12 134.6 (4) 120.8 102.4 18
Natural gas (MMcf/d) 515.4 493.4 4 511.3 1 490.5 435.5 13
Total sales volumes (mboe/d)(2) 215.1 197.3 9 219.8 (2) 202.6 175.0 16
Liquids % 60% 58% 3 61% (2) 60% 58% 3
Realized prices
Condensate ($/bbl)(1) 53.57 67.95 (21) 79.26 (32) 71.63 61.28 17
Natural gas ($/Mcf) 4.77 3.53 35 3.65 31 3.98 3.84 4
NGLs ($/bbl)(1) 8.44 18.30 (54) 14.02 (40) 12.21 14.56 (16)
Total ($/boe)(2) 33.66 37.13 (9) 42.99 (22) 39.33 34.45 14
Royalty expense ($/boe) (0.99 ) (1.18 ) (16) (2.20 ) (55) (1.34 ) (0.97 ) 38
Operating expenses ($/boe) (5.25 ) (5.69 ) (8) (5.22 ) 1 (5.52 ) (5.60 ) (1)
Transportation, processing and other ($/boe) (7.07 ) (6.43 ) 10 (6.14 ) 15 (6.65 ) (6.09 ) 9
Operating netback before the following(2)(3) 20.35 23.83 (15) 29.43 (31) 25.82 21.79 18
Realized hedging gains (losses) ($/boe) (1.58 ) 0.38 nm (1.79 ) (12) (1.33 ) 0.25 nm
Marketing income ($/boe)(3) 0.20 0.65 (69) 0.28 (29) 0.39 0.39
Operating netback ($/boe)(3) 18.97 24.86 (24) 27.92 (32) 24.88 22.43 11
Adjusted funds flow ($/boe)(3)(5) 17.06 22.25 (23) 25.81 (34) 22.65 19.23 18
Financial Results
Revenue ($)(4) 1,146.8 615.1 86 809.0 42 3,169.9 2,454.6 29
Net income ($) 245.4 83.1 195 196.4 25 439.9 562.5 (22)
Per share – diluted ($) 0.68 0.23 196 0.53 28 1.21 1.54 (21)
Operating income ($)(3) 66.3 129.2 (49) 208.3 (68) 573.6 326.3 76
Per share – diluted ($) 0.18 0.36 (50) 0.57 (68) 1.58 0.90 76
Cash provided by operating activities ($) 410.1 310.3 32 536.9 (24) 1,796.3 1,154.3 56
Per share – diluted ($) 1.13 0.85 33 1.47 (23) 4.94 3.17 56
Adjusted funds flow ($)(5) 337.4 403.8 (16) 522.0 (35) 1,674.2 1,228.3 36
Per share – diluted ($) 0.93 1.11 (16) 1.43 (35) 4.60 3.37 36
CROIC (%)(3) 19.1% 17.9% 7 20.5% (7) 19.1% 17.9% 7
ROCE (%)(3) 12.9% 9.8% 32 15.6% (17) 12.9% 9.8% 32
Balance sheet
Capital investments ($) 262.3 322.3 (19) 358.2 (27) 1,765.7 1,651.4 7
Available funding ($)(3) 1,345.9 1,467.4 (8) 1,379.4 (2) 1,345.9 1,467.4 (8)
Net debt ($)(5) 2,202.8 1,866.4 18 2,059.5 7 2,202.8 1,866.4 18
Weighted average shares – basic 359.2 354.7 1 361.9 (1) 358.6 353.3 2
Weighted average shares – diluted 362.3 363.9 365.7 (1) 363.9 364.4
(1) Beginning in 2018, Seven Generations began presenting C5+ (pentanes plus) in the NGL mix as a condensate volume (previously reported as an NGL volume). 2017 liquids and natural gas sales have been adjusted to conform to this current period presentation.
(2) Excludes the purchase and resale of condensate and natural gas in respect of the company’s transportation commitment utilization and marketing activities.
(3) See “Non-IFRS Financial Measures” under Reader Advisory. Certain comparative figures have been adjusted to conform to current period presentation.
(4) Represents the total of liquids and natural gas sales, net of royalties, gains (losses) on risk management contracts and other income.
(5) Refer to Note 17 of the audited consolidated financial statements of the company for the years ended December 31, 2018 and 2017.

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Nest Activity 2018 2017 % Change 2018 % Change 2018 2017 % Change
Horizontal wells rig released 19 20 (5 ) 21 (10 ) 91 88 3
Average measured depth (m) 6,010 5,278 14 5,691 6 5,735 5,742
Average horizontal length (m) 2,776 2,128 30 2,557 9 2,551 2,537 1
Average drilling days per well 28 29 (3 ) 28 27 33 (18 )
Average drill cost per lateral metre ($)(2) $ 1,236 $ 1,760 (30 ) $ 1,373 (10 ) $ 1,389 $ 1,592 (13 )
Average well cost ($ millions)(2) $ 3.4 $ 3.6 (6 ) $ 3.5 (3 ) $ 3.5 $ 3.9 (10 )
Wells completed 13 16 (19 ) 28 (54 ) 89 88 1
Average number of stages per well 46 39 18 58 (21 ) 48 41 17
Average tonnes pumped per metre 1.9 2.2 (14 ) 2.0 (5 ) 2.3 2.4 (4 )
Average tonnes pumped per well 4,417 5,643 (22 ) 5,206 (15 ) 5,402 6,236 (13 )
Average cost per tonne(2) $ 1,282 $ 1,107 16 $ 1,240 3 $ 1,228 $ 1,190 3
Average well cost ($ millions)(2) $ 5.7 $ 6.2 (8 ) $ 6.5 (12 ) $ 6.6 $ 7.3 (10 )
Total D&C cost per well ($ millions)(2) $ 9.1 $ 9.8 (7 ) $ 10.0 (9 ) $ 10.1 $ 11.2 (10 )
(1) The drilling and completion counts include only horizontal Montney wells in the Nest. The drilling counts and metrics exclude wells that are re-drilled or abandoned.
(2) Information provided is based on field estimates and are subject to change.


With the temporary weakness in fourth quarter Canadian condensate pricing, 7G elected to defer until January the start-up of seven Nest 2 upper/middle Montney wells that were previously drilled, completed, equipped and tied-in. This was an economic decision driven by visibility toward improved condensate differentials in the beginning of 2019. 7G has seen a significant strengthening in the Canadian condensate market with the local discount to WTI currently averaging approximately US$3.25 per bbl.

Average well drilling and completion costs in 2018 were 10 percent lower than the previous year with reductions roughly equal in both drilling and completions. Drilling activity benefitted from an 18 percent reduction in drilling days versus 2017, on wells of a similar depth and lateral length. 7G continues to evolve its completions design, which has shifted towards a higher stage count and a lower per-stage proppant intensity in order to efficiently develop and recover its resource at reduced costs. The company is encouraged with the results from its evolving completions designs and will continue to innovate and progress its resource understanding to enhance corporate returns.

7G’s third owned and operated processing plant, located in the Gold Creek area, was brought on stream in November of 2018. It was successfully tested at full capacity during December. This 250 MMcf/d interconnected plant provides heightened operating flexibility to mitigate both planned and unplanned downtime and is built to accommodate a cost-effective expansion to 500 MMcf/d. The plant’s connectivity to the NGTL and Alliance pipeline systems also provides opportunities to optimize the pricing of 7G’s natural gas and NGL revenue stream between the Alberta market and Aux Sable facilities in the US Midwest. The Gold Creek plant was designed, engineered and constructed to achieve the company’s lowest emissions intensity with a carbon dioxide emission intensity about 10 percent lower than 7G’s other plants.

7G continues to evaluate infrastructure partnership opportunities and is encouraged by the level of interest. The company is evaluating proposals aimed at enhancing the value of its infrastructure assets.


The following table summarizes 7G’s reserves at December 31, 2018 and 2017 as estimated by the company’s independent qualified reserves evaluator using the forecast price and cost assumptions in effect at the applicable reserves evaluation date.


Year ended

December 31,

2018 2017
Reserve Category(1) MMboe $MM(2) MMboe $MM(2)
Gross proved developed producing (PDP) 242 2,824 211 2,470
Gross proved reserves (1P) 856 6,518 870 6,133
Gross proved plus probable reserves (2P) 1,644 12,282 1,695 11,988
Gross best estimate risked (2C) contingent resources 1,323 2,942 1,291 2,579
(1) For important additional information regarding the independent reserves and resources evaluations conducted by McDaniel, please see “Reader Advisory” and the Annual Information Form dated February 27, 2019 for the year ended December 31, 2018 that is available on SEDAR.
(2) Estimated pre-tax net present value of discounted cash flows from reserves using a 10% discount rate.

7G is committed to increasing the long-term value of its resource within one of the most economic plays in Western Canada. As discussed in 2018, the company saw increased condensate volumes and reduced natural gas volumes in its production stream. This dynamic drove a 2.5 percent increase in the pre-tax net present value of the company’s 2P reserves, despite a year-over-year reduction in reserve evaluator price forecasts and wider local price differentials. The company’s increase in condensate reserves were offset by a reduction in natural gas volumes on a boe basis. Based on 2018 production levels of 202,600 boe/d, 7G’s 1.64 billion boe 2P reserves represent more than 22 years of reserve life.

Total PDP reserve volumes increased 14.7 percent year-over-year, replacing 142 percent of 2018 production. These gains were consistent with a successful 2018 development program. Per-boe future development capital continues to fall on a 1P and 2P basis, and is consistent with the company’s 5-year trend as the company completes initial investments in its natural gas processing build-out.

The company’s 2C contingent resources increased by 2.5 percent to 1,323 MMboe representing a pre-tax net present value of $2.9 billion, an increase of 14 percent. Approximately 98 percent of the 2C contingent resources attributed to the company’s properties by McDaniel, as at December 31, 2018, are in the Montney formation and have been classified in the “development pending” project maturity subclass. 7G also includes more than 170 lower Montney locations within the 2C contingent resource estimate. Development plans for these locations are expected to be established once the 2019 lower Montney delineation program is complete.


Nest 1 Perimeter

7G recently concluded completion operations on the first well of 2019’s Nest 1 perimeter delineation program. The company is encouraged by initial results that have exceeded expectations, with initial wellhead rates of approximately 2,200 boe/d (75% condensate) over the first 30 days. The company will use the delineation results to design gathering systems and artificial lift for full-scale Nest 1 development anticipated to begin in 2020.

Lower Montney

The company completed drilling of its comprehensive triple-stack test in January, consisting of three wells in the upper Montney, three wells in the middle Montney, and three wells in the lower Montney. Completion operations commenced in February. Following tie-in and sufficient flow data, management anticipates providing an update on initial rates in the second half of 2019. Upon successful lower Montney results, future development has the potential to benefit from improved cost efficiencies and the use of existing surface infrastructure.


During 2018, the company retired 9.67 million shares at an average cost of $10.72 per share plus transaction costs, reducing its outstanding shares at the beginning of 2019 to 352.6 million, a 2.7 percent reduction of 7G’s outstanding shares. 7G continues to evaluate further allocation of excess cash to the NCIB, reduction of debt and other investment opportunities in its portfolio, subject to commodity prices generating additional adjusted funds flow in excess of its budgeted capital requirements.


7G’s 2019 guidance remains unchanged, as below:

Condensate (%) 36 – 38
Total liquids (%) 58 – 60
Natural gas (%) 40 – 42
Total production (Mboe/d) 200 – 205
H1 2019 (Mboe/d) 195 – 200
H2 2019 (Mboe/d) 205 – 210
Royalties (%) 5 – 7
Operating ($/boe) 5.00 – 5.50
Transportation ($/boe) 6.75 – 7.25
G&A ($/boe) 0.80 – 0.90
Interest ($/boe) 1.80 – 1.90
Capital investment ($mm) 1,250
Drilling and completions (%) 55 – 60
Pipelines and infrastructure (%) 30 – 35
Delineation (%) 10 – 15
Wells on-stream 65 – 70


7G is pleased to announce that Ronnie Irani, an executive and director with more than 39 years of experience in the oil and gas industry, has joined the 7G Board effective February 27, 2019. Irani is founder and Chief Executive Officer of RKI Energy Resources, LLC, a private company headquartered in Oklahoma City. He also serves as a director of Enable Midstream Partners, LP, a NYSE-listed company.

Irani was founder, President and Chief Executive Officer of RKI Exploration and Production until the company sold its assets for US$3.5 billion in 2015. He was Senior Vice President and General Manager with Dominion Resources, a Fortune 200 company, until 2005 and previously held senior executive positions at Louis Dreyfus Natural Gas Corp. and Woods Petroleum Corporation, both NYSE-listed companies. Irani has served on several private and public boards, including Quest Resource Corporation and Seventy Seven Energy Inc. He has made significant contributions to broader industry and community initiatives having served as a director of the Greater Oklahoma City Chamber of Commerce, the Integrated Petroleum Environmental Consortium, the US Department of Energy Industry Oil Review Panel, and as a founding board member and past Chair of the Oklahoma Energy Explorers.

Irani holds a Bachelor of Science in Chemistry from Bombay University, India, a Bachelor’s and a Master’s degree in Petroleum Engineering from the University of Oklahoma, and an MBA from Oklahoma City University.


7G management will hold a conference call to discuss results and address investor questions today, February 28, 2019, at 9 a.m. MT (11 a.m. ET).

Participant Dial-In Numbers

Dial in – toll free: (866) 521-4909
Dial in – toll: (647) 427-2311
Webcast link:

Replay dial in toll-free: (800) 585-8367
Replay dial in toll: (416) 621-4642
Audience passcode: 9578078
Available to: March 14, 2019

Seven Generations Energy

Seven Generations Energy is a low-supply cost energy producer dedicated to stakeholder service, responsible development and generating strong returns from its liquids-rich Kakwa River Project in northwest Alberta. 7G’s corporate office is in Calgary, its operations headquarters is in Grande Prairie and its shares trade on the TSX under the symbol VII.

Further information on Seven Generations is available on the company’s website:

Reader Advisory

Non-IFRS Financial Measures

This news release includes certain terms or performance measures commonly used in the oil and natural gas industry that are not defined under International Financial Reporting Standards (IFRS), including “return on capital invested” (ROCE), “cash return on invested capital” (CRIOC), “operating income”, “operating netback”, “adjusted funds flow per boe”, “marketing income”, “adjusted working capital” and “available funding”. The data presented is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. These non-IFRS measures should be read in conjunction with the company’s consolidated financial statements for the years ended December 31, 2018 and 2017 and the accompanying notes. Readers are cautioned that the non-IFRS measures do not have any standardized meaning and should not be used to make comparisons between the company and other companies without also taking into account any differences in the way the calculations were prepared.

For additional information about these measures, please see “Advisories and Guidance – Non-IFRS financial measures” in Management’s Discussion and Analysis dated February 27, 2019, for the years ended December 31, 2018 and 2017.

Net debt and adjusted funds flow have been included in Note 17 in the company’s consolidated financial statements for the years ended December 31, 2018 and 2017 in order to provide users with a better understanding of these key metrics used by the company to manage its capital and liquidity and assess performance. Accordingly, the net debt and adjusted funds flow performance measures are considered to be measures presented in accordance with IFRS. Please refer to Seven Generations’ consolidated financial statements for the years ended December 31, 2018 and 2017 for further details.

Forward-Looking Information Advisory

This news release contains certain forward-looking information and statements that involve various risks, uncertainties and other factors. The use of any of the words “anticipate”, “continue”, “estimate”, “expect”, “may”, “will”, “should”, “believe”, “plans”, and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward-looking information and statements pertaining to the following: the timing of bringing new wells online; expected improvements in condensate differentials in 2019; expected processing capacity; the ability to expand the processing capacity of the Gold Creek plant in a cost-effective manner; continued innovation and improved understanding of the company’s assets will lead to enhanced corporate returns; value enhancement expected from further delineation drilling; the expectation that the new Gold Creek gas processing plant will provide heightened operating flexibility to mitigate both planned and unplanned downtime and opportunities to optimize 7G’s natural gas and NGL revenue stream between the Alberta market and Aux Sable facilities in the US Midwest; the expectation that development plans for the company’s planned lower Montney locations will be established once the company’s lower Montney delineation program has been completed; expectation that future lower Montney development may benefit from improved cost efficiencies and the use of existing surface infrastructure; planned timing for the release of results from the first well drilled as part of the company’s Nest 1 perimeter delineation program; expectation that the Nest 1 perimeter delineation results will be used to optimize plans for gathering systems and artificial lift design for a full-scale Nest 1 development program anticipated to begin in 2020; expected reserve life; expectation that initial rates from lower Montney wells will be provided in the second half of 2019; the objectives of the midstream process that is currently underway and the timing of the conclusion of that process; the guidance provided under the heading “Outlook” including expected production, expenses, capital investment and allocation of capital; the company’s expected development horizon; further value enhancement expected through scientific analysis and delineation drilling; expectation that the 2019 capital program will be funded by the company’s expected cash flow; expectation that lower growth will mitigate production declines and preserve top-tier drilling inventory; expectation that disciplined execution will improve operating and capital cost efficiencies; expectation that planned infrastructure investments will lower operating coasts and expand profit margins. In addition to the foregoing, information and statements in this news release relating to reserves and contingent resources are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and contingent resources described exist in the quantities predicted or estimated, and that they can be profitably produced in the future.

With respect to forward-looking information contained herein, assumptions have been made regarding, among other things: future oil, NGLs and natural gas prices being consistent with current commodity price forecasts after factoring in quality adjustments at the company’s points of sale; the company’s continued ability to obtain qualified staff and equipment in a timely and cost-efficient manner; drilling and completion techniques; infrastructure and facility design concepts that have been successfully applied by the company elsewhere in its Kakwa River Project may be successfully applied to other properties within the Kakwa River Project; the consistency of the regulatory regime and framework governing royalties, taxes and environmental matters in the jurisdictions in which the company conducts its business and any other jurisdictions in which the company may conduct its business in the future; the company’s ability to market production of oil, NGLs and natural gas successfully to customers; the company’s future production levels and amount of future capital investment will be consistent with the company’s current development plans and budget; new technologies for recovery and production of the company’s reserves and resources may improve capital and operational efficiencies in the future; the recoverability of the company’s reserves and resources; sustained future capital investment by the company; future cash flows from production; taxes and royalties will remain consistent with the company’s calculated rates; the future sources of funding for the company’s capital program; the company’s future debt levels; geological and engineering estimates in respect of the company’s reserves and resources; the geography of the areas in which the company is conducting exploration and development activities, and the access, economic, regulatory and physical limitations to which the company may be subject from time to time; the impact of competition on the company; and the company’s ability to obtain financing on acceptable terms.

Operating cost assumptions reflect recent actual cost trends with adjustments to address planned activity levels. Royalty rate assumptions were calculated using a price range of US$50-US$65/bbl WTI, net of credits and projected C* for new wells to be drilled in 2019. Royalty rate assumptions are net of expected gas cost allowance from investments in gas plants and gathering infrastructure. G&A cost assumptions reflect recent actuals and expectations for a larger staff count and information technology investments in 2019.

Actual results could differ materially from those anticipated in the forward-looking information that is contained herein as a result of the risks and risk factors that are set forth in the company’s annual information form dated February 27, 2019 for the year ended December 31, 2018 (AIF), which is available on SEDAR, including, but not limited to: volatility in market prices and demand for oil, NGLs and natural gas and hedging activities related thereto; general economic, business and industry conditions; variance of the company’s actual capital costs, operating costs and economic returns from those anticipated; the ability to find, develop or acquire additional reserves and the availability of the capital or financing necessary to do so on satisfactory terms; risks related to the exploration, development and production of oil and natural gas reserves and resources; negative public perception of oil sands development, oil and natural gas development and transportation, hydraulic fracturing and fossil fuels; actions by governmental authorities, including changes in government regulation, royalties and taxation; political risk; potential legislative and regulatory changes; the rescission, or amendment to the conditions, of groundwater licenses of the company; management of the company’s growth; the ability to successfully identify and make attractive acquisitions, joint ventures or investments, or successfully integrate future acquisitions or businesses; the availability, cost or shortage of rigs, equipment, raw materials, supplies or qualified personnel; the adoption or modification of climate change legislation by governments and the potential impact of climate change on the company’s operations; the absence or loss of key employees; uncertainty associated with estimates of oil, NGLs and natural gas reserves and resources and the variance of such estimates from actual future production; dependence upon compressors, gathering lines, pipelines and other facilities, certain of which the company does not control; the ability to satisfy obligations under the company’s firm commitment transportation arrangements; the uncertainties related to the company’s identified drilling locations; the high-risk nature of successfully stimulating well productivity and drilling for and producing oil, NGLs and natural gas; operating hazards and uninsured risks; the risks of fires, floods and natural disasters, which could become more frequent or of a greater magnitude as a result of climate change; the possibility that the company’s drilling activities may encounter sour gas; execution risks associated with the company’s business plan; failure to acquire or develop replacement reserves; the concentration of the company’s assets in the Kakwa River Project; unforeseen title defects; aboriginal claims; failure to accurately estimate abandonment and reclamation costs; development and exploratory drilling efforts and well operations may not be profitable or achieve the targeted return; horizontal drilling and completion technique risks and failure of drilling results to meet expectations for reserves or production; limited intellectual property protection for operating practices and dependence on employees and contractors; third-party claims regarding the company’s right to use technology and equipment; expiry of certain leases for the undeveloped leasehold acreage in the near future; failure to realize the anticipated benefits of acquisitions or dispositions; failure of properties acquired now or in the future to produce as projected and inability to determine reserve and resource potential, identify liabilities associated with acquired properties or obtain protection from sellers against such liabilities; government regulations; changes in the application, interpretation and enforcement of applicable laws and regulations; environmental, health and safety requirements; restrictions on development intended to protect certain species of wildlife; potential conflicts of interests; actual results differing materially from management estimates and assumptions; seasonality of the company’s activities and the oil and gas industry; alternatives to and changing demand for petroleum products; extensive competition in the company’s industry; changes in the company’s credit ratings; third party credit risk; dependence upon a limited number of customers; lower oil, NGLs and natural gas prices and higher costs; failure of seismic data used by the company to accurately identify the presence of oil and natural gas; risks relating to commodity price hedging instruments; terrorist attacks or armed conflict; cyber security risks, loss of information and computer systems; inability to dispose of non-strategic assets on attractive terms; the potential for security deposits to be required under provincial liability management programs; reassessment by taxing authorities of the company’s prior transactions and filings; variations in foreign exchange rates and interest rates; risks associated with counterparties in risk management activities related to commodity prices and foreign exchange rates; sufficiency of insurance policies; potential for litigation; variation in future calculations of non-IFRS measures; breach of agreements by counterparties and potential enforceability issues in contracts; impact of expansion into new activities on risk exposure; inability of the company to respond quickly to competitive pressures; and the risks related to the common shares that are publicly traded and the company’s senior notes and other indebtedness.

Any financial outlook and future-oriented financial information contained in this document regarding prospective financial performance, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action based on management’s assessment of the relevant information that is currently available. Projected operational information contains forward-looking information and is based on a number of material assumptions and factors, as are set out above. These projections may also be considered to contain future oriented financial information or a financial outlook. The actual results of the Company’s operations for any period will likely vary from the amounts set forth in these projections and such variations may be material. Actual results will vary from projected results. Readers are cautioned that any such financial outlook and future-oriented financial information contained herein should not be used for purposes other than those for which it is disclosed herein. The forward-looking information and statements contained in this document speak only as of the date hereof and the company does not assume any obligation to publicly update or revise them to reflect new events or circumstances, except as may be required pursuant to applicable laws.

Notes Regarding Oil and Gas Metrics and Early Production

This presentation includes certain metrics, including barrels of oil equivalent (boe) and reserve life, which do not have standardized meanings or standard methods of calculation and therefore such measures may not be comparable to similar measures used by other companies and should not be used to make comparisons. Such metrics have been included herein to provide readers with additional information to evaluate the company’s performance; however, such measures are not reliable indicators of the future performance of the company and future performance may not compare to the performance in previous periods.

Seven Generations has adopted the standard of 6 Mcf:1 bbl when converting natural gas to boes. Condensate and other NGLs are converted to boes at a ratio of 1 bbl:1 bbl. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf: 1 bbl is based roughly on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the Company’s sales point. Given the value ratio based on the current price of oil as compared to natural gas and NGLs is significantly different from the energy equivalency of 6 Mcf: 1 bbl and 1 bbl: 1 bbl, respectively, utilizing a conversion ratio at 6 Mcf: 1 bbl for natural gas and 1 bbl: 1 bbl for NGLs, may be misleading as an indication of value.

Reserve life has been calculated by dividing the 2P reserves stated herein by 2018 production. Management has used this measure to determine how long booked reserves would last at 2018 production levels, if no further reserves were added.

The Nest 1 perimeter well that is described in this news release was drilled in the middle interval of the Montney formation in the company’s Nest 1 area. The results have been obtained during a 27 day initial production test. The average gas production rate observed to date is 3,343 Mcf/d and the average condensate production rate observed to date is 1,641 bbl/d. Cumulative gas production has been 90.6 MMcf, cumulative condensate production has been 44,470 bbls and cumulative produced water has been 38,033 bbls. Gas, condensate, and water rates ramped up over a period of 10 days. Gas maintained a plateau rate of about 4,200 Mcf/d) while condensate gradually declined as expected. Tubing pressure reached a maximum of 9,300 KPa (1,350 psi) after 6 days of flow and gradually decreased to about 5,750 KPa (834 psi), consistent with a relatively high liquid/gas ratio of about 700 bbl/MMcf. No pressure transient analysis or well-test interpretation has been carried out to date. Readers are cautioned that the flow test results are not necessarily indicative of long-term performance or ultimate recovery.

Independent Reserves and Resources Evaluation

Estimates of the company’s reserves and contingent resources and the net present value of future net revenue attributable to the company’s reserves and contingent resources, as at December 31, 2018, are based upon the reports prepared by McDaniel, dated February 27, 2019. The estimates of reserves and contingent resources provided in this news release are estimates only and there is no guarantee that the estimated reserves or contingent resources will be recovered. Actual reserves and contingent resources may be greater than or less than the estimates provided in this in this document, and the differences may be material. Estimates of net present value of future net revenue attributable to the company’s reserves and contingent resources do not represent the fair market value of the company’s reserves and contingent resources and there is uncertainty that the net present value of future net revenue will be realized. There is no assurance that the forecast price and cost assumptions applied by McDaniel in evaluating Seven Generations’ reserves and contingent resources will be attained and variances could be material. Contingent resources in the “development pending” project maturity subclass have been assigned by McDaniel, as at December 31, 2018, in the upper, middle and lower intervals of the Montney formation in certain parts of the Nest 1, Nest 2, Nest 3, Rich Gas and Wapiti areas within the Kakwa River Project. The COGE Handbook indicates that it is appropriate to categorize contingent resources in the development pending project maturity subclass where resolution of the final conditions for development are being actively pursued and there is a high chance of development. Approximately 98% of the contingent resources attributed to the Company’s properties by McDaniel, as at December 31, 2018, have been classified as “development pending” and the balance of the contingent resources have been classified as “development unclarified”. Contingent resources in the “development unclarified” project maturity subclass have been assigned by McDaniel, as at December 31, 2018, in the Wilrich formation within the Cretaceous stack across the Project area. The COGE Handbook indicates that it is appropriate to categorize contingent resources in the “development unclarified” project maturity subclass when the evaluation is incomplete and there is ongoing activity to resolve any risks or uncertainties. There is uncertainty that it will be commercially viable to produce any portion of the contingent resources. For important additional information regarding the independent reserves and resources evaluations that were conducted by McDaniel, please refer to the AIF, which is available on SEDAR.

Certain oil and gas terms

Terms used in this news release that are not otherwise defined herein are provided below:

best estimate is a classification of estimated resources described in the COGE Handbook, which is considered to be the best estimate of the quantity that will actually be recovered. It is equally likely that the actual quantities recovered will be greater or less than the best estimate. Resources in the best estimate case are considered to have a 50% probability that the actual quantities recovered will equal or exceed the estimate.

contingent resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingencies are conditions that must be satisfied for a portion of contingent resources to be classified as reserves that are: (a) specific to the project being evaluated; and (b) expected to be resolved within a reasonable timeframe. Contingencies may include factors such as economic, environmental, social, political factors and regulatory matters, lack of markets or a prolonged timetable for development. It is also appropriate to classify as contingent resources the estimated discovered recoverable quantities associated with a project in the early evaluation stage.

developed producing reserves are those reserves that are expected to be recovered from completion intervals open at the time of the estimate. These reserves may be currently producing or, if shut in, they must have previously been on production, and the date of resumption of production must be known with reasonable certainty.

developed reserves are those reserves that are expected to be recovered from existing wells and installed facilities or, if facilities have not been installed, that would involve a low expenditure (for example, when compared to the cost of drilling a well) to put the reserves on production. The developed category may be subdivided into producing and non-producing.

gross, in relation to reserves, means the applicable working interest (operating or non-operating) share before deduction of royalties and without including any royalty interests.

probable reserves are those additional reserves that are less certain to be recovered than proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or less than the sum of the estimated proved plus probable reserves.

proved reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated proved reserves.

reserves are estimated remaining quantities of oil and natural gas and related substances anticipated to be recoverable from known accumulations, as of a given date, based on: (i) analysis of drilling, geological, geophysical and engineering data; (ii) the use of established technology; and (iii) specified economic conditions, which are generally accepted as being reasonable, and shall be disclosed. Reserves are classified according to the degree of certainty associated with the estimates.

Other Definitions/Abbreviations


gross proved reserves


gross proved plus probable reserves


gross best estimate contingent resource


the Alliance Pipeline System






barrels of oil equivalent

COGE Handbook

the Canadian Oil and Gas Evaluation Handbook maintained by the Society of Petroleum Evaluation Engineers (Calgary Chapter), as amended from time to time.


the sediment deposition between the Jurassic and Tertiary periods. It includes development opportunities in formations such as the Cadomin, Gething, Bluesky, Wilrich, Falher, Cadotte, Dunvegan and Cardium


cash return on invested capital


the drilling and completion cost allowance under Alberta’s Modernized Royalty Framework




drilling and completions


general and administrative expenses


first half of the year


second half of the year


International Financial Reporting Standards








million barrels of oil equivalent


thousand barrels of oil equivalent


thousands of barrels


thousand cubic feet


million cubic feet


the Nest 1, Nest 2 and Nest 3 areas combined

Nest 1

the “Nest 1” area shown in the map provided in the AIF

Nest 2

the “Nest 2” area shown in the map provided in the AIF

Nest 3

the “Nest 3” area shown in the map provided in the AIF


natural gas liquids


not meaningful information


New York Stock Exchange


Nova Gas Transmission Ltd. System


gross proved developed producing reserves


pounds per square inch

Rich Gas

the “Rich Gas” area shown in the map provided in the AIF


return on capital employed


the System for Electronic Document Analysis and Retrieval maintained by the Canadian Securities Administrators available at


Toronto Stock Exchange


the “Wapiti” area shown in the map provided in the AIF


West Texas Intermediate

Seven Generations Energy Ltd. is also referred to as Seven Generations, Seven Generations Energy, 7G, we, our, the Company and the company.

2019 40 Under 40 Honorees – Utah Business

For many of our Forty Under 40 honorees, the first step they took into their careers was when the Great Recession hit. Thrown into a fragile job market and an economic decline, these honorees were forced to learn to swim or risk sinking to the bottom. Now, years and countless accomplishments later, all 40 of our honorees have learned to do more than swim. They’re innovating the future of the business landscape in Utah while building communities that will inspire the next generation of entrepreneurs.

AJ Boldan, 39

President & General Manager | University of Utah Hockey

After joining the University of Utah Hockey team in 2007, AJ Boldan has worked diligently to grow and guide the team to success. Starting as a player and a University of Utah student, he quickly took over the team as general manager in 2008. Leading the team to a comeback after back-to-back losing seasons, Mr. Boldan quickly proved himself more than a leader. Securing bids for the 2014 PAC-8 Championships, the 2015 ACHA Division 2 National Championships, and democratizing the broadcasting of college hockey, Mr. Boldan even executed Utah’s move to Division 1 for the ACHA 2016-2017 season.

After more than a decade with the team, Mr. Boldan hasn’t forgotten what’s important. “I really enjoy how the game brings so many people together,” he says. “From grandparents to alumni to the players themselves, no matter who is playing, people just love hockey!” Recently, under Mr. Boldan’s direction, the team announced they will be expanding to include a women’s hockey program beginning in the 2019-2020 season.

Amber Sawaya, 38

Executive Vice President | Zorroa

Amber Sawaya has always had a talent for art, so following her passion into a career in graphic design was a no-brainer. Combining her passion with business, she built a career around user experience―and it paid off. “My first self-made million was a huge accomplishment,” Ms. Sawaya says, describing the consulting firm she ran for over decade. But as she’s pushed forward with passion, her innovations have only continued to push the envelope.

Since joining the team at Zorroa―which provides machine learning tools for businesses―Ms. Sawaya has made her mark on a whole new industry. Pushing the value of user experience in artificial intelligence, she maps how real humans interact with the power of machine learning, and she’s taken a leadership role in guarding against undiversified bias and other unintentional consequences that have vexed earlier AI efforts. “This curious nature and ability to dive in and understand a new area served me well when I was able to bring a UX mindset to the artificial intelligence industry,” she says. A best-selling author and startup success, Ms. Sawaya is a heavily sought after speaker, influencer, and mentor.

Bahar Ferguson, JD, MBA, 34

President | Wasatch IT

“I had no idea I would ever end up in IT,” Bahar Ferguson says, recounting her entrepreneurial achievements. “But being raised by entrepreneurs, I was always starting my own business as a child. I always loved the creativity in business.” From operating the cash register at her family’s restaurant as a child to leading the sales, marketing, and business development team at Wasatch IT, she has driven every endeavor she’s pursued to success.

Receiving her MBA from Westminster College and then her Juris Doctorate from Brigham Young University, Ms. Ferguson has been busy. Beginning her political career at just 19, she was a key resource in Governor Huntsman’s campaign and spent several years working in the governor’s office before practicing law and then joining her husband to run Wasatch IT. In the 18 months since joining the company, she has doubled its monthly recurring revenue and its core business.

Ben Kolendar, 34

Director of Business Development & Economic Development | Salt Lake City Department of Economic Development

2019 40 under 40 honorees

“I was drawn into economic development during the Afghanistan war,” says Ben Kolendar. “I worked for a special mission task force out of the Pentagon that sought stability through strategic economic initiatives. That was my toe in the water.” And he was immediately hooked. Working in economic development and foreign affairs quickly became his passion, and he says that helping to build the Salt Lake City Department of Economic Development has been extremely rewarding.

After Mayor Biskupski created the department in 2016, Mr. Kolendar has lead it to tremendous growth, retaining over 9,000 jobs and nearly a billion dollars in capital investment. He played a critical role in updating Utah’s Foreign Trade Zone process, as well as bringing the 68th United Nations Department of Public Information NGO Conference to Salt Lake City in 2019. Prior to his work with the city, Mr. Kolendar worked with the Obama administration as senior advisor to the executive director of SelectUSA, an initiative to attract and retain foreign business investment in the United States. As a presidentially appointed official, Mr. Kolendar provided guidance to create jobs, spur economic growth, and promote American competitiveness.

Bethany Teeples, 30

Owner | Waffled

2019 40 under 40 honoreesStarting her waffle career as a summer adventure, Bethany Teeples turned her passion into a thriving company. From catering weddings and baby showers to opening Waffled in 2017, her very first brick and mortar store in Farmington, followed by a second in 2018, she was always willing to get her hands dirty and build from the ground up.

But what Ms. Teeples finds most rewarding is helping her young staff navigate their lives. “Most of my staff [members] are between 15 and 18 years old,” she says. “I love getting to know each of them and watching them grow.” Ms. Teeples strives to be a strong role model for her young staff, and hopes to expand on that in the future by creating a coaching service for teens. “I truly feel they needmore advocates on every level,” she says. With ideas like these, it’s clear that Ms. Teeples is building more than good waffles, she’s working to build strong individuals.

Brandon Rodman, 37

CEO | Weave

2019 40 under 40 honorees

After graduating from Brigham Young University in 2004, Brandon Rodman worked in summer sales before completely pivoting his career trajectory. Founding Recall Solutions from his attic in Lehi, which later became Weave, he was elected by Y-Combinator for funding in 2014 and the company has continued to see success ever since. Since the company’s conception as a phone company, it’s grown into a substantial software hub. Now, Weave’s software is used in over 7,000 offices across the US.

Mr. Rodman hopes to inspire other entrepreneurs as he takes the next steps in his career. “I would encourage others to join an early-stage company and spend time learning what success looks like rather than starting a company in your early 20’s,” he says. “Be patient. Embrace the hard times. Your path will be unique. Enjoy the journey.”

Brock Loomis, 34

Land Acquisition & Development Director | JF Capital2019 40 under 40 honorees

“I knew I wanted to do something related to construction and development, but I didn’t know what,” says Brock Loomis, recounting the unique journey that led him to where he stands today. Graduating from Weber State University with no experience in 2007, he dove headfirst into construction and development. Working with an engineering firm, he was promoted within six months to oversee a team of engineers with far more experience. At 27, he oversaw the Asia territory, and then moved to Shanghai to oversee projects in places like Hong Kong, Tokyo, and Malaysia.

Joining JF Capital as the land acquisition and development director at 32, Mr. Loomis has been a tremendous part of the development of communities and continues to push innovation at every turn. And with a unique perspective on the industry, he intends to keep pushing those innovations forward. “I have a personality that is always hungry for something to do. Working in the fast-paced world of real estate development keeps me on my toes.”

Carl Sokia, 39

Executive Director, People Operations | The Grand America Hotel

2019 40 under 40 honoreesCarl Sokia has always had a passion for making an impact on others’ lives. Working in hospitality for over 15 years, he’s spent 13 of them working in human resources, or what he calls “people operations,” helping propel others in their careers. “I actually fell into my career in HR by accident,” he says, though he’s extremely proud of the accomplishments he’s made. As the executive director of people operations at The Grand America Hotel, Mr. Sokia measures his success by the people he impacts every day, and works to inspire younger generations.

“I hope I can be an example to the young polynesians and other young ethnic minorities found across the Utah business landscape,” he says. “My goal is to be a light on the hill for young people.”

Carrie Rogers-Whitehead, 36

Cofounder & CEO | Digital Respons-Ability; Wizarding Days LLC

2019 40 under 40 honorees

Carrie Rogers-Whitehead founded Digital Respons-Ability because of the gaps she saw in her own career. “There was talk about the what of technology, but not the why. I saw a push for STEM, but not a push for soft skills. Technology is changing rapidly, but the human brain has been the same for thousands of years.” Now empowering youth to be responsible digital citizens, Ms. Rogers-Whitehead has also taken extensive care in planning digital programs around youth with special sensory needs, such as autism.

Ms. Rogers-Whitehead is heavily involved in the community, both on the local and state levels, innovating and implementing youth programs like ToshoCON, the only teen-lead anime convention in the country; Teen Hackathon; Teen Yule Ball, and various other clubs and contests. She is also the cofounder of Wizarding Dayz, a fantasy event that focuses on charity, education, and STEM. “Adults are very reactive to what they see young people doing,” she says, and she’s working to engage youth in the mediums they enjoy.

Cory Tholl, 39

CEO | Klymit

2019 40 under 40 honorees

Cory Tholl didn’t found Klymit, but from the way he’s lead it to success, you would think he had. Hired for product development in 2008, he helped develop the initial ideas of Klymit’s founder. But his passion for taking products from ideation to market put him on the path to success, and by asking the right questions, he was appointed CEO in 2011. From that point on, Mr. Tholl has steered Klymit forward, seeing continual year-over-year revenue and profitability growth, with a three-year growth rate of 406.1 percent. He has lead Klymit to become an Inc. 5,000 company for the past three years, and he pushes his team toward a high standard of excellence necessary to reach their highest potential.

Looking forward, Mr. Tholl isn’t sure where the future leads, but he’s excited to explore. “I’m really enjoying this journey and believe there’s a lot of blue sky still ahead of us at Klymit.”

Courtney Anderson, 37

Founder & CEO | Spa Trouvé

2019 40 under 40 honorees

With an eye for design, Courtney Anderson bought her first medical spa in 2011 and set out to create a beautiful environment where “feeling good looks good.” Now, eight years later, Spa Trouvé allows everyone who enters its doors to feel truly beautiful. “I’ve had a love for the beauty industry since I was a young girl, and being able to combine that with my degree in exercise physiology, I discovered my true passion,” she says. In addition to founding the medical spa, Ms. Anderson also completed the 2014 Goldman Sachs Business Program, writing her 60-page thesis about her business.

The culture Ms. Anderson has created around Spa Trouvé is unique. Known as the Nordstrom of medical spas, she focuses on attention to detail and superior customer service, setting the spa apart from competitors. Now with four locations, under Ms. Anderson’s leadership they have won multiple awards, including Utah Valley’s best laser hair removal and best medical spa for four years in a row.

Crystal Low, 37

Executive Vice President, Business Payments & Technology | Zions Bank

2019 40 under 40 honorees

Crystal Low initially applied at Zions Bank to transition out of retail and help get her through college. Now, 17 years later, she’s the director of business payments and technology. Graduating from the University of Phoenix with a degree in business management and then earning her Executive MBA from the University of Utah, she was the first generation of her family to graduate college, and then the first member to earn a graduate degree. And at 35, she became the youngest female executive vice president in Zions Bank history.

Ms. Low focuses on innovation and improvement, and her efforts at Zions Bank haven’t gone unnoticed. Implementing an idea tracking tool that allows any employee to submit a solution for improvement, her initiative saved the company over $300,000 in expenses in 2017. “Banking is cool,” says Ms. Low, and she’s clearly excited about her work. When asked about her future, she has no intention of leaving the industry. “I would love to stay and one day run the bank.”

Dallin Anderson, 34

VP & GM, Inside Sales & Acquisition Marketing | Vivint Smart Home

Although just 34 years old, Dallin Anderson has played a pivotal role in driving Vivint’s growth and propelling the company to its position as the number one smart home services provider in North America. Leading a talented team of more than 500 salespeople, marketers, and analysts, he has grown his team by 30 percent over the last year alone. Under Mr. Anderson’s leadership, Vivint generated a lifetime revenue of $600 million from new customers in 2018 and will reduce customer acquisition costs by 66 percent in 2019.

But, like all rising stars, Mr. Anderson didn’t always know success. Entering the workforce at just 13, he had 15 jobs before entering college, all of which instilled an incomparable work ethic within him before leading him to a full-ride scholarship at Brigham Young University. “My career philosophy is that you should learn to do your job in 20 hours a week, then spend the rest of your time thinking like a CEO,” he says. “Use your talents to drive new initiatives for the business.”

Dan Cook, 36

Senior Vice President of Sales & Customer Success | Lucid

2019 40 under 40 honorees

“When I joined Lucid, the company was four years old and had millions of users without ever having had a single sales person. Now, more than 100 sales and success professionals later, I’m very proud of what we’ve accomplished since that first day.” With Dan Cook putting deliberate measures behind such a successful product, he’s propelled Lucid beyond what he ever thought possible.

After graduating from Brigham Young University, Mr. Cook worked in investment banking, and served on the board of ABI Innovation Hub before earning his MBA from Harvard. And then he found Lucid. Mr. Cook realized the incredible opportunity to leverage Lucidchart’s massive user base into enterprise customers, building the sales team from the ground up and scaling the team to its current 120 members. “Building this team has definitely been the most rewarding project I’ve worked on. And the best part is we’re just getting started.” And going forward, he’s hopeful about the endless possibilities. “I like to think of life as a choose your own adventure novel. Each incremental decision opens up new opportunities.”

Daria D. Anderson, 37

Director of Compliance | National Association of Black Accountants, Salt Lake City Chapter

2019 40 under 40 honorees

As a child, Daria Anderson always knew she would grow up to be a lawyer. Graduating from Indiana University, she earned her degree in criminal justice, and then her juris doctorate at Valparaiso University. Taking the unorthodox route of serving her community, Ms. Anderson dedicated herself to helping urban communities, nonprofits, and refugees.

Ms. Anderson is a member of Alpha Kappa Alpha, the oldest sorority founded by African American students, and serves as the director of compliance and membership engagement for the Salt Lake City chapter of the National Association of Black Accountants. Committed to diversity initiatives in Utah, her goal is to connect businesses and individuals to resources that will expand their experience. “I am very passionate about financial literacy awareness among groups that are underrepresented and young people,” she says. “I find ways to give back by volunteering and teaching classes on how taxes and credit work as well as how the economy works to children and adults alike.”

David Garbett, 40

Special Projects Leader | Garbett Homes

2019 40 under 40 honorees

A community advocate with more than a decade of experience in litigating, lobbying, and crafting policy, David Garbett has dedicated his professional life to addressing complex social problems in innovative ways. As the former executive director of The Pioneer Park Coalition, he helped to address the homelessness epidemic in the Rio Grande area of Salt Lake City. During his first year with the coalition, he worked to unite local residents, businesses, and public officials in a visualization of a revitalized Pioneer Park, and in August of 2018, he was vital to the groundbreaking for the construction of “The Green Lawn,” a new multi-use field in the center of the park.

Mr. Garbett has worked with nonprofits for years as a public interest attorney, focusing on public lands law and environmental issues. After earning his MS in business from Stanford, he received his juris doctorate from Harvard Law. He also holds an MS in economics from Utah State University and a BA in history from Brigham Young University.

Heather Allen, 37

Tax Partner | Tanner LLC

2019 40 under 40 honorees

Heather Allen is quietly making a difference in accounting. As one of the few female partners in a public accounting firm in Utah, Ms. Allen is an advocate for diversity―leading and inspiring other women to move up and make a positive impact. “Throughout my career, I haven’t had many women with senior management or partner positions to model a career path after,” she says, and she’s working hard to make up for that.

After teaming up with another female accounting partner nine years ago, she worked to create internal programs and initiatives specifically designed to recruit and mentor future female partners. “I would like to be a role model for younger women by showing them that there are different ways to achieve your goals.”

Ian S. Davis, 39

Shareholder & Attorney | Durham Jones & Pinegar

2019 40 under 40 honorees

After graduating law school near the top of his class and completing a judicial clerkship with Justice Ronald Nehring on the Utah Supreme Court, Ian S. Davis started his legal practice with Durham Jones & Pinegar in 2007. Just in time for the great recession. Developing expertise in handling complicated loan workouts and foreclosures, he has worked diligently on guiding his clients through troubled loan situations. “I had to quickly shift focus,” Mr. Davis says. “I had hoped to do loan origination work, but very few banks were making loans then.” But being thrown into the fire taught him how to navigate those troubled situations, and he’s since only grown.

Outside of Law, Mr. Davis is an avid gardener and is a member of the board for Wasatch Community Gardens. “We offer a place of refuge and a source of community,” Mr. Davis says. Providing them with legal support and business advice, he hopes to continue to build a flourishing community space.

Jessica Bueno Moyer, 34

Vice President of Corporate Training & Development | Four Foods Group

2019 40 under 40 honoreesJessica Bueno Moyer has a passion for hospitality. Formerly a Best Buy general manager, she used the majority of her time there training in public speaking, meeting etiquette, and media training, using her skills to open new stores and train new employees. She is also responsible for developing the hospitality and culinary training programs at Cafe Zupas. Having attended more than five leadership training programs, including the Disney Institute Hospitality Training and the Harvard Leadership Institute Training, she has become an authority on hospitality and leadership.

Ms. Moyer has been instrumental in the ideation and execution of the new training technology in the Four Foods Group restaurants, always ten steps ahead of the next innovation. “Fearlessness is my motivation,” says Ms. Moyer. “As the mom of a determined two year old girl, I want her to know what a fearless woman can accomplish. What can I do today if I’m not afraid to look stupid or fail?

Jessie Lynn Richards, 38

Associate Professor & Lecturer; Executive Director | Eccles School of Business, University of Utah; Fight Against Domestic Violence

2019 40 under 40 honoreesJessie Lynn Richards is dedicated to increasing education, awareness, and resources for domestic violence victims, survivors, and their communities. As cofounder and executive director of the nonprofit foundation Fight Against Domestic Violence, she uses her skills to lead others that are passionate about the cause. A long time advocate for marginalized communities, and women in particular, she has served on the board of the Utah Coalition Against Sexual Assault (UCASA) and with the Utah Women and Refugee Council. She also serves on the board of the College of Humanities and Social Sciences (ChASS) at Utah State University and is the founder of the Jessie and Jared Richards Scholarship Fund, which provides low-income students interested in studying issues of family violence a full-tuition scholarship for four years.

Aside from her domestic violence activism, Ms. Richards is a true academic, and she’s proud of the fact that she earned her PhD while parenting three children. “I always wanted to be in academia,” she says. “My favorite professors were those who combined their personal passions with their teaching and research.”

Josh Rosenthal, 36

Cofounder| La Barba Coffee, Creek Tea, Seabird

2019 40 under 40 honorees

Josh Rosenthal is the visionary behind local favorites La Barba Coffee and Creek Tea. “When I moved to Salt Lake City in 2002, people weren’t always happy to be here. So I wanted to contribute to making this a more enjoyable place to be. I love Salt Lake City,” he says. After a professional music career as an acoustic guitarist, Mr. Rosenthal launched his entrepreneurial adventure with La Barba in 2012, followed by Creek Tea in 2017. And Seabird, a craft cocktail bar, is targeted to launch before spring.

As an entrepreneur, Mr. Rosenthal believes the best way to give back is to care about the communities you work in. “It’s just money,” he says. “Make it. Lose it. It’s all the same. Put an equal emphasis on the people you’re impacting as the money you’re making. Give more of yourself to make sure everyone in the supply and demand chains feel valued.”

Joshua Heath, 39

Managing Director | Codeword

2019 40 under 40 honorees

Joshua Heath has played a vital role in many of Utah’s major brands throughout his 12 year career, from Vivint to InMoment and beyond. As a member of the public relations team, he’s built their strategies and generated narratives that have resulted in coverage by publications like the New York Times, Fortune, CNN, and many other national networks.

Throughout his career, he’s launched campaigns that give back to the community on local, national, and even international levels, including launching the anti-sexual violence campaign in Salt Lake City, helping the US Department of Justice fight to keep the drinking age at 21, and raise international awareness on the issue of nuclear nonproliferation.

But while helping a brand cut through the noise and connect with their target audience is rewarding in itself, Mr. Heath’s true reward is mentoring the team he’s worked with along the way. “Leadership is forged while working side by side in the trenches with your team,” he says. “My best mentors were always the ones working with me, not the ones shouting out orders from behind closed doors.”

Joshua McLaughlin, 37

Managing Director | Palantir Technologies

2019 40 under 40 honorees“I fell backwards into tech,” says Joshua McLaughlin. Commissioned into the United States Army as a Second Lieutenant from the University of Colorado, he spent seven years on active duty, three of which were spent deployed in Iraq. A graduate of the US Army Ranger School, he joined Palantir Technologies after transitioning from active duty when a former army friend introduced him to it. In his earliest days with Palantir, he helped US troops and allied militaries utilize big data and advanced analytics to dismantle terror networks. After spearheading major software growth initiatives, he was appointed managing director in 2017.

Splitting his time between Doha, Qatar, and Salt Lake City, Utah, Maj. McLaughlin also spends several months a year in uniform supporting the 19th Special Forces Group (Airborne). He doesn’t have free time. But he hopes to continue his growth in the Utah business community. “I would like to help grow the Utah startup community,” he says. “Whether that’s on the VC side, in state government, or even in a Utah startup.”

Juliette Tennert, 38

Chief Economist, Director of Economic & Public Policy Research | Kem C. Gardner Policy Institute, University of Utah

2019 40 under 40 honorees

Juliette Tennert has accomplished more before 40 than most people do in their entire careers. Dedicated to public service, she was appointed as the Chief Economist for the State of Utah at only 27, where she chaired the Governor’s Council of Economic Advisers. During her tenure, she directly advised Governor Jon Huntsman and his senior staff, while playing a tremendous role in guiding Utah through the Great Recession. “I’d often be the youngest person in the room,” she recounts of her time with Gov. Huntsman. Following that, she was named Utah’s State Budget Director under Governor Gary Herbert, where she coordinated the governor’s budget proposal and implementation through the recession recovery and economic expansion.

“I never imagined I would work as an economist,” says Ms. Tennert. Now, she serves as the chief economist and director of economic and public policy research at the Kem C. Gardner Policy Institute at the University of Utah. Directing a team of the state’s 13 best and brightest economists and analysts, she sets the conversation on on major economic policy issues.

Karnell McConnell-Black, 32

Interim Vice President of Student Affairs & Dean of Students | Westminster College

2019 40 under 40 honoreesAs a first generation college student, Karnell McConnell-Black has always charted new paths. As someone who has demonstrated remarkable leadership skills through his work with Westminster College, he tirelessly champions others and pushes them toward success. Since becoming interim vice president of student affairs and dean of students, Mr. Karnell has accomplished much, including developing and implementing the Division of Student Affairs Learning Domains, co-leading the initiative to re-establish the Westminster College Staff Council, and establishing a new policy to support student demonstrations on campus.

“When we combine our beliefs and values, we exercise our ability to create meaningful and transformational experiences that serve as a catalyst for an authentic life,” he says. “To be a transformative educational leader is to combine compassion and vulnerability, understanding that creative environments allow for individuals of all identities to be true stewards of the community we live in.”

Kendra Jackson, 34

Global Operations Manager | Qualtrics

2019 40 under 40 honorees

After graduating from Georgetown University, Kendra Jackson began her career in academia leading student programs at several universities, which sparked a passion for leading teams and organizations. Four years later, she returned to business school at the Ross School of Business at the University of Michigan, where she was the president of the Black Business Student Association. After four years with Goldman Sachs, Ms. Jackson joined Qualtrics in 2017.

Since joining Qualtrics, she has launched their first online community, led campus recruiting to increase the female employment rate at Qualtrics, established employee research groups, and launched the Women Leadership Development program. “I want to be a visible example of what is possible,” says Ms. Jackson. “I will continue to challenge both the status quo of business strategy and the makeup of our businesses to drive more positive impact on our communities.” She leads by not only attracting top talent, but by empowering her team and mentoring others.

Kylie Chenn, 26

Founder & CEO | Acanela Expeditions

2019 40 under 40 honorees

Kylie Chenn’s vision for Acanela Expeditions began when she was a student at Brigham Young University. After living in eastern Africa and southeast Asia as a part of her studies, she saw firsthand how positive ecotourism had the capability to elevate local economies out of poverty and empower individuals in a more sustainable way than many of the local charitable organizations. Now, sidestepping the constraints that traditional travel companies encounter, Ms. Chenn has built a travel company fit for the 21st century.

“As a female entrepreneur, and a young female entrepreneur, I face challenges every day about what a woman should be or do in the workplace,” she says. “I’m incredibly motivated by the opportunity to break down some of those biases and make a positive impact.” Rather than taking a hands-off approach, Ms. Chenn is always right there with her team, ensuring a smooth experience for everyone. “I hope to inspire other young female entrepreneurs to pursue their passions and dreams and turn that into something that positively benefits the community.”

Lauren Andersen, 36

Director of Personal Enrichment | University of Utah Continuing Education

2019 40 under 40 honorees

“It took me a while to realize it, but my desire to make education accessible, affordable, and approachable came from my grandmother,” says Lauren Anderson, when recounting what initially drew her into her career. “She wanted to go to college, but was told she would go to beauty school instead. She continued to learn the rest of her life through books and classes, but I know she wished she had the chance to get a university degree.”

Hired by the University of Utah in 2016, Ms. Andersen became responsible for the Lifelong Learning and the Go Learn Travel programs, working with senior learners, including those in their ‘80s. During her two year tenure, enrollments have increased by 200 students and membership for the Osher Lifelong Learning program has increased by 21 percent. Under Ms. Andersen’s leadership, the program has become self-sustaining, even adding four new international destinations. She has also launched an inter-generational learning opportunity, allowing Osher members to volunteer at a local daycare so members can share their passion for learning with children from 12 weeks to five years old.

Lauren E. Willie, 33

Founding Member | Volunteer Managers of Utah, Volunteer Manager | National Ability Center

2019 40 under 40 honorees

Throughout her life, Lauren E. Willie has sought out ways to give back to her community and engage in acts of service. Volunteering at a small village in Cameroon with the Peace Corps, she was inspired to find new ways to support communities abroad as well as communities at home. “I learned so much from those who had so little and understood what sustainability meant for their future,” she says. After her tour with the Peace Corps, she returned to Cameroon determined to make a difference, creating a guidebook that encompassed 233 local villages, empowering the local communities to take control of their economic empowerment.

Since then, numerous organizations, governments, individuals, and businesses have utilized the connections she made to address the crisis in Cameroon. During her work, Ms. Willie was awarded the title Ekandim Nkanda―a lifelong honor to those who demonstrate the ability to unite communities. Back home, Ms. Willie employs the same strategies she used in Cameroon to build networks and empower local communities with the Volunteer Managers of Utah.

Michael M. Parker, 32

Vice President of Public Affairs, Marketing, & Senior Economist | Ivory Homes

2019 40 under 40 honorees

“I’ve always been passionate and drawn to making a positive impact in my community,” says Michael M. Parker. And working with Utah’s number one home builder puts him in prime position to not only impact communities, but to create them. An instrumental part of Ivory Homes’ 30,000 trees initiative for their 30th anniversary, he’s stayed focused on providing positive future impact as well.

Mr. Parker’s background includes a diverse mix of business, government, and public policy experience, ranging from local to federal policy issues. Prior to joining Ivory Homes, he lead public policy efforts for the Salt Lake Chamber, Utah’s largest and longest-standing business association. “I’m proud of being Team Utah, focusing on making our state one of the best in America. I’ve been fortunate to be part of most of the significant legislative changes in transportation and tax policy over the past five years.”

Philip Niu, 38


2019 40 under 40 honorees

Philip Niu was raised by a hard working, first generation American father from a small village on the island of Tonga. Raised in Hawaii, what they lacked in financial stability, they made up for in rich heritage. After graduating from Brigham Young University, Mr. Niu entered the corporate world, but it didn’t take long for him to realize that his passion laid elsewhere.

In 2016, he created with his wife, Melissa, driving the next step of working and living in the Access Economy. Providing a space for people to gain what they need only when they need it, after launching a single article in Resource Magazine, they were immediately overwhelmed when other magazines such as Wired and TechCrunch began to give them unprompted exposure as well.

Since their initial launch, Mr. Niu has closed and reopened after completing market research to make the business bigger and better. And he promises to continue to do what it takes to reach his goal. “I don’t believe in retirement,” he says. “I’d like to spend every breath driving the future forward.”

Rebecca Macias, 38

Regional Marketing Manager | Eide Bailly LLP

2019 40 under 40 honorees

When asked what drew her into career, Rebecca Macias says, “getting laid off.” And she’s serious. “I know that what I’m doing now is what I’ve always wanted to do. However, for years, I just did events. I enjoyed it, but I knew it wasn’t my future. Then I got laid off. It was the best thing that happened to me.”

Six years ago, Ms. Macias was with the first Utah firm to join Eide Bailly as a marketing coordinator with the freedom to build it as she wanted. Working independently, she created something extraordinary. Creating the framework needed to market professional services, she developed the firm’s first marketing plan, individual business development plans for leadership, and coaching opportunities for senior levels of staff.

In 2018, she took on a new role as regional marketing manager, taking her marketing expertise to firms across the west. “I hope to be a voice and advocate for women, especially Latina women, to know that they can speak up for what they want.”

Reece Rovig, 32

Vice President of Commercial Sales | Pluralsight

2019 40 under 40 honorees

Highly sought after for his ability to make an immediate and significant impact on the bottom line of some of Utah’s most well-known organizations, Reece Rovig knows what it takes to be successful. Spending the last four and half years of his career preparing the pipeline for two of Utah’s leading technology IPO’s, he couldn’t be in an industry he finds more fulfilling. “I love the tech industry,” he says. “Although it can be very volatile, it’s also a fertile ground to pioneer new methodologies, strategies, and processes.”

Since joining Pluralsight, he has led a team of 40 professionals, been promoted three times, surpassed his sales quota each year, and increased the number of enterprise accounts to include more than 60 percent of Fortune 500 companies. Mr. Rovig is always looking for new ways to exceed expectations and set the new standard within each role he represents. “Focus on developing skills rather than money or job titles,” he advises about the path to success. “If you spend your time and energy developing the right skills, the money and titles will eventually follow.”

Rosalyn Kennedy, 39

Vice President, Executive Communications & Community Relations | Ancestry

2019 40 under 40 honorees

Rosalyn Kennedy is a storyteller. A two-time Emmy Award winner for her work on The Dr. Oz Show, she has also covered some of the most important news stories of her generation on 60 Minutes and The CBS Evening News. Working with brands like Google and Coca-Cola, she transitioned from broadcast journalism to corporate communication. And now, as a new resident of Utah, she has joined the team at Ancestry. “My job at Ancestry is pretty incredible,” she says. “Working for a company like this where our product empowers journeys of personal discovery to enrich lives, it’s an awesome responsibility.”

A rising industry voice, Ms. Kennedy now speaks on topics as impactful as internal communications, strategic public relations, and cultivating leadership voices. “I’m the daughter of immigrants whose first language was not English,” she says. “To have a job that allows me to work with words for a living, it’s pretty awe-inspiring.”

Shannon Bahrke Happe, 38

Chief Inspiration Olympian | Team Empower Hour2019 40 under 40 honorees

At age 17, Shannon Bahrke Happe was named to the US Freestyle Mogul Ski Team and spent the next 12 years dedicating her life to being the best in the world. She represented the USA three times as an Olympic Member, and at 21, she won her first Olympic medal during the 2002 Salt Lake City Olympics.

Skiing led Ms. Happe to her first entrepreneurial adventure as a motivational speaker in 2002. In 2008, she started Silver Bean Coffee Company, and in 2010 she represented both the St. Regis Deer Valley and Montage Deer Valley as their Ski Ambassador and eventually became the Ski Champion for Deer Valley Resort. But in 2017, she combined her passion of skiing and business and launched Team Empower Hour. “As an Olympic athlete, I know how important it is to live a healthy lifestyle. By bringing together all the skills I learned during my Olympic career, I wanted to empower others to be healthier, one hour at a time, every day,” she says.

Stevenson Sylvester, 30

CEO | KLYP LLC2019 40 under 40 honorees

A former professional football player, Stevenson Sylvester played first for the Utah Utes before being drafted to the Pittsburgh Steelers. Leading the Utes to four winning seasons, then going to the Super Bowl during his rookie year with the Steelers, he played until a career-ending knee injury sidelined him in 2014. Then, he founded KLYP, a cutting edge cosmetology service app.

No stranger to the beauty industry, Mr. Sylvester struggled finding a barber while traveling across the US as a pro athlete―and he knew he wasn’t the only one. So he set out to change that. Creating an app to help improve communication between the stylist and the client, he’s made it effortless to find a good haircut no matter where you are. And he’s helped stylists find business.

“With the lack of technology in this industry, it was a no brainer,” he says. “KLYP will create jobs for independent contractors, allowing them flexibility you don’t see anywhere else. We intend to improve daily lives by taking the stress out of your transactional cosmetology needs.”

Tessa Arneson, 37

Chief Boss Babe | Maven Strong, Maven Well, and Maven District2019 40 under 40 honorees

Tessa Arneson embarked on her entrepreneurial dream five years ago by purchasing a small fitness studio. Almost immediately, she started work on what is now Maven District―a hub of wellness-based businesses in Salt Lake City.

With 20 percent growth year over year since purchasing the original studio, Maven Strong expects to double their revenue this year. Capitalizing on this growth, Ms. Arneson is planning another location, Maven West, which is projected to open in 2020, as well as two more locations she’s currently working to curate.

When we asked what she’s most proud of, she barely had to stop and think. “The fact that Maven District has 19 female, locally owned businesses,” she says. “That means 19 women believed in our idea of creating a curated community of wellness, beauty, food, and retail enough to quit their day jobs and chase their dreams of being entrepreneurs.”

Thom Carter, 40

Executive Director | Utah Clean Air Partnership (UCAIR)2019 40 under 40 honorees

Since joining the Utah Clean Air Partnership in 2017, Thom Carter has established himself as a passionate and effective leader when it comes to the clean air issue. From big business on the right to environmentalists on the left, he has helped bridge the divide in both understanding and education to find solutions to clean air policy that all stakeholders can support. “I like to say that in our efforts to clean the air, there are not perfect answers. But there are practical solutions,” he says.

Under Mr. Carter’s direction, UCAIR executes a nearly $1 million advertising and public relations campaign to help accomplish the initiative to reduce emissions and other particulate matter in our air, such as “Be Idle Be Free” and “Show UCAIR.” And under his leadership, UCAIR has released over $400,000 in grants to groups improving Utah’s air. Instrumental in generating public and private funding and support, private donations have risen 40 percent since his appointment as executive director.

Tyler Buswell, 38

Shareholder & Attorney | Kirton McConkie

A commercial real estate agent at Kirton McConkie, Tyler Buswell began his career in 2008. Unanimously selected as a shareholder in 2015, his knowledge and understanding of key legal issues is demonstrated not just in the complicated transactions he works on, but also in being a frequently requested presenter on legal issues. “I love helping my clients get deals done,” he says. “If I’ve done my job right, my client and the adverse party are both happy at the end of the transaction because we resolved any potential issues before there was a dispute.”

“I’m passionate about pro bono legal services for those that can’t afford attorneys,” he says. This passion lead to the founding of the Serving Our Seniors project that provides certain free legal services to indigent senior citizens across the State of Utah. In the first year the project was operating, it received national accolades from the American Bar Association for service to the community. The Serving Our Seniors project continues to thrive today.

Zach Holmquist, 32

Cofounder | Teem x Wework

2019 40 under 40 honorees

“As the true founder of Teem, he came up with the idea, built the prototype, launched the company, and has been the driving force behind it all the way through its nine figure sale to WeWork in September 2018,” says Zach Holmquist’s cofounder, Dan Caffee of him. Mr. Holmquist helped create a define a new category of technology known as workplace experience, and now presents around the world as an expert on the subject.

“I’ve always been fascinated with the concept of having an idea, bringing it to life, and then sharing it with others. Before the internet, I wanted to be a disney animator to create and share. But then I was 13 and saw my cousin’s Geocities page,” says Mr. Holmquist. He created Teem as a small side project, but he always knew it had the potential to be a powerhouse. By the time it sold last year, it had over a million users worldwide.

West Bengal Govt launches web portal to provide real-time data on schools – Elets

West Bengal Education Minister Partha Chatterjee has inaugurated a web portal to provide real-time data of state-run and aided schools.

The portal named as ”Banglar Shiksha” ( is likely to be operational within two months” time, revealed the minister. During the launch, the minister also suggested his department officials to update the portal on regular basis with relevant information.

“This is probably the first-of-its-kind online initiative in the state as well as in the country. It will be operated on a trial basis for two months to remove glitches, if any. The portal should be fully functional by May 1,” Chatterjee stated.

The minister also said that the web portal would keep records of school attendance.

“Unlike many initiatives of the previous regime, we have to ensure it (portal) does not become dysfunctional. The portal will address many issues, including attendance of students and teachers. “A class teacher will also have to be present in the school to fill in data pertaining to academic and co-curricular activities of every student,” he maintained.

Chatterjee also asked the officials of school education department to upload videos of teaching sessions from various institutes on the portal.

“The school principals and headmasters will play a vital role in supplying information. They should be the first ones to receive training on how to operate the web platform,” Chatterjee said. “The State Government is also taking measures to introduce e-learning in government-run primary schools,” he added.

According to a statement issued by the school education department, “The proposed portal will store real-time data of 1.5 crore students, five lakh teachers and one lakh schools.”

Klobuchar defends her record on regulating medical devices – Daily Mail

MINNEAPOLIS (AP) – In her more than two terms as a U.S. senator representing Minnesota, Amy Klobuchar has built a reputation as an effective champion for consumer safety, sponsoring bills that improve swimming pool safety, ban lead in children’s products and tackle the nation’s opioid crisis.

“Consumers deserve products that have been tested and meet strong health and safety standards,” her website declares.

But Klobuchar, who announced two weeks ago she will contend for the 2020 Democratic presidential nomination, has also forcefully advocated for the medical device industry – a huge employer in her home state – in ways that complicate her reputation as a consumer defender.

During her time in the Senate, Klobuchar has advanced proposals championed by the medical device industry that some consumer advocates claim would put patients’ safety at risk, a review of her record by The Associated Press and the International Consortium of Investigative Journalists found. Safety and regulatory concerns relating to medical devices have come under scrutiny since the AP, ICIJ and other media partners began publishing a series of investigative stories about the industry in late 2018.

Klobuchar has pushed the federal Food and Drug Administration to approve medical devices faster and called for a greater presence of industry-backed experts at the agency. Not all of her proposals became law, but bills she introduced called for reducing the use of randomized clinical trials for some devices and limiting the amount of information FDA reviewers can ask of companies when evaluating devices. Language in bills she sponsored to streamline device approvals and increase the influence of industry-recommended experts ultimately ended up in landmark legislation signed into law by President Barack Obama.

While many of her Democratic presidential rivals promote ambitious proposals for free health care and college tuition, Klobuchar’s work on medical devices is a window into her narrower, often more moderate policy portfolio.

In this Sunday, Feb. 24, 2019, photo, U.S. Sen. Amy Klobuchar, D-Minn., speaks to voters during a campaign stop at a home in Nashua, N.H. U.S. Sen. and presidential hopeful Klobuchar has built a reputation as an effective champion for consumer safety. She also aggressively advocated for the medical device industry - a big employer in her home state of Minnesota - in ways that complicate her reputation as a consumer defender. Some consumer advocates say her work has helped put patients at risk. (AP Photo/Steven Senne)

In this Sunday, Feb. 24, 2019, photo, U.S. Sen. Amy Klobuchar, D-Minn., speaks to voters during a campaign stop at a home in Nashua, N.H. U.S. Sen. and presidential hopeful Klobuchar has built a reputation as an effective champion for consumer safety. She also aggressively advocated for the medical device industry – a big employer in her home state of Minnesota – in ways that complicate her reputation as a consumer defender. Some consumer advocates say her work has helped put patients at risk. (AP Photo/Steven Senne)

Klobuchar defends her record on regulating medical devices, telling the AP in a statement, “Patient and consumer rights have always been a major focus of mine.”


This story was produced through a partnership between The Associated Press and the International Consortium of Investigative Journalists.


Klobuchar did not make herself available for an interview for this story. Her statement highlights her efforts to speed up approvals of new devices, noting that approvals for many life-saving devices had languished for years.

“The legislation to improve the process was passed as part of a larger package of reforms, signed into law by President Obama, in response to slow-downs and workforce shortages at the FDA,” Klobuchar said. “The legislation also included more funding for the FDA to hire medical experts to examine the safety of products that came before them for approval. The final legislation was supported by numerous patient safety groups.”

Diana Zuckerman, president of the nonpartisan National Center for Health Research think tank, said that Klobuchar’s legislative record has put the demands of the device industry above patient safety. It has also provided political cover that makes it easier for other progressive lawmakers to embrace pro-industry measures, Zuckerman said.

“When a liberal Democrat actively champions a position that harms patients, as Sen. Klobuchar has done on FDA legislation, it helps to persuade other liberal Democrats,” Zuckerman said.

Dr. Margaret Hamburg, head of the FDA from May 2009 to April 2015, said Klobuchar worked on streamlining the process, but was also concerned about conflict of interest issues that could put consumers at risk – sponsoring legislation that required both medical device makers and drug companies to disclose payments they make to doctors and researchers.

Hamburg said others in Congress expressed similar concern.

“There was a great deal of concern about making sure that American consumers were getting cutting-edge medical devices as soon or sooner than anyone else in the world, but also concern about ensuring the safety of those products,” Hamburg said. “She was an advocate and supportive of a number of things that we were doing and she held our feet to the fire to make sure we were keeping our promises.”

That a U.S. senator would work to advance the interests of a powerful home-state industry is not necessarily surprising.

She’s obligated to support “job makers,” said Larry Jacobs, a political scientist at the University of Minnesota. “Every presidential candidate is going to have issues that put them in sticky spots between the national political centers of the party and their constituents back home,” he said.

“I think Sen. Klobuchar has been a very good representative of the state and a leader in Congress in being able to facilitate important conversations around medical devices,” said Shaye Mandle, chief executive and president of the Medical Alley Association, which represents device makers and other health care businesses in Minnesota. “Most states don’t have a medical device industry – every state has millions of patients that rely on medical technology.”


Medical devices provide clear benefits to millions of people, but a yearlong investigation by ICIJ, the AP and media partners in 36 countries has called into question whether the device industry has put patients in harm’s way by rushing poorly tested products to market. Governments around the world, including the United States, hold even complex implants to a lower safety testing standard than most new drugs.

Many devices are implanted near vital organs or pressed against sensitive nerves. If they corrode or rupture, the results can be catastrophic. An entire generation of metal-on-metal artificial hips was discontinued after they were found to rot flesh and poison blood at high rates.

Minnesota is widely seen as the capital of the U.S. device industry. Medtronic, the world’s largest medical device company, has its operational headquarters in Minneapolis. Klobuchar has developed relationships with the company’s leadership – even inviting Medtronic’s then-chief executive to be her guest at Obama’s State of the Union address in 2011.

Hundreds of other device makers have offices in Minnesota and the industry employs nearly 30,000 people in the state. As a result, Democratic and Republican lawmakers from Minnesota have traditionally supported the industry’s interests. Erik Paulsen, a Republican House member who was defeated in November, received more financial support from the device industry over the past 10 years than any other member of Congress.

Legislators from other states with device businesses have also gained reputations as friendly to the industry. Sen. Elizabeth Warren, a Massachusetts Democrat also running for president, has been criticized for omitting medical devices from her tough stance on the pharmaceutical industry. Sen. Bob Casey, a Democrat from Pennsylvania, is a leading recipient of device industry money and has fought for years to repeal a long-delayed 2.3 percent tax on medical devices intended to help fund the Affordable Care Act. Klobuchar has also fought to repeal the tax.

Over the past 10 years, Klobuchar’s Senate campaigns have received more than $300,000 from the device industry, including corporations, unions, political action committees and individuals, according to the Center for Responsive Politics. Among Democrats, only Casey received more money from the device industry during the period.

In a statement, Medtronic said its dealings with government officials are consistent with its mission to alleviate pain, restore health and extend life.

“Medtronic has engaged with Senator Klobuchar on a range of policy issues over the years,” Medtronic said in its statement. “She listens to our positions as one of her constituents, advocates for them when she agrees, and doesn’t when she disagrees.”

There have been times when Klobuchar has spoken out against the industry. In 2016, after the Minneapolis Star Tribune revealed that Medtronic failed to disclose more than 1,000 reports of “adverse events” relating to its Infuse Bone Graft device, Klobuchar wrote Medtronic asking why the company didn’t report the information sooner.

She also criticized a program that allowed device makers to report some patient injuries and product problems years after the fact.

After the newspaper reported more details about Infuse device problems last year, Klobuchar and fellow Minnesota Sen. Tina Smith wrote Medtronic about the company’s “failure to quickly and accurately report data to the FDA.”


In 2010, halfway through Klobuchar’s first Senate term, the device industry became alarmed about a looming report that it feared would lead to heightened regulation – and a slower, and more expensive, path to get new products to market.

After a series of device safety scandals, the FDA had commissioned the Institute of Medicine, a nonpartisan group that advises federal authorities on health issues, to conduct an independent review of its fast-track device approval process.

The process allows companies to get approval for new devices based on “substantial equivalence” to previously approved products. It’s how the vast majority of new medical devices are approved for the American public.

Already worried about a backlog in approvals, a prominent device trade group and its allies in Washington began pressing the FDA to ignore the Institute of Medicine’s findings even before the institute finished its review. In a May 2010 letter, Klobuchar and Paulsen said they were concerned with the review and called for the FDA “to reject proposals that unduly burden small businesses and suppress the development of promising medical breakthroughs.”

In July 2011, the Institute of Medicine concluded that the streamlined approval pathway was flawed and should be dismantled. The FDA quickly dismissed that recommendation.

Three months later, Klobuchar introduced legislation seeking to speed up medical device approvals by reducing the use of randomized and controlled clinical trials for some devices and limiting the amount of information medical device makers needed to provide to the FDA.

The consumer advocacy group Public Citizen denounced the bill, writing to Klobuchar that it would “weaken the already inadequate regulatory requirements for medical devices” and “would undoubtedly accelerate the rate of patient casualties.”

The bill never left the Senate, but some key provisions that required the FDA to take a lighter approach with industry during device approvals and language that eased conflict of interest rules at the agency were ultimately included in the Senate’s version of the landmark Food and Drug Administration Safety and Innovation Act, according to a press release from Klobuchar’s office.

The senator characterized the changes as “common-sense reforms” that would give patients access to vital devices. Obama signed the legislation into law in 2012.

In 2016, Klobuchar introduced another bill aimed at easing device regulation. The Improving Medical Device Innovation Act would have required the FDA to explore alternatives for some device types to existing reporting requirements for patient injuries and device malfunctions “that will be least burdensome for device manufacturers.” These reports are a primary way the FDA learns about dangerous devices once they are already on the market.

The bill also contained a provision to give device companies a voice in recommending which experts the FDA includes on panels reviewing their devices. “This is really noxious,” said Dr. Peter Lurie, who held senior posts at the FDA from 2009 to 2017 and now heads the nonprofit watchdog group, the Center for Science in the Public Interest. “The last thing the agency needs is a bunch of self-interested input from sponsoring companies.”

The Senate bill was never voted on but the provision regarding FDA expert panels lived on. In late 2016, Klobuchar joined an overwhelming majority of legislators to approve the 21st Century Cures Act. Signed into law by Obama, the measure seeks to accelerate product development for drugs and devices and strengthens the requirement that the FDA emphasize the “least burdensome means” for reviewing medical devices.


Woodman reported from New York. Sydney P. Freeberg of the International Consortium of Investigative Journalists reported from St. Petersburg, Florida.

Marks & Spencer Looks To Launch Food Delivery Service With Ocado –

Marks & Spencer is in discussions with online supermarket Ocado that would offer the British retailer a food delivery service for the first time.

“Following press speculation, Marks and Spencer Group PLC confirms that it is in discussions with Ocado Group plc regarding a joint venture in U.K. retail. There is no certainty that these discussions will result in any agreement or as to the timing of any such agreement,” according to a statement on the M&S corporate site.

London’s Evening Standard was the first to report that M&S will pay Ocado between £800 million and £900 million for a 50 percent stake in the venture. The news sent shares in both companies soaring, with Ocado up 10 percent and M&S seeing a 4 percent boost.

Ocado launched online grocery deliveries 20 years ago with Waitrose, but their latest agreement is set to end next year. Sources say that M&S and Ocado are trying to reach a deal before March 1, the deadline for Ocado to activate an 18-month break clause with Waitrose.

Last year, Ocado inked a deal with Kroger to be its exclusive partner in the U.S., giving it an entry in the U.S. market. In addition, the two launched a high-tech customer fulfillment center (CFC) in Ohio in November, and just last week announced that Central Florida and the Mid-Atlantic will be the next regions for two new CFCs. Kroger has committed to building 20 CFCs throughout the United States.

“This announcement marks another important step toward combining Kroger’s long-standing dedication to innovative and world-class grocery services with Ocado’s unique, industry-leading technology,” Luke Jensen, CEO of Ocado Solutions, said at the time. “As the U.S. retail landscape continues to change, these CFCs will play a crucial role in helping Kroger offer its customers a superior online shopping experience in these two major markets.”


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