WILLIAM BUSH COMMITTEES STATE REPRESENTATIVE Economic Development, Banking, 29th District Insurance & Commerce, Chair HOUSE OF REPRESENTATIVES Energy, Chair STATE OF DELAWARE Agriculture, Vice-Chair Education 411 LEGISLATIVE AVENUE Judiciary DOVER, DELAWARE 19901 Natural Resources Public Safety & Homeland Security Transportation, Land Use & Infrastructure Veterans Affairs
House Economic Development, Banking, Insurance & Commerce Meeting Minutes
March 16, 2021
Chair Bush called the virtual meeting to order at 1:00 p.m. He stated that the meeting was planned in accordance with HCR 1 and took the roll call of the committee’s members. Members present included Vice-Chair Bennett, and Reps. Griffith, Dorsey Walker, Baumbach, Wilson- Anton, Lambert, Hensley, Ramone, Smith, Spiegelman, and Yearick. For a list of guests present, please see the speaker list below.
Chair Bush introduced HB 111, AN ACT TO AMEND TITLE 18 OF THE DELAWARE CODE RELATING TO INSURANCE DISCRIMINATION BASED ON PRE-EXPOSURE PROPHYLAXIS MEDICATION TO PREVENT HIV INFECTION. He referred to Rep. Heffernan to explain the bill.
Rep. Heffernan introduced HB 11 as a bill which prohibits discrimination against those who take Pre-Exposure Prophylaxis Medication (PrEP) in issuance or renewal of disability, long-term care, and life insurance.
Chair Bush opened the floor for public comment.
Rep. Heffernan stated the Department of Insurance supports the bill.
Sarah Matthews, a physician who provides PrEP services, voiced support for the bill.
Christiana Haas from the Department of Insurance shared the department’s support for the bill.
A motion was made by Rep. Bennett and seconded by Rep. Dorsey Walker to release HB 111 from committee; motion carried. Yes= 10 (Bush, Bennett, Dorsey Walker, Baumbach, Lambert, Hensley, Ramone, Smith, Spiegelman, and Yearick); No= 0; Absent= 3 (Griffith, Bolden, Wilson-Anton). HB 111 was released from committee with a F= 4, M= 5 U= 0 vote.
Chair Bush HB 22, AN ACT TO AMEND TITLE 6 OF THE DELAWARE CODE RELATING TO THE DIGITAL RIGHT TO REPAIR ACT. He referred to Rep. Briggs King to explain the bill.
Rep. Briggs King explained the bill identifies and defines authorized repair providers and digital electronic equipment, and makes contract agreements with companies accessible for parts and prices without exclusivity clauses. She shared a constituent’s experience with not being able
to fix devices as wanted due to inaccessibility of parts, as well as her own difficulties with accessing nearby phone repairs. She noted copyrights are still protected under federal law. She stated authorized retailers may have to purchase parts at a higher price and issues arose with hospitals needing to repair ventilators and not having access to necessary parts in the beginning of the pandemic. She indicated there are potential environmental benefits to this bill.
Rep. Baumbach voiced concerns over the parent potential for mandated release of trade secrets and intellectual property to independent contractors, which could be fixed with appropriate language.
Rep. Yearick shared concerns for the bill’s application to electronics in the healthcare area and a more limited product scope to limit liability.
Rep. Briggs King stated healthcare technicians and engineers have their own credentials, but exclusions could be included.
Rep. Dorsey Walker asked for clarification on changes to lines 41 and 42 of the bill.
Rep. Briggs King stated line 41 and 42 had language about leasing removed, line 61 to 63 were replaced with language from the Attorney General about enforcement, and technical corrections to lines 67 and 68.
At the request of the sponsor, Gay Gordon-Byrne from The Repair Association covered potential benefits of the bill including less environmental waste and an inability for companies to create repair monopolies. She stated she has never uncovered trade secrets with any material she has worked with. She emphasized the importance of consumer choice with repairs.
Chair Bush opened the floor for public comment.
Nancy Hannigan questioned guaranteed access for replacement parts and voiced her support for the bill.
Robert Overmiller voiced his support for the bill.
Manthan Bhatt, on behalf of Advanced Medical Technology Association, voiced opposition to the bill. He stated that servicing of medical equipment is highly regulated by the FDA and existing issues of fraud and patient-risk from third party servicers. He highlighted potential harm from lines 56 and 60 of the bill due to their application to devices such as glucose monitors, pacemakers, and MRIs.
Richard Wilkins, on behalf of the Delaware Farm Bureau, stated his support the bill. He emphasized the importance of consumer choice with repairs and existing knowledge some farmers have to repair their own equipment but are currently unable to.
Lisa McCabe, on behalf of Cellular Telecommunications & Internet Association, voiced opposition to this bill. She stated there are existing repair options for consumers where technicians are qualified and trained with the manufacturer as well as independent party
repairers, although quality is not guaranteed by manufacturers.
Charlie Garlow, on behalf of the Delaware Electric Vehicle Association, stated his support for the bill. He noted the bill reduces waste including broken electronic vehicles and scooters, due to current inaccessibility of repair parts.
Michael Parkowski, on behalf of the Delaware Solid Waste Authority, voiced support for the bill due to high repair costs and inaccessibility of parts. He stated they have data on electronic waste to support the bill.
Sean Looney, on behalf of Comcast, voiced support for the bill and recent amendments on leased equipment.
Markevis Gideon, Founder of NERDiT NOW, voiced support for the bill. He shared NERDiT NOW has given 5,000 computers children since the pandemic began which were going to be thrown away. He stated inflated repair costs for electronics cause hurdles in their mission to help underserved communities.
Tara Ryan, on behalf of Entertainment Software Association, voiced opposition to the bill, due to an unauthorized repair mandate it would create. She stated that providing schematics of game consoles would increase risks for privacy to occur. The Federal Digital Millennium Copyright Act protects video games consoles, ensures copyrighted material remains secure, and makes it illegal to bypass protection measures or to distribute tools.
Duston Brighton, on behalf of the Repair Done Right Coalition, voiced opposition to the bill. He stated the bill increases cybersecurity and safety risks, as some repairs can be dangerous, especially those with lithium batteries.
Coralie Pryde voiced support for the bill and noted the current waste stemming from a lack of access to manufacturer parts.
Dee Durham, on behalf of Plastic Free Delaware, voiced support for the bill because it reduces waste in Delaware. She noted high costs associated with recycling, negative environmental impacts from toxic materials, and unsustainable use of natural resources as other reasons for supporting the bill.
David Marvel voiced support for the bill, noting farm and agriculture needs for immediate access to equipment due to wait times from authorized dealers. He shared the need for accessible repair tools to fix machines in a timely manner.
Lisa Locke, on behalf of Delaware Interfaith Power & Light, voiced support for the positive efforts of the bill to reduce environmental impacts and benefits of extended life fror electronic products.
John Keane, on behalf of the Association of Home Appliance Manufacturers, voiced opposition for the bill. He noted the complex nature of repairs in this industry due to building codes, plumbing codes, gas lines, and potential for property damage. He stated the bill undercuts
consumer protections and undermines safety needed for repairs.
Rep. Lambert noted the lack of language on environmental and sustainability efforts within the bill and encouraged the bill not to be reframed as an environmental bill.
Rep. Dorsey Walker asked the sponsor to clarify language in lines 56- 60 related to medical equipment.
Rep. Briggs King stated repair persons will be given necessary information to reset electronic locks which they may be locked out of in the course of diagnosis.
Rep. Baumbach asked the sponsor if the bill would have necessary amendments made outside of committee.
Rep. Briggs King stated her willingness to make amendments before the bill reaches the house floor.
Rep. Dorsey Walker noted a donation of 100 computers from NERDiT NOW to children in her district.
A motion was made by Rep. Bennett and seconded by Rep. Dorsey Walker to release HB 22 from committee; motion carried. Yes= 12 (Bush, Bennett, Griffith, Dorsey Walker, Baumbach, Wilson-Anton, Lambert, Hensley, Ramone, Smith, Spiegelman, and Yearick); No= 0; Absent= 1 (Bolden). HB 22 was released from committee with a F=1, M=7 U=1 vote.
Chair Bush introduced HB 103, AN ACT TO AMEND TITLE 6 OF THE DELAWARE CODE RELATING TO AUTO REPAIR FRAUD PREVENTION, AND PROHIBITED TRADE PRACTICES. He referred to Rep. Briggs King to explain the bill.
As the sponsor, Rep. Briggs King introduced the bill as one that addresses a public safety issue. She added HB 103 was released from the House Economic Development, Banking, Insurance & Commerce Committee and passed on the house floor last year. She shared that certified servicers unknowingly purchase fraud replacement airbags which may void insurance and warranties. She stated the American Automobile Association, National Intellectual Property Rights Coordination Center, and the Coalition Against Insurance Fraud support the bill.
Rep. Griffith voiced support for the bill.
Chair Bush opened the floor for public comment.
Robert Overmiller voiced support for the bill.
Craig Orlan, on behalf of Honda, voiced support for the bill which prohibits the trafficking of counterfeit and non-functional replacement airbags.
A motion was made by Rep. Wilson-Anton and seconded by Rep. Bennett to release HB 103 from committee; motion carried. Yes= 12 (Bush, Bennett, Griffith, Dorsey Walker, Baumbach,
Wilson-Anton, Lambert, Hensley, Ramone, Smith, Spiegelman, and Yearick); No= 0; Absent= 1 (Bolden). HB 103 was released from committee with a F=3, M=6 U=0 vote.
Chair Bush introduced HB 3, AN ACT TO AMEND TITLE 18 OF THE DELAWARE CODE RELATING TO STANDARD NONFORFEITURE LAW FOR INDIVIDUAL DEFERRED ANNUITIES. He referred to Christina Haas from the Department of Insurance to explain the bill.
Christina Haas explained the bill is a model law from the National Association of Insurance Commissioner which lowers minimum interest rates used by insurers when determining cash values of annuity products. She stated the bill lowers the floor for non-forfeiture amounts.
At the request of the Chair, Vince Ryan from American Council of Life Insurance explained that current law requires insurers to provide contract holders a cash-surrender minimum if contract holders stop making payments during accumulation periods. He stated non-forfeiture amounts are the minimum annuity value adjusted with a minimum interest rate, which the bill lowers from 1% to 0.15% for new business. He noted current interest rates threatens annuity products viability and availability.
Chair Bush opened the floor for public comment.
Rebecca Kidner, on behalf of American International Group, voiced support for the bill.
Jennifer Webb, on behalf of Pacific Life Insurance, voiced support the bill. She emphasized the bill would not amend existing contracts and would only impact low interest products.
A motion was made by Rep. Bennett and seconded by Rep. Baumbach to release HB 3 from committee; motion carried. Yes= 12 (Bush, Bennett, Dorsey Walker, Bolden, Baumbach, Wilson-Anton, Lambert, Hensley, Ramone, Smith, Spiegelman, and Yearick); No= 0; Absent= 1 (Bolden). HB 3 was released from committee with a F=3, M=6 U=0 vote.
Chair Bush adjourned the meeting at 2:30 p.m.
Respectfully submitted by:
A’lece Moore
Speaker List:
• Sarah Matthews • Christiana Haas (Delaware Department of Insurance) • Gay Gordon-Byrne (The Repair Association) • Nancy Hannigan • Robert Overmiller • Manthan Bhatt (Advanced Medical Technology Association) • Richard Wilkins (Delaware Farm Bureau) • Lisa McCabe (Cellular Telecommunications & Internet Association) • Charlie Garlow (Delaware Electric Vehicle Association) • Michael Parkowski (Delaware Solid Waste Authority) • Sean Looney (Comcast) • Markevis Gideon (NERDiT NOW) • Tara Ryan (Entertainment Software Association) • Duston Brighton (Repair Done Right Coalition) • Coralie Pryde (League of Women Voters of Delaware) • Dee Durham (Plastic Free Delaware) • David Marvel (Fruit and Vegetable Growers Association of Delaware) • Lisa Locke (Delaware Interfaith Power & Light) • John Keane (Association of Home Appliance Manufacturers) • Craig Orlan (Honda) • Vince Ryan (American Council of Life Insurers) • Rebecca Kinder (American International Group) • Jennifer Webb (Pacific Life Insurance)
Attendance List:
• Amanda Martin • Anne Marie Green • Bailey Brooks • Bill McGuire • Carol Clapham • Carrie Cole • Cheryl Siskin • Chris DiPietro • Christina Bryan • Christopher Gilrein • DL Legan • Haig Karakashian • Iskeisha Stuckey • James Nutter • Jamie Hastings • Jonathan Patterson • Joseph Fitzgerald • Kathleen Rutherford • Kim Willson • Kristen Killheffer • Laird Stabler III • Lincoln Willis • Linda Barnett • Malcolm Richards • Manabu Kinoshita • Marie Pinkney • Mark Babbitt • Mary Davis • Mary Kate McLaughlin • Michael Parkowski • Monica Beard • Patrick Allen • Robert Trostel • Roger Roy • Roman Battaglia • Shweta Arya • Susan Giacalone • Suzan Abdallah • Tim Johnson
411 Legislative Avenue, Legislative Hall, Dover, Delaware 19901 Office: (302) 744-4351 Fax: (302) 739-2313 Email: [email protected]
3.16.21 House Economic Development Meeting Public Comment
HB 111 (Sponsor: Heffernan)
1. Submitted by The Delaware HIV Consortium | March 16, 2021
HB 22 (Sponsor: Briggs King)
1. Submitted by The Repair Association | March 15, 2021 at 5:34 p.m. 2. Submitted by The Advanced Medical Technology Association | March 15, 2021 at 7:15 p.m. 3. Submitted by Delmarva Chicken Association | March 15, 2021 at 7:26 p.m. 4. Submitted by The Delaware Electric Vehicle Association | March 17, 12:37 p.m. 5. Submitted by Cellular Telecommunications & Internet Association | March 17, 2021 at 1:29 p.m. 6. Submitted by Midwest-SouthEastern Equipment Dealers Association | March 17, 2021 at 1:44 p.m.
HB 103 (Sponsor: Briggs King)
1. Submitted by Alliance for Automotive Innovation | March 11, 2021 at 5:25 p.m.
HB 3 (Sponsor: Bush)
1. Submitted by Delaware Department of Insurance | March 16, 2021
March 15, 2021
The Repair Association Testimony in Favor of Right to Repair HB22 (Briggs-King)
The Repair Association is a 501c6 Trade Association of repair professionals. Our more than 450 members repair, refurbish, resell and recycle electronics. Our members are experts in repair -- from being subcontractors to OEMS in support of their in-warranty or post-warranty programs, to being competitors in repair offerings, to actively buying and selling used equipment, to being the for profit and nonprofit groups that handle harvesting parts for reuse and final processing of the remains.
Summary of Right to Repair Principles
Right to Repair bills are necessary to restore the right of the owner to fix 100% of their purchases. The manufacturer sold it, was paid in full, and transferred ownership at the point of purchase. “Right to Repair” has nothing to do with the technology, size, shape, price or software application. Hardware is tangible property. Licenses are not. Repair of equipment with embedded electronic parts is no longer possible without cooperation from the Original Equipment Manufacturer (“OEM”)
Independence from the manufacturer is critical. OEMs are businesses that can merge, fail, or be bought out. Relying on a promise today for a future that might include better access to repair, as in a voluntary agreement, is tenuous at best. We’ve seen many examples in the tech world of products where repairs are available one day and not the next when ownership changes.
Most modern equipment is designed to be repaired, but the equipment owner is left out of the repair process. This bill returns the owner to their rightful role as owners and not renters. The only requirement of this bill is for manufacturers to make available the same service materials that they created for their own repair technicians to their customers and independent repair businesses.
There are no mandates in this bill on formats, pricing, design, parts availability or method of delivery as we see coming out of Europe. The costs of compliance should be minimal. OEMS can distribute required service materials in any way they prefer.
Impacts of Repair Monopolies:
Total reliance on repair from the OEM and related distribution or dealer networks is not only anti-competitive, but results in significant repair delays. Very few OEMS host enough repair outlets to meet demand which drives consumers into new retail purchases. Scarcity of repair is to the advantage of the OEM and not the consumer. When OEMS control all repair, they also control the retail price of repair regardless of their costs for parts and labor. Repairs are commonly rigged to be unattractive in comparison to a new purchase. Repair monopolies have enormous value to the monopolist -- and everyone should expect they will not willingly agree to allow competition for these valuable services without statute.
It took state law passed first in 2012 Massachusetts to restore competition to repair of automobiles. The reason you can take your Toyota or your Ford to your neighborhood mechanic is because of state legislation. Commercial trucks came to a similar agreement in 2015 -- leading to the absurd situation where a Cummins engine in an over-the-road truck is easily repairable but the same engine in a tractor is not.
The bodies of these products are definitely different, but the electronics are the same. Repairing a broken wire or replacing a burnt out sensor is the same task regardless of the product. There is no technological reason that an auto mechanic can replace a broken sensor in a car but a consumer cannot replace a broken thermostat in a refrigerator.
Active Statute: Unfair and Deceptive Acts and Practises (UDAP)
States have control of general business law, and not the federal government. The auto industry successfully used state consumer protection statutes (UDAP) to address the imbalance of negotiating power between manufacturers and auto buyers. Consumers need the same protections for the same reasons for all of their purchases.
Consumers are not able to negotiate terms and conditions as equals and are helpless when forced to accept unfair and deceptive contracts such as “End User License Agreements” (EULA). EULA are the contracts that change the original rights to repair inherent in ownership law, and modify them to remove those rights. EULA are written to be ignored, and if read, are written to confuse and obfuscate. Further, it has become common for consumers to be “deemed to have accepted” these contracts by simply using the product.
There is no escaping these terms and conditions. This is why legislation is needed to prevent the consumers and businesses from losing important rights of ownership removed unfairly and deceptively in EULA or similar contracts.
Absence of Competitive Options
It is no longer possible for consumers to avoid repair monopolies with their wallets. Continued tech consolidations have reduced the variety of brands, and the obvious financial advantages of monopolized repair have made truly repair-friendly businesses a rarity. Companies can also go out of business, be bought or sold at any time and change policies overnight.
Opposition Positions We have attended multiple hearings over the past few years where opposition from the Association of Equipment Manufacturers (AEM) and the Equipment Dealers Association (EDA) has been provided in both written and verbal form. There are 7 assertions commonly made, none of which apply to the actual legislation.
1. Lost of Proprietary Rights
The first claim we often hear in opposition to Right to Repair (regardless of product) is that manufacturers will lose their “Proprietary” rights. This is demonstrably not true and we see these claims made less frequently. But each state is a new audience so we expect these claims may pop up at any time.
The word “Proprietary refers to a suite of rights that include Copyrights, Patents and Trade Secrets. All of these rights are federal, and as such, off limits to changes in state legislation. Copyrights are rights of distribution, and repair is not distribution. Copyrighted materials are not secret, as is often assumed. You buy a copyrighted book to read it. You cannot make copies and sell those copies. Repair documentation is often copyrighted, which means that the author (manufacturer) controls rights of distribution. Firmware may also be copyrighted, but under copyright law is fully legal to backup and restore for purposes of repair.
Patents are rights of production, and repair is not manufacturing.
Trade Secrets are of no use to repair, and are specifically disclaimed. Manufacturers lose the protection of trade secret law when distributing materials. No manufacturer puts trade secrets, or any other kind of secret, into repair documentation.
Since manufacturers are legally entitled to control distribution of copyrighted materials -- only the manufacturer provides essential repair materials. Legislation is necessary to make it possible for farmers to acquire this information.
2. Repair is complex -- only the OEM has the skills to make repairs
All computerized products are complex -- but repair is not complex. We know this as experts in complex repairs from mainframes to cell phones. Manufacturers design diagnostics, parts, tools, firmware and documentation to make their own technicians efficient as complex repairs are labor intensive. Without the same materials designed by manufacturers to be used to make repairs. Independent or self-repair is impossible and impractical. The impact is that competition is blocked resulting in repair monopolies.
3. Repair materials will enable hackers and nefarious bad actors to do bad things.
This is not possible unless the manufacturer included back doors or other cyber-security holes in their products. Since this is highly unlikely, over the past 7 years we have repeatedly asked opposition for examples so that we can work with our cyber experts to make legislation better, but have never been provided a single example.
4. OEMS will be forced to divulge “Source Code”
This is a very confusing statement since the only code necessary for repair is created by the manufacturer for purposes of repair. Most commonly this means restoring firmware (embedded software) that may have been lost during the repair process or the permissions necessary to match spare parts to the system. There is nothing in this legislation that requests source code.
5. Farmers just want to hack their tractors to avoid emissions requirements
The bill doesn’t change anything about emissions tampering which is already illegal. Emissions laws and regulations are federal, and state legislation cannot pre-empt federal law. With or without Right to Repair, tampering is a real issue but it is not an issue of repair.
Furthermore, farmers are subject to fines and penalties for illegal tampering by the EPA, which has separate requirements for manufacturers or dealers selling equipment which is not approved for purchase in the US. Once sold, the farmer is responsible for her own fines, just as automobile owners are responsible for their own fines.
6. Consumers will be unsafe if allowed to make repairs.
This is highly unlikely as repairs of electronics are far less dangerous in a physical sense than mechanical repairs. With electronics, manufacturers create diagnostics to make problems easier to diagnose. The same diagnostics are used to confirm repairs are complete -- eliminating the worry about an incompletely repaired product running out of spec and wreaking harm.
In the world of complex electronics -- the technician doesn’t determine if the repair is complete -- the diagnostics make that determination. If problems persist even after diagnostics state the repair is complete - that is a serious support defect that can only be resolved by the manufacturer.
For some brands, such as John Deere (tractors), GE (Refrigerators) and Apple (cell phones) there is an additional step for making a complete repair which puts OEMS back in control of the repair, even if the repairs have been made correctly by the consumer or an independent technician. The step is known as “Parts Tying” or “Authentication” where a connection back to the OEM is required to allow the spare part to be recognized by the system. Without authentication/pairing, the replacement part is not functional and the repair is not complete.
We find this puzzling as the step creates a significant delay and extra cost all around without any benefit to the consumer. All the firmware needed to operate the part was already provided in the initial sale. Restoring firmware to a different serial number seems pointless. 7. Modifications
Repair is not modification. The right to modify falls under copyright law and is not altered by this bill. The only purpose of this bill is to restore the option of repair to the owner.
Summary
Repair monopolies are real, they are dangerous, and if left to proliferate -- will not disappear on their own. Businesses won’t be able to treat their investments as assets, won’t be able to borrow against them as collateral, and won’t be able to put them on the books. Everything that was owned will now be a piece of software wrapped in metal -- and will have to be expensed.
This is not what we expect when we buy, rather than rent, things. Manufacturers have not offered any reasons that they alone should be allowed to monopolize the use of their product post-purchase, despite all the obvious impacts of such complex and convoluted repair systems. We do not ask for manufacturers to change their systems, only to cease preventing customers from accessing those systems on fair and reasonable terms.
Respectfully, Gay Gordon-Byrne Executive Director, The Repair Association Repair.org [email protected] 518-251-2837 (office) 201-747-4022 (mobile)
Attachment - Supporter List from The Repair Association 701 Pennsylvania Avenue, Ste. 800 Washington, DC 20004–2654 Tel: 202 783 8700 Fax: 202 783 8750 www.AdvaMed.org
March 15, 2021
onora le Representative William Bush 411 Legislative Ave. Dover, DE 19901
Dear Chairman Bush:
The Advanced Medical Technology Association (AdvaMed), the national association of medical technology providers, is opposed to House Bill 22, right to repair legislation, that could require medical technology providers to share design and repair information.
Medical technology servicing and repair by original equipment manufacturers is highly regulated by the FDA and servicing of these devices is sensitive as it relates to patient safety and device system security. Medical technology manufacturers maintain their own devices or provide repair information to authorized third-party servicers they contract with for device servicing.
Federal Oversight of Medical Devices
FDA’s Quality Systems Regulations (QSR) CFR 21, Section 820, define requirements addressing repair and maintenance of medical devices. QSR requirements govern methods used for the design, manufacture, packaging, labeling, storage, installation, and servicing of medical devices. The requirements are intended to ensure that devices are designed, manufactured and serviced according to established specifications and that quality is built into the product. Under the QSR, device manufacturers are responsible for establishing protocols for servicing of their devices and are required to analyze adverse events and report them to the FDA. Third-party servicing entities, not contracted with by device manufacturers, are not subject to these same provisions.
Patient Risk
There have been cases where failure to appropriately repair medical devices, or not use approved replacement parts, by non-approved third party servicers has put patients at risk. AdvaMed provided FDA with information on January 2018 from six manufacturers who recorded at least 281 adverse events (also referred to as Medical Device Reports or MDRs) from 2012 to 2017 associated with third-party servicing. For some devices (e.g., imaging devices), up to 38,500 patients and/or operators were exposed to the potential for harm. These included the following adverse events representing Actual or potential patient and/or operator impacts from these reports include:
In one example, a serious adverse event occurred after an infusion pump was repaired with a non-approved part, which resulted in an overdose of medication that harmed the patient. In addition, utilizing used X-ray tubes in imaging procedures, such as computerized tomography (CT) and in interventional cardiology may no longer meet manufacturer specifications or may not meet FDA approval requirements.
Finally, for devices that rely on computer software, cybersecurity issues could pose a threat from third party non-credentialed service providers especially where untrained staff or volunteers could obtain access to confidential information that could lead to cybersecurity vulnerabilities.
Conclusion
Thank you for considering our perspective on this complicated issue. Our members bear a significant responsibility to the FDA and individual patients that depend on us to protect the safety and security of medical devices, as well as the sensitive data that they contain. We are committed to working with you to promote digital privacy and security, while resisting dangerous interventions that impact patient safety. For those reasons, AdvaMed opposes B .
Thank you for considering our concerns. Please contact me at [email protected] or 303-718-4367 if you have any questions.
Sincerely,
Manthan Bhatt Director, State Government & Regional Affairs Raising the Bar How OEMs Meet the Highest Standards for Servicing Medical Devices
Proper servicing of complex, life-saving and life-sustaining medical devices is vital to their safe and e!ective functioning. Original equipment manufacturers (OEMs) and their authorized servicers must follow comprehensive FDA quality system requirements to ensure their devices are properly serviced and maintained and continue to meet safety and e!ectiveness standards set by the agency. However, tens of thousands of unregulated third-party servicers do not follow the same FDA requirements, putting patients and device users at risk.
ORIGINAL EQUIPMENT THIRD-PARTY FDA REQUIREMENTS MANUFACTURERS SERVICERS (OEMS)
Quality System Regulation (OSR) (!" CFR %!#) QSRs are documented and approved policies and procedures covering all aspects of a company’s operations, including purchasing of replacement parts and components; personnel training; equipment and facilities maintenance; supplier evaluation; record-keeping; complaint !les; corrective actions; and more. Ensures that all servicing operations are carefully controlled and executed.
Registration (!" CFR 8#$) Companies are required to register the location of their facilities with FDA to enable the agency to inspect their facilities. Ensures that FDA knows who is repairing medical devices.
Medical Device Reporting (MDR) (!" CFR %#') MDRs are mandatory reporting to FDA of any deaths, serious injuries or malfunctions involving a medical device. Ensures that FDA and OEMs know about potentially serious device problems.
Voluntary Recalls (!" CFR $) Recall actions can range from a simple labeling change, to an in-!eld correction or a partial/full removal of the product from the market. This requirement establishes comprehensive procedures to protect the public health from products that present a risk of injury, gross deception or are otherwise defective. Ensures that potential device problems are addressed quickly and e!ciently.
Corrections and Removals (!" CFR %#&) Requires companies to report any action in the !eld to address any risk to health posed by a medical device. Ensures that potential device problems are addressed quickly and e!ciently. All Rights Reserved • ©"#"# The Advanced Medical Technology Association
Third Party Servicing of Medical Devices
Issue To ensure the continued safety and effectiveness of devices, AdvaMed believes all device servicing should be subject to FDA regulation and oversight via key elements of the Quality System Regulation (QSR). FDA has stated “quality systems … help ensure that …products consistently meet applicable requirements and specifications.” Original equipment manufacturers (OEMs) are already subject to FDA regulation via the QSR, including their servicing activities. To ensure patient safety, FDA should regulate third party servicers.
Evidence of Patient and Operator Harm AdvaMed has shared information with FDA from six manufacturers who recorded at least 281 adverse events (also referred to as Medical Device Reports or MDRs) from 2012 to 2017 associated with third party servicing. For some devices (e.g., imaging devices), up to 38,500 patients and/or operators were exposed to the potential for harm. Going forward, when forensic evidence provides justification, AdvaMed member companies will continue to identify and attribute MDRs to third party servicers.
Actual or potential patient and/or operator impacts from these reports include: • Screwdriver tip lodged in patient • Operator injury, counterpoise support system arm (80-93 pounds) struck operator • Potential for repeat CT scans and contrast administration with concomitant risk of additional radiation exposure • Potential for burns including internal or oral 3rd degree burns which may not be apparent until burning tissue is sensed • Delayed surgery (potential for worsening patient condition) • Prolonged surgery (may result in longer exposure to anesthesia, greater potential for infection, and more blood loss) • Potential for concussions and/or fractures • Infusion therapy - Air in System – potential harms include death, neurological changes, stroke, seizures, cardiac and/or respiratory arrest, pain, decreased oxygenation, arrhythmia, pulmonary hypertension • Delays in infusion therapy with delay of pharmacological effects and/or worsening of condition including death • Insufficient or excessive infusion therapy or interruption of therapy and/or worsening of condition including death • Temporary hearing loss; ringing in ears
Third Party Servicing Lacks Transparency and Accountability Third party servicers are not required to mark the devices they service or to identify the components they use in repair of devices. As a result, the end user may not be aware a device failure or patient injury was associated with third party servicing. Problems associated with third party servicing are frequently attributed to the OEM because it may not be clear which device parts were serviced, whether replacement parts including software, met specifications, and whether servicing or parts 1 changed the configuration of the device. A device may pass functional testing and operate normally in a normal mode but when it is operated at its edge conditions, untested configurations may stress the component or timing interactions causing unpredictable device malfunctions resulting in patient injuries.
In addition, third party servicers are not required to submit adverse events associated with devices they repair to FDA. OEMs are required to submit MDRs and have been instructed by FDA to report any adverse events associated with third party servicing as their own MDRs. As a result, safety and performance issues associated with third party servicing are hidden from view.
Access to Manuals, Specialized Tools and Diagnostic Software Some third party servicers have argued the problem would be solved if they are provided “reasonable access” to OEM service manuals, diagnostic software, specialty tools and/or training. However, sharing manuals, specialized tools or software does not ensure the servicing is done correctly if basic QSR tenets are not followed (e.g., such as ensuring training of personnel, evaluating parts suppliers, calibrating tools and maintaining records of such, and maintaining device service and preventive maintenance records, etc.). As an example, some OEMs train service personnel to service specific product lines and training on the product line may require three months or more with periodic recertification required (e.g., every two years).
Applicability of Existing Quality Standards Others have argued that third party servicers’ compliance with quality standards such as ISO 13485 is sufficient. However, compliance with standards is voluntary and FDA does not currently inspect to ensure that third party servicers are appropriately complying with the standard.
Impact to Health Care Costs Some have argued that OEM service contracts increase health care costs and that OEMs use service contracts as a profit center. Third party servicers’ failure to adhere to basic quality requirements can actually increase overall healthcare costs. As an example, in one particular case study, when the OEM resumed servicing from a third-party servicer, there was a 470% increase in the number of needed replacement parts, a 121% increase in needed service calls, and a 177% increase in the total hours of spent repairing the devices in order to bring the devices up to performance requirements.1 Among other issues, the inadequate third-party service repairs lead to increased device downtime and increased cost to the health system.
Addressing Concerns Regarding Regulatory Burden and Anti-Competitive Behavior It’s important to understand that many OEMs also act as third party servicers to other OEMs and comply with QSR. OEMs also rely on contracted third party servicers to meet their own servicing needs. For these reasons, AdvaMed believes high quality third party servicers are needed to ensure sufficient device servicing capacity.
FDA QSR requirements are flexible, scalable and feasible for any company to meet – regardless of size – to ensure the continued safety and effectiveness of devices. For this reason, we believe all companies, OEMs and third parties alike, should be QSR compliant.
1 Based on an analysis conducted by one company. Comparisons in this case were between equipment continuously maintained by the OEM versus equipment maintained by the third-party servicer. 2
The QSR covers the entire device lifecycle from device design, manufacturing and installation to servicing. Importantly, the QSR is risk-based and scalable – it applies to all device manufacturers – no matter their size – from the very smallest to the largest company. Small device companies – some with extremely limited numbers of staff – are not allowed to exempt themselves from QSR compliance. Importantly, QSR compliance is understood to be a required fundamental of doing business in the device sector. FDA has stated “quality systems … help ensure that …products consistently meet applicable requirements and specifications.”
Precedent for FDA Regulating Third Parties There is precedent for regulating third parties engaged with devices to ensure patient safety. In the Medical Device User Fee and Modernization Act of 2002 (MDUFMA), Congress required FDA to regulate reprocessors who cleaned and reprocessed single use devices, including requiring that they the mark devices they reprocessed with their name.
AdvaMed Recommendation At a minimum, to ensure patient safety, AdvaMed believes FDA should issue formal regulations vis a vis third party servicing outlining the following: • Require third party servicers to register and list with FDA • Require third party servicers to establish a Quality Management System that is scaled to the products and types of servicing they conduct as required by the QSR • Clarify that FDA will routinely inspect third party servicers for compliance with the QSR • Require third party servicers to report MDRs – Ensure that MDR codes include identifiers for third party servicers
3
Educate. Advocate. Innovate.
Date: March 15, 2021 To: Members of the House Economic Development/Banking/Insurance & Commerce Committee From: Holly Porter, Executive Director Re: HB22 – Digital Right to Repair Act - SUPPORT
Delmarva Chicken Association (formerly Delmarva Poultry Industry, Inc.), the 1,600-member trade association representing the meat-chicken growers, processing companies and allied business members on the Eastern Shore of Maryland, the Eastern Shore of Virginia, and Delaware supports HB 22 and encourages a favorable committee report.
HB 22 would require that a manufacturer make parts, tools and updates available for the consumer or repair shop to purchase on fair and reasonable terms.
Modern agriculture has become more reliant on technology than ever. From tractors with auto-steer, to sprayers that use GPS to map the fields to controllers in chicken houses that monitor the exact temperature and windspeed, technology is improving farmers day to day.
However it is extremely important for farmers to have the ability to repair their own equipment, or have quick servicing. A farmer’s window to plant the crops or fix equipment that will impact the health of the birds is very limited and cannot wait for days for the manufacturer to send the correct part or schedule an appointment with a service person from out of the area. Farmers across Delaware are embracing technology as they know the importance not only to the bottom line, but also to improvements in best management practices and welfare. But farmers also wear many hats, and repair man is just one of them – as long as they are allowed that ability.
With those reason, we would urge a favorable report on HB 22.
Should you have any additional questions, please feel free to contact me at [email protected] or 302-222-4069.
16686 County Seat Highway | Georgetown, DE 19947 | 302-856-9037 | www.dcachicken.com | Testimony of DEEVA, the Delaware Electric Vehicle Association A chapter of Electric Vehicle Association of Greater Washington, DC, a non-profit educational organization
In favor of HB22 Right to Repair Bill
DEEVA is an educational organization of Delaware electric vehicle owners, drivers and “wannabes” dedicated to promoting the many benefits of electric vehicles (EVs).
DEEVA supports HB 22 as it is good for the environment, good for consumers and good for small businesses. This bill is needed as part of the world-wide effort to reduce and eliminate waste going to landfills. Our nation is plagued by huge volumes of electronic trash going to the dump. Part of that electronic trash are electric scooters, electric bicycles, electric motorcycles and electric cars, all of which could be repaired so they would not be thrown out or taken to the junk yard so early. Electronic trash can be dangerous, if the batteries are hard to remove and or mistreated. Batteries have been known to burn and explode. We need to make them easy to move.
HB22 would require electronic equipment manufacturers to make available at reasonable cost such tools, parts and manuals. This allows small business repair shops and shade tree mechanics, like me, the chance to repair our own gear, rather than be at the mercy of giant electronics companies, who have too often shown little interest in making their products easy to repair. Planned obsolescence may be profitable for large companies, but it is not good for the Earth or consumers or small businesses.
I was raised by parents who grew up during the Depression and we were always encouraged to “use it up, wear it out, make do or do without”, to be frugal and Do It Yourself (DIY) to fix your gear.
Some opponents of this bill suggest that DIY repair can void the warranty. That may be true, but the warranty on my MacBookAir laptop computer is one year. So that doesn’t persuade me not to use a DIY approach. On day 366, I must pay full fare, but I would rather use one of the small business repair shops in Sussex County rather than drive to Wilmington or out of state to find an authorized repair shop.
Testimony of Lisa McCabe CTIA Opposition to House Bill 22 Before the Delaware House Economic Development, Banking, Insurance & Commerce Committee March 16, 2021
Chair Bush, Vice Chair Bennett and members of the Committee, on behalf of CTIA, the trade association for the wireless communications industry, I am here to testify in opposition to House Bill 22. CTIA’s members include wireless service providers, infrastructure providers, suppliers and manufacturers.
The marketplace already provides a wide range of consumer choice for repair with varying levels of quality, price and convenience without the mandates imposed by state legislation.
This legislation would harm the marketplace by weakening the relationship that manufacturers have with authorized repair facilities and provides no protection or quality assurance for consumers.
For example, manufacturers have relationships with authorized repair providers. These providers – which include local small businesses – have received the appropriate training from manufacturers and have the qualifications to help ensure that repairs are done properly and safely.
Manufacturers want to make certain the repair providers they work with understand the numerous components of the electronic products being repaired. Their authorization to perform repairs ensures that the changes made to the devices are compatible with current technology and the networks on which they operate.
Manufacturers also prize consumer brand loyalty and have gone to extraordinary lengths to establish that the devices they produce are of the highest quality. Authorized repair ensures those products maintain that high quality and guarantees that repairs meet the manufacturer’s standards.
In addition to authorized repair providers, manufacturers may offer walk-in repair options at retail as well as mail-in services. Insurance providers may also offer repair options, including authorized third party remote technicians that will travel to the consumer to perform repairs.
1400 16th Street, NW · Suite 600 · Washington, DC 20036 · www.ctia.org
Moreover, consumers can currently avail themselves of numerous independent repair alternatives although manufacturers cannot guarantee the quality assurance of independent repair providers.
To further address the repair marketplace, CTIA recently launched two programs related to repair, the Wireless Industry Service Excellence (WISE) Technician Certification Program and the WISE Authorized Service Provider (ASP) Certification Program.
The WISE technician program educates and tests wireless device repair technicians on industry-recognized standards, certifying those that meet the highest standards for service quality and technical skill. The first certification of its kind, WISE-certified device repair technicians provide consumers with a predictable, high-quality repair experience.1
The WISE ASP program creates a network of certified retail locations, helping consumers identify qualified providers that meet the highest standards for service quality and wireless device repair.2
Both programs were created by CTIA’s Reverse Logistics and Service Quality Working Groups, which convene members representing the entire reverse logistics community to address the wireless industry’s challenges and develop requirements for industry-recognized standards in repair and refurbishment of wireless devices.
CTIA is also concerned that this legislation would have a number of unintended consequences for the security and operation of electronic devices. Legislation mandating the sharing of important and proprietary information regarding how electronic products operate, specific schematic diagrams and service code descriptions could weaken cybersecurity on devices and potentially harm the security of devices and the networks themselves.
Cyber criminals could more easily circumvent security protections, harming not only product owners but also everyone who shares their network. In an era of sophisticated cyberattacks, we should not make it easier for cyber criminals to hack security protections.
In addition, even if an independent repair provider is provided the technical information mandated under this bill, without specific training on reassembling a device, the provider could unintentionally cause antenna performance problems, stress on the device’s frame, heat buildup or degradation of water tightness.
For these reasons, CTIA asks that you not move this legislation.
1 https://www.ctia.org/news/ctia-launches-technician-certification-program 2 https://www.ctia.org/news/ctia-launches-retail-certification-program-for-wireless-device-repair
December 14, 2020
Hon. Ruth Briggs King CC: Hon. David Wilson 411 Legislative Ave. Via Email: [email protected] Dover, DE 19901 Via Email: [email protected] CC: Hon. Richard Collins Via Email: [email protected] CC: Hon. Brian Pettyjohn Via Email: [email protected] CC: Hon. Edward Osienski Via Email: [email protected]
Dear Hon. Briggs King:
Our coalition is unified in opposition to HB 22, which would allow for unfettered access to the software that governs safety, security and, in the case of engine-powered products, emissions technology on many products manufactured and sold by coalition members. The proposed legislation serves special interests and does not meet the needs of the general public. Furthermore, if enacted, such legislation could pose serious safety, security and environmental risks. Our industries and customers have a shared desire to minimize downtime and maximize productivity. That is part of the reason why our broad coalition has invested so much capital in cutting-edge proprietary innovations that incorporate the latest technology, training and support for end users.
Proponents of so-called “Right to Repair” legislation are advocating unfettered access to the software that governs safety and emissions features incorporated into products sold by coalition members. Giving access to the source code will undermine manufacturers' innovation and intellectual property rights, increase the risk of unlawful tampering that run afoul of applicable safety, security and emission requirements, and pose potential corporate reputational risk due to damage from modifications by untrained service personnel. Modifications also create liability issues for original equipment manufacturers (OEMs), who may remain responsible for the safe and efficient operation of their products. In addition, the proposed legislation puts dealers who subsequently trade-in or refurbish modified equipment for resale, as well as subsequent owners--who may not even know their equipment is modified-- at risk.
Our coalition members do not believe that proprietary software, developed specifically for the safe operation of equipment that meets strict government regulations, should be used to “legalize” tampering. In 2020, at least twenty-six (26) states rejected so called “Right to Repair” legislation because of these substantial concerns. We urge you not to take up HB 22 for consideration, and if it is, we ask you to vote NO. Doing so will protect your constituents from risky equipment modifications that may circumvent safety and environmental regulations and create security risks. You can find more information on the website www.illegaltampering.com.
Sincerely,
Associated Equipment Distributors National Hispanic Landscape Alliance Association of Equipment Manufacturers National Marine Distributors Association Deep Southern Equipment Dealers Association National Marine Manufacturers Association Diesel Technology Forum Northeast Equipment Dealers Association Truck & Engine Manufacturers Association Outdoor Power Equipment Institute Equipment Dealers Association Outdoor Power Equipment and Engine Service Association Equipment Leasing and Financing Association Pioneer Equipment Dealers Association Far West Equipment Dealers Association Portable Generator Manufacturers Association International Snowmobile Manufacturers Association Power Tool Institute Iowa-Nebraska Equipment Dealers Association Professional Grounds Management Society IPC PRBA - The Rechargeable Battery Association Marine Retailers Association of the Americas The Remanufacturing Industries Council Midwest-Southeastern Equipment Dealers Association United Equipment Dealers Association Montana Equipment Dealers Association Western Equipment Dealers Association National Association of Landscape Professionals
March 11, 2021
The Honorable William Bush Chair, House Economic Development/Banking/Insurance & Commerce Committee State Capitol Dover, DE 19901
Dear Chair Bush and Honorable Members of the committee:
I am writing on behalf of the Alliance for Automotive Innovation1 (Auto Innovators) to express our support for HB 103, which seeks to prevent the trafficking of counterfeit supplemental restraint systems and nonfunctional airbags.
Supplemental restraint systems, commonly referred to as airbags, are one of the most important safety features of today’s automobile. These devices have saved countless lives and reduced the severity of injury of those involved in automobile accidents an immeasurable number of times.
Counterfeit airbags present a serious public safety risk to consumers. Counterfeit airbags are known to malfunction by either failing to inflate or by inflating but expelling dangerous shrapnel. We believe regulation of counterfeit airbags will play an important role in maintaining the integrity of this life-saving device.
The United States has been inundated with counterfeit supplemental restraint systems and nonfunctional airbags that are sold across the nation and have resulted in serious injury and death to motorists. The significant majority of these airbags are imported from China, sold online and then installed in the vehicle of an unknowing consumer. While federal authorities have been highly supportive of efforts to stop the flow of these oftentimes-deadly products, federal authority to prosecute is limited. Federal authorities can only act in defense of federal trademark law, and because many of the airbags do not carry a registered trademark, the counterfeit airbags and supplemental restraint systems cannot be seized.
1 Formed in 2020, the Alliance for Automotive Innovation is the singular, authoritative and respected voice of the automotive industry. Focused on creating a safe and transformative path for sustainable industry growth, the Alliance for Automotive Innovation represents the manufacturers producing nearly 99 percent of cars and light trucks sold in the U.S. The newly established organization, a combination of Global Automakers and Alliance of Automobile Manufacturers, will be directly involved in regulatory and policy matters impacting the light-duty vehicle market across the country. Members include motor vehicle manufacturers, original equipment suppliers, technology and other automotive-related companies and trade associations. The Alliance for Automotive Innovation is headquartered in Washington, DC, with offices in Detroit, MI and Sacramento, CA. For more information, visit our website http://www.autosinnovate.org.
1050 K Street, NW Suite 650 Washington, DC 20001 AutosInnovate.org
To combat this problem, automakers and other interested stakeholders have worked to support federal and state law enforcement investigations and prosecutions, and worked to pass state laws that give law enforcement the tools they need to prosecute these bad actors.
Similar legislation has successfully passed in 26 states and we urge you to give law enforcement in Delaware the same tools. If I can answer any questions or provide any further information, please do not hesitate to contact me at 202-326-5562 or [email protected].
Thank you for your consideration.
Sincerely,
Josh Fisher Director, State Affairs
Comments from Christina Haas, DOI House Economic Development Committee Meeting 3.16.21
This is a model law from the National Association of Insurance Commissioners which lowers the minimum interest rate guarantee an insurer can use when determining the cash value of an individual fixed annuity from 1% to 0.15% for annuities purchased in the future. Again, this lowers the floor for the nonforfeiture rate, but not the actual rate, which will still need to be filed with and approved by the Delaware Department of Insurance. For those of you who may not know, the National Association of Insurance Commissioners, or the NAIC, is a 150 year old organization that every state and several US territories participate in, and the model law went through multiple committees prior to a vote by insurance commissioners throughout the country to make this a model law. We will see this enacted by states across the country this year.