Modalidades de evaluación: véase el documento UNESCO/OIE/C.49, Inf.3

AND SAY:

1. I am the Canadian Risk and Compliance Director of the State Farm Group in Canada, and also Chief Risk Officer and Chief Compliance Officer of three of the State Farm applicants with respect to the Canadian Business. As such I have personal knowledge of the facts

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to which I depose, except where I have indicated that I have obtained facts from other sources, in which case I hereby state that I believe those facts to be true. All capitalized terms used herein have the same meaning as defined in the accompanying factum unless otherwise indicated.

2. I am swearing this affidavit in support of:

(a) a motion for an initial order approving the form and content of legal notices (“Legal Notices”) to be published twice in the National Edition of Globe and Mail regarding the disclosure by State Farm of the personal information of Affected Persons to Desjardins, as part of the transaction pursuant to the MTA (Master Transaction Agreement) in which Desjardins will acquire the Canadian Business of State Farm; and

(b) an application for a judgment declaring State Farm’s efforts to provide knowledge to Affected Persons of State Farm’s proposed disclosure of personal information to Desjardins are sufficient and that consent as required under PIPEDA has been obtained by State Farm so that State Farm may disclose to Desjardins the personal information of Affected Persons as it relates to the Canadian Business and Desjardins may use that personal information in the future operation of that business.

3. I have worked at State Farm since 1988, and in the Risk & Compliance Department for the past five years. My primary role is to ensure that State Farm’s Canadian businesses comply with all laws and regulations that govern State Farm’s Canadian operations.

- 3 - State Farm’s Operation of the Canadian Business

4. State Farm has operated in Canada since 1938. It currently has more than 500 agents and more than 1700 employees working in Canada to provide insurance and financial services to approximately 1.2 million customers in Ontario, Alberta and New Brunswick.

5. In the ordinary course of operating the Canadian Business, State Farm collects and uses the personal information of its policyholders, financial services customers, employees and other persons. The personal information so collected and used is customary and typical for insurance and other types of companies in the same businesses as is State Farm, and includes information such as names, addresses and telephone numbers, driving records, claim histories, credit information and medical information.

6. State Farm takes its privacy responsibilities seriously and handles personal information of Affected Persons in accordance with its Canadian Privacy Notice (the “Privacy Notice”) in effect during the relevant period. Attached hereto as the following exhibits are copies of the following State Farm privacy policies applicable to State Farm’s Canadian Business:

(a) Exhibit A: State Farm’s current online Privacy Notice, effective September 15, 2014;

(b) Exhibit B: State Farm’s prior online Privacy Notice, effective before September 15, 2014;

(c) Exhibit C: State Farm’s current hard copy Privacy Notice, effective April, 2014;

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(d) Exhibit D: State Farm’s prior hard copy Privacy Notice, effective before April, 2014.

7. The Privacy Notice lists State Farm’s Privacy Principles:

(a) “We do not sell customer information.”

(b) “We do not allow those who are doing business on our behalf to use our customer information for their own marketing purposes.”

(c) “We contractually require any person or organization providing products or services on our behalf to protect State Farm customer information.”

(d) “We do not share customer medical information with anyone within the State Farm family of companies unless:

 You expressly authorize it; or

 It is permitted or required by law; or

 Your insurance policy contract with us permits us to do so.”

(e) “We afford our prospective and former customers the same protections as existing customers with respect to the use of personal information.”

8. With respect to customer information, State Farm’s Privacy Notice provides:

“We maintain physical, electronic, and procedural safeguards to protect customer information. In addition, we regularly review our policies and practices, monitor our computer networks, and test the strength of our security.”

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9. As part of our efforts to notify the Affected Persons, on September 15, 2014 State Farm updated its online Privacy Notice to include an express statement that we would disclose personal information pursuant to any sale of the company’s business: “We reserve the right to transfer any personal information we have about you in the event that we sell or transfer all or a portion of our business or assets to a third party”.

State Farm’s Sale of the Canadian Business to Desjardins

10. On January 15, 2014, State Farm and Desjardins entered into the MTA, relevant excerpts of which are attached hereto as Exhibit E, under which Desjardins will purchase State Farm’s Canadian Business. The closing of the transaction is scheduled for January 1, 2015.

11. Under the MTA, State Farm provided Desjardins with copies of all of its privacy policies concerning the collection, use, retention, destruction and disclosure of personal information. State Farm also warranted that “since January 1, 2011, its collection, use, disclosure and retention of personal information and conduct of business has complied in all material respects with applicable privacy laws”.

12. Under the terms of the MTA and in order that Desjardins may acquire and operate the Canadian Business, State Farm must necessarily disclose to Desjardins information, including personal information, of Affected Persons.

Notice provided to Affected Persons

13. As is described below, State Farm has made a number of efforts to notify Affected Persons both of the transaction and of its intention to disclose their personal

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information to Desjardins, and to obtain consent from our 1.2 million current customers. The purpose of this application to the court is only to address those situations, in which the applicants have not been able to directly notify the Affected Persons. These include archived historical paper records and the personal information of approximately 5,800 current customers to whom notification letters could not be sent or whose notification letters have been returned to sender as undeliverable.

14. On January 15, 2014 State Farm and Desjardins issued a joint press release, a copy of which is attached hereto as Exhibit F, and State Farm published this press release on its website.

15. The press release informed State Farm’s customers and the public generally that Desjardins and State Farm had entered into an agreement under which Desjardins would be purchasing and would be operating the newly acquired State Farm Canadian Business. The press release also noted that State Farm’s 1,700 Canadian employees and more than 500 Canadian agents would continue to serve over 1.2 million State Farm customers in Canada.

16. This press release was carried by several major news organizations in Canada, which published the information regarding the Desjardins’ acquisition and the impact on Affected Persons:

(a) Attached hereto as Exhibit G is an article published by the Globe and Mail on January 16, 2014 by Jacqueline Nelson. In the article Ms. Nelson noted: “State Farm has a network of 1,700 employees spread across Ontario, Alberta and New

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Brunswick. It has been in Canada since 1938 and has about 1.2 million customers here. Desjardins intends to continue operating the company under the State Farm label for an undisclosed period.”

(b) Attached hereto as Exhibit H is a January 15, 2014 article published on the CBC’s website entitled “Montreal’s Desjardins Group takes over State Farm Canada.”

The article stated: “Desjardins, a cooperative financial group with insurance and mutual fund interests, is buying State Farm’s property and casualty and life insurance business, as well as its mutual fund, loan and living benefits portfolio. It said it would continue to operate State Farm’s business under the State Farm name and maintain its network of 1,700 employees”.

(c) Attached hereto as Exhibit I is an article entitled “Desjardins to buy State Farm Canada’s insurance businesses” published by the National Post on January 15, 2014. The article stated: “Once the deal closes, State Farm’s 1,700 Canadian employees and its network of more than 500 Canadian agents will continue to serve more than 1.2 million customers in Ontario, Alberta and New Brunswick, the companies said in a joint statement.”

17. In addition, in January 2014 State Farm sent letters, a copy of the form of which is attached hereto as Exhibit J, to its 1.2 million affected current customers.

18. Five months later, on June 9, 2014, State Farm sent a second letter to its affected current customers. In this letter, a copy of which is attached hereto as Exhibit K, State Farm

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specifically stated that information in the possession of State Farm would be disclosed to Desjardins pursuant to its acquisition of the Canadian Business under the MTA, as follows:

In order to prepare for and ensure a smooth transition, and to provide for the uninterrupted continuation of your products and services, beginning July 9, 2014, it will be necessary for State Farm to transfer to Desjardins Group the personal information associated with your insurance and financial services products and any consents or authorizations (including an authorization to process pre-authorized debits for your payments) previously provided by you to State Farm.

19. Beginning in January 2014 State Farm agents sent personalized letters to individual customers using a template that State Farm provided. The letter, a copy of which is attached as Exhibit L hereto, stated: “Following the closing, our operations will transfer to Desjardins Group and any changes will be clearly communicated to you.” In total, 775,000 letters were mailed to State Farm customers.

20. Since the announcement of the transaction, including the above-noted correspondence, approximately 50 customers have objected to the proposed disclosure of information.

Additional Publication of Information Concerning the State Farm-Desjardins Transaction

21. In accordance with the requirements set out under the Insurance Companies Act (Canada) (the “ICA”), State Farm Mutual Automobile Insurance Company (“State Farm Auto”) and State Farm Fire and Casualty Company (“State Farm Fire”) each published its notice of intention (the “Notice”) to apply to the Superintendent of Financial Institutions

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(Canada) (the “Superintendent”) for approval of the Transaction in each of the Canada Gazette and The Globe and Mail. Attached hereto as Exhibit M are copies of affidavits from the Canada Gazette dated August 20, 2014 for each of State Farm Auto and State Farm Fire confirming proof of publication of the Notices in the August 9, 2014 edition of the Canada Gazette.

Attached hereto as Exhibit N are copies of affidavits from The Globe and Mail dated August 11, 2014 confirming proof of publication of the Notice for each of State Farm Auto and State Farm Fire in the print edition of The Globe and Mail on August 9, 2014.

22. The proposed assumption reinsurance agreement in respect of the Transaction for each of State Farm Auto and State Farm Fire was made available at the chief agency for each company for the inspection of its policyholders for at least 30 days after the publication of the Notice (August 9, 2014 to September 8, 2014) in accordance with subsection 587.1(7) of the ICA.

23. State Farm received no objections to the Notices from any of its policyholders.

State Farm received one question from an agent of State Farm requesting clarification about the Notice and State Farm answered the question to the satisfaction of the agent.

24. State Farm International Life Insurance Company Ltd. (“SFIL”) published its notice of intention to apply to the Superintendent for approval of the transaction in each of the Canada Gazette and the Globe and Mail on September 20, 2014. The completion of the period within which SFIL policyholders may respond to this Notice is October 20, 2014. The proposed assumption reinsurance agreement in respect of the Transaction for SFIL is being made available at the chief agency for SFIL for the inspection of its policyholders for at least 30 days after the

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publication of the Notice (September 20, 2014 to October 20, 2014) in accordance with subsection 587.1(7) of the ICA.

25. A package of information was sent by mail to SFIL policyholders in respect of the assumption reinsurance agreement, explaining the transaction, providing a copy of the Independent Actuary’s Report, and giving information in respect of the Bermuda court filing referred to in the next paragraph.

26. Because SFIL is a Bermuda corporation, it also made application to the Supreme Court of Bermuda approving the transfer by SFIL to Desjardins of the policies issued by SFIL.

SFIL published its notice of intention to apply to the Supreme Court of Bermuda in the Bermuda Gazette and the Globe and Mail on September 23, 2014. The Bermuda Court hearing is scheduled to take place on October 31, 2014.

The Nature and Extent of Personal Information held by State Farm, and the Proposed Notice to be Published in the Globe and Mail

27. To ensure that Affected Persons have knowledge of the proposed disclosure of personal information, State Farm and Desjardins seek to publish two Legal Notices in the National Edition of the Globe and Mail. Attached hereto as Exhibit O is the proposed form of notice to be published. Before the Legal Notices are published, State Farm will have set up, and we will include in the last paragraph of the notices, an e-mail address for Affected Persons to send notices of objection.

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28. There are no other steps that State Farm could reasonably have taken to provide knowledge of the proposed disclosure of personal information to Affected Persons and to obtain their consent. With respect to prior customers, for example, State Farm no longer has an active relationship with any of these individuals and therefore State Farm’s contact information for many of them would be out of date. Any customer whose policies were terminated by State Farm or who had a bad customer experience would likely have no incentive to have their information transferred.

29. The cost of sending the initial January letter to State Farm’s 1.2 million customers was approximately $1.2 million. State Farm estimates the number of returned pieces of mail and of inquiries or complaints would be 25% of its customers, based on a statistic that 22% of Canadian households moved in 2011. This percentage increases with the age of the records. The foregoing does not include the difficulty of personally notifying other categories of persons such as prospective customers, or claimants and other persons related to claims.

30. If State Farm were to disclose to Desjardins the personal information only of those Affected Persons who State Farm is sure have been personally notified, the process of separating that personal information would be extremely expensive and time-consuming. It could not be completed by the closing on January 1, 2015. State Farm uses a centrally managed information retention process for paper records. The process for removing the files of individuals who State Farm cannot be sure have been notified personally would involve generating a file from the relevant systems, comparing that file to the inventory for the boxes and then manually pulling all identified records.

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31. State Farm has 34,406 banker’s boxes of customer information, 27,184 of which are managed at the file level. Each box contains approximately 40 files. The cost of processing these records would be:

(a) $250,000 to “system generate” files and compare those files to the box inventory;

and

(b) $700,000 or 3,500 person days to pull an estimated 10% of the files, label, re-box, and enter them into the inventory system. This would be 108,000 files or 2,700 boxes and is based on an estimate of 15 minutes per file and 30 minutes per box.

32. The remaining 7,222 of these boxes are managed at the box level. Each box contains approximately 1,500 documents. In total, these boxes contain about 11.7 million documents. The process for removing files for individuals who State Farm cannot be sure have been notified personally would involve opening each box, identifying which individuals have personal information in the file, searching for each person on appropriate Systems, and then determining if all the people contained in the file have been personally notified. The cost of processing these records would be:

(a) $140,000,000 or 700,000 person days based on an estimate of 30 minutes per document to review and determine whether it may be disclosed to Desjardins and an estimate that 40% of these files would be pulled since the closed boxes contain information for both active and inactive customers;

Court File No.: 

CERTAS HOME AND AUTO INSURANCE COMPANY, STATE FARM

MUTUAL AUTOMOBILE INSURANCE COMPANY and others