Vermont Legislature SmartTranscripts:

[Michael "Mike" Marcotte (Chair)]: Good afternoon, everyone. This is the Vermont House Committee on Commerce and Economic Development. It is Tuesday, 01/06/2026 at, 02:03 in the afternoon. So we're back from a short break, and now we're here to, number one, have an introduction to the commissioner by Samsung. He's a new seven month new commissioner at the EFR, Department of Financial Regulation. And we'll be talking with him and with Joe Valentini about the franchise report that we asked EFR and safe office to kind of take a look at and get some recommendations and thoughts how we move forward with that. So, Commissioner, if you'd like to join us, I don't know, Joe, if you wanted to join, maybe you can use Jonathan's chair. Commissioner, welcome. Thank you. Thank you for coming in. Just so I think before we start with you chatting with us, we'll just have I'll have everybody introduce themselves to you. Probably not know everybody. So again, Mike Marcotte and from Coventry, I'm chair of the committee.

[Edye Graning (Vice Chair)]: Edye Graning from Jericho, representing Jericho and Underhill, and the vice chair

[Abbey Duke (Member)]: of the committee. I'm Abbey Duke. I'm from Burlington.

[Kirk White (Ranking Member)]: Herb Olson. Crystal Lincoln, Monkman Starkville.

[Emily Carris Duncan (Member)]: Emily Carris Duncan representing Wilmington, Whitingham, Jacksonville, Saladettes.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: Okay. I didn't know we had a Jacksonville.

[Emily Carris Duncan (Member)]: We do. It's the tiniest little thing. It's in it's in the Whitingham doughnut.

[Kirk White (Ranking Member)]: Okay. Didn't know it was I in got a donut. Good afternoon. My name is Jonathan Cooper. I represent the Bennington 1 District in the Southwestern corner of

[Jonathan Cooper (Member)]: the state. I live in Powell, and the district also includes Searsburg, Reedsboro, Woodford,

[Jonathan Cooper (Member)]: and one other town, Stamford. Glad I got it.

[Michael "Mike" Marcotte (Chair)]: Dave Bosch from Clarendon Springs representing Longford, Clarendon, West Rutland, and the larger part of Rutland County. Okay. Tony Micklus representing the Route 7 corridor of Milton and a little bit of Georgia.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: Okay. Michael Boutin, Bear Boy. City.

[Michael "Mike" Marcotte (Chair)]: Michael.

[Kirk White (Ranking Member)]: Kirk White representing Bethel Rochester, Stockbridge, and Hancock, and the ranking member. Anna Grace.

[Abbey Duke (Member)]: Anna Grace.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: Queen of the committee. Nice. Corner. Nice to meet you all and some of you again. I'm Kai Samson, commissioner of of the Department of Financial Regulation.

[Joe Valenti (Director of Policy, DFR)]: Joe Valenti, director of policy at EFR.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: So some of you I I know from before. Just a brief bit of history that, my first state job was actually at the state auditor's office when Randy Brock was, state auditor. And then from there, I moved to what was then Bishka, and Herb Olson was the general counsel at the time, I believe, when I started there. Yeah. Yeah. 2005. So Good.

[Michael "Mike" Marcotte (Chair)]: That's a lot of fun.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: Yeah. It's a

[Michael "Mike" Marcotte (Chair)]: lot of fun.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: It continues to be. And, of course, as you know very well, we have banking securities insurance and the captive division, but served for three legislative sessions, not quite three full years as tax commissioner when governor Scott was elected and then moved up to National Life Insurance Company where I met representative Putin briefly and did internal audit up there and recently came back when I saw the commissioner job opened. And I always loved the department. I love the intersection of I'm a CPA. So very interested in finance and and the intersection of finance and public policy. So obviously, that's put me in certain places like auditors, office tax commissioner, and DFR. So that's that's my background. So new in this latest iteration, but certainly not new to state government. Would you like a Joe introduction as well? Okay.

[Joe Valenti (Director of Policy, DFR)]: Sure. So Joe Valenti. I started in April, a week after commissioner Samsung. Not new to financial regulation. I've most of my work experience has been federal. Spent fifteen years in Washington, DC and around there. Spent time at the Treasury Department. I had spent time doing research and advocacy at the Center for American Progress and at AARP. And most recently, I was at the Consumer Financial Protection Bureau for three years. Most of my work has been around financial services and really how it connects with regular people and communities and lots of work on low income communities and community involvement, things like that as well. Had also worked at one point in New York City government many years ago.

[Michael "Mike" Marcotte (Chair)]: Great. You're welcome.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: Thank you. Thanks for having us. I understand we're the last on the agenda.

[Michael "Mike" Marcotte (Chair)]: Sure. That's good. We have

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: a three hour presentation, so that should be great. No slides. Yeah. The report, which really isn't a report, was a request from chair Marcotte to look into, you know, the franchisor franchisee relationship. The reason I made sure Joe was with me today is, frankly, Joe did most of of the work looking into that, kept me up to date as that was ongoing. I'd like to kinda turn it over to Joe after just kinda opening it up with my perspective on it is, you know, we you'll hear Joe reference, we have limited information, and and that even goes for many of the states that that do have regulation. There's limited information and limited complaints. So some of the questions chair Marcotte posed, like, should we put in an infrastructure or a regulatory regime? We kind of I think the takeaway is we really don't have a lot of data. We were only really able to talk to one individual who had a grievance. And I think it does kind of raise that overall question of which Joe is is pretty eloquent about discussing that we we do a good job in regulation of protecting consumers, individuals. But when it comes to business to business transactions, we kinda broad brush stroke that and say, well, it's sophisticated investors or it's sophisticated people or, you know, a business can hire an attorney to review a franchise report. Might be an opinion not not report, contract. So there's more availability or expectation of protecting oneself or or caveat emptor in the business world. Not that that's the right balance of where to be, but it's certainly pervasive throughout financial. Well, actually, all kind of protection, but certainly financial regulation where there's a different tier of reporting requirement, protections, know, things that aren't allowed when it comes to a business versus a consumer, and it's pretty obvious why that would be. But when it comes to business to business transactions You know? So another word of way of saying it's it's a fair question. You know? Is there harm here? We know at least one case, and we know in other states, they've done things, and Joe will go through that. But the question is, is the is the juice worth the squeeze in terms of what it would take? And and I think we can't give you an opinion on that until we see more data. I will share that Joe has taken to Vermont very well because when I said that, he said was the was the Sapworth the tap Sapworth the tap.

[Joe Valenti (Director of Policy, DFR)]: Nice. He's

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: lived here since since third grade, and

[Joe Valenti (Director of Policy, DFR)]: I'd never heard that one.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: So he's already well ahead of you probably knew that it Jacksonville. Probably knew that too. So Joe's a master of Vermont trivia already. But, anyway, so so with that, I'd you know, if you wanna I mean, you've all seen the letter, the report the report. But Yes, take it away and go through it. Sure. So there

[Joe Valenti (Director of Policy, DFR)]: are a few things I'll highlight, and then, you know, we're more than happy to take any questions that you have. You know, I did want to be upfront, and I think we were upfront in the letter, just about the limited information that we have. And when we spoke with the secretary of state's office, it was very similar that we're both you're trying to wrap your head around something that you can't really see or touch your research the same way you can with other kinds of products. So there's no way that we can identify franchises unless you were going to just go down the street and identify the various chains. And even then, you don't know if it's There's a single owner who has a whole bunch of franchises of a certain business, or if some of them are owned by the parent company and all of that. Even business registrations don't tell us if a business is a franchise, and if it is, who would be franchisor is who's affiliated with that business? So one thing to consider if the Secretary of State's office were amenable to it, it would probably involve some cost and technology, be to find a way to capture that information in business registrations, just to have a better sense of what we are dealing with. So we don't have very much that is specific to Vermont. Most of what we were able to find is national. The Federal Trade Commission had a rule on non competes that it finalized in 2024 and then withdrew earlier this year. There was some litigation over that. The FTC rule only applied to employer employee relationships, but they considered whether the franchisor franchisee relationship should have limitations on non competes as well. And so there's a lot of public comment on that topic on both sides, lots of arguments back and forth. So we were able to review that. We also were able to review one contract from a federal court class action lawsuit involving the franchisor Dickies barbecue pit. And we only know about this contract. A lot of these contracts are confidential. It was a class action lawsuit by two franchisees. One was in Ohio, I believe. The other was in Idaho. They both felt that things were misrepresented when they entered into the contract, that it didn't perform as anticipated. They filed a class action. Ultimately, that lawsuit ended up in arbitration. But because the class action was filed, the contract and all the documents are public. So we did look at that. Of course, if you've seen one contract, you've seen one contract. We have no idea if the various terms and conditions in that contract are similar for other franchisors, but it does provide a little bit of a window into what may go on.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: If I can interject, I think one question I asked Joe based on his research was, you know, how much of the either known or or, I guess, is the known harm from talking to other states, you know, How much could be prevented with proper legal review by the franchisee before signing a contract? Not legal review to see what's legal or but advice to say, Okay, you know when you're signing this, you are giving up your right to ABC. If there's a dispute, you have to go to another state, you know, things like Arbitration. Or go yeah. Go to arbitration. So but we don't I I think we don't know the answer to that. Right? Because we don't have a good even in some of the states that have regulation, the complaint volume was quite low. Think that's mentioned in the letter. Right.

[Joe Valenti (Director of Policy, DFR)]: And part of that too is that so these are contracts that are, to our knowledge, are often take it or leave it on the part of the franchisee, that they're not able to negotiate those terms. And sometimes, and this was true with the one franchisee who spoke with us as well, sometimes those terms do change. For example, the various fees that are charged at a franchisee may pencil out at one point in time, and at another point in the future, the franchisor may change what those fees are, and that could be detrimental to business. Now, some of that could just be the price of various goods or materials. If you have a burger business and the price of beef goes up, then that relationship is going to change, and those cost pressures are going to be there. So those are sort of the limitations of what we've seen. We did identify sort of two different paths that the committee could choose to take, depending on additional data. One of those would be to have some type of franchise or registration program. The other would be to identify the specific harms in the contracts and to seek to outlaw those specific harms. A number of states, I'll talk about that one first, number of states will limit, for example, non competes at the end of the contract. They may limit prohibitions on free association between franchisees. In some situations, franchisees may not be allowed to talk to each other about various topics, and this is something that state laws would address. Sometimes there are state laws about choice of law or venue regarding how disputes might be handled. So it might be possible to focus in on those specific practices. That would, of course, be enforced through the courts and not through us as an agency. And again, that would take some time to figure out what those specifics are. And of course, there's always the risk that some franchisors might choose not to operate under certain conditions. In terms of registration, there are 14 states that currently have some type of registration program for franchisors through NASA, which is not space and rockets and satellites in the DFR world. It's the North American Securities Administrators Association, so an extra A on the end. If you're familiar with the NAIC, the National Association of Insurance Commissioners, it's a similar body in the securities world. And so there are 14 states that have some type of a program. And of those, we were able to talk to folks at four of them to hear how they operate, how it's working. And just to give you an example of how resource intensive this could be, Rhode Island, which is a fairly comparable state to us, has one full time employee whose only job is to process the franchise or filings that they get every year. And so that's a considerable amount of effort. There can be hundreds, if not thousands, of these filings in a given year. And that is really just to look over the disclosures and make sure that everything is complete. If you were looking at doing what's considered a merit review, where you are actually looking at the real details in these disclosures and trying to make determinations, Maryland is one state that was we did not talk to Maryland, but they were directed to us as a state that does a fairly comprehensive review, and we've seen they've done some enforcement in this space. Then you need greater staff and resources to make that And so we just want to level set around the challenges there. To put it in context, we currently have seven people in the entire securities division, and the corporate finance position that normally deals with these kinds of issues is currently taking. So it wouldn't be a fairly large Well,

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: to to be clear on that, we don't deal with these type of issues now, but the corporate finance position that might be well suited for for you

[Joe Valenti (Director of Policy, DFR)]: know, that type of work.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: But Right. And so I should have said at the outset what I hope you know, we are not experts on or or even novices on franchise or franchisees. So you know, which is not to say that we can't get there, you know, if if that's what the legislature decides in terms of staffing and expertise. Certainly, 14 other states have have gotten there. And through their securities division, I was kind of surprised that, you know, when the when the letter first came, I was like, with with this even BS, this would be attorney general, or this would be secretary of state from a registration, if not just private attorneys. You know, this is contract law. But yeah. So I was surprised, but, you know, good to have the data that it it does live in in the DFR equivalents Right. At at least 14 other states.

[Joe Valenti (Director of Policy, DFR)]: And to be clear, in some states, the securities division is within a financial regulator. In some states, it is within the security of state the secretary of state or the AG that every state just like we have all four of our divisions in one body, and that is you know, other states have chosen to break them up in different ways. But state securities does seem to be the most common, and that's we do we do have 14 sort of case studies to rely on there.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: It's not in the report, but we were thinking maybe it could go to the green nut and care bill.

[Michael "Mike" Marcotte (Chair)]: It was a thought.

[Joe Valenti (Director of Policy, DFR)]: My forgive my humor. And I will say, to the point on complaints, I think of the four states that we talked to, it was anywhere from one or two complaints a year to maybe a dozen. And there was a question of, could they handle them in house? Would they go to their enforcement division? The other challenge is if there is a complaint, what do you do with that information? And one possibility would be to avoid the franchise, but that may or may not be the outcome that the franchisee is looking for.

[Emily Carris Duncan (Member)]: Is there a sense of how many franchise applications SMS gets, or is it just that they are not delineating out this notion

[Joe Valenti (Director of Policy, DFR)]: of there's way to know.

[Emily Carris Duncan (Member)]: So the estimation on how many applications, like

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: we still have, makes sense. Well, from the other state, you've got some volume.

[Joe Valenti (Director of Policy, DFR)]: Right. Well, the franchisor volume, so these are the companies that are offering franchises. It's in the hundreds. It may even be sort of low. It may even be over a thousand. But in terms of the number, that is to be able to sell franchises in that state. The number of franchisees with the Secretary of State, we don't know. And it's possible one thing that we saw in the one contract we were able to look at was that the name of the business that was registered with the secretary of state was not to use identifiers of the franchisor. And so it wasn't even like you couldn't look for businesses with the word burger in the title and associate them back to Right. Back to the franchise. Right. So that's that's part of the difficult undertaking of figuring out where all of these are located.

[Emily Carris Duncan (Member)]: So am I also understanding that if you are a franchisor wanting to sell your franchise, and you just need to have have that registered? I guess I'm just understanding where the application

[Joe Valenti (Director of Policy, DFR)]: number is coming from. If we had a registration program, then they would need to register.

[Emily Carris Duncan (Member)]: They would need to sale and Yes. That's what I was trying get.

[Michael "Mike" Marcotte (Chair)]: I would

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: see it very similar to our insurance law, which is if ABC Insurance Company wants to sell in Vermont, not even execute, but just sell, solicit, they have to be licensed. They have to be licensed. Yes. And it would be the same. But right now, we don't have that. So we have no idea. And and it would be like so many areas that we regulate where they'd all register, but only maybe 10% of them would actually end up executing a contract doing business. But you just to just generally, the way these things work is just to do say just to attempt to, you know, execute a franchise contract in in the state or in you know, you have to be licensed there because that's doing business. Right.

[Joe Valenti (Director of Policy, DFR)]: But if you were if you were thinking of and this is not to pick on any specific company just to give examples, right, that it would be Dunkin' Donuts or McDonald's, or it would be a lot of notable firms that would need to do that if they were looking to sell franchises instead.

[Emily Carris Duncan (Member)]: But those notable firms would, in some other states, they already have to do that. Right.

[Kirk White (Ranking Member)]: So you mentioned the FTC rule. Before it was withdrawn, did it have particular standards around what's fair and what's not fair in terms of franchisees, or did

[Joe Valenti (Director of Policy, DFR)]: it be that tension? The rule was only dealing with non competes. Got it. And they had decided, because it was a business to business relationship, they had decided not to do anything about non competes in the franchise context. Yeah.

[Kirk White (Ranking Member)]: There were 14 other states that, you know, deal with franchises in some manner. Did any of them create, you know, specific standards in terms of what's fair in a contract, things like that?

[Joe Valenti (Director of Policy, DFR)]: I haven't looked at whatever the various regulations might be in those various states.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: There are

[Joe Valenti (Director of Policy, DFR)]: going to be the statutory differences.

[Kirk White (Ranking Member)]: And of those 14 states that touch on this to some extent, how many of them deal with it inside an agency versus, say, creating standards and having the courts have a card?

[Joe Valenti (Director of Policy, DFR)]: All of those 14 have a registration program through their state securities regularly. Okay.

[Michael "Mike" Marcotte (Chair)]: Thank you. Sure.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: Yeah. And I think, correct me if I'm wrong, but we didn't do an exhaustive review of 50 state laws to see if there was just a Okay. Right? Right. So there could be states in addition or overlapping those 14 that also have just laws forbidding certain contract terms.

[Kirk White (Ranking Member)]: And then they let the courts deal with that.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: Right. So no no registration, no regulation, or maybe yes, but also rules like you can't have this type of non You'd be right. Yeah. Right.

[Abbey Duke (Member)]: So I have two questions. One is, is there any way through tax filings to know if companies are franchises or franchisees, like when they've filed their their taxes?

[Michael "Mike" Marcotte (Chair)]: I don't think so.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: But I'm just going off my memory of the the corporate income tax. But

[Abbey Duke (Member)]: Well, you've got the tax experience.

[Michael "Mike" Marcotte (Chair)]: A little bit.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: Yeah, I mean, it's similar to a business registration, which seems actually the more obvious place. And that's what Joe discussed in the letter was, is it onerous? Again, consult with the Secretary of State. But to say, if you're registering ABC business, indicate if it's a franchise. Are you setting up this business because you're a franchisee? And then at least you start to get Right. Some data of volume to your own.

[Abbey Duke (Member)]: Like that could be as a start to if they are amenable to that, they just to get data and then that know who to communicate with.

[Joe Valenti (Director of Policy, DFR)]: And who and and who the parent is. Yeah. So that way too.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: Who the franchisor is? Right. Right. Right.

[Joe Valenti (Director of Policy, DFR)]: I think part of part of the challenge here, and you see this in the debate around this issue, is, it comes up, are these sophisticated investors? Is this a business to business relationship? Or is this, some have argued this is a situation where there's really an unequal power dynamic, And the franchisee does not have as much agency as they might think. But I think we've seen if you look at the public comment record, you see both of those arguments.

[Michael "Mike" Marcotte (Chair)]: Like, I guess one thing that oh, Jonathan?

[Jonathan Cooper (Member)]: Yes. Thank you. And I'm sorry if I missed this already. Would language from the contracts, the entire contract, or the portion that's pertaining to franchisor franchisee relations, do those need to be filed with the state what's being contemplated?

[Joe Valenti (Director of Policy, DFR)]: So it's the I believe it's the franchise disclosure documents that are filed. I'm not I'm not positive if it is all of the contract language. That's something

[Michael "Mike" Marcotte (Chair)]: that we can check up.

[Jonathan Cooper (Member)]: Okay. The as you mentioned, like, you've seen one contract, you've seen one contract, and my my sort of interest was, is it to be presumed then that the contract that you did get insight into through the class action would have been in whatever state where those in those two states was on file with the an entity within the state government, and that was sort of what I was curious about. So thanks, Michael.

[Joe Valenti (Director of Policy, DFR)]: I think it would depend. I don't have a list of states in front of me. I'm not positive that either of those states has a franchise registration in place. The Yeah, we're

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: not sure if those two states were one of the 14. But more broadly, Joe, I think it goes back to the representative's first question. In the 14 states, are they registering? Are they five

[Joe Valenti (Director of Policy, DFR)]: Neither neither one of neither Idaho nor Ohio are states that have a registration for

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: And then the the states that do have registration, did did we go deep enough to know whether you're filing your full contract or just a disclosure document. That that I'm not sure. But yeah.

[Jonathan Cooper (Member)]: Okay. Thank you very much.

[Kirk White (Ranking Member)]: So you said Ohio and what other states?

[Michael "Mike" Marcotte (Chair)]: I know.

[Kirk White (Ranking Member)]: I know. And so you wouldn't know whether those states had statutes that were any new standards. Maybe Is there a court? No, it was just discovery.

[Joe Valenti (Director of Policy, DFR)]: Since it's an We don't know the ultimate disposition because we went

[Michael "Mike" Marcotte (Chair)]: to arbitration. Oh, right, of course. Other questions?

[Edye Graning (Vice Chair)]: I guess I just want to make sure I'm taking away what I'm hearing. I want to share what I'm taking away and make sure that's what

[Abbey Duke (Member)]: you want me taking away from this.

[Edye Graning (Vice Chair)]: It's not a problem that we hear of a lot in Vermont. And in order to set up the system that we would need to support it, it would take significant resources. Is that more

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: To the first one, I just want to you didn't mention it, but I think you mentioned it. But you did talk to the AG's office. Right? Yep. Chris Curtis, I think. Yep. They in terms of so to your to your takeaway of it's not a thing we hear a lot of, not in DFR, not ever in my history. So and then you reached out to the secretary of state and Right. To talk about that

[Michael "Mike" Marcotte (Chair)]: a little bit.

[Joe Valenti (Director of Policy, DFR)]: But I think part of the the challenge there, though, and and this came up in our our interactions, is, you know, you're not hearing about things that you're not asking about. If you have an entity that same thing with DFR, we do not take complaints from franchisees because we don't have any oversight there. And so it's hard to measure something when you're

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: not expecting it or looking. But there is an indication, again, with the data you found from, was it Rhode Island or a couple of the states that had registration programs, they had at least something. So at least there was someone knew who to call in state government. Whereas right now, that wouldn't be the case in Vermont. It was Rhode Island had, I think, one

[Joe Valenti (Director of Policy, DFR)]: or two complaints a year. Some of the other states, I think it may have been a dozen complaints a year. Part And of that may also be where in the business cycle that someone is. The one contract that we saw was for twenty years, and it's entirely possible that someone starts a business and it's going very well and there are changes in the agreement or in market conditions or whatever, and five or ten years down the road, they're looking at it differently. Right.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: So I think my takeaway is that there's not a lot of volume, but with the caveat that there's everything Joe said. It's hard to measure. And then the other takeaway is we do need more data. I believe that before we do anything in terms of setting up a regulatory structure and expanding state resources, we should do more research or learn more or or or set up you know, baby step would be see if you can collect some data.

[Joe Valenti (Director of Policy, DFR)]: The the other piece that does complicate this is that we've seen in the FTC comment record and elsewhere that a lot of contracts have confidentiality. And so, for example, there are a number of people who filed comments with the FTC anonymously. And so it just it may be a situation where we just we don't know what we don't know.

[Kaj Samsom (Commissioner, Department of Financial Regulation)]: So, yeah, that was a takeaway for me in talking to Joe. Like, if we were to start pounding the pavement and saying, hey. Can I see your contract? I'm a regulator. They could not give it to us because we're not their regulator. We're not their franchisor's regulator, even if they wanted to. So and so maybe that's a baby step, to give the ability, and it might not however it goes or wherever it goes. But at this point, we don't have the legal authority to look at contracts. And, you know, you found one because of a federal court case. Right.

[Michael "Mike" Marcotte (Chair)]: Do the other jurisdictions, the other 14, do they have that ability to look at contracts?

[Joe Valenti (Director of Policy, DFR)]: That I don't know. And I think a part of it too is I don't know what if any there is in term of in terms of follow-up because there is this situation where, you entered into a contract, and this was the pricing, and these were the terms, and then those change over time. And I'm not sure if the regulator is involved for any of those later changes.

[Michael "Mike" Marcotte (Chair)]: So

[Kirk White (Ranking Member)]: in terms of the AG's jurisdiction, I think it's under the protection. I can't remember what the jurisdiction and relationship is there. Business

[Michael "Mike" Marcotte (Chair)]: consuming

[Kirk White (Ranking Member)]: products and things, but doesn't sound

[Joe Valenti (Director of Policy, DFR)]: like That's exactly right. That was the way that it was explained to me was if you are a business and you are buying paperclips and you are not receiving the paperclips that you were expecting as a consumer, that would be grounds. Again, part of the challenge here is that business to business relationships are often governed very differently than consumer relationships.

[Kirk White (Ranking Member)]: And it this week, company did. Consumer protection statute doesn't say.

[Michael "Mike" Marcotte (Chair)]: Other questions? Think we'll probably ask the Secretary of State's office, you know, come in and they just went through a change in their software. They may be able to actually put those little boxes on businesses, applications, and when businesses register and reregister every year, whether or not they're franchise. And I'm just wondering, because franchises, they required to register in the state as business? Because they're selling, they're operating in the state, selling franchises. Are they required to register as a business in the state? Franchisors. That would be good to probably find out if there's a little box that the franchisee is operating as a business in the state, whether or not you're a franchisee. Right, just to start. It's a good place to start, but we generally take in even business to business, although this is a little different, but business to business, the businesses that are consumer are protected and are consumer protection. The way that it's in my mind, they're still a consumer That's buying a good question. And, know, most I think most of the large franchises are franchisors have this nailed down. They know what they're doing. People that are buying those franchises are know what they're doing. But there's a lot of small franchisors out there that, you know, maybe $20.30, $40,000 to get in. You have somebody who just wants to get into, you know, start their own business that doesn't have to wear with all, and Yeah. Say, how do we protect them? Mhmm. They haven't gone from an attorney. I think those are some of the things that they're thinking about.

[Kirk White (Ranking Member)]: Might be interesting to hear from the AG in terms of their how they view their jurisdiction and their connection. So

[Michael "Mike" Marcotte (Chair)]: thank you. We appreciate your number one word on this and time it takes to put all this together. And I think we'll just keep looking at it. We'll David to come over from the Secretary of State's office, we'll ask Todd and Chris to come over and chat with us about the Consumer Protection Act. And it'll be Nancy what we're doing, and I think you're right in baby steps here. Probably the best way, data is what helps us create policy, the right policy, and do something that's not gonna cost an argument to let it to. Right. Okay. No other questions? Great. Commissioner, thank you. Joe, thank you. Appreciate you having us. Thank you.

[Abbey Duke (Member)]: Business is a person for helping finance. Surely they're a person for Yeah. Good signal protection. Turns the bar.

[Kirk White (Ranking Member)]: It might not be

[Michael "Mike" Marcotte (Chair)]: that. So, I'll have the bill draft being drafted, and we'll take a look, and we'll see where we can go down this road prior to the election. If everyone's interested, see what happens. That's all I have for today. There's a couple of bills that I have, the DFR housekeeping bill and the captive bill. If you haven't signed on yet.

[Abbey Duke (Member)]: I think I'm

[Michael "Mike" Marcotte (Chair)]: Yes. Captive? Perfect. So if you're interested, take a look at it and like to get him in for these. Both of those bills and get him out of here so they can get over to the seller. Anybody have anything?

[Kirk White (Ranking Member)]: I have a question. So we

[Michael "Mike" Marcotte (Chair)]: were talking about the franchise and that kind

[Kirk White (Ranking Member)]: of piece. But I know at one point we also talked about just like it

[Michael "Mike" Marcotte (Chair)]: would be communism in general. That's tomorrow. That's Okay. Will be in tomorrow. Yeah. He the other group is appreciative to him and everyone that was on the group. Herb, side in too as well. So we'll we'll hear more about that form Thursday. Thursday. Thank you for correcting. Tomorrow, we get we'll talk with and and the HFAs, Looking at the policy strategy that they're looking at. And then at 11:00, we were having Phil Edyecan from help push the ABLE Act through the model, which helps people with disabilities be able to actually put more money into their accounts, penalised by the government. He's tomorrow's not supposed to be such a great day, so we've asked him if he would like to come in next week, which he he will. He's coming out from Middlebury, hate to have him driving in freezing rain and snow. Oh, we

[Emily Carris Duncan (Member)]: can't Is that what's tomorrow? Yeah.

[Michael "Mike" Marcotte (Chair)]: I'm talking about. Yeah. It's

[Kirk White (Ranking Member)]: not gonna be a

[Michael "Mike" Marcotte (Chair)]: nice day. Chicken leg. Yeah. So I don't right now, don't have anything set for a little tomorrow. So we'll we'll see what if we can do something about but we'll move forward. So nothing left. Apply.