Vermont Legislature SmartTranscripts:

[Rep. Chris Keyser (Member)]: Hello, Justin, Judge.

[Rep. Timothy R. Corcoran II (Vice Chair)]: Good morning. It is May 22 here in the House Transportation Committee. Today, we're trying to wrap up our committee conference. Hopefully, that can be done here in the next couple of days, if not early next week. But one of the items that the Senate put in their version of the transportation bill had to do with CARFAX, section 56 of the T Bill, and sort of get us up to speed here. We're going to have the lobbyist, Justin Johnson, give testimony and his thoughts on section 56.

[Justin Johnson (MMR, representing CARFAX)]: Well, you. Thanks for the opportunity to speak to the committee this morning. Justin Johnson from MMR representing Carfax just for the record. This section 56, it's a study that was put in by the Senate fairly late in the process. They didn't take a lot of testimony on it, but it came up because of a constituent complaint to one of the senators about they bought a car and the car had an issue. And then later on, they found out that the car had had a similar issue earlier in its life, but it didn't show up in the I'm not sure whether it was Carfax or one of the other ones they've looked at. And, you know, they had raised the issue about what's in these reports and get more information, dealers be required to report that sort of thing. And so they decided to have to do a study committee. We did not testify. We we didn't get the opportunity to testify in the senate. Mhmm. We are generally fine with having a study. We're open to it. I mean, you know, CARFAX lives and dies on information. The more we have, the better the reports can be. We have no issue with that. The one thing that tweak that we would wanna make to the language that's in there is that we would like to add in section a just to say that as part of the examination, the Commissioner of Motor Vehicles and any consulting party should not gather or request the disclosure of information constituting a trade secret under nine VSA 4,601. So we're not asking to change what constitutes a trade secret. Just want to clarify that the study isn't going to try and make us hand over things that are confidential. It's a very competitive business. We have a lot of arrangements about how we collect information. We don't make any of the information, we only compile it and make it available to people. The one thing I would say about that is we do. It's stated very clear on the reports and on our website that this is the information we have. You know, we recommend anyone buying a car uses our report as one piece of the information making that decision. You know, look at the car, drive the car, see if you like the car, look at our report, get a mechanic to look at the car on your behalf is always a good idea. You know? But, you know, you shouldn't just rely on the CARFAX report or any others. There's a few others. There's car auto check. There's car vertical. There's a bunch of them here and in other parts of the world.

[Rep. Timothy R. Corcoran II (Vice Chair)]: So the gist of it is they're trying to get a liability, oh, somebody speak to the fire sounds like. Right. So I

[Justin Johnson (MMR, representing CARFAX)]: think they're just they're trying to say, well, these reports have to be more complete. But Yeah. There's a lot that goes into that because, you know, if you do your own work on your own car at home, do you report that to someone? You know? Yeah. What happens? You know, some dealerships reports, some independent shops might report, depends what it is. Carfax is more than happy to have that conversation with anyone anytime. We don't actually need a statute to tell us to do it. We're open to the conversation anytime. What we don't wanna do is get into a situation where we're saying we're not gonna give you information because it's confidential. We just don't want we don't want the DMV to ask us for things we can't give them and then create a sort of problem there. And we just saw this clarification would just help everyone in that case. I think, you know, it's the information that we have sort of varies a little bit. Like, obviously, there's buying and selling information that's pretty standard and consistent comes from the DMV. Your title information, we will have information on if someone gets a salvage title on a VIN number, and the car has that VIN number that'll show up in the report. But service information, what parts were changed out, whether it would be your accident information, some of that gets reported, and some of it doesn't, we don't, you know, we'd love it all to get reported. Mean, we would, from a business perspective, the more comprehensive our reports are, the more useful they are to the people who are getting them from us, the better off everyone is. But then there's just a lot to unpack in that in a conversation around who has to report, when they have to report, what happens if they don't report, where the liability goes, you know, who's responsible if there's a report that's not correct. You know, so there's just lots to talk about there, which the Senate didn't really get into. And so that's why we're requesting the silver tax.

[Rep. Phil Pouech (Ranking Member)]: Representative Pouech? Yeah, thanks for helping us understand it. I don't think I've ever bought a car back, but certainly I've seen some. So I have some familiarity with it. And you're saying, if I was to buy one, there's some language at the end, like if you buy anything that sort of says, this is the best information we have, but there's no guarantee that it includes A CARFAX report only includes what was reported to us. We don't actually go out sort of Solistic.

[Justin Johnson (MMR, representing CARFAX)]: And track all these. We do have contracts with some people that provide information, including the DMV. But ultimately, you know, if a dealership or an independent shop does work on a car, we have no way to know that unless they actually report it. And similarly, if you do work on your own car, there is a mechanism for someone to report their own work. Like, they can go in and say, I did an oil change, I did this, I did that. But, you know, we can only report what we have. And so I think this was the issue that came up was the person felt that there was something that had been done to the card that wasn't reported. But, you know, I think we would caveat the report by saying this is this is one piece of information. You should also, obviously, you know, if you have any concern, have the car checked by a mechanic. I mean, the dealership might say the car is pristine or we get a full service on the car. You may still wanna get it someone who's working for you to have a look at follow-up

[Rep. Phil Pouech (Ranking Member)]: on a couple more questions. So you're looking to add to the language that CARFAX and anybody else doesn't want to disclose proprietary information. I mean, would you think that you're already protected and you're just looking to add this to be like double sure? Yes. Think it's mostly we just wanna make it clear that there is proprietary information. We're not changing the definition of that. It's just that it's already covered. It's already there. It's already there. But we just don't want to

[Justin Johnson (MMR, representing CARFAX)]: we would like to avoid a situation where someone, whether it's DMV or someone else asks for information that we can't give them. And they say what you know what's going on here?

[Rep. Phil Pouech (Ranking Member)]: This just clarifies it. So now and then CARFAX really is getting information on publicly available information from EMV's information on VIN numbers, which are legal. There are legal requirements to report certain things.

[Justin Johnson (MMR, representing CARFAX)]: There are, yeah, like titles and that sort of thing. Obviously, they get reported. I'm not sure that there's a legal requirement for a shop to provide information, but we do have I

[Rep. Phil Pouech (Ranking Member)]: think you would know that, but I would assume there's

[Justin Johnson (MMR, representing CARFAX)]: no legal requirement. But we do have report. When you get a carfax report, it'll list ownership changes, it'll list inspection when the car got inspected. If the dealer or the independent shop is reporting it, it'll list service like it'll say on this date it came in for its you know 38,000 mile service off.

[Rep. Phil Pouech (Ranking Member)]: But I would guess if I brought my car in for a 38,000 mile at the dealer, they're not required to report that. Right. Yeah. So, okay. And so you're getting as much public information as possible and putting it out there and you've got the idea

[Justin Johnson (MMR, representing CARFAX)]: the report is to not be the complete and comprehensive list of everything that was ever done to a car. It's just to give the potential buyer or the owner just something that says, this is a list of the things that have been reported on what's happened with us.

[Rep. Timothy R. Corcoran II (Vice Chair)]: Representative Keyser? So there, now

[Rep. Chris Keyser (Member)]: this person that apparently got a CARFAX, there was a problem there and they were trying to look into basically make you guys liable. Well, what? Because you didn't have I mean, you only get the information that you get, but they

[Justin Johnson (MMR, representing CARFAX)]: were looking for more information Right. And I I think they felt that there should have been more information. Like, somewhere along the line, someone should have been required to do it. Right. And I, you know, I don't wanna get into that. I think that's the whole point of the study is to look at that sort of thing. But my understanding is they had a steering power steering issue in the vehicle and then found out later through some I'm not sure exactly how that it had had a previous power steering issue. Yeah. And felt that that should have been reported. Yeah. I don't know the paragraphs. By somebody. Yeah. I mean, if if someone had put in a if we had got service information and said that that had happened, it likely would have been on the report, but, obviously, it wasn't there. So it was never reported to anyone.

[Rep. Chris Keyser (Member)]: I just have no problem

[Justin Johnson (MMR, representing CARFAX)]: with your language. As I said, we just really wanna just highlight the fact that this is a very sort of competitive business. And we you know, we're happy to sit down and talk to anyone and talk about how it could be done better. We just want to recognize that there is some confidential information and a lot of business arrangements in the background. That's it.

[Rep. Timothy R. Corcoran II (Vice Chair)]: Any other questions? All right, thank you.

[Rep. Phil Pouech (Ranking Member)]: Thank very

[Justin Johnson (MMR, representing CARFAX)]: much. You. There's one more question.

[Rep. Phil Pouech (Ranking Member)]: So did you have language

[Justin Johnson (MMR, representing CARFAX)]: that you had? I do. I can send it electronically or I have an art copy on it. Yeah, would send it electronically to Okay, I'll do that in a few minutes.

[Rep. Timothy R. Corcoran II (Vice Chair)]: Yeah, great. Thank you. And I just wanted to share, this is from Secretary of Transportation, Joe Blinn, and Sarah Clark, Secretary of Administration, did weigh in on this section, and it starts out with, Finally, we have concerns with provision section 56, legislative report with third party car defects and other vehicle history reports. This section changes the agency with a consumer protection function for which it has no data, expertise, or authority. I ask you to remove this provision and seek relevant testimony with recommendations from the Attorney General's Office on Consumer Protection, Industry, and Economic Development. This is critical to ensure that the Bill keeps us focused on a poor mission and moves us to a more stable and sustainable model. I'll just

[Justin Johnson (MMR, representing CARFAX)]: add that if the section came out altogether, we would be totally fine with that. We don't actually think it's necessary. We would be perfectly happy to have a conversation with anyone without being told to. Thank you. Again,

[Rep. Timothy R. Corcoran II (Vice Chair)]: it's a misperior to justice because it's only representing one person. I don't like legislation that addresses one person's issues. So committee discussion, you're Thank you. Any thoughts, directions that you could give me and Phil and Matt, Representative Candice?

[Rep. Candice White (Member)]: I think Representative Keyser brings up a good point, and whether you all have time to talk to the Attorney General, because it does seem like they really deal with consumer protection, and I had a recent incident where they were incredibly effective in helping with the consumer protection issue that everybody else had kind of passed the buck on. So it does sound like you might want to talk to

[Rep. Phil Pouech (Ranking Member)]: them. I mean, it seems like if CARFAX didn't give you the information you wanted, you should have used something else. I mean, there's no guarantee you're going to get everything. Now, I think it could be helpful if you want to check to make sure it isn't a car that was flooded and supported hurricane, I don't know how you would get all the information, and you can't compel everybody to provide the information. You're not guessing the states.

[Rep. Candice White (Member)]: You just trust, and you're gonna have other ways of deciding whether you can buy a car.

[Rep. Phil Pouech (Ranking Member)]: It's a

[Rep. Timothy R. Corcoran II (Vice Chair)]: personal experience. I got my summer car out, and I had a CARFAX on it when I bought it last year, and I just replaced the battery. I didn't put that in the fact that I replaced the battery in that thing, because I did it. I replaced the battery.

[Rep. Candice White (Member)]: So to hold a data gathering company liable for information they couldn't have had, this miscarriage. I do think that it's CARFAX are used for, as Phil said, did the car get flooded? Did it have to get a transmission replaced? Some major piece of work done to the car, which signals might be something else you want to look into.

[Rep. Timothy R. Corcoran II (Vice Chair)]: I'm not feeling love for this, Matt.

[Rep. Phil Pouech (Ranking Member)]: Things. Never

[Justin Johnson (MMR, representing CARFAX)]: All

[Rep. Timothy R. Corcoran II (Vice Chair)]: right, so we'll take that out. Thank you. Or at least try to.