Opponent Testimony - Marc Dann, House Bill 272, House Commerce and Labor Committee

Summary

Opponent testimony from Marc Dann of Dann Law on House Bill 272, addressed to Chairman Stein, Vice Chairman Johnson, Ranking Member Lepore-Hagan and members of the House Commerce and Labor Committee. The testimony says the bill empowers private companies like Amazon and Facebook to perform what should be a governmental function, and states that adjusting foreign business registration requirements would be more reliable. It argues that the bill gives mega-sellers an unfair advantage over third party sellers and prohibits consumers from bringing claims under the Ohio Consumer Sales Practices Act. It urges that the prohibition against private right of action be removed.

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                                                                                               Marc Dann
                                                                                  Direct Dial:216-452-1026
                                                                               Email: mdann@dannlaw.com


                                      Marc Dann
                                       Dann Law
                                    On House Bill 272
                           House Commerce and Labor Committee
                                   Opponent Testimony

Chairman Stein , Vice Chairman Johnson , Ranking Member Lepore-Hagan, and Members
of the House Commerce and Labor Committee:

        My name is Marc Dann. Both in and out of government I’ve devoted my career to
representing consumers. While I applaud the sponsor’s desire to require companies that do
business in Ohio to disclose current and relevant contact information to their customers, the bill
raises several questions that I believe deserve additional consideration before it is rushed to the
floor of the House.

First, rather than revising existing statutes to require that out of state companies doing business
over the internet in Ohio register with the Secretary of State and appoint a agent for service of
process, the bill empowers private companies like Amazon and Facebook to perform what
should be a governmental function. I believe you should determine if Secretary of State LaRose
supports this partial privatization of the functions of his office. In my opinion, adjusting the
foreign business registration requirements to fit the internet age would have a broader and more
reliable impact on the ability of consumers and law enforcement agents to track down and hold
bad actors accountable. It would also ensure that out of state companies competing with Ohio
based businesses are remitting taxes as they should.

Second, because companies like Amazon both host third party sellers and compete with them
requiring those sellers to provide confidential information gives the mega-sellers an unfair
advantage over them. While low barriers to market entry are one of the great advantages of the
internet the unique, confusing, and unfair scheme established by the bill may deter companies
from offering lower cost products to Ohio consumers. I believe it is counter-productive to allow
mega-sellers like Amazon, Google or Facebook to cut off smaller merchants from their
customers without due process of law.

Finally, adding an additional burden of enforcement to the already overwhelmed Consumer
Protection Section of the Ohio Attorney General’s office while prohibiting consumers impacted
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875 N. High Street, 3d Floor                                           DannLaw.com
Columbus, OH 43215                                                     [614] 500-4395
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by the bad conduct of these newly regulated sellers from bringing their own claims under the
Ohio Consumer Sales Practices Act will place consumers at increased risk for abuse and
encourage fraud by merchants who know there is little chance they will be held accountable for
their bad or illegal acts. Current law provides much stronger protections for consumers who have
been wronged by an internet seller. Exempting out of state sellers who compete with in-state
companies from Ohio’s consumer protection laws is bad for both consumers and the smaller
enterprises who depend on Amazon and other internet-based commercial platforms to bring their
products to market. In order to protect then I strongly urge that at a minimum that the prohibition
against private right of action be removed from the legislation.


Current law, if properly enforced, is a more than adequate solution for the perceived problem the
bill is attempting to address. Requiring high volume internet sellers to comply with existing
foreign business registration laws will ensure that consumers and law enforcement agencies have
the information they need to pursue, prosecute, and punish bad actors. Delegating the Ohio
Secretary of State’s constitutional power to companies that clearly have conflicts of interest is an
incredibly bad idea that will harm consumers, small and mid-size businesses, and our state’s
economy.




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875 N. High Street, 3d Floor                                           DannLaw.com
Columbus, OH 43215                                                     [614] 500-4395
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