What specific sections of the Maryland Franchise Registration and Disclosure Law did the Commissioner conclude 360 Painting violated?
360_Painting Franchise · 2025 FDDAnswer from 2025 FDD Document
and or to any Maryland residents. In the Consent Order, the Commissioner concluded that defendants had violated §§ 14-214, 14-216, 14- 228 and 14-229 of the Maryland Franchise Registration and Disclosure Law by offering and selling franchises in Maryland and to Maryland residents while not registered to offer and sell franchises in Maryland and using a Franchise Disclosure Document that failed to set forth all information the Securities Division requires to be included in a Maryland registered Franchise Disclosure Document under the Maryland Franchise Registration and Disclosure Law and Maryland's Franchise Regulations. Specifically, the Commissioner found that, in the Franchise Disclosure Documents distributed to the Maryland Franchisees, defendants had failed to disclose the lawsuit filed by Leslie Owens Brown referenced above in Item 3. 360 Painting has corrected this error. The two Maryland Franchisees accepted the rescission offer.
In the Matter of 360 Painting, LLC, No. 20-AVC-F001, investigation by Illinois Attorney General's Office.
Source: Item 3 — LITIGATION (FDD pages 13–18)
What This Means (2025 FDD)
According to the 2025 FDD, in a Consent Order, the Commissioner concluded that 360 Painting violated §§ 14-214, 14-216, 14- 228 and 14-229 of the Maryland Franchise Registration and Disclosure Law. These violations stemmed from 360 Painting's actions of offering and selling franchises in Maryland and to Maryland residents without being properly registered to do so. Additionally, the Commissioner determined that 360 Painting used a Franchise Disclosure Document that did not include all the information required by the Securities Division under Maryland law and regulations.
Specifically, the Commissioner's findings indicated that 360 Painting failed to disclose a lawsuit filed by Leslie Owens Brown in the Franchise Disclosure Documents provided to Maryland franchisees. This lack of disclosure was a key factor in determining the violation. 360 Painting has since taken steps to correct this error, and the two Maryland franchisees who were affected accepted an offer of rescission.
In an Order Modifying Consent Order dated January 4, 2017, the Consent Order was modified so that 360 Painting was not required to register its 360 Painting franchise offering in Maryland as long as no offers or sales of 360 Painting franchises were made in Maryland or to any Maryland residents.