Texas Attorney General Ken Paxton sued General Motors Tuesday, alleging the carmaker illegally collected and sold drivers’ data to insurance companies without their consent or knowledge, according to a release from the AG’s office.
General Motors is the first car manufacturer to be hit with a lawsuit after the attorney general’s office opened an investigation into several manufacturers in June for allegedly collecting mass amount of data and then illegally selling it.
With the lack of a detailed, modern data privacy and security law at the federal law, many states are stepping in to pass their own regulations to protect consumers in the ever-growing data brokerage market.
“We’ve been in discussions with the Attorney General’s office and are reviewing the complaint. We share the desire to protect consumers’ privacy,” a GM spokesperson said in a statement.
In car models from 2015 and later, the Detroit-based car manufacturer allegedly used technology to “collect, record, analyze, and transmit highly detailed driving data about each time a driver used their vehicle,” according to the AG’s statement.
General Motors sold this information to several other companies, including to at least two companies for the purpose of generating “Driving Scores” about GM’s customers, the AG alleged. The suit said those two companies then sold these scores to insurance companies.
Insurance companies can use data to see how many times people exceeded a speed limit or obeyed other traffic laws. Some insurance firms ask customers if they want to voluntarily opt-in to such programs, promising lower rates for safer drivers.
But the attorney general’s office claimed GM “deceived” its Texan customers by encouraging them to enroll in programs such as OnStar Smart Driver. But by agreeing to join these programs, customers also unknowingly agreed to the collection and sale of their data, the attorney general’s office said.
“Despite lengthy and convoluted disclosures, General Motors never informed its customers of its actual conduct—the systematic collection and sale of their highly detailed driving data,” the AG’s office said in a statement.
