On August 13, 2024, Texas filed a lawsuit against General Motors (GM). They alleged that the company installed technology in over 14 million vehicles to collect driver data. This data was then sold to insurance companies and other businesses without the drivers’ explicit consent.
Texas Attorney General Ken Paxton announced on Tuesday that the lawsuit follows an investigation launched in June to see whether several automakers were gathering and selling large amounts of data without drivers’ prior knowledge.
Paxton added that GM’s data was used to generate “Driving Scores” which are used to evaluate over 1.8 million Texans. These scores determine whether these people had bad driving habits, such as speeding, rapid braking, sharp steering, not using seatbelts and late-night driving. This data could then be used by insurance companies to influence decisions on raising premiums, canceling policies, or denying coverage.
The technology in question was reportedly installed in most GM vehicles starting from the 2015 model year. Paxton alleged that GM may have misled consumers into believing that enrolling in OnStar diagnostic products, which was the technology that collected data, was mandatory after they had completed the purchasing or leasing process.
“Companies are using invasive technology to violate the rights of our citizens in unthinkable ways,” Paxton said in a statement. “Our investigation revealed that General Motors has engaged in egregious business practices that violated Texans’ privacy and broke the law. We will hold them accountable.”
GM responded via email by saying: “We’ve been in discussions with the Attorney General’s office and are reviewing the complaint. We share the desire to protect consumers’ privacy.”
This case highlights concerns on data privacy and the use of technology in modern vehicles. According to Cinch, telematics insurance, commonly known as a black box, collects data with driver consent and is regulated under strict data protection laws in the UK.
“It’s only shared with third parties who work with the insurer, or the police if they have your permission or a court order asking for it,” the experts detailed.
The difference between the two cases is that the black box technology has the driver’s explicit consent on the use of their private information, which was allegedly violated by GM.
Texas filed the suit in state court in Montgomery County near Houston, seeking the destruction of improperly collected data, compensation for affected drivers, civil penalties, and other remedies under the Texas Deceptive Trade Practices Act.
