General Motors Sued for Collecting and Selling Drivers’ Data

Texas Attorney General Ken Paxton sued General Motors, alleging the automotive giant illegally collected and sold the data of more than 1.8 million Texas drivers to insurance companies without their knowledge or consent. OnStar, a subsidiary of GM that makes the telematics systems that produce the data in question, was also named in the lawsuit.

In June 2024, Paxton began investigating if several auto companies were secretly collecting data about drivers directly from vehicles and selling it to third parties. The Texas Deceptive Trade Practices – Consumer Protection Act authorizes the Office of the Attorney General to investigate false, misleading, or deceptive acts or practices. The GM lawsuit is the first to result from the investigation.

“Our investigation revealed that General Motors has engaged in egregious business practices that violated Texans’ privacy and broke the law,” said Attorney General Paxton. “Companies are using invasive technology to violate the rights of our citizens in unthinkable ways. Millions of American drivers wanted to buy a car, not a comprehensive surveillance system that unlawfully records information about every drive they take and sells their data to any company willing to pay for it.”

The Collection of Drivers’ Data

According to the lawsuit, GM has been installing technology in its vehicles since 2015 that was promoted as a tool for improving safety and operability. The technology was allegedly also used to collect, record, analyze, and transmit “Driving Data,” which includes speed, seatbelt status, driving distances and times.

The lawsuit further outlines that General Motors partnered with companies to use the Driving Data to create a “Driving Score” that accounts for driving actions considered high-risk, such as sharp turns, speeding, and hard braking.  GM then arranged for insurance companies to be able to purchase a license to access the Driving Scores. Further, General Motors is accused of leading insurance companies to believe customers consented to the collection, sale, and use of their data.

Deceptive Practices

The Lawsuit also accuses GM of deceiving many customers by compelling them to enroll in its products, including OnStar Smart Driver, as part of its vehicle “onboarding” process. Dealership employees could earn commissions by signing customers up for OnStar Smart Driver subscriptions. Customers who initially declined the service were led to believe that failing to enroll would result in their vehicle’s safety features being deactivated.

The allegations claim that GM did not clarify to customers that by enrolling in GM’s products, they were “agreeing” to the collection and sale of their data. GM presented customers with long and confusing disclosures that failed to provide correct information about the systematic collection and sale of their highly detailed driving data.

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