Attorney General Ken Paxton has filed a lawsuit against General Motors for allegedly gathering customers’ private data and selling it to insurance companies.
General Motors—which owns and manufactures Chevrolet, Buick, GMC, and Cadillac—is accused of illegally collecting and selling the private driving data of over 1.5 million Texans without their knowledge.
This follows an initiative launched by the attorney general in early June aimed at enforcing the state’s data privacy laws and protecting Texans’ personal information.
As part of the large-scale security initiative, Paxton’s data privacy team investigated General Motors.
“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,” Paxton said in a Tuesday press release. “Companies are using invasive technology to violate the rights of our citizens in unthinkable ways.”
The attorney general argued that millions of Americans are in the market to purchase cars—not mechanical surveillance apparatuses that sell data to third parties every time they drive.
Under the guise of safety features, General Motors has allegedly been installing technology in cars since 2015 that records specific information about each drive. According to the lawsuit, General Motors sold this data to purchasing companies that built a “telematics exchange” to store the data.
Based on certain risk factors predetermined by General Motors, purchasing companies would use the data they collected to calculate a “Driving Score.” A few negative risk factors used to formulate a driver’s score include late-night driving, seat belt status of both the driver and passenger, degree angle of turns made in the car, hard braking, floored acceleration, and even piloting the vehicle more than 80 miles per hour.
Agreements General Motors had with data purchasing companies also required them to allow insurance companies to access the driving scores.
The lawsuit posits that insurance companies subsequently used these scores and information from the “telematics exchanges” to either jack up customers’ insurance costs, drop coverage entirely, or deny coverage of would-be customers. As a result, General Motors accumulated large sums of money from these practices.
According to the Attorney General’s Office, General Motors hoodwinked customers by getting them to enroll in programs like OnStar Smart Driver and told them that safety features would be disabled if they did not enroll.
However, customers were unaware that opting into these products involved “agreeing” to the purchasing and selling of their personal driving data.
“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,” reads Paxton’s press release.
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