Texas Sues General Motors and OnStar Over Alleged Unlawful Data Collection
Written by: Scott Michael Lupiani, Esq.

Headline:

Texas Attorney General Ken Paxton: “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.” 

Background:

Texas filed suit against General Motors LLC and OnStar LLC alleging violations of the Texas Deceptive Trade Practices-Consumer Protection Act (DTPA). The complaint states that since 2015, General Motors has installed technology in its vehicles to collect highly specific “Driving Data” about customers’ driving habits and vehicle usage. Texas alleges that without customers’ knowledge or consent, General Motors has unlawfully collected, used, and sold this Driving Data to other commercial entities, including insurance carriers. The Driving Data includes details like trip start/end times, vehicle speed, seatbelt status, and distance driven for over 14 million GM vehicles, including 1.8 million in Texas.

Deceptive Marketing and Enrollment:

Further alleged is that General Motors aggressively marketed products like Connected Vehicle Services, mobile apps, and the OnStar Guardian App as providing “better drives,” “better entertainment,” “better safety,” and “better control.” Enrolling customers in these products was a deceptive scheme to obtain consent for collecting and selling their Driving Data. GM used misleading onboarding processes at dealerships that appeared mandatory, made confusing disclosures that obfuscated its data practices, and deterred customers from declining enrollment by implying safety features would be deactivated.

Data Sale Agreements:

Texas stated that from 2015 to 2024, General Motors entered into multiple agreements to sell customers’ Driving Data to companies like Verisk Analytics, Wejo Limited, LexisNexis Risk Solutions, and Jacobs Engineering. These agreements required the companies to create databases housing the Driving Data, calculate “Driving Scores” based on factors like hard braking and speeding, and sell access to insurers. General Motors profited through lump-sum payments, royalties from database licenses sold to insurers, and minimum guaranteed payments based on vehicle sales. Insurers could then use customers’ Driving Scores to increase premiums, deny coverage, or drop customers entirely, without their knowledge or consent.

Click here to read the full complaint on the Texas Attorney General’s website.