Texas Attorney General Ken Paxton has taken legal action against General Motors (NYSE: GM), accusing the company of engaging in false, deceptive, and misleading business practices related to the unlawful collection and sale of private driving data from over 1.5 million Texans.
The lawsuit brings to light significant concerns about data privacy, particularly in the context of modern vehicle technology.
Allegations Against General Motors
The lawsuit claims that GM secretly collected detailed driving data from vehicles manufactured in 2015 or later without obtaining proper consent from drivers. This data, which included information about driving habits, was allegedly sold to third-party companies, including insurers.
These companies then used the data to create “Driving Scores” to evaluate drivers, potentially affecting insurance rates without the drivers’ knowledge.
GM is also accused of misleading customers by requiring them to enroll in products like OnStar Smart Driver during the vehicle onboarding process. Customers were reportedly led to believe that not enrolling could deactivate key safety features, but in reality, enrollment meant agreeing to data collection and its sale to third parties.
Attorney General Paxton commented on the investigation, stating, “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.”
He further expressed concern about the broader implications of such practices, noting, “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.”
GM’s Defense and Industry Implications
This action follows a broader investigation initiated by Paxton in June 2024, which examined similar practices by multiple automakers. The investigation forms part of a larger effort to ensure companies comply with privacy protection laws and respect consumer privacy rights.
The case against GM could influence future data privacy regulations, particularly in the automotive industry, where the collection and use of consumer data are becoming increasingly common.
While GM has yet to respond directly to the lawsuit, the company may defend its data practices by arguing that the information collected is essential for improving vehicle performance and safety. However, the central issue remains whether consumers were fully informed and gave explicit consent to this data collection and its subsequent use.
The lawsuit highlights the ongoing debate between innovation and privacy, particularly as vehicles become more connected and data-driven. The outcome of this case could have significant implications for how consumer data is managed in the automotive industry.
“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.”
Ken Paxton, Attorney General of Texas
The Wrap
The legal action taken by Texas Attorney General Ken Paxton against General Motors adds to the growing scrutiny over data privacy practices in the automotive sector. As technology continues to evolve, the tension between consumer rights and industry innovation will likely intensify, making the resolution of this case potentially influential for the future of data privacy in connected vehicles.
