General Motors (GM) is facing a second lawsuit for collecting driver data without their consent and sharing it with outside parties, increasing insurance rates.
The lawsuit was filed on March 28 in the U.S. District Court for the Eastern District of Michigan’s Southern Division by Larry Reed from Michigan and Darnell McCoy Sr. from California.
Moreover, the 246-page lawsuit claims approximately 8 million vehicles were part of GM’s program with LexisNexis and Verisk. Additionally, GM’s decision to cease providing the two data brokers with customer-driving data “suggests an acknowledgment by defendants that they, in fact, did not have the requisite legal consent by their customers for this data sharing practice.”
According to the complaint, “there are more than 100 putative class members” for class action status, and the damages sought from GM and OnStar surpass $5 million.
However, Erik Gordon, a lawyer and lecturer at the University of Michigan’s Ross School of Business, pointed out that GM’s decision to stop sharing customer data does not always imply guilt.
On March 22, GM stated that, following three consumer consents, it would share limited data obtained through the OnStar Smart Driver program with insurers via a third party. The OnStar program is optional. Customers can unenroll at any time, and GM noted that it tracks driving habits to help enhance driving safety and lessen wear and tear on the vehicle.
Ultimately, this latest lawsuit claims that GM and OnStar forced customers to participate in data collection programs, unintentionally limiting user choice. For example, it states that, in 2022, GM “forced” many consumers to pay for a three-year OnStar and Connected Services package, regardless of their desire.
