General Motors (GM) has agreed to a $220 million settlement with a coalition of 36 attorneys general to resolve allegations that it unlawfully sold customer data to third parties.
GM allegedly sold customers’ location information and driver behavior data to third parties, including data brokers, who then resold it to insurance companies. The insurers used this information to set premiums depending on drivers’ driving habits. However, “GM did not disclose to drivers that their data would be sold for this purpose,” the Washington state attorney general’s office said in an Oct. 29 statement.
Washington co-led the case together with Oregon. GM has settled the matter with all 36 attorneys general.
According to the Washington State lawsuit, driver behavior data collected by GM, through its Smart Driver feature, includes information regarding hard braking, crossing a designated high-speed threshold, hard acceleration, seat belt usage, and late-night driving.
GM presented the feature to customers as a way for them to level up driving skills, while failing to disclose that it sold the information to third parties, the lawsuit alleged.
Meanwhile, the geolocation data collected through GM’s OnStar service were linked to personally identifiable information, including names, addresses, and vehicle identification numbers.
The complaint alleged violation of Washington State’s Consumer Protection Act, which declares that unfair or deceptive acts in commerce are unlawful.
Oregon’s complaint against GM accused the company of violating the state’s Unlawful Trade Practices Act.
Washington State will receive $12.3 million through the settlement and Oregon over $10.4 million, with the remainder disbursed to the other states.
“People bought a car, not a tracking device,” Oregon Attorney General Rayfield said in an Oct. 29 statement from his office.
“GM told drivers this program would help them drive more safely and promised it wouldn’t share their data with insurers without permission. Our investigation found GM sold that data anyway, and some drivers paid for it with higher premiums. This settlement puts people back in control of their own information,” Rayfield said.
GM announced that it was discontinuing the Smart Driver program in 2024, citing customer feedback.
No Admission of Liability
The lawsuits were filed against General Motors LLC, General Motors Holdings LLC, and OnStar, LLC, all three being subsidiaries of General Motors Company.
According to the settlement agreement, GM has not admitted any violation or liability arising from local, state, or federal laws.
A GM spokesperson said the settlement reinforces other steps the Detroit automaker has taken to strengthen privacy, according to Reuters.
“Safer, more helpful and personalized experiences are enabled by connected vehicle data, and GM is committed to being clear about what information is used, how it’s protected, and the choices customers have about what they share,” the spokesperson said.
The company agreed to place restrictions on how it uses driver data, while prohibiting such information from being sold to data brokers for a period of five years as part of the agreement.
The Epoch Times reached out to GM for comment but did not receive any response by publication time.
GM previously made a similar settlement with California, which was not a party in the recent case against the company. In May, California Attorney General Rob Bonta announced that GM agreed to pay $12.75 million in penalties over the illegal sale of location and driving data of hundreds of thousands of Californians, according to a statement from the attorney general’s office in May.
Reuters contributed to this report.
