General Motors (GM) is facing a second lawsuit for collecting driver data without their consent and sharing it with outside parties to increase insurance premiums.
The lawsuit was filed on March 28 in the U.S. District Court for the Eastern District of the Southern District of Michigan by Larry Reed of Michigan and Darnell McCoy Sr. of California.
Additionally, the 246-page lawsuit alleges that approximately 8 million vehicles were part of GM's programs with LexisNexis and Verisk. Additionally, GM's decision to stop providing customer driving data to two data brokers “in fact reflects Defendants' recognition that it did not obtain the necessary legal consent from customers for this data-sharing practice.” It suggests.”
According to the complaint, there are “more than 100 estimated class participants” who are the subject of the class action lawsuit, and damages sought from GM and OnStar exceed $5 million.
But Eric Gordon, a lawyer and lecturer at the University of Michigan's Ross School of Business, said GM's decision to stop sharing customer data doesn't necessarily mean it's guilty.
On March 22, GM announced that, with three consumer consents, it will share limited data obtained through the OnStar Smart Driver program with insurance companies via third parties. The OnStar program is optional. Customers can unsubscribe at any time, and GM said their driving habits can be tracked to make driving safer and reduce vehicle wear and tear.
Ultimately, the lawsuit alleges that GM and OnStar forced customers to participate in data collection programs, unintentionally limiting user choice. In 2022, for example, GM says it “forced” many consumers to pay for a three-year OnStar and Connected Services package regardless of their wishes.