LINCOLN, Neb. (KSNW) – The Nebraska Attorney General’s Office announced on Tuesday that it has initiated legal proceedings against General Motors and its subsidiary OnStar. The lawsuit alleges that the companies have been collecting, processing, and selling sensitive driving data from Nebraska residents without their explicit knowledge or consent.
Attorney General Mike Hilgers claims that GM and OnStar installed telematics systems in vehicles that gather extensive data, including speed, seatbelt usage, driving habits, and location. This data was purportedly sold to third-party data brokers who created individual driving scores. These scores were then allegedly sold to insurance companies, which used them to adjust rates, deny coverage, or cancel policies, all without informing Nebraska drivers.
Allegations of Misrepresentation and Consent Issues
Key allegations in the lawsuit include accusations that GM misled consumers at the point of sale by misrepresenting the nature and scope of OnStar-connected services. Many consumers reportedly believed that enrolling in OnStar was necessary to access basic safety features, a claim the lawsuit disputes.
Further, GM is accused of failing to adequately disclose that enrolling in its mobile apps or Connected Vehicle Services would allow the company to collect and sell detailed personal data. Dealership employees were allegedly incentivized to enroll customers without proper disclosure and, in some instances, without obtaining any consent.
“Nebraskans deserve to work with companies that are truthful and honest about what they are doing,” said Attorney General Hilgers. “That is not what happened here, and we filed this lawsuit because one large company decided that it wouldn’t honestly tell Nebraskans that their data was going to be used to impact their insurance rates. This is wrong. Our office will hold companies that mislead Nebraskans accountable, no matter how large.”
Industry-Wide Concerns and Historical Context
The lawsuit against GM and OnStar is not an isolated incident. A 2024 investigation by the New York Times uncovered similar practices across the industry, where drivers were tracked without their knowledge or consent. The data collected was often sold to third parties, leading to increased insurance premiums.
This development follows growing concerns about consumer privacy and data protection, especially as vehicles become increasingly connected. The use of telematics systems has raised questions about how much control consumers have over their personal information and the transparency of data practices by large corporations.
Responses and Legal Implications
When contacted for a response, a spokesperson for GM stated, “We remain committed to protecting consumers’ privacy and will conduct a review of the complaint.” The company has not yet provided a detailed response to the allegations.
Nebraska’s lawsuit seeks civil penalties, restitution for affected residents, and an injunction to prevent GM and OnStar from continuing these practices within the state. The case could set a precedent for how telematics data is handled and the level of transparency required from companies regarding data collection and usage.
By the Numbers: The telematics industry is expected to grow to $103 billion by 2025, highlighting the increasing importance of data privacy and consumer rights.
Looking Forward
The outcome of this lawsuit could have significant implications for the automotive industry and consumer privacy laws. If Nebraska succeeds, it may encourage other states to pursue similar actions, potentially leading to stricter regulations on data collection and usage.
As technology continues to evolve, the balance between innovation and privacy remains a critical issue. Consumers and lawmakers alike are calling for greater transparency and accountability from companies that handle personal data, a demand that is likely to shape future legislation and corporate practices.
The legal battle in Nebraska is just one chapter in an ongoing narrative about data privacy in the digital age. As the case unfolds, it will be watched closely by industry experts, consumer advocates, and legal professionals nationwide.
