Texas Lawsuit Targets Allstate, Arity Over Alleged Data Collection Violations

Texas Lawsuit Targets Allstate, Arity Over Alleged Data Collection Violations

Texas has launched a lawsuit against Allstate, accusing it of unlawfully collecting and selling the driving data of millions.

At a Glance

  • Texas has filed a lawsuit in Montgomery County District Court against Allstate and Arity.
  • Over 45 million Americans’ driving data was allegedly collected and sold without consent.
  • Data gathered allegedly included sensitive information like geolocation and gyroscopic data.
  • Allstate potentially used this data to adjust insurance rates and sold it to third parties.
  • The lawsuit seeks to halt data collection and impose fines under Texas data privacy law.

The Allegations and Key Players

Texas filed a lawsuit against Allstate Corporation and its subsidiary, Arity, in Montgomery County District Court. The suit accuses these entities of unlawfully harvesting and distributing personal driving data from over 45 million Americans without their consent. The lawsuit seeks a jury trial to address these serious allegations.

Defendants named in the lawsuit include not just Allstate Corporation but also Allstate Insurance Company and several Arity entities. They allegedly captured vast amounts of data, including geolocation, accelerometer readings, and more from individuals’ mobile and in-car devices.

How Data Collection Allegedly Occurred

Arity, touted as having the “world’s largest driving behavior database,” allegedly exploited data collected through various means without user knowledge. Vehicles, mobile devices, and even purchased information from manufacturers like Chrysler and Toyota were reportedly used to compile this massive data trove.

Relevant data includes behavior metrics such as speeding and phone distractions. This information was reportedly used to create risk scores that influenced insurance premium calculations and were sold to third parties.

Legal Implications and Future Impact

Attorney General Ken Paxton’s lawsuit aims to enforce Texas’s comprehensive data privacy laws, such as the TDPSA, which requires clear notice and informed consent for sensitive data use.

“Our investigation revealed that Allstate and Arity paid mobile apps millions of dollars to install Allstate’s tracking software. The personal data of millions of Americans was sold to insurance companies without their knowledge or consent in violation of the law. Texans deserve better, and we will hold all these companies accountable,” Paxton stated.

The lawsuit has raised significant attention due to its nature and may set a legal precedent regarding data privacy across the United States. The request for cease of data collection, deletion of existing data, and imposing fines will serve as a stern warning to entities engaging in improper data practices.

Broader Implications for Consumers

This case echoes a wider concern over how consumer data is collected and wielded by corporations. Consumers have questioned the integrity and transparency of data practices following the lawsuit against General Motors for similar privacy violations.

As legal battles ensue, time will tell how this could impact the future of companies handling consumer data.

Sources

  1. Texas sues Allstate alleging it illegally collected and sold users’ data
  2. EXCLUSIVE: Red state sues insurer for using customer data to build ‘world’s largest driving behavior database’
  3. Texas sues over data that drives up insurance rates