Settlement Over Disclosure of Driver’s Information Receives Final Court Approval
Earlier this year, a federal court granted preliminary approval of a proposed class action settlement in connection with litigation arising under the Driver’s Privacy Protection Act (“DPPA”). Gaston v. Lexisnexis Risk Solutions, 2021 U.S. Dist. LEXIS 12872 (W.D.N.C. Jan. 25, 2021). Last week, the court gave the settlement final approval, marking an end to five years of litigation between the parties.
To recap, the DPPA is a federal statute governing the sale and resale of certain personal information (PI) from a motor vehicle record (think driver’s license number and the like). In Gaston, after the plaintiffs had been involved in a car accident they filed a putative class action complaint alleging that their PI had been electronically transmitted by officers and law enforcement agencies to North Carolina DMV to be used to create a “DMV-349 crash report.” Plaintiffs alleged that information in those crash reports was accessed and used by PoliceReports.US LLC and LexisNexis Risk Solutions to solicit business in violation of the DPPA.
Following discovery, both parties moved for summary judgment. The court held that the DMV-349 crash reports are “motor vehicle records” under the DPPA. Additionally, “based on Defendants’ admission that they disclosed the reports without regard to whether the personal information in the reports would be used for a purpose permitted by the DPPA as well as the undisputed evidence that at least some of those reports were used for an impermissible purpose,” the court awarded Plaintiff's summary judgment on their claim for declaratory and injunctive relief.
Which brings us to the settlement which received final court approval last week. Recall that the negotiated relief to the class includes Defendants adopting business changes to govern the release of crash reports going forward (including disclosing the information contained in the crash reports only under limited circumstances, such as those protected under the DPPA).
In granting final approval last week, the court confirmed its prior holding that “the settlement represents not only a fair, reasonable, and adequate resolution of the claims brought in this action, but also represents a new standard for the treatment of information on a Crash Report nationwide.” Order at 2-3. Among other things, the court confirmed that the settlement reached by the parties satisfied a multi-factor test used in the Fourth Circuit for fairness (including “(1) the posture of the case at the time the proposed settlement was reached, (2) the extent of discovery conducted, (3) the circumstances surrounding the settlement negotiations, and (4) counsel’s experience in the type of case at issue.”) (citation omitted).
Additionally, in the absence of settlement, the court noted both parties intended to pursue litigation before the Fourth Circuit (concerning the issues of whether crash reports are a “motor vehicle record” under the DPPA or are otherwise outside the scope of the DPPA and whether Defendants are entitled to qualified immunity and otherwise had an express permissible purpose under the DPPA precluding liability). This in turn would increase litigation costs and uncertainty, while stalling any class-wide relief.
So there you have it. While this litigation has come to the end of the road, other DPPA cases remain pending. And aside from claims brought under the DPPA, there are other cases involving the purported collection and use of driver and driver’s license information. Not to worry, CPW will be there to keep you in the loop. Stay tuned.