International Law

State?s Bulk Sale of Motor Vehicle Records Did Not Violate Federal Driver?s Privacy Law

This posting was written by Thomas A. Long, Editor of CCH Privacy Law in Marketing.

The federal Driver?s Privacy Protection Act (DPPA) permitted the State of Texas to sell drivers motor vehicle (DMV) records in bulk to private entities that certified that they had a lawful purpose for acquiring the data, the U.S. Court of Appeals in New Orleans has decided.

A provision of the Texas Transportation Code allowed individuals and companies to buy magnetic tapes of driver?s license records, upon certification of a lawful purpose.

Plaintiffs bringing a purported class action on behalf of individuals with drivers licenses issued by the State of Texas asserted that the purchasing entities did not use all of the records immediately and maintained databases or resold the information.

The plaintiffs did not contend that the entities used any of the records for a purpose other than the permissible purposes listed in the DPPA; nor did they allege that records resold to third parties were used for impermissible purposes. Instead, they argued that maintaining records not actually used for the purpose stated at the time of purchase was itself an impermissible purpose under the DPPA.

The text and legislative history of the DPPA indicated that Congress intended to allow states to distribute DMV information in bulk, according to the court. Purchasers of the data were not required to actually use all of the data, as long as they did not use any of the information for a purpose not permitted by the DPPA. The DMV database was analogous to a set of legal reporters purchased by an attorney who intended to do research using the set, but was unlikely to read every single opinion, the court said.

In addition, the purchasing entities were not required to make use of the DMV records before reselling them to third parties for one or more of the DPPA?s permissible purposes. Dismissal of the DPPA claims with prejudice was affirmed.

The decision in Taylor v. Acxiom Corp. will appear at CCH Privacy Law in Marketing ¶60,510.

Full post as published by Trade Regulation Talk on August 11, 2010 (boomark / email).