Seventh circuit joins other federal circuits in concluding that obtaining information in bulk and storing it for sale to third parties later is not a violation of federal law.
Oct. 3, 2011 – Federal law does not prohibit a private company from reselling personal information it buys from a state’s Department of Motor Vehicles (DMV), the U.S. Court of Appeals for the Seventh Circuit has ruled.
A class of plaintiffs sued West Publishing Company under the Driver’s Privacy Protection Act (DPPA), 18 U.S.C. section 2722, arguing that West improperly disclosed personal information obtained from the Illinois DMV without consent. But in Gracyk et al. v. West Publishing Co., No. 10-1193 (Sept. 28. 2011), a three-judge panel ruled that West Publishing did not violate the DPPA in reselling the information it obtained.
The DPPA limits how state DMVs can share personal information, and prohibits private individuals from obtaining or disclosing personal information from a DMV record for certain uses. However, the federal law did not prohibit West Publishing from releasing the information for profit.
“[I]t cannot be the profit motive that renders West Publishing’s conduct unlawful,” wrote Judge Ann Willliams. “[T]he plaintiffs do not allege that West Publishing is releasing personal information to persons who do not have a permissible use. …”
The appeals panel rejected the argument that a state fails to be the “gatekeeper” of information if it allows companies to obtain personal information in bulk without individual requests. Thus, the panel upheld the district court’s decision to dismiss the case for plaintiffs’ failure to state claim.