Follow That Car!
| Citation | Vol. 3 No. 3 |
| Publication year | 2007 |
Abstract
Recent court cases in Connecticut and California have challenged the commercial use of Global Positioning Systems (GPS) for tracking and gathering data about consumers. Specifically, these cases focused on the terms and disclosures contained in automobile rental contracts relating to the use of GPS to monitor the driving patterns of rental car drivers. In response to concerns about consumer privacy, several states have also enacted legislation that addresses the use of tracking technology in the rental car market. This Article examines recent litigation concerning the use of GPS in rental cars and related legislative efforts. Although recent legislation and litigation focuses on the automobile rental industry's use of GPS, similar legal issues may arise in other circumstances where devices containing tracking technology may be leased to consumers or commercial parties. Such devices include cellular telephones, heavy machinery, and other types of tracking and remote technologies such as ignition kill devices.
Introduction
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[1] Two states recently challenged car rental companies' use of Global Positioning Systems (GPS) to monitor the driving speed and location of their customers. [fn2] In addition to lawsuits, statutes in California, Connecticut, and New York specifically restrict the use of GPS by car rental companies. [fn3] As a general matter, private and commercial parties commonly use Global Positioning Systems (GPS) in automobiles. [fn4] GPS is a tracking system that uses satellite signals to calculate information related to navigation, such as location, speed, and direction of travel. [fn5] Companies increasingly rely on GPS and similar tracking technology to collect data regarding product use. [fn6] This Article focuses on recent legal challenges to the use of GPS in the rental market and uses these cases to illustrate some of the contractual and policy issues that may arise in other business contexts, when companies deploy tracking technology in conjunction with leasing products or equipment to consumers or commercial entities.Overview of GPS and Tracking Technologies
Overview of GPS and Tracking Technologies
[2] The United States Department of Defense created GPS, a satellite based tracking program, in the early 1970s to increase military efficiency. [fn7] A network of over 24 satellites transmits signals to the earth, where a receiver uses the signals to calculate its own position and other information such as speed and direction of travel. [fn8] If the receiver has a transmitter, it can relay the calculated information to outside data gatherers or third parties. [fn9] President Ronald Reagan approved commercial use of GPS in 1983, after Russia shot down a Korean Airlines flight when the plane erroneously entered Russian airspace. [fn10]
[3] Despite GPS' origin as a purely navigational tool, a variety of locational tracking devices now use GPS. Workforce monitoring programs observe employees using GPS devices in mobile phones and make this information available to employers via the Internet. [fn11] Equipment rental companies use "wireless management solutions" to track the length of time customers use equipment, which allows companies to enforce hourly rates and reduce uncompensated wear and tear on the equipment. [fn12] Car owners use ignition kill devices to deter thieves. Owners operate these devices from outside the vehicle using remote controls. The devices cut off power to the automobile's fuel pump, fuel injectors or spark plugs so that cars will not start. [fn13] Auto racetracks currently use ignition kill devices to increase driver safety during races. [fn14]
[4] Although not widely in use, "biometric vehicle diagnostic/tracking/ignition kill" systems can disable vehicles from remote stations using information sent from a transceiver device. [fn15] Law enforcement could use this technology to disable illegally driven vehicles, such as those that are not registered or insured. [fn16] Commercial leasing companies could also use these systems to disable vehicles whose users have defaulted on their payments. [fn17] Other non-GPS tracking technologies exist, such as Radio Frequency Identification (RFID). RFID tags are small wireless tracking devices that communicate with computers using radio waves. [fn18] Retailers can embed these small, tags into consumer products such as clothing in order to track inventory. [fn19]Contractual Issues Arising in the Use of GPS in the Rental Car Market
Contractual Issues Arising in the Use of GPS in the Rental Car Market
[5] The California and Connecticut legislatures enacted current GPS-restriction laws after courts in these states found car rental companies liable for not fully disclosing GPS use to consumers. [fn20] In
[6] The
[7] The parties agreed to settle the case. [fn26] The settlement agreement permanently prohibits Acceleron from using GPS to collect information about consumers' use of rental cars and from using GPS information to impose any fines, penalties, or surcharges. [fn27] It allows the use of GPS only for the narrow purpose of locating stolen, abandoned or missing rental vehicles. [fn28] Acceleron agreed to keep all records detailing its use of GPS or other electronic surveillance technology, for three years following the rental contact related to such GPS use. Acceleron will make such records available to the offices of the California Attorney General and District Attorney within seven days of a request for inspection. [fn29]
[8] In
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