Motorists in six states are suing a company that sends advertising in vehicle registration notices, saying it violates a federal law that protects their personal information.
Imagitas Inc., a Pitney Bowes company, has contracts in all six states – Ohio, Massachusetts, Missouri, Florida, Minnesota and New York – to insert advertisements before mailing vehicle registration notices to millions of drivers. A total of nine class-action lawsuits have been filed.
“The class action attorneys are essentially trying to kill the program so they can line their pockets at the expense of the taxpayer,” said Alfie Charles, vice president of DriverSource at Imagitas. “This is one of those programs that makes sense for everybody.”
Imagitas’s DriverSource program redesigns a state’s registration renewal package to include a renewal form and an information guide. Private-sector partners, such as auto insurance companies, car dealerships and gasoline or oil companies, underwrite the cost of the renewal process in exchange for inclusion of their offers in the packages. The ads are usually redeemable coupons included inside the envelopes. Advertisers have included Sirius Radio, Discover, AAMCO, State Farm, JP Morgan Chase Auto and Kia.
Imagitas has had agreements with these states since 2005. To do the mailings, the company receives drivers’ names and addresses. Imagitas pays the state to do the mailing and receives a fee from the advertisers. The advertisers have no access to drivers’ private consumer information.
To date, the program has saved more than $12 million for the taxpayers in the six participating states and has generated $3 million in new revenue for state governments, according to Imagitas.
Imagitas also said its program complies with the federal Driver’s Privacy Protection Act of 1994, which requires states to get specific permission from drivers before releasing their personal data for any direct marketing purpose. States must also meet provisions allowing consumers to opt in to state programs that market their personal information.
The states, however, say the practice is an apparent loophole in their states’ Driver Privacy Protection Act, which allows drivers to shield personal data, such as names and addresses, from being disclosed by Motor Vehicles divisions to commercial mailers.
John R. Climaco, an attorney representing motorists in Cleveland, sued Imagitas last September. The lawsuit contends that Imagitas never gave the Ohio Bureau of Motor Vehicles permission to release personal data.
“This creates a dangerous situation,” he said. “The state should be controlling the names of drivers.”
Mr. Charles said it would make sense to consolidate all nine lawsuits into one in an effort to get the issue resolved as soon as possible. A hearing on the consolidation issue took place late last month, and Imagitas is awaiting the next steps.
“We think we will win the case,” Mr. Charles said. “We are happy [this legal challenge] is going to be dealt with and resolved completely so that future states that we deal with know exactly what the law says.”
