Opinion ID: 1036114
Heading Depth: 4
Heading Rank: 1

Heading: Disclosure for an Impermissible Use

Text: Gordon contends that the Resellers disclosed his personal information for a use that was not specifically identified in the DPPA's list of fourteen exceptions. See 18 U.S.C. § 2721(b). We review the disclosure of each Reseller separately and conclude that, while Softech disclosed Gordon's personal information for a permitted use, a material question of fact exists as to the propriety of Arcanum's disclosure. -23-
Gordon alleges that Softech disclosed his personal information to Arcanum even though Arcanum did not identify a permissible use; this argument is meritless. When Arcanum, a private investigative agency, requested Gordon's personal information from Softech, it selected DPPA Purpose No. 8. Rodriguez Dep. 49:8-11, Feb. 16, 2011; Cohn Dep. 29:3-10, Apr. 13, 2011. This corresponds to the exception in section 2721(b)(8), [f]or use by any licensed private investigative agency . . . for any purpose permitted under this subsection. 18 U.S.C. § 2721(b)(8); see also Rodriguez Dep. 49:12-16. Hence, this exception includes two limiting factors: (1) the entities that may claim the exception, and (2) the purposes for which information may be requested. Arcanum's request satisfied both requirements. First, as discussed above, Arcanum was a licensed private investigative agency and therefore eligible to claim the exception. Second, Arcanum had provided Softech with an Affidavit of Intended Use that specifically identified -24- three intended uses for the records requested, all of which complied with exceptions in section 2721(b). 7 When Softech accessed the New York State DMV database and provided Arcanum with Gordon's name, address, and additional information pertaining to his car , it disclosed that information pursuant to an exception in section 2721(b), to an entity eligible to invoke the exception, for three purposes permitted by the DPPA. See 18 U.S.C. § 2721(b)(8). Therefore, the district court correctly concluded as a matter of law that Softech had disclosed Gordon's personal information for a use expressly permitted by statute. 8 7 Specifically, the affidavit indicated that Arcanum would use information only for the purposes outlined in section 2721(b)(3) (for limited purposes in the normal course of business), section 2721(b)(7) (to provide notice to owners of towed or impounded vehicles), and section 2721(b)(13) (when the party in interest had consented in writing). 8 Gordon also argues that Softech's disclosure under the private investigative agency exception violated the terms of an agreement between Softech and Arcanum. Under either Florida or New York law, Gordon, because he is a non-party who was not an intended third-party beneficiary of the agreement, cannot allege a DPPA violation on breach of contract grounds. See, e.g., Bochese v. Town of Ponce Inlet, 405 F.3d 964, 981-83 (11th Cir. 2005) (discussing Florida law); State of Cal. Pub. Emps.' Retirement Sys. v. Shearman & Sterling, 95 N.Y.2d 427, 434-35 (2000) (discussing New York law). -25-
Arcanum disclosed Gordon's personal information to Leifer based on Leifer's selection of Insurance Other  from the Docusearch.com dropdown menu. Gordon contends that Insurance Other did not correspond to a permitted use. 9 Although Resellers insist that Gordon waived this argument by failing to raise it below, we disagree. Gordon's amended complaint noted that Arcanum disclosed . . . Gordon's personal information without a permissible use under the DPPA. Amended Complaint, ¶¶ 79, 81. This necessarily implied that Gordon challenged whether the stated use -- Insurance Other -- fell within the section 2721(b) exceptions. 10 Furthermore, Gordon argued below that 9 Although Resellers further argue that Leifer wanted Gordon's personal information in preparation for litigation, pursuant to the exception in section 2721(b)(4), Leifer only claimed one exception -- Insurance Other. Section 2722(a) prohibits disclosure for any use not permitted by statute, and Arcanum did not know that Leifer's use might later qualify for this exception. A reseller's ex post decision about a recipient's intended use of information cannot justify its decision to disclose the information in the first place. 10 When cross-moving for summary judgment, Gordon explicitly argued that Insurance Other was not a permitted use, but made that argument only with respect to Softech. -26- to qualify under [the insurance exception] you have to either be an insurance company or a self-insured entity. Nov. 22, 2011 Tr., at 17:21-23. Counsel for Arcanum was present, but did not object. Accordingly, we determine that the issue was not waived. Under a textual approach, Insurance Other does not track the language of the insurance exception, which allows a person to disclose or use DPPA-protected personal information in connection with claims investigation activities, antifraud activities, rating or underwriting . 18 U.S.C. § 2721(b)(6). Thus, a disclosure for Insurance Other could be outside the scope of the statute , as the generic phrase encompasses many insurance-related activities beyond the stated activities of section 2721(b)(6). See Maracich, 133 S. Ct. at 2199-2200 (examining DPPA's litigation exception and noting that [u]nless commanded by the text . . . these exceptions ought not operate to the farthest reach of their linguistic possibilities if that result would contravene the statutory design). -27- The insurance exception, moreover, may only be claimed by certain entities: an insurer or insurance support organization, or [] a self-insured entity. Id. § 2721(b)(6). When deposed, Leifer conceded that he did not work at an insurance company, and could not identify what a self-insured entity or an insurance support organization was. Leifer Dep. 81:22 to 82:19, July 12, 2011. Arcanum has pointed to nothing in the record to suggest that Leifer was, in fact, eligible to request information pursuant to that exception. Thus, even if we were to assume that a collision had occurred, an insurance claim had accrued, and Insurance Other was coterminous with section 2721(b)(6), a reasonable jury could easily find that Leifer was not eligible to request information pursuant to the insurance exception. The Resellers insist that Insurance Other covered all insurance-related uses, but only to the extent contemplated by the exception in section 2721(b)(6). This argument relies on the fact that each Docusearch.com customer certified that it was in, and assume[d] full responsibility for, compliance with the Driver's Privacy -28- Protection Act of 1994 by clicking OK on a pop-up window. Furthermore, the customer also check ed a box, thereby consenting to the terms of a Client Agreement, in which the customer represent[ed] and warrant[ed] that it will provide Docusearch with accurate and complete information regarding the searches requested, and that search results will not be used for any purpose other than the purpose stated to Docusearch. We need not decide whether these representations sufficiently narrowed the scope of Insurance Other ; Resellers' argument still ignores the fact that only certain entities are eligible to claim the insurance exception. Whether Leifer is one of them is determinative of Arcanum's liability. If Leifer was not eligible to claim that exception, Arcanum's disclosure would have been for a use not permitted by section 2721(b). Hence, with respect to Arcanum, we conclude that the district court erred by granting summary judgment without having first considered (1) whether Leifer was eligible to request information pursuant to the insurance exception, (2) if so, whether a collision had occurred, and (3) if so, whether an -29- insurance claim had accrued. These material questions of fact preclude summary judgment as to Arcanum's liability.