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California Toll Road Agency Settles Class Action Lawsuit
Toll roads in Southern California settle $175 million lawsuit over privacy invasion and outrageous penalty fees.

Orange County Toll Road
By Richard Diamond

Notices of a forthcoming refunds are going out to motorists overcharged by late fees on Southern California's toll roads. A group of eight motorists filed a lawsuit five years ago after they were hit with penalty bills of up to $55,000 for using the 73, 133, 241, 261 and 91 Express Lanes toll roads without the toll being collected -- often as a result of an expired credit card. The suit charged the toll road operators with taking deliberate steps to encourage penalty fees.

"The conversion to a cashless system was deceptively and negligently designed and implemented by defendants to cause a radical increase in violations (and thus revenue) for defendants," attorney Helen I. Zeldes argued in the original complaint against the tolling system.

After reviewing more than 500,000 pages of documents, the toll road agencies were caught sharing the travel pattern data and other private information of its users with the Arizona Department of Motor Vehicles (DMV) as well as private companies like LexisNexis, icontact, Marshall Advertising, Julinne von KleinSmid, DataTicket Incorporated and Law Enforcement Systems LLC -- potentially in violation of California law. The tolling agencies turned to these companies to convert license plate information from toll road cameras into names and addresses so that they could mail out violation tickets.

In 2010, the legislature adopted a law designed to prevent toll roads from misusing the personal information of drivers for marketing purposes. Judge Andrew J. Guilford found that the law did not apply to tolling agencies that give a license plate number to a state DMV for the purpose of obtaining the registered owner's address, but the legality of other transfers of information were so complex that they would have to be sorted out at trial. The tolling agencies did not want to risk further litigation, so they decided to settle the case after the Ninth Circuit US Court of Appeals refused to block the case from going forward.

Refunds under the settlement include $40 million in cash payments plus $135 million in forgiveness for outstanding late fees and penalties. The tolling agencies must also change their policies to give drivers seven days, instead of five, to pay a toll before a ticket can be issued. The agencies must have a clear policy outlining who receives what personal information about toll road users. The lawyers who brought the suit will pocket $20,490,000 out of the settlement fund.

Those interested in filing a refund claim must do so by November 8. The court's special master has scheduled a settlement approval hearing will be held via Zoom on January 4, after which the judge will render a final decision.

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