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In apparently the first case in the nation brought under the federal Drivers Privacy Protection Act, a municipality in upstate New York and former police officer have agreed to pay $325,000 to resolve a complaint that arose after the officer improperly tapped motor vehicle records to provide information to a private investigator. The settlement reached Tuesday came on the brink of a trial before Northern District Judge David N. Hurd in Utica, N.Y. Hurd in March issued a watershed summary judgment opinion that said the act imposes vicarious liability on municipalities, and that it also covers relatives and others who may be harassed because of the wrongful release of a driver’s personal information. “This is the first case that addressed the issues related to a violation of the statute and the reach of the statute,” said the plaintiffs’ attorney, Kevin A. Luibrand, a partner at Tobin and Dempf in Albany, N.Y. “Judge Hurd found that it not only protects the person [whose personal information was revealed], but anyone in the household. So, for instance, with one of our clients [the perpetrators] ran the plate and then threatened the family. The entire family was covered by the statute.” Margan v. Niles, 00-CV-1201, began with a suspicious workers’ compensation claim. After William Niles obtained benefits for an allegedly job-related injury, his employer, the Hannaford Brothers supermarket chain, launched an investigation. Mary Ellen Louer, an administrator with Hannaford, hired investigators to watch Niles. The investigators filmed Niles, who had complained of a back injury, performing activities inconsistent with the alleged injury. Niles and Garth Russell Johnston obtained the motor vehicle license numbers of the investigators. Johnston then asked a friend, then Glenville Police Officer Keith McKenna, to obtain the investigators’ names by cross-referencing their license data. That information was apparently used to harass Louer and the investigators and their families. Niles and Johnston pleaded guilty and are now serving federal prison sentences for conspiracy to commit extortion. As counsel for the plaintiffs, Luibrand sued in federal court, alleging violations of the Drivers Privacy Protection Act (DPPA). The law was enacted in the aftermath of the 1989 murder of actress Rebecca Schaeffer, who was murdered by a fan who had obtained her home address through California motor vehicle records. In response, Congress included the DPPA within the Violent Crime Control and Law Enforcement Act of 1994, with the aim of preventing stalkers and other would-be criminals from exploiting public records to obtain information about their prey. However, until Luibrand brought this case, the driver privacy act had apparently never been used as the foundation for a civil action. Judge Hurd set the stage for settlement in March, when he found that the Town of Glenville was vicariously liable for the misconduct of Officer McKenna, and when the judge held that the statute extended to victims such as the detectives’ families. “By imposing vicarious liability upon employers, they will have incentive to adopt appropriate policies and procedures to prevent the misuse of motor vehicle records, thereby furthering the DPPA’s goals of protecting individuals’ personal information found in motor vehicle records,” Hurd wrote in the March decision. In a settlement agreement finalized on Tuesday, the town and now-retired Officer McKenna agreed to pay the 16 plaintiffs — a group that included relatives of the victims — a total of $325,000. Additionally, Niles agreed to pay $125,000. A claim against Johnston is pending. Attorney David A. Bagley of Petrone & Petrone in Utica, who represented the town, said the municipality’s probable exposure and the settlement figure were virtually identical. “The settlement figure represented our likely damages calculus,” he said. “That number was, of course, influenced by the fact that the statute provides for an attorney fee award.” Bagley said it is unclear how Judge Hurd’s findings will affect other cases. “I don’t know how that will play out in future cases,” he said. “It won’t be the subject of an appeal, obviously, in this case. But I wouldn’t be surprised if the matter is further developed in future case law.” Appearing for the individual defendants were Joseph D. Giannetti of Horigan, Horigan, Lombardo & Kelly in Amsterdam, N.Y., and Andrew R. Safranko of O’Connell & Aronowitz in Albany.

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