   OFFICE   OF THE ATTOREEY   GENERAL   - STATE OF TEXAS

   JOHN     ~~RNYN




                                               October 19,200l



The Honorable Tony Goolsby                                 Opinion No. JC-0423
Chair, Committee on House Administration                                             %
Texas House of Representatives                             Re: Limitation on disclosure of driver’s license
P. 0. Box 2910                                             information imposed by the Federal Driver’s
Austin, Texas 78768-29 10                                  Privacy Protection Act (RQ-03 8 1-JC)



Dear Representative     Goolsby:

         House Bill 3016, adopted by the 77th Texas Legislature, “permits the use of information
accessed by using the magnetic strip on a . . . driver’s license by persons other than law enforcement
officials when used to prevent the purchase of alcoholic beverages by minors and to comply with
Texas Alcoholic Beverage Commission record keeping rules regarding private club memberships.”
HOUSE COMM. ON LICENSING&ADMINISTRATIVEPROCEDURES,                BILL ANALYSIS, Tex. H.B. 3016,77th
Leg., R.S. (2001). You ask whether this legislation falls afoul of the Federal Driver’s Privacy
Protection Act, 18 U.S.C. § 2721. In our view, it does not.
                                                                                  *.
        House Bill 3016 amends the Alcoholic               Beverage Code by adding section 109.61, which
provides:

                  (a) A person may access electronically readable information on a
                  driver’s license, commercial      driver’s license, or identification
                  certificate for the purpose of complying with this code or a rule of the
                  commission, including for the purpose of preventing the persop from
                  committing an offense under this code.

                 (b) A person may not retain information accessed under this section
                 unless the commission by rule requires the information to be retained.
                 The person may not retain the information            longer than the
                 commission requires.

                  (c) Information   accessed under this section may not be marketed in
                  any manner.
The Honorable   Tony Goolsby     - Page 2    (JC-0423)                         .




                (d) A person who violates this section commits an ‘offense.        An
                offense under this section is a Class A misdemeanor.

Act of May 27’2001’77thLeg., R.S., ch. 1163,200l        Tex. Sess. Law Serv. 2486 (to be codified at
TEX. ALCO. BEV. CODE ANN. 0 109.61).

         As the bill analysis indicates, House Bill 3016 was drafted in response to an opinion of this
office, Attorney General Opinion JC-0337 (2001). That opinion considered whether the Department
of Public Safety (the “DPS”), in adopting rules under section 52 1.126 of the Transportation Code
to insure that magnetic stripe information “is used only for law enforcement or governmental
purposes,” TEX. TRANSP. CODE ANN. 8 521.126 (Vernon Supp. 2001)’ could restrict usage of the
information provided on the magnetic stripe to law enforcement and government agency personnel
acting in their official capacity. See Tex. Att’y Gen. Op. No. JC-0337 (2001). The opinion
concluded, based on the language and legislative history of the Transportation Code section, that the
proposed DPS rule “correctly interpreted the legislature’s intent . . . [and] that magnetic stripe
information contained on a driver’s license or identification card issued by the Department of Public
Safety may be utilized only by law enforcement and other governmental agency personnel acting
in their official capacities.” Id. at 5.
                                                                                /

         The opinion specifically rejected the view that “an alcoholic beverage retailer’s use of the
magnetic stripe information serves a law enforcement purpose because it enables such a retailer to
more easily identify, and thus refuse to serve minors, and to determine beyond doubt that a particular
driver’s license or identification card is fraudulent.” Id. at 3. While acknowledging the argument,
the opinion took the view “that the DPS has the initial discretion to determine what [law enforcement
or governmental] purposes are,” and had done so in the proposed rule in question. Id. House Bill
30 16, however, permits the use of magnetic stripe information by private parties to prevent under-
age drinking or other violations of the Alcoholic Beverage Code.

         You express concern about the relation of House Bill 3016 to the Federal Driver’s Privacy
Protection Act, 18 U.S.C. 0 2721, which provides in relevant part:

                (a) IN GENERAL.- A State department of motor vehicles, and any
                officer, employee, or contractor thereof, shall not knowingly d&close
                or otherwise make available to any person or entity:

                    (1) personal information, as defined in 18 U.S.C. 2725(3), about
                any individual obtained by the department in connection with a motor
                vehicle record, except as provided in subsection (b) of this section;
The Honorable   Tony Goolsby     - Page 3     (JC-0423)                           .




                (b) PERMISSIBLE USES. - Personal information           referred       to in
                subsection (a) . . . may be disclosed as follows:

                    (1) For use by any government agency, including any court or law
                enforcement agency, in carrying out its functions, or any private
                person or entity acting on behalf of a Federal, State, or local agency
                in carrying out its functions.




                    (3) For use in the normal course of business by a legi timate
                business or its agents, employees, or contractors, but only -




                         (B) if such information as so submitted is not correct or is no
                longer correct, to obtain the correct information, but only for the
                purposes of preventing fraud by, pursuing legal remedies against, or
                recovering on a debt or security interest against, the individual.




                    (14) For any other use specifically authorized under the law of
                the State that holds the record, if such use is related to the operation
                of a motor vehicle or public safety.

Driver’s Privacy Protection Act of 1994’18 U.S.C. 8 2721 (a), (b) (1994 & Supp. V 1999)’amended
hy Pub. L. No. 106-346. 114 Stat. 1356 (2000) (amendment to be codified at 18 U.S.C. 9 2721(a)).

        The purpose of the Driver’s Privacy Protection Act (the “DPPA”), as the Supreme Court
noted in Reno v. Condon, 528 U.S. 141,144 (2000), is to establish “a regulatory scheme that restricts
the States’ ability to disclose a driver’s personal information without tde driver’s consent.”
Representative   James Moran, who introduced the legislation in the United States House of
Representatives, described the problem the statute seeks to correct thus:

                In 34 states across the country, there are virtually no restrictions on
                who has access to the name and address of licensees. In fact, very
                few Americans realize that by registering their car or obtaining a
The Honorable   Tony Goolsby     - Page 4    (JC-0423)




                driver’s license through the DMV, they are surrendering their
                personal and private information to anyone who wants to obtain it.

139 CONG.REC. E2747-02 (1993) (statement of Rep. James P. Moran). Accordingly, Representative
Moran described the DPPA as “safeguard[ing] the privacy of drivers and vehicle owners by
prohibiting the release of personal information - including a person’s name and address - to anyone
without a specific business-related reason for obtaining the information.” I&

         As the statutory language, legislative history, and case law recited above all make clear, it
is the dissemination of private information by state departments of motor vehicles such as the Texas
Department of Public Safety that the DPPA seeks to regulate. But the transactions at issue in House
Bill 3016 do not directly involve the DPS. The person accessing information from the magnetic
stripe has presumably obtained possession of the license from the licensee, rather than from the DPS.
Accordingly, it does not appear to be the case that in this situation the DPS has, in the terms of the
DPPA, “knowingly disclose[d] or otherwise [made] available” any information.           (We note as an
aside that, given that the magnetic stripe information is “the information printed on the license and
a physical description of the licensee,” TEX.TRANSP.CODEANN. 0 521.126(a) (Vernon Supp. 2001)’
a transaction permitted by House Bill 3016 would not seem to implicate the DPPA any more than
would any other instance in which a driver’s license was used as proof of age for a commercial
transaction.)

          Assuming for the sake of argument, however, that a court were to take the view that allowing
the use of magnetic stripe information by persons who sell alcoholic beverages to check for under-
age drinkers did constitute the making available of information protected under the DPPA, we
believe a case could be made that transactions permitted under House Bill 3016 are permissible
under at least two separate exceptions permitted by the federal statute - the exceptions for use in the
normal course of business to verify the accuracy of personal information submitted, see 18 U.S.C.
8 272 1(b)(3) (1994 & Supp. V 1999)’ and for “any other use specifically authorized [by state law] .
. . related to . . . public safety.” Id. tj 272 1(b)( 14).

         While there is little case law interpreting the DPPA, and accordingly little guidance
concerning the breadth of the statutory exceptions, we note that subsection (b)(3)‘s exception of
“use in the normal course of business by a legitimate business . . . to verify the accuracy of personal
information submitted by the individual” appears to us precisely to describe the activity popularly
known as “carding” by those who sell alcoholic beverages. That is, a person attempting to purchase
such a beverage is asked to provide verification for the claim that he or she is twenty-one years of
age. What House Bill 3016 provides is a method by which that claim may be verified. When the
license is provided, its electronic reading assures that the information on the face of the license has
not been tampered with. Such a use as this is exactly the sort excepted by the language of 18 U.S.C.
6 272 1(b)(3).
The Honorable    Tony Goolsby     - Page 5     (JC-0423)




        Further, subsection (b)( 14)’the DPPA’s “catch-all” provision, excepts from its coverage “any
other use specifically authorized under the law of the State that holds the record, if such use is related
to the operation of a motor vehicle or public safety.” 18 U.S.C. 9 2721(b)(14) (1994). The laws
related to the possession of alcohol by minors are to be found in chapter 106 of the Alcoholic
Beverage Code. The public policy which that Code articulates, and in light of which it is to be
construed, is stated in section 1.03 of the Code:

                         This code is an exercise of the police power of the state for the
                protection of the welfare, health, peace, temperance, and safety of the
                people of the state. It shall be liberally construed to accomplish this
                purpose.

TEX. ALCO. BEV. CODE ANN. 8 1.03 (Vernon          1995).

        In light of the fact that preventing minors from acquiring alcoholic beverages is therefore a
matter related to the public safety, and the use of magnetic stripe information is specifically
authorized by House Bill 3016 for that purpose, as well as for the other reasons articulated above,
we conclude that House Bill 3016 does not fall afoul of the Federal Driver’s Privacy Protection Act.
The Honorable   Tony Goolsby     - Page 6    (Jc-0423)




                                        SUMMARY

                        House Bill 3016, which permits the use of magnetic stripe
                information on drivers’ licenses and identification cards issued by the
                Texas Department of Public Safety for the purpose of compliance
                with the Alcoholic Beverage Code and rules promulgated by the
                Alcoholic Beverage Commission, does not violate or conflict with the
                Federal Driver’s Privacy Protection Act, 18 U.S.C. 5 2721.

                                               Yo rs very trul ,



                                            4Qb-r
                                              JO&N     C&RNYN
                                              Attorney General of Texas



HOWARD G. BALDWIN, JR.
First Assistant Attorney General

NANCY FULLER
Deputy Attorney General - General Counsel

SUSAN D. GUSKY
Chair, Opinion Committee

James E. Tourtelott
Assistant Attorney General, Opinion Committee
