Netflix is in the crosshairs of Ken Paxton, the Republican attorney general of Texas, who filed a lawsuit against the streaming giant, alleging violations of the Texas Deceptive Trade Practices Act.
According to Paxton’s office, Netflix has been “spying on Texans, including children, and collecting users’ data without their knowledge or consent.”
The lawsuit also alleges that Netflix has designed its platform to be addictive, including through its “autoplay” function that “creates a continuous stream of content intended to keep users, including children, watching for extended periods of time.” Other video services that have similar “autoplay” functions include YouTube, Disney+, Hulu, Amazon’s Prime Video, Apple TV and HBO Max.
Netflix did not immediately respond to a request for comment.
One of the lawsuit’s main points is that Netflix for years said it would not introduce advertising as part of its service, before launching an ad-supported plan in late 2022. The suit quotes remarks by then-CEO Reed Hastings on an earnings call in January 2020 as saying, “We don’t collect anything. We’re really focused on just making our members happy, and we’re not tied up with all that controversy around advertising.”
The State of Texas’ lawsuit says: “In short, Netflix sold subscriptions to its programming as an escape from Big Tech surveillance: pay monthly, avoid tracking. Texans trusted that bargain. Netflix broke it — constructing the very data-collection system subscribers paid to escape.”
The Texas AG’s lawsuit was filed May 11 in Texas District Court in Collin County. The lawsuit seeks to stop Netflix’s “unlawful collection and disclosure of user data”; to require Netflix to disable autoplay by default on kids’ profiles; and other “injunctive relief and civil penalties.”
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Paxton is running for the U.S. Senate seat in Texas against incumbent Republican Sen. John Cornyn. The GOP nominee will be determined in a runoff election on May 26, after no candidate secured a majority of the votes in the March 3 primary.
According to the suit, Netflix operates “surveillance machinery” that currently collects roughly 5 petabytes of user-behavior logs per day while processing more than 10 million events per second to fuel over 40,000 internal “microservices.”
In addition to sharing data with advertisers, Netflix “opens its users’ data to commercial data brokers like Experian and Acxiom,” the lawsuit says. The company also has “partnered with dominant ad‑tech platforms, including Google Display & Video 360 and The Trade Desk, to further enable Netflix user data to be merged with information collected off the platform.”
“Texans would be shocked to learn how extensively Netflix shops their data across Big Ad Tech’s shadowy networks. But under Texas law, consumers should never be left in the dark — users are entitled to the truth through clear and forthright disclosures,” the Texas attorney general’s lawsuit says. “Yet Netflix earns billions of dollars every year by quietly deploying the exact playbook it publicly eschewed to lure consumers in the first place. Netflix’s years-long bait-and-switch has led the company right to where it promised never to be: addicting children and families to its platform, mining those users for data, and then converting that data into lucrative intelligence for global advertising juggernauts. Simply put, this is deceptive conduct that violates Texas law.”
In 2022, the lawsuit notes, Netflix acknowledged in its privacy policy the option of an ad-supported plan, and the company introduced high-level terms about behavioral advertising and choices. However, the company “omitted information about the scope of first-party behavioral logging that underpins ad measurement and failed to disclose details on who receives or can model against the data Netflix harvests,” the Texas state suit alleges.
According to the lawsuit, it wasn’t until 2024 that Netflix, after an investigation by the Dutch Data Protection Authority (DPA), “finally name-checked items in its privacy policy like ‘playback events (play, pause),’ ‘app clicks,’ ‘text input,’ and ‘time and duration.’ Yet Netflix had long collected that granular interaction data without disclosure.”
The suit also alleges that privacy-policy changes Netflix introduced in 2025 “furtively imply — without openly admitting — that Netflix collects and leverages data from non-ad-tier subscribers for advertising, and has likely done so since 2022. Yet Netflix still withholds crucial details about who receives this data, how identities are stitched and enriched, and how household-level projections power its ad-targeting reach. Put plainly, even for those who find their way to Netflix’s privacy policy, the disclosures therein are vague, deceptive, and incomplete.”
With regard to tracking usage by children, the lawsuit says, “Netflix’s Help Center narrowly assures that it ‘does not engage in behavioral advertising on a Kids profile’ and then withholds opt-outs for that reason. But Netflix omits that it still collects and analyzes children’s behavioral events and measures ad audiences using household estimates from its own first-party research.”
From Variety US