Texas AG Sues Netflix Over Alleged Secret Tracking and Data Sales

Texas says Netflix built a system that records every click, pause, and viewing duration, then monetizes that information despite marketing itself as an alternative to Big Tech surveillance. The attorney general’s office cites the Texas Deceptive Trade Practices Act, which bans false or misleading acts in commerce. Netflix has denied the allegations and says it will defend itself in court. The filing notes that the company once promoted itself as unlike other tech firms because it did not sell ads or monetize user data. Paxton’s office argues those statements were deceptive given the alleged data collection and sharing practices.

- The lawsuit alleges Netflix monitors users' viewing activity. - Texas Attorney General Ken Paxton alleges Netflix records and monetizes billions of data points on user behavior. - In 2022, Netflix allegedly used data collected from children and families to generate billions in revenue by sharing it with data brokers. - The complaint quotes former CEO Reed Hastings saying in 2019 and 2020 that Netflix would not collect or monetize user data for advertising. - According to the filing, Netflix employed addictive design features such as auto‑play and infinite scroll to keep users engaged while logging their interactions.

The court could order Netflix to delete allegedly deceptively collected data, stop targeted advertising, and disable auto‑play for children’s profiles. Texas may seek civil penalties that can reach $10,000 per violation under the Deceptive Trade Practices Act. The case could inspire similar actions in other states as lawmakers scrutinize addictive design features and data‑sharing practices. Observers will watch for Netflix’s legal response, any settlement talks, and whether the ruling influences broader privacy legislation.