Netflix is facing a lawsuit from the state of Texas after Attorney General Ken Paxton accused the streaming giant of illegally collecting consumer data without consent and designing its platform to encourage addictive viewing habits.
The lawsuit, filed on Monday in a state court in Collin County near Dallas, claims that Netflix secretly tracked users’ viewing habits and shared or sold the information to advertising technology firms and commercial data brokers for profit.
Texas alleged that the company falsely assured consumers for years that it did not collect or share personal user data, while allegedly making billions of dollars annually from those activities.
According to the complaint, the streaming platform also relied on “dark patterns” to keep viewers watching for longer periods. One of the features highlighted in the lawsuit is autoplay, which automatically starts a new show after another ends.
The state argued that these practices were especially harmful to children and families using the platform.
“Netflix’s endgame is simple and lucrative: get children and families glued to the screen, harvest their data while they are stuck there, and then monetize the data for a handsome profit,” the complaint stated.
Texas also quoted Netflix co-founder and chairman Reed Hastings, who reportedly said in 2020 that the company did not collect user data, while comparing Netflix’s approach to companies such as Amazon, Facebook, and Google.
The lawsuit further accused the company of violating the Texas Deceptive Trade Practices Act.
Attorney General Paxton is seeking court orders that would force Netflix to delete any data allegedly collected illegally and stop using consumer information for targeted advertising without user consent. The state is also demanding civil penalties of up to $10,000 per violation.
In response, a spokesperson for Netflix denied the allegations and said the company would defend itself in court.
“Respectfully to the great state of Texas and Attorney General Paxton, this lawsuit lacks merit and is based on inaccurate and distorted information,” the spokesperson said. “Netflix takes our members’ privacy seriously and complies with privacy and data protection laws everywhere we operate.”
The lawsuit comes as several major technology and social media companies continue to face legal scrutiny over allegations involving user tracking, data sharing, and targeted advertising practices.
Paxton, a Republican, is currently running for the U.S. Senate, where he is challenging incumbent Senator John Cornyn in the Republican primary.
