Texas Sues Netflix, Claims Streaming Giant Secretly Tracked Users and Hooked Kids With “Addictive” Features

BBC, Politico, Reuters, FOX Business contributed to this report.

Texas is taking aim at Netflix, accusing the streaming company of quietly harvesting massive amounts of user data – including information tied to children – while publicly presenting itself as a privacy-friendly alternative to Big Tech.

In a lawsuit filed Monday, Texas Attorney General Ken Paxton alleged that Netflix collected and monetized detailed behavioral data from subscribers without properly informing them or getting meaningful consent. The complaint also accuses the company of designing its platform to keep viewers glued to their screens through features like autoplay.

“When you watch Netflix, Netflix watches you,” the lawsuit says.

Texas argues that the company spent years marketing itself as the opposite of data-hungry tech firms while quietly building a sophisticated tracking system behind the scenes. According to the complaint, Netflix monitored nearly every interaction users had with the platform – what they clicked, how long they hovered over titles, what they searched for, when they paused, skipped or rewound content, and even how long they lingered before making a choice.

State lawyers claim those interactions became valuable data points used to create detailed consumer profiles.

The lawsuit repeatedly points to past comments from Netflix co-founder Reed Hastings, who said in 2019 and 2020 that the company had “zero interest” in collecting or selling customer data for advertising purposes. Texas says Netflix later reversed course after building a huge reserve of user information.

“For years, Netflix’s leadership told the world it had ‘zero interest’ in advertising,” the complaint states. “But once Netflix had stockpiled user data under those promises, it flipped the script.”

Texas claims the company expanded its advertising business in 2022 by sharing viewer information with commercial data brokers and ad-tech firms, helping generate billions in revenue.

The suit also targets Netflix’s interface design. Prosecutors describe autoplay and other engagement tools as “dark patterns” meant to maximize viewing time, especially among children and families. The complaint argues the platform was engineered to encourage compulsive viewing behavior while simultaneously collecting more user data.

Paxton’s office wants the court to force Netflix to stop allegedly unlawful data collection practices, delete data gathered from Texans through what the state calls deceptive methods, and disable autoplay by default on children’s accounts.

The case was filed under the Texas Deceptive Trade Practices Act, which prohibits misleading or deceptive business conduct.

Netflix rejected the accusations and said it plans to fight the lawsuit.

“Respectfully to the great state of Texas and Attorney General Paxton, this lawsuit lacks merit and is based on inaccurate and distorted information,” a company spokesperson said in a statement shared with Reuters.

The company added that it complies with privacy laws and provides what it called “industry-leading” parental controls.

The lawsuit lands as tech companies face mounting scrutiny over how platforms are designed to capture attention – particularly among younger users. Recent cases involving Meta and YouTube have focused on whether endless scrolling, autoplay and recommendation algorithms contribute to addictive behavior.

Texas appears to be pushing that argument further into the streaming world.

At the center of the case is a broader question that has become increasingly uncomfortable for Silicon Valley: how much personal data companies collect while telling users they’re simply watching, scrolling or relaxing online.