Texas Attorney General Ken Paxton has filed a sweeping lawsuit against Netflix, accusing the streaming giant of misleading consumers for years while secretly operating what the state describes as a massive behavioral surveillance and advertising system targeting both adults and children.
The legal complaint alleges that Netflix publicly portrayed itself as an ad-free, privacy-focused alternative to companies like Google and Facebook while quietly collecting enormous amounts of behavioral data from users and feeding it into advertising and analytics systems.
The lawsuit seeks civil penalties, injunctive relief, deletion of allegedly unlawfully collected data, and an order forcing Netflix to disable autoplay by default on children’s profiles.
The filing cites several public statements from Netflix co-founder Reed Hastings between 2015 and 2020 in which he claimed Netflix had “no intention of monetizing with ads” and was “not integrating everybody’s data” like other tech firms.
However, Texas alleges that the company built an extensive behavioral-logging infrastructure behind the scenes. The lawsuit references multiple Netflix engineering presentations and technical blog posts in which company employees allegedly described Netflix internally as “a logging company that occasionally streams movies.”
The state claims Netflix records granular user interactions, including: play, pause, rewind, search history, scrolling behavior, viewing duration, device information, IP-derived location data, household network details, and content abandonment metrics. The complaint further alleges that Netflix processes billions of behavioral events daily through large-scale internal data pipelines used to train recommendation algorithms and support advertising operations.
One of the more striking claims in the lawsuit references a 2024 statement by a venture capital executive allegedly connected to Netflix, who said the company collects “160,000 unique data points every 30 seconds” while users stream content.
The lawsuit also argues Netflix marketed kids’ profiles as safe, segregated spaces for children while continuing to collect the same categories of behavioral telemetry from minors.
The filing repeatedly targets Netflix’s autoplay functionality, describing it as a “dark pattern” engineered to maximize engagement and extend viewing sessions. The state argues that autoplay removes natural stopping points, contributes to binge-watching behavior, and increases the volume of data Netflix can collect from users, particularly children.
Texas further alleges that Netflix pivoted into the advertising business after years of stockpiling behavioral data, in violation of promises that it would never operate like traditional ad-tech companies. The complaint claims Netflix now works with advertising and data firms, including Google Display & Video 360, The Trade Desk, Yahoo DSP, Amazon DSP, Experian, Acxiom, and LiveRamp, to support audience targeting, identity matching, and advertising measurement.
Texas argues that Netflix’s consumer-facing privacy policies remained vague even as the company expanded its ad-supported offerings and programmatic advertising partnerships.
The state is now asking the court to order Netflix to:
- Purge unlawfully collected data from Texans
- Obtain express informed consent before using data for targeted advertising
- Stop collecting children’s behavioral data without parental consent
- Disable autoplay by default on kids’ profiles
- Halt “clean room” advertising data collaboration involving Texans without clearer disclosures
Netflix has not yet publicly responded to the lawsuit.
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