Texas AG Hits Netflix With Suit Over Sale of Kids’, Users’ Data

Texas Attorney General Ken Paxton (R) hit Netflix Inc. with a privacy lawsuit Monday, alleging the streaming giant is collecting and selling users’ personal information despite years of promises that it wasn’t in the data-collection business.

The suit is the latest in a series of privacy-enforcement actions initiated by Paxton’s office, including lawsuits against TikTok Inc.; Allstate Corp.; Powerschool Holdings Co.; and a group of smart-TV makers including Samsung Electronics America, Sony Corp. of America, and LG Electronic USA.

Paxton’s office also won a $1.375 billion settlement with Google LLC in May 2025 that resolved two privacy lawsuits over the search giant’s collection of consumers’ location data and facial-recognition data.

Texas alleged in a complaint filed in Texas District Court, Collins County, that Netflix founder and former CEO Reed Hastings long assured shareholders and the public that the Netflix revenue model was based on subscriptions rather than the use of data for advertising. But behind the scenes, the company built a “behavioral-surveillance program of staggering scale” that collected mountains of user data, it said.

The program is “designed to illegally collect and profit from Texans’ personal data without their consent, and my office will do everything in our power to stop it,” Paxton said in a statement. “Netflix is not the ad-free and kid-friendly platform it claims to be. Instead, it has misled consumers while exploiting their private data to make billions.”

Netflix didn’t respond immediately to a request for comment.

Netflix accomplishes its data goals by “getting Texans and their children glued to the screen then extracting every possible bit of data about them while they are there,” the complaint said. The streamer also uses “dark patterns” and subtle features are engineered to manipulate users—especially children—and to defeat parental efforts to control how much their kids watch the platform, it said.

The company’s “surveillance machinery” records how users and kids behave including “what they click, how long they linger, what they avoid, when they pause, what draws them in, what they replay or skip, where they are, what devices they use, what other devices are in their home, what other apps they interact with, and much more,” it said.

The company’s explosive financial growth is tied to its 2022 decision to pivot into digital advertising, allowing it to leverage the “mountains of data” it had extracted from users and kids by selling it to online advertisers, data brokers, and ad-tech platforms, it said.

The complaint brings claims under the Texas Deceptive Trade Practices Act and seeks civil penalties, disgorgement, temporary and permanent injunctive relief, and attorneys’ fees and costs.

The case is Texas v. Netflix Inc., Tex. Dist. Ct., complaint filed 5/11/26.