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Netflix, Hulu Face Suit Over Alleged Unpaid Texas Utility Fees

Aug. 13, 2020, 2:57 PM

Netflix Inc. and Hulu LLC are facing allegations of failing to pay utility fees to Texas municipalities.

The city of New Boston, Texas, filed a class action Tuesday, accusing the companies of failing to pay franchise fees of 5% of their gross revenues to municipalities in the state as required under the Texas Utilities Code. The suit was filed in the U.S. District Court for the Eastern District of Texas.

New Boston claims Netflix and Hulu, like other video providers, must pay the fees because the companies’ data flows over wireline broadband facilities that are located in public rights-of-way.

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