Netflix is facing a major legal challenge in the United States after the state of Texas filed a lawsuit accusing the streaming giant of secretly collecting personal data from users, including children, without proper consent. The case, filed by Texas Attorney General Ken Paxton, alleges that Netflix has engaged in widespread data tracking practices while misleading consumers about how their information is used.
According to the complaint, Netflix has for years collected detailed data on viewers’ habits, including what they watch, when they watch it, and how long they remain engaged on the platform. Texas authorities claim that this data was not only used internally but also allegedly shared or sold to advertising technology companies and data brokers, generating significant commercial profits. The lawsuit further argues that such practices were carried out without clear user consent, particularly affecting minors who use children’s profiles on the platform.
A key focus of the case is the allegation that Netflix designed its platform features to maximise user engagement in ways that could be harmful to children. The state points to tools such as autoplay, which automatically starts the next episode or recommended content, describing them as “dark patterns” intended to keep viewers watching for longer periods. Texas argues that these design choices contribute to compulsive viewing behaviour, especially among younger audiences who may not fully understand or control their screen time.
The lawsuit also references earlier public statements made by Netflix co-founder Reed Hastings in 2020, in which he suggested that the company did not collect user data in the same manner as major tech firms like Google, Meta, or Amazon. Texas claims these statements were misleading, asserting that Netflix’s data practices contradict its public assurances of privacy protection.
In addition, the state alleges that Netflix has built a business model increasingly reliant on user tracking and data monetisation, despite presenting itself as a subscription-based, privacy-conscious entertainment service. Authorities argue that the company’s actions violate Texas consumer protection laws, specifically the Deceptive Trade Practices Act.
Texas is seeking strict penalties against the streaming platform, including fines that could reach up to $10,000 per violation. The lawsuit also demands that Netflix delete any data allegedly collected without proper consent, restrict targeted advertising based on minors’ data, and disable autoplay features on children’s profiles unless explicitly enabled by users or guardians.
Netflix, however, has rejected the allegations. In its response, the company stated that the claims are “without merit” and based on inaccurate interpretations of its business practices. It maintains that it complies with privacy regulations and provides parental controls designed to protect younger users.
The case adds to growing scrutiny of major tech and streaming companies in the United States, as regulators increasingly examine how digital platforms collect and use personal data, particularly when it involves children. The outcome of the lawsuit could have wider implications for how streaming services operate and design their user engagement features in the future.
