Texas Attorney General Ken Paxton has filed a lawsuit against Netflix, accusing the streaming giant of misleading users by moving into advertising after years of promoting itself as an ad-free and privacy-friendly alternative to Big Tech.
The lawsuit, filed on Monday, claims Netflix attracted subscribers by presenting its service as a safer escape from online surveillance and advertising-driven platforms. Paxton argues that the company changed direction after launching its ad-supported streaming plan in 2022, opening the door for Netflix to collect and use viewer data for digital advertising.
According to the lawsuit, Netflix built what Texas describes as a “behavior-surveillance program” that collects details about user activity, including location, device information, search terms, content ratings, and other viewing-related events. The complaint also accuses Netflix of sharing or making that data available to advertising and data broker partners, including companies such as Experian and Acxiom.
Paxton claims Netflix’s shift into advertising is a “bait-and-switch” because the company had previously criticized the same kind of ad-tracking model it now uses. The lawsuit says Netflix gained trust from families and children by promising a cleaner streaming experience, then used its growing platform and user data to support a larger advertising business.
Netflix’s ad-supported plan has grown quickly since its launch. The company’s ad-tier subscriber base more than doubled from 2024 to 2025, reaching 70 million users. In January, Netflix reported earning $1.5 billion from advertising in 2025.
This is not the first time Netflix has faced legal trouble in Texas. In 2020, a grand jury in Tyler County indicted the company over the film Cuties.
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