Texas vs. the Smart TVs

I’m Alan Chapell. Over the past 20+ years, I’ve been outside privacy counsel to hundreds of digital media companies and write a monthly syndicated report called The Chapell Regulatory Insider. I’m also a regulatory analyst for The Monopoly Report.

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 This week, I welcome Dr. Travis Hall, Director for State Engagement at the Center for Democracy & Technology (CDT), a nonpartisan organization focused on civil rights and liberties in the digital age. We go deep on U.S. state privacy laws.

Texas and the Pros and Cons of Aggressive Enforcement

On Dec. 15, 2025, while many of us were still wrapping presents, the Texas AG’s office announced that it has “filed suit against five major television companies for spying on Texans by secretly recording what consumers watch in their own homes” via ACR technology. All told, the Texas AG filed complaints against Sony, Samsung,  LG, Hisense, and TCL.

As I’ve noted previously, regulators are starting to look more closely at the data collection practices of the CTV space, including their provision of privacy choices. The Texas AG actions come on the heels of California AG Rob Bonta announcing a $530,000 settlement with Sling TV, the Florida AG complaint against Roku for allegedly violating Florida’s privacy law, and an EU privacy report and investigation into the CTV space.

I get the sense that Texas wants to be known for having robust (and perhaps even aggressive) privacy enforcement. Over the past two years, Texas has: (a) announced settlements with Meta and Google, (b) gone after car manufacturers for passing data to insurance companies, and (c) launched investigations into Character.AI and 14 other companies (including Reddit, Instagram, and Discord) regarding their privacy and safety practices for minors.

The December Texas filings against the Smart TV manufactures :

1. Frames smart TV data collection as an out of control problem

2. Identifies a number of issues with the way smart TV manufacturers obtain consumer permission for data collection

3. Notes that the privacy choice mechanisms often lack symmetry, so that it’s easier for consumers to “accept” data collection than it is to “opt-out” from it

4. Claims that some of these smart TV companies are sending U.S. personal data to China.

I’m not here to praise or bury any of these smart TV companies. But I think it’s fair to state that many of them could do a better job of offering transparency and privacy choices, and embracing data minimization.

Tradeoffs

The real problem runs deeper. Nobody—businesses, regulators, or consumers—seems to want an honest dialog about tradeoffs between data collection, advertising, and subsidization. We need that conversation; we have needed it for decades. So I won’t beat that drum here.

Anyway, this is so much more than just another privacy case.

I’m sure I’ll get beaten up as being too industry friendly with what I’m about to write below. So to be clear, I hope this isn’t considered me letting industry off the hook.

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Multiple Narratives in Play

This case involves at least eight distinct components, each deserving examination:

1. Why has smart TV data collection suddenly become so urgent that it needs to be stopped immediately? It’s not like these practices are new, or even newly discovered. What’s changed?

2. Is it a good idea for a state AG (or really any governmental entity) to be able to use its emergency powers to justify effectively shutting businesses down by filing TROs?

3. AG Paxton is certainly not the first politician to use a privacy crusade as a political launching pad, but do we really need a further blurring of the line between official acts and political acts?

4. Aggressive state enforcement certainly isn’t a bad thing, but states generally need to be careful about being too heavy-handed. At some point, if states are viewed as stepping over the line, it creates pressure for federal preemption. A functioning Congress might view overly aggressive enforcement as reason to end the state privacy law experiment.

5. At least two of the smart TV manufactures allegedly send data to China. If we’re concerned about social platforms sending U.S. personal data to China and other places in Asia, we should also be concerned about smart TV companies sending data to China and other parts of Asia. While I don’t think the ads space has internalized this yet, there are laws in place to ensure that this doesn’t happen. Interestingly, neither of them are even referenced in the Texas complaints. Also, if our goal is to move away from having our televisions manufactured outside the U.S., the road to get there is at best an uphill climb. (If you haven’t yet, I’d encourage you to read Apple in China. I had the author on the TMR podcast last year.)

6. With all this enforcement activity at the state level, I can only wonder if it’s becoming more difficult to argue that a private right of action is really necessary for robust enforcement. (Ducks as the privacy advocates lunge at me.)

7. Speaking of class actions, it only seems a matter of time before the CTV space feels the presence of class-action litigants. Wherever there’s lots of allegations that you’re offering a less than perfect choice mechanism, the CIPA litigants are certain to come calling.

8. Finally, it’s worth noting that Texas is one of the states that engages private law firms to assist them in their enforcement efforts. The enforcement budgets at the state level are typically a bit limited, so bringing in private law firms and giving them a cut of the fines imposed certainly solves the resource issues. It also potentially creates conflicts of interest, and a peculiar set of incentives when it comes to enforcement targets.

What Comes Next?

These eight threads will play out over the next several months. More state AGs will file similar complaints. Class-action attorneys will follow the roadmap Texas provided. To what degree will consumers be helped by all this?

The real question isn't whether smart TV device data collection practices need reform. They do. The question is whether this enforcement approach, with its mix of emergency powers, private firm incentives, and political motivations, represents the best path forward.

That answer depends on which of these eight narratives you find most compelling.

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