Texas Attorney General Ken Paxton opened an investigation into Meta and Character.AI via Civil Investigative Demands, alleging deceptive trade practices including misrepresenting AI chatbots as confidential mental health tools while harvesting user data for targeted advertising. The probe assesses potential violations of Texas consumer protection laws and the SCOPE Act, particularly regarding privacy misrepresentations, concealment of data usage, and harms to children. This builds on prior investigations into Character.AI for SCOPE Act compliance.
In-house legal teams should review all contracts with AI service providers, especially those offering chatbots or automated advice tools, to ensure explicit disclosures of data collection, usage, and sharing practices, particularly regarding confidentiality claims. Clauses governing children's data processing, consent for targeted advertising, and AI-driven automated decision-making must be updated to comply with the SCOPE Act and Texas consumer protection laws. Additionally, terms of service and vendor agreements should be audited to eliminate misleading privacy representations and ensure full transparency of data usage for all users, including children and vulnerable populations.
Entity
Meta Platforms, Inc. and Character Technologies, Inc.
Industry
TechnologyOfficial Press Release
https://www.texasattorneygeneral.gov/news/releases/attorney-general-ken-paxton-investigates-meta-and-characterai-misleading-children-deceptive-ai
attorney general ken paxton launches investigations characte
https://www.texasattorneygeneral.gov/news/releases/attorney-general-ken-paxton-launches-investigations-characterai-reddit-instagram-discord-and-other
Texas Attorney General Enforcement Page
https://www.texasattorneygeneral.gov/consumer-protection/privacy
"Meta and Character.AI"
"Meta AI Studio and Character.AI"
"Texas Attorney General Ken Paxton"
"opened an investigation"
"August 18, 2025"
"Texas consumer protection laws"
$3.0M
Texas Attorney General Ken Paxton announced a settlement requiring Temu to protect Texans’ sensitive personal data from exposure to the Chinese Communist Party and to strengthen product-safety practices. Temu must pay Texas $3 million, comply with data-security requirements backed by a potential $8 million annual penalty, conduct annual independent product testing, and take specified action on products found to contain harmful substances.
$773.0M
Texas Attorney General Ken Paxton announced that a multistate coalition had secured an opioid settlement with Albertsons, which would require the grocery chain to pay more than $773 million nationally once final. Texas and its political subdivisions may receive up to $57.8 million for opioid abatement; the release does not identify privacy violations.
Texas Attorney General Ken Paxton sued Gerber Products Company and Nestlé USA, Inc., alleging that Gerber made deceptive safety and testing claims while its baby food contained dangerous levels of toxic heavy metals. The lawsuit asserts claims under the Texas Deceptive Trade Practices Act; the release does not report a settlement, monetary penalty, or court order.
$1.5M
The Texas Attorney General obtained a judgment holding Rubinsky Roofing LLC liable for 27 violations of the Texas Deceptive Trade Practices Act, including deceptive practices involving older consumers and payment for unnecessary or unfinished repairs. The judgment requires more than $1.5 million in civil penalties, allocates at least $500,000 to consumer restitution, and permanently bars the company and its owner from the practices at issue.
The Texas Attorney General opened an investigation into UnitedHealth Group over allegations that its insurance-benefit administration and patient-care decisions denied Texans medically necessary healthcare. The AG issued Civil Investigative Demands to collect evidence; the release announces no penalty or remedy.
$7.5M
Texas Attorney General Ken Paxton announced a $7.5 million settlement with Tris Pharmaceuticals over alleged misrepresentations about the efficacy of Dyanavel XR, an ADHD drug marketed for children. The release says the company overstated the drug’s efficacy and directed sales representatives to make misleading claims to doctors, including Medicaid providers.