Texas Attorney General Ken Paxton announced an investigation into Chinese AI company DeepSeek for alleged violations of the Texas Data Privacy and Security Act, citing concerns over the company’s privacy practices and ties to the Chinese Communist Party. The AG also notified DeepSeek of the alleged violations, issued a ban on DeepSeek’s platform on all Office of the Attorney General devices, and sent third-party Civil Investigative Demands to Google and Apple for documentation related to the DeepSeek app. The investigation stems from allegations that DeepSeek acts as a proxy for the CCP to steal Texas citizens’ data and undermine U.S. AI dominance.
DeepSeek’s AI platform is banned from all Texas Office of the Attorney General devices effective January 28, 2025. The investigation into the company’s privacy practices and alleged Texas Data Privacy and Security Act violations is ongoing, and no additional remedies have been imposed as of the February 14, 2025 press release date.
In-house legal teams should audit all existing and proposed vendor agreements with AI service providers, particularly those with ties to foreign governments, to ensure alignment with the Texas Data Privacy and Security Act and other state privacy regulations. Key clauses to review include data collection and use limitations, cross-border data transfer restrictions, data security requirements, and prohibitions on unauthorized data sharing with foreign entities. Teams should also add requirements for vendors to provide evidence of compliance with app store submission standards, immediate notice of any privacy-related investigations, and audit rights to verify adherence to privacy and security commitments.
Entity
DeepSeek
Industry
Technology"DeepSeek—a Chinese artificial intelligence (“AI”) company"
"violates the Texas Data Privacy and Security Act"
"steal the data of our citizens"
"over concerns about security"
"announced an investigation into DeepSeek"
"Texas Attorney General Ken Paxton"
Texas Attorney General Ken Paxton filed a lawsuit against proxy advisory firm Institutional Shareholder Services, Inc. (ISS) alleging violations of the Texas Deceptive Trade Practices Act by prioritizing political agendas over sound financial guidance in voting recommendations. The lawsuit seeks an injunction to stop deceptive practices and civil penalties of up to $10,000 per DTPA violation. This action follows a 2025 investigation into ISS and peer firm Glass Lewis & Co.
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