Texas AG sues security camera manufacturer, claiming Chinese ties

McKINNEY, Texas (CN) — Texas Attorney General Ken Paxton filed a lawsuit Thursday accusing security camera manufacturer Lorex of concealing ties to a Chinese company that the U.S. government has designated as a national security risk.

Lorex comprises two firms, Lorex Technology Inc. and Lorex Corporation, which sell surveillance systems for businesses and homes, including baby monitor cameras. Lorex was previously owned by the Chinese company Dahua, but it was sold to a Taiwan-based company in 2022.

Despite this, Paxton claims in a petition filed in Collin County District Court that Lorex continues to have ties to Dahua, as it uses components produced by Dahua in its products. Paxton says Lorex has failed to disclose this to consumers, which he argues constitutes a violation of the Texas Deceptive Trade Practices Act.

“The federal government has scrutinized Dahua as a company posing national security threats and creating human rights concerns, placing it on multiple lists that impose restrictions on Dahua’s U.S. operations,” Paxton writes in the complaint. “Restrictions that Lorex neither discloses to consumers nor acknowledges in its marketing materials.”

Paxton also claims Lorex has falsely marketed its products as safe and secure even though Dahua components have a “documented history of critical vulnerabilities.” Paxton further asserts that, because of Lorex’s relationship with Dahua, consumer data it collects may be disclosed to the Chinese government due to China’s PRC National Intelligence Law, which requires Chinese entities to share data with the Chinese government upon request.

Paxton says Lorex has failed to disclose this fact to consumers.

“Marketing their products under the slogan ‘protect what matters most,’ Lorex convinces Texas parents that Lorex cameras shield their homes and families,” Paxton writes. “Lorex encourages Texans to place their cameras in the most private sanctuaries of the home. Parents purchase Lorex cameras hoping for peace of mind. But in reality, by bringing Lorex products into their homes, they are unwittingly compromising the very safety they sought to secure.”

Paxton requests temporary and permanent injunctions requiring Lorex to disclose the use of Dahua components in its products and the possibility of Chinese authorities accessing consumer data as well as enjoining it from marketing its products as safe and secure and from collecting or sharing consumers’ data without informed consent. He also seeks civil penalties against Lorex.

Lorex and Dahua did not immediately respond to requests for comment on the claims in Paxton’s lawsuit.

“Lorex has exploited parents’ God-given desire to protect their kids and left them vulnerable to threats from China,” Paxton said in a statement announcing the lawsuit. “Any company that allows the Chinese Communist Party to threaten Americans’ safety and security will face the full force of the law.”

This case is the third in a series of similar lawsuits Paxton has filed this week accusing companies of concealing their ties to China. Paxton previously sued TP-Link, a Wi-Fi and smart home technology company that controls a substantial share of the retail market for Wi-Fi routers in the U.S., and commercial drone manufacturer Anzu Robotics based on such claims.

Paxton also filed a fourth lawsuit today claiming the popular e-commerce platform Temu, which primarily ships goods from China, operates as “spyware disguised as a shopping app.”

The attorney general claims that the Temu app contains software functions typically associated with malware and that, because Temu’s parent company has substantial operations in China, it is subject to the PRC National Intelligence Law and could be required to share consumers’ data with the Chinese government upon request.

Temu did not immediately respond to a request for comment on that lawsuit.