Meta Platforms agreed to pay up to 16.68 billion dollars and make big changes to Facebook and Instagram to settle claims from states across the U.S. The company made those platforms to hook children, lied to people about their safety, and took kids personal information in that way.
The deal settles claims from 29 U.S. States. It will stop a federal trial that was one of the biggest tests yet of the idea that social media companies hurt young users.
Meta will set limits on how long kids can use Facebook and Instagram. It will also stop kids from using the apps at night. The company will also do more to stop children from seeing content that is meant for people.
The company, based in Menlo Park, California, said it did nothing when it agreed to this deal.
The deal also settles lawsuits from California, Illinois, New Mexico and Washington, D.C. These lawsuits were about privacy issues from the Cambridge Analytica case. In that case, a company took information from millions of Facebook users. Those states will get 459.3 million dollars to end those lawsuits.
Meta stock went up 2.3% in the market.
These cases were part of a wave of legal action taken by states, local governments, school districts and individuals. They said Meta and other social media companies caused health problems for young people all over the country.
The trial in the Oakland, California federal court looked at claims from California, Colorado, Kentucky and New Jersey that Meta broke their state laws that protect people.
It also looked at claims from 29 states that Meta broke the Children’s Online Privacy Protection Act. That law says companies cannot take information from kids without telling parents and getting their permission. Meta used that data to train machine learning and AI tools.
Meta has always said it could not have lied to people about whether its services were addictive. It said “social media addiction” is not something that doctors recognize as a condition.
Before the trial started on August 18, Meta said that California, Colorado, Kentucky and New Jersey were asking for up to 1.4 trillion dollars in penalties. The states said the number would be closer to 200 billion.
A Mental Health Crisis Situation
Meta, Snapchat and its parent company Snap, YouTube and its parent company Alphabet, and TikTok and its parent company ByteDance still face thousands of lawsuits in state courts over claims that Meta, Snapchat, YouTube, TikTok and their parent companies purposely designed their platforms with features that are addictive for children and teens, causing a mental health crisis.
The federal cases were combined before U.S. District Judge Yvonne Gonzalez Rogers in Oakland. These cases include lawsuits brought by individuals, school districts and state governments.
This year Meta lost both phases of a landmark lawsuit brought by New Mexico. A jury in March ordered Meta to pay $375 million after finding Meta had misled consumers about the safety of its platforms. On August 6, a judge found Meta had created a nuisance and ordered Meta to pay an additional $567 million and implement youth-safety measures.
Also in March, the first trial over an individual’s claims against Meta and Google ended with a verdict in the plaintiff’s favor. A Los Angeles jury found Meta and Google liable for plaintiff Kaley G.M.’s depression and anxiety. Ordered Meta and Google to pay a combined $6 million in damages.
Meta, Snapchat, YouTube, TikTok, and their parent companies have said they will appeal those verdicts.
