Key facts
- Meta Platforms disclosed that four U.S. states are seeking $1.4 trillion in penalties.
- The states allege Meta's platforms are designed to addict young users and that the company misled the public.
- The penalty amount is nearly equivalent to Meta's market capitalization of approximately $1.5 trillion.
- A trial addressing these claims is scheduled for August in Oakland, California.
- Meta contends the requested penalty amount is unsupported by evidence and unprecedented in consumer protection history.
Meta Platforms revealed in a court filing that four U.S. states are seeking $1.4 trillion in penalties, accusing the company of designing its Facebook and Instagram platforms to addict young users and misleading the public about their safety. The figure, disclosed in Meta's response to the states' penalty calculations, is close to the company's market capitalization of approximately $1.5 trillion.
The states of California, Colorado, Kentucky, and New Jersey are pursuing these claims, which are set for trial in August before U.S. District Judge Yvonne Gonzalez Rogers. Meta has argued that the requested penalty amount is unsupported by evidence and unprecedented in the history of consumer protection enforcement.
Representatives for the attorneys general have not yet responded to requests for comment. The states reportedly calculated the penalties by multiplying the number of alleged violations by fine amounts set by state law, based on the estimated number of affected teens and young users. Twenty-nine states have also sued Meta in federal court, primarily alleging violations of the Children's Online Privacy Protection Act for collecting data from children without parental consent. A separate trial in February will address claims brought by an additional 14 states under their own consumer protection laws.
Judge Rogers recently rejected Meta's attempt to dismiss the August trial, finding that factual disputes remain regarding the addictiveness of its platforms, whether Meta falsely denied designing them that way, and if the platforms were intentionally directed at children. California Attorney General Rob Bonta stated after the ruling that Meta prioritizes profits over children's safety and vowed to hold the company accountable for its role in the teen mental health crisis. Meta, along with other social media companies like Snap, Alphabet (parent of YouTube), and ByteDance (parent of TikTok), faces numerous lawsuits over similar allegations. In March, New Mexico was awarded $375 million after a jury found the company had misled consumers in that state.