Meta, Facebook’s parent company, could be on the hook for $1.4 trillion in penalties. The massive sum represents the potential damages from an ongoing lawsuit against the company over allegations from several US states that Meta designed its platforms to be addictive to young users.
California, Colorado, Kentucky, and New Jersey are leading the charge, with the trial being held in Oakland, California before US District Judge Yvonne Gonzalez Rogers. The states’ filings remain sealed for now, but a hearing held in June revealed some details.
The $1.4 trillion figure is the result of a simple calculation — multiplying the number of violations by the fines set by each state. The number of violations is an estimate of how many young people were affected by Meta’s allegedly harmful design. The states allege that Meta misled its users about the safety of its platforms.
Meta denies these claims, stating that “social media addiction” is not a recognized psychiatric condition. However, Judge Rogers denied a motion to dismiss the trial last month. The judge noted that it remains to be seen whether Meta’s platforms are addictive, whether the company falsely denied allegations that they were designed to be that way, and whether they are directed at young users.
“A sanction of that size has no analog in the history of consumer protection enforcement,” Meta said in a court filing. Meta currently has a market cap of $1.52 trillion, just north of the potential penalty.
All of this is part of a broader legal battle. A trial in New Mexico already awarded the state $375 million this March after the court found that Meta did indeed mislead its users. That case is still ongoing as New Mexico seeks additional damages and to compel Meta to change Facebook, as well as Instagram and WhatsApp.
There is also another case — 29 states are suing Meta in federal court over alleged violations of the Children’s Online Privacy Protection Act (also known as COPPA).
