Meta Platforms has agreed to settle allegations brought by US states accusing the company of deliberately designing Instagram and Facebook in ways that could make children dependent on the platforms, while also misleading users about their safety and improperly collecting personal information from minors, according to court filings, according to Reuters.
It agreed to $16.68 billion settlement with 29 US states over child data collection, teen “addiction by design”.
The settlement was reached during a federal trial in California involving claims from 29 states, bringing an end to a closely watched legal challenge over the impact of social media platforms on children. The case was set to become a major test of allegations that social media companies have harmed young users.
The agreement came shortly before the trial got underway, with jury selection beginning on August 12. A federal appeals court had rejected Meta’s request to stop the proceedings just days earlier.
The allegations form part of a larger series of lawsuits filed by states, local authorities, school districts and individuals, who accuse Meta and other social media companies of contributing to a nationwide mental health crisis among young people.
The federal case included claims by the attorneys general of California, Colorado, Kentucky and New Jersey, who alleged that Meta had breached state consumer protection laws.
It also involved allegations from 29 states that Meta violated the federal Children’s Online Privacy Protection Act by gathering personal information from users it knew were children without informing or obtaining consent from their parents. The states further alleged that the company used this data to train machine-learning and generative systems.
has rejected the accusations, maintaining that it has taken significant steps to safeguard children using its platforms. The company also argued that it could not have deceived consumers by claiming its services were addictive because “social media addiction” is not formally recognised as a psychiatric disorder.
Before the trial began, Meta stated in a court filing that California, Colorado, Kentucky and could seek as much as $1.4 trillion in penalties. The states had not specified an exact figure, but during a pre-trial hearing, they indicated that the amount was likely to be closer to $200 billion.
Moreover, besides financial penalties, the states were seeking further damages and court orders requiring Meta to make substantial changes to its platforms, including preventing children from creating accounts.
Meta, TikTok, YouTube face thousands of US lawsuits over alleged harm to children
Meta, Snap, Alphabet’s YouTube and ByteDance’s TikTok continue to face thousands of lawsuits in US federal and state courts. The cases allege that the companies knowingly built features into their platforms that can be addictive for children and teenagers, contributing to a wider youth mental health crisis.
The federal lawsuits have been consolidated before US District Judge Yvonne Gonzalez Rogers in Oakland. The cases include claims filed by individuals, school districts and state governments.
Thousands of additional lawsuits remain pending in state courts. In Los Angeles, a judge is overseeing a large number of cases filed by individuals who claim that they or their family members suffered harm because of the platforms’ design.
Court records show that around 30 states have separately sued the companies in state courts. A trial involving claims brought by Tennessee against Meta has also been underway in Nashville since July.
The settlement follows Meta’s defeat in both stages of a landmark case filed by New Mexico. In March, a jury found that the company had misled consumers about the safety of its platforms and ordered it to pay $375 million. On August 6, a judge separately ruled that Meta had created a public nuisance, imposing another $567 million penalty and requiring the company to introduce measures aimed at protecting young users.
In another significant development in March, the first trial involving an individual’s claims against Meta and Google ended in favour of the plaintiff. A Los Angeles jury held the companies responsible for depression and anxiety suffered by plaintiff Kaley GM and awarded $6 million in combined damages.
Both companies have said they plan to challenge those verdicts through appeals.
Meanwhile, all four companies settled the first federal case scheduled for trial, which was filed by a Kentucky school district that alleged the platforms had harmed its students. Public records showed that Breathitt County School District was due to receive a combined $27 million under the settlement.
(With inputs from agency)
