Meta Platforms has agreed to pay up to $16.68bn to settle lawsuits accusing Facebook and Instagram of deliberately making their platforms addictive to children and misleading users about their safety.
The settlement was reached during a federal trial in California involving claims brought by 29 US states, potentially ending one of the most significant legal challenges yet faced by the social media giant over its impact on young users.
Under the agreement, Meta will also introduce new measures for teenage users of Facebook and Instagram across the United States.
The company will impose daily usage limits, restrict children’s access to the platforms at night and strengthen measures aimed at preventing minors from accessing age-restricted content.
Meta, which is based in California, denied wrongdoing as part of the settlement.
Privacy claims also settled
The agreement also resolves separate lawsuits filed by California, Illinois, New Mexico and Washington, DC, over privacy violations linked to the Cambridge Analytica scandal.
The four jurisdictions will receive $459.3m to settle those claims.
The wider lawsuits accused Meta and other social media companies of contributing to a youth mental health crisis by designing platforms with features that encourage prolonged and addictive use.
The California trial involved claims by California, Colorado, Kentucky and New Jersey that Meta violated state consumer protection laws.
The case also included allegations from 29 states that Meta breached the US Children’s Online Privacy Protection Act by collecting personal information from children without parental notification or consent.
The states further alleged that the information was used to train machine learning and generative artificial intelligence models.
Meta had argued that it could not have misled consumers by describing its services as addictive because social media addiction is not recognised as a psychiatric condition.
States had sought up to $1.4tn
Before the trial, Meta said California, Colorado, Kentucky and New Jersey were seeking penalties of up to $1.4tn.
The states had indicated before the trial that the figure was more likely to be around $200bn.
They were also seeking additional damages, major changes to Meta’s platforms and restrictions preventing children from creating accounts.
More lawsuits pending
The settlement does not end Meta’s legal battles over alleged harm to children and teenagers.
Meta, Snapchat and its parent company Snap, YouTube and its parent Alphabet, as well as TikTok and its parent ByteDance, still face thousands of lawsuits in federal and state courts across the US.
The lawsuits accuse the companies of knowingly designing features that can be addictive to children and teenagers and contributing to a youth mental health crisis.
Thousands of cases have been consolidated before US District Judge Yvonne Gonzalez Rogers in Oakland, involving individuals, school districts and state governments.
Around 30 states have also filed separate lawsuits in state courts.
Meta has suffered recent legal setbacks
The settlement comes after Meta suffered major losses in recent cases.
In March, a New Mexico jury ordered the company to pay $375m after finding that it had misled consumers about the safety of its platforms.
On August 6, a judge ruled that Meta had created a public nuisance and ordered the company to pay another $567m while implementing additional measures to protect young users.
Also in March, a Los Angeles jury found Meta and Google liable for harm suffered by an individual who said their platforms contributed to depression and anxiety. The companies were ordered to pay a combined $6m in damages.
Both companies have said they will appeal those verdicts.
Meta, along with the other major social media companies, had also settled the first federal case scheduled for trial, brought by Breathitt County School District in Kentucky. Public records showed the school district was due to receive a combined $27m.
