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Social media turned 'public nuisance' In a recent ruling against Meta, a judge in New Mexico fined the company a collective $942m and ordered it to make changes similar to those that the additional states are now demanding.

Meta said it disputes the allegations, and the trial evidence will show its commitment to supporting young people. “We’ve listened to parents, worked with experts and law enforcement, and conducted in-depth research to understand the issues that matter most,” the company said in a statement.

"Meta designed a dangerous product for young users, knew it to be dangerous, and then lied to children, families, and the community about how dangerous it was," he said. "We are ready to hold Meta accountable for its role in fueling the mental health crisis of American children and look forward to trial."

States are seeking extensive financial damages that could, in theory, total as much as $1.4 trillion, plus changes to how the company operates Facebook and Instagram.

Not only are the states seeking upwards of $1 trillion, external from Meta, they are demanding it make changes to Instagram and Facebook, including ending "like" counts and infinite scroll.

“Meta has harnessed powerful and unprecedented technologies to entice, engage, and ultimately ensnare youth and teens. Its motive is profit, and in seeking to maximize its financial gains,” the lawsuit says.

By allegedly targeting child users, Meta "chose to exploit" young people in order to hook them on its platforms, so it could grow its user base and expand its business. Today, Meta's value on the stock market is about $1.5tn.

States seek to land a major blow against Meta For Meta, which already lost two pivotal cases over harms to children and teens this year, the stakes are high. The company reported a rare profit decline last month, in part due to $2.4 billion in legal expenses.

The $1.4 trillion figure, which Meta disclosed in a legal filing, is almost as high as the Menlo Park, California, company’s entire market capitalization — that is, the value of all its outstanding shares on the stock market. Paying it would inevitably put Meta Platforms in bankruptcy and perhaps put the company under state ownership.

“The state attorneys general are going for the gusto,” said Eric Goldman, a professor and co-director of the High Tech Law Institute at Santa Clara University School of Law. “They are trying to set the definitive precedent in this case and they have asked for extraordinary damages and they are going to seek extraordinary structural remedies if they succeed.”

Meta calls the possible penalty “untethered to any claimed violation” by the states.

“A sanction of that size has no analog in the history of consumer protection enforcement,” Meta said in a July 6 filing with the U.S. District Court for the Northern District of California.

If Meta loses the trial, the court would have wide discretion over the size of any financial penalty, and legal experts say anything close to $1.4 trillion would be unlikely.

“It’s not plausible in the sense that Meta doesn’t have that much money and could not get it,” said James Grimmelmann, a law professor at Cornell Law School and Cornell Tech. “An award that large would put Meta into bankruptcy, wipe out its owners, and effectively result in the states owning Meta.”

“And there’s a lot of them because it’s four different states and at least three different kinds of statutes. There’s a child privacy statute, there’s a false advertising statute and there’s unfair competition statutes,” said Rebecca Allensworth, a professor at Vanderbilt University Law School.

Meta has added safety tools - but states want more An outcome that leads to changes in how Facebook and Instagram operate could be as consequential as any financial penalty.

The states suing Meta are asking for many more changes to the way Instagram and Facebook operate for young people, too.

Meta has introduced a slew of new features in recent years designed to protect minors. In 2024 it launched teen accounts on Instagram, which are private by default and come with messaging and content restrictions, and parental controls. The company also uses artificial intelligence to determine if kids under 13 are using Instagram or if teenagers are lying about their age to access adult accounts.

They want Meta to: implement a process of parental verification for teenage users change its "dopamine-manipulating recommendation algorithms" remove many image filters that change one's appearance in photos end autoplay of video content prohibit the creation of multiple accounts end disappearing or "ephemeral" posts, such as Instagram Stories

“These AGs have a real chance at fixing the product,” Laura Marquez-Garrett of the Social Media Victims Law Center said Friday in a virtual discussion with advocates hosted by the Tech Oversight Project. “For these companies, this is a real point of reckoning. As these cases go forward, this is a leap forward, folks, not a step.”