Meta, the parent company of Facebook and Instagram, is facing a high-stakes trial in a federal court in Oakland, California, that could lead to critical changes for the social media giant. A coalition of 29 US states brought a single case against Meta, alleging the company violated numerous federal and state child privacy laws. Meta strongly denies the allegations.
Allegations of harm to children
The states, including California and New York, claim Meta contributed to a mental health crisis among children and deliberately created design features that keep youngsters addicted to social media. The lawsuit also alleges Meta gathers data from children aged 13 without parental consent, a major breach of US federal law if proven accurate.
Kentucky Attorney General Russell Coleman said in a statement: "This week, we’re in court with the largest consumer protection lawsuit in American history. We’ll show a jury that Meta concealed what it knew about the harm its products cause young people because looking away was more profitable."
Comparisons to tobacco settlement
The move has been compared to the 1998 tobacco settlement, which forced major changes in cigarette marketing and required companies to pay US states for smoking-related medical expenses. "AGs are in the perfect position to get this done," Coleman said. "We did it with the Tobacco Settlement in the 1990s. We did it with the companies behind the opioid crisis. We’ll do it again with Meta."
The lawsuit alleges Meta illegally collected and used data of children under 13 using its platforms. It also claims the company made design decisions that drove excessive use "and put young users at risk, and lied to users, their families, and the public about the safety of its platforms." The US Attorneys General allege Meta violated federal and state laws, including the Children's Online Privacy Protection Act (COPPA) and the New Jersey Consumer Protection Act.
'Astronomical' consequences if Meta loses
Meta lost a similar case in New Mexico and will be forced to make changes to its online services and pay the equivalent of £855,555,000. If Meta loses this lawsuit, the consequences could be far more stark. New Mexico Attorney General Raúl Torrez told CNBC after his state's victory that the consequences would be "astronomical" for a company that generates some 98 per cent of its revenue from online advertising. He added: "This is a state with some 2 million people. If you map that same argument onto California or Florida or Texas or New York, I mean, that’s a potentially massive and a market shifting force."
California holds enormous influence and could impose harsher penalties, including a major overhaul of how algorithms are implemented. "California matters more than any other jurisdiction in the US," Julia Powles, executive director of the UCLA Institute for Technology, Law and Policy, told CNBC. "It’s where they are subject to the greatest legal reach, and it’s a jurisdiction watched around the world."
Potential implications for the UK
Should Meta lose in California, the decision would likely have implications beyond the US, including in the UK. Dr Hellen Mukiri-Smith from Loughborough University's Department of Law said the ruling would likely "shape ongoing global debates about the extraordinary power and influence wielded by social media companies over infrastructure, behaviour and norms that shape the lives of social media users, and how to ensure that social media companies are held accountable." She noted that despite efforts to regulate social media, such as the UK's Online Safety Act, regulatory challenges remain.
Following the New Mexico ruling, ex-Prime Minister Sir Keir Starmer said his government would "study the ruling very carefully." He added that the government would trial social media bans and digital curfews in the homes of 300 teens in the UK.
Public opinion and prior losses
A Reuters/Ipsos survey of US adults carried out earlier this month found 61 per cent of respondents believed social media firms should face tighter regulation. Some 66 per cent also supported using age-verification to prevent children under 16 from accessing social media sites.
Earlier this year, a Los Angeles jury handed down a legal defeat against Meta and YouTube over a young woman's childhood addiction to online platforms. The woman, known only as Kaley, was awarded £4.5 million in damages after the jury found Meta and Google deliberately built addictive platforms that damaged her mental health. Meta and Google said they would appeal the verdict.
Meta has strongly denied the allegations in the current lawsuit. The company attempted to dismiss the coalition lawsuit in 2024, but a court fully denied its attempt in June this year. "These lawsuits misportray our company and the work we do every day to provide young people with safe, valuable experiences online," Meta said in a previous statement. "We have listened to parents, researched the issues that matter most, and made real changes to protect teens online – like introducing Teen Accounts with built-in protections and providing parents with tools to manage their teens’ experiences."
