Two technology giants have faced legal setbacks involving cases over misleading consumers about user safety and privacy in the United States, with Facebook found liable by a jury and TikTok agreeing to pay a $100m settlement. Facebook was found to have violated 43 million state consumer protection laws by a jury in New Mexico on Friday. Meanwhile, on the same day, TikTok and its Chinese parent company, ByteDance, agreed to its first-ever settlement with a state just days before its scheduled trial in Alabama.
TikTok was accused by the Alabama attorney general’s office of intentionally designing the platform to be addictive and misleading consumers about its safety. The settlement comes as the social media company battles similar claims nationwide. Facebook’s trial centred on claims that the company, owned by Meta, misled users about a data breach, harvesting data from about 87 million profiles through a third-party personality quiz and selling it to a political consulting firm to create targeted advertisements.
The now-defunct firm, Cambridge Analytica, used the data to help US President Donald Trump’s 2016 campaign bid and intended to work with a pro-Brexit group. Jurors in New Mexico found the California-based social media company had deceived the public about investigations into third parties that harvest user data following the scandal. Jurors also found Facebook published deceptive statements about protecting the data of New Mexico’s entire population of more than two million.
The verdict follows an August settlement in which Meta agreed to pay $18bn over a lawsuit involving child safety issues. New Mexico is the only state to pursue a case over the Cambridge Analytica privacy breach, as an agreement buried within the 130-page settlement released Meta from future liability related to the scandal. In the lawsuit filed last year by the state’s attorney general, Steve Marshall, Alabama claimed the social media app’s algorithm pushed increasingly violent content to young users, contributing to a teen mental health crisis and causing related emergency room visits to “skyrocket”.
The state also accused TikTok of falsely claiming that it limits access to inappropriate content to have the app rated safe for teens in app stores and misleading the public about the Chinese government’s access to US users’ data. According to the Alabama attorney general’s office, the state will receive a minimum of $100m due within 45 days under the settlement, with the potential to receive up to $300m if certain conditions are met. In the settlement, TikTok agreed to implement a two-hour daily time limit, pause after 15 minutes of use and improve age checks for users.
At least 27 other states and Washington, DC, have also sued over similar claims. TikTok previously reached a $400m settlement with the US Department of Justice over allegations that the company violated federal children’s privacy laws.
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