A judge in New Mexico ordered Meta Platforms to pay $25bn on Wednesday after a jury found the company had misled consumers in a case arising from allegations that a political consulting firm involved in Donald Trump’s 2016 presidential campaign obtained data from millions of Facebook users without their consent. Mathew found that a penalty of more than $219bn was warranted, based on state law, but he reduced the figure to $25bn. A spokesperson for Meta did not immediately respond to a request for comment.
Settlements over the social networks’ safety are growing so large that Meta is reporting significant drags on its business. In its quarterly earnings report, issued the same afternoon as the announcement of the judge’s order, the company said its net income came in significantly below Wall Street analysts’ expectations because of a $9.9bn settlement payment in the US. In August, the social media giant agreed to pay $17bn to settle a nationwide lawsuit by dozens of state attorneys general, who alleged it intentionally designed addictive products that harmed children.
Despite the hefty payments, Meta still reported a 26% increase in quarterly revenue up to $64.6bn. New Mexico’s attorney general had sued Meta in 2021 following revelations that Cambridge Analytica, a British political consulting firm, had harvested personal data from as many as 87 million Facebook users through a third-party app. The state accused Meta of lying to Facebook users in New Mexico about who had access to their data, how the company handles hate speech and misinformation posted on the platform, and other internal policies.
The company knew that third parties had broad access to users’ personal data, and it tolerated hate speech or other harmful content when it benefited the company’s bottom line, the state said. Meta has faced a wave of lawsuits over the course of the year related to user safety, with the culmination of several cases being referred to as a big tobacco moment for social media. The company will report its third-quarter earnings on Wednesday.
Jurors on 25 September found that 26 of 29 statements made by the company and its leadership on those issues were misleading. They said the company had committed more than 43m violations of New Mexico’s consumer protection laws, based on the number of Facebook users or New Mexico residents who were the audience for each misleading statement. State law allows a penalty of up to $5,000 per violation, and directs that all of the money go to New Mexico’s school system, New Mexico’s attorney general, Raúl Torrez, told reporters after the verdict.
At a hearing on 1 October, Randi McGinn, a lawyer for New Mexico, had asked Mathew to award the state between $35bn and $40bn, saying that would be supported by the US constitution’s protections on due process and the jury’s verdict. In court filings, Meta urged Mathew to cap the penalties at $3.45bn, saying a higher penalty ran the risk of scaring businesses out of the state. The evidence showed that Meta does not sell user data and New Mexico did not prove that any consumer had actually been misled, the company said in court filings.
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