$25B Meta Ruling Has Settling States Asking If They Left Money

When state attorneys general in the US announced a $17 billion settlement with Meta this summer, the figure was unprecedented. Last week, however, a judge in New Mexico topped it. Ruling on claims that Meta misled users around the 2018 Cambridge Analytica scandal and related events, the judge ordered the company to pay $25 billion.

Similar claims were resolved in most other states through the settlement over children's online safety. That has prompted one question: should the settling states have demanded more?

If the ruling holds, the balance could shift

The answer depends, among other things, on whether the $25 billion judgment survives Meta's legal challenges. Meta's chief legal officer, C.J. Mahoney, said in a statement that the company is confident it will prevail on appeal, and described New Mexico's case as an attempt to impose a "tax on speech."

Still, if the penalty stands, the appetite of those facing big tech companies to go all the way to trial, or to ask for far larger sums in settlements, could grow. According to Daphne Keller, director of platform regulation at Stanford's Program on Law, Science and Technology, the settling attorneys general will look at this and perhaps feel some regret over the claims they released, and start looking into what else they haven't released. Keller says that for the many individuals, school districts and tribes with pending claims, the ruling is encouraging, raising hopes that litigating aggressively could lead to a big payout.

The settlement had advantages of its own

The New Mexico judgment covers millions of violations; a jury had found that Meta misled users about how it protects their data and how it handles misinformation and hate speech. In most other states, comparable claims were resolved with a $459 million payment as part of the child-safety settlement. Next to the New Mexico figure, that looks small.

The settlement nonetheless had upsides. Even though Meta will spread its payments over 10 years, the deal gave the states greater certainty and faster payment. It also secured product commitments, such as restrictions on teen use, that might have been harder to win through a court order. Advocates say it matters that these measures took effect shortly after the settlement was approved, since that helps stop ongoing harm to children. Other attorneys general may also be working under different laws or with different evidence, which could produce results unlike New Mexico's.

Ongoing cases and an uneven field among states

Keller says that if even part of the ruling is upheld, the settling states will look like they got pennies on the dollar compared with New Mexico. She adds that an attorney general with similar claims would now be less willing to settle, and if they did, would ask for more. Florida Attorney General James Uthmeier, whose state did not join the settlement, wrote on X that he had said at the time that the multistate deal was a "slap on the wrist," that Florida would not be bought off by Meta, and that it would force the company to answer for its conduct. The District of Columbia, which did not settle its Cambridge Analytica claims and is pursuing the case in court, may be the next place to test whether New Mexico's success can be repeated. A separate New Mexico judgment against Meta of roughly $1 billion is also counted among the encouraging developments for those still litigating.

Attorneys general who joined the Meta settlement cannot bring the covered claims again, but they may seek more in their cases against other social media companies such as TikTok, YouTube and Snap. Keller says that with so many cases, it is unrealistic to expect each to end this way; the multipliers are so large that Meta would go bankrupt. But one, or ten, or fifty of them could hit the jackpot.

Blake Reid, an associate professor at the University of Colorado Law School, points to Congress's inertia on major tech policy bills and the Trump administration's generally lighter-touch approach to technology, and sees the episode as a shift toward state-level tech policy. For Reid, the problem is that the fifty states differ in resources, political balance, incentives and ability to litigate at this scale; Meta is still Meta, but it faces fifty smaller opponents that can be broken in different ways. Whether the $25 billion ruling changes state strategy depends partly on whether it is upheld on appeal and whether Meta loses other cases, he says, though the other settlement shows that not every attorney general wants to play this game.