Meta to pay historic US$25 billion in New Mexico deception case

The fine issued Wednesday by state court Judge Francis Mathew is among the largest verdicts ever issued in United States legal history.

The award comes after a jury in Santa Fe determined that Meta had violated the state’s consumer protection laws over 43 million times based on dozens of widely viewed deceptive statements made by the company and its top executives about how it handled hate speech and user data.

In his ruling, Mathew awarded the highest possible penalty under New Mexico’s Unfair Practices Act of US$5,000 per violation, which amounts to a shocking US$219 billion when multiplied by the number of violations. But the judge reduced that number down to US$25 billion. The state sought an award of between US$35 billion and US$40 billion.

“The clearly intentional and systemic nature of Facebook’s repeated misstatements” support that award, Mathew wrote.

“Facebook’s wrongdoing—over the course of years and systematically broadcast to the public—goes to the heart of Facebook’s core business practices,” he said.

Meta didn’t immediately return a request for comment. At a hearing earlier this month, Meta’s attorneys argued that any penalty in the tens of billions of dollars range would be a “constitutional violation of epic proportions.”

The penalty award is well above New Mexico’s typical revenue for a year—in fiscal 2028, the state is projected to bring in US$14.8 billion of general-fund revenue. The state is already doing well financially, and has increased its revenue forecasts.

New Mexico Attorney General Raúl Torrez said at a press conference that the penalty is “one of the single largest, if not the largest, single-state verdict against a company in American history.”

“This judgment should be a signal, an unambiguous message to anyone in Silicon Valley and beyond that New Mexico will stand strong and go to court,” he said.

The award also outpaces the entirety of Meta’s US$18 billion settlement reached this summer with the majority of the country’s attorneys general resolving all pending claims related to youth social media harm and addiction.

The two-week trial in the First Judicial District Court of New Mexico centred on claims by the state that Meta had lied to Facebook users about its privacy policies how it handled their data in the wake of the Cambridge Analytica leak almost a decade ago.

The attorney general also advanced claims that the company deceived the public about content moderation decisions and its hate speech policies, pointing to evidence that certain high-profile accounts weren’t subject to the same scrutiny as ordinary users.

Jurors saw video deposition testimony from chief executive Mark Zuckerberg and former chief operation officer Sheryl Sandberg.

Meta has been willing to pay large sums to settle cases involving the Cambridge Analytica leak, which involved a political consulting firm using ill-gotten data on millions of Facebook users to target voters for Donald Trump ahead of the 2016 election.

The Menlo Park, Calif., company paid out US$5 billion to settle with the Federal Trade Commission in 2019, and inked a US$725 million settlement in 2022 to resolve a consumer class action. Meta paid US$459 million in an agreement this summer to resolve cases from 46 states and two territories.

But New Mexico has been an especially costly thorn in the side of Meta, opting out of state AG coalitions prosecuting the company and instead going it alone.

The penalty award for New Mexico comes months after the state became the first in the nation to win a jury verdict against Meta over claims that Facebook and Instagram harm teen mental health and foster child sexual exploitation.

That trial from earlier this year saw a US$375 million civil penalty followed by an additional US$567 million payment Meta must make to the state to set up programs to combat the youth mental health crisis.