A New Mexico judge has ordered Meta to pay $25 billion after a jury found the Facebook parent company misled consumers, adding another enormous legal penalty to the social media giant's mounting bills.
The case arose from allegations connected to the Cambridge Analytica scandal, in which the political consulting firm that worked for Donald Trump's successful 2016 presidential campaign obtained data from millions of Facebook users without their consent.
Cambridge Analytica gained access to personal information from as many as 87 million Facebook users through a third-party app, according to Reuters. The firm used the information to profile and target voters.
A New Mexico jury in September found that 26 of 29 statements made by Meta and its leadership were misleading and that the company committed more than 43 million violations of the state's consumer protection laws.
Judge Francis Mathew found that state law warranted a penalty of more than $219 billion but reduced it to $25 billion.
Meta has said it plans to appeal. C.J. Mahoney, the company's chief legal officer, said Meta was confident it would prevail and criticized New Mexico's approach to the case.
The judgment dwarfs several of Meta's previous settlements and regulatory penalties over privacy, user safety and the handling of personal data.
$25 Billion New Mexico Penalty
The $25 billion judgment is the largest penalty levied against Meta in the wake of the Cambridge Analytica scandal, Reuters says.
New Mexico Attorney General Raúl Torrez described it as one of the largest, if not the largest, single-state verdicts against a company in U.S. history.
New Mexico sued Meta in 2021. The state accused the company of misleading Facebook users about who had access to their data, how it handled hate speech and misinformation posted on its platform, and other internal policies.
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The jury ultimately found more than 43 million violations based on the number of Facebook users or New Mexico residents who were the audience for each misleading statement.
State law allows penalties of up to $5,000 per violation, Reuters reports. New Mexico had sought between $35 billion and $40 billion following the verdict, while Meta urged the court to limit the penalty to $3.45 billion.
Meta has argued that a multibillion-dollar penalty risks violating its constitutional protections against excessive fines and its right to due process.
Up to $17.1 Billion Child-Safety Settlement
The latest judgment comes less than two months after Meta reached another massive agreement with states over separate allegations involving young social media users.
In August, state attorneys general announced a multistate agreement under which Meta could pay up to $17.1 billion to resolve claims concerning harm to young users and implement new child-safety measures on Facebook and Instagram.
The precise value of that agreement has been reported differently. The figure is important because part of the eventual payout depends on the resolution of litigation involving other social media companies.
Separately, six states settled lawsuits related to the Cambridge Analytica scandal for a combined $459.2 million, Reuters says.
New Mexico has also pursued separate litigation against Meta involving the safety of young users. In March, a Santa Fe jury ordered Meta to pay $375 million in civil penalties after finding the company had misled users about the safety of young people on Facebook, Instagram and WhatsApp.
Following another phase of that case, a judge in August directed Meta to pay $567 million into a New Mexico fund for teen mental health and ordered the company to implement measures aimed at protecting teen Facebook and Instagram users.
$5 Billion FTC Penalty and Other Privacy Settlements
Meta's legal battles over privacy extend well beyond New Mexico.
In 2019, Facebook agreed to pay a $5 billion penalty to the Federal Trade Commission following an investigation into the company's privacy practices in the aftermath of the Cambridge Analytica scandal. At the time, it represented an extraordinary financial penalty for the social media company.
Meta later agreed to pay $1.4 billion to Texas to settle a lawsuit alleging that the company illegally collected biometric information through Facebook's facial-recognition technology.
Texas alleged Meta captured biometric data from photographs and videos uploaded to Facebook without users' informed consent. Meta did not admit wrongdoing as part of the settlement.
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The company has also agreed to a $725 million settlement of a Facebook user privacy class action stemming from the Cambridge Analytica scandal. The litigation accused Facebook of improperly allowing third parties access to users' personal information.
Those figures are nevertheless dwarfed by Wednesday's New Mexico judgment.
The $25 billion penalty is unlikely to be the final word. Meta intends to appeal, setting up the prospect of another legal fight over an award that already stands apart from even the multibillion-dollar penalties and settlements the company has faced in previous privacy and consumer-protection cases.
Torrez framed the ruling as a broader warning to major technology companies, saying after Wednesday's decision that New Mexico intended to protect its residents and consumers.
Newsweek’s reporters and editors used Martyn, our AI assistant, to produce this story. Learn more about Martyn here. Contact Newsweek editors on this story: Edward T. Cummins