Meta has agreed to pay up to $18 billion to settle its blockbuster legal battle with US states over alleged failures of child protection and social media addiction, in what has been described as one of the largest legal settlements ever made by an individual US company.
As reported by the Financial Times among other international media, "The parent of Facebook and Instagram has agreed to pay a $16.68 billion settlement to 47 states, the District of Columbia and three US territories, according to filings on Wednesday. A separate $1 billion settlement with Texas pushed the total to about $18 billion."
It noted that the settlement came as the trial was just getting under way in a California courtroom. "Meta had previously estimated that losing the case could have cost it hundreds of billions of dollars. The agreement does not include an admission of wrongdoing by Meta. The payout, which the court approved later on Wednesday, is more than double the $7.4 billion agreed last year by Purdue Pharma and the Sackler family over claims related to its opioid medication OxyContin," the Financial Times reported.
California Attorney General Rob Bonta commented that the settlement “will make social media less dangerous for our kids and make a world of difference for children and their families”, forcing “massive transformations” to Meta’s platforms within months. Social media companies are facing a wave of similar cases, all of which contend that Big Tech platforms cause personal injury by developing deliberately addictive products.
As part of the settlement, Meta has agreed to impose default daily limits and night-time blocks for teenage users of its social media apps, bolster its age-assurance systems to prevent children from accessing inappropriate content and provide extra tools for parents and guardians. The limits do not apply to WhatsApp or Meta’s other direct-messaging services. Meta’s new controls will not apply to Florida and New Mexico, which did not sign up to Wednesday’s agreement and so will not receive a share of the payout. “The framework we’ve negotiated will empower parents to easily manage how their children access our platforms,” said CJ Mahoney, Meta’s chief legal officer, according to the report.
It is also worth noting that Meta said about $5.3 billion of the settlement would only be paid out if YouTube and TikTok each agreed to pay the same sum, as well as implementing some of the same usage limits and age-assurance measures. “Because teens move fluidly across dozens of apps, we need an industry-wide solution,” Mahoney said. Meta said it would introduce tighter default time limits and restrictions on night-time access if YouTube and TikTok also agreed to do so.
