Meta has to pay a $25 billion fine for misleading users about data protection

Meta Platforms Inc. was ordered today to pay $25 billion in penalties after a jury concluded that the company misled its users about the way it protected and used their data.

A jury in Santa Fe, New Mexico found the company guilty of deceiving its users. The case, which dates back ten years, is related to the Cambridge Analytica scandal, when Meta was still Facebook Inc.

After a two-week trial last month, the jury ruled against Meta, concluding that the company had committed 43 million violations of the state’s unfair practices law. Since each violation was punishable by a penalty of up to $5,000, the state was initially awarded $219.5 billion, but Judge Francis Mathew reduced the fine to $25 billion.

“The extraordinary number of intentional violations found by the jury, the duration and repetition of the conduct, the breadth of topics on which violations occurred, the involvement of senior Facebook executives, the size of the audiences reached in New Mexico, and the clear intent and systematic nature of Facebook’s repeated misrepresentations found in the trial record favor the highest penalty permitted under the New Mexico Unfair Practices Act – $5,000 per violation found by the jury,” Judge Mathew wrote in the filing.

Meta is paying a heavy price for allegations that its platforms are harming the public. In August, the company agreed to a $17.1 billion settlement with dozens of U.S. states over claims that it intentionally made its products addictive. Another settlement charge of $9.9 billion caused its latest quarterly earnings to fall well short of Wall Street expectations. Still, business continued to boom, with sales rising 26% to $64.6 billion.

The penalty increases by 15% for each year it is not paid in full. With thousands of lawsuits pending, most of which have to do with child safety, privacy and social media addiction, Meta finds itself in a unique, seemingly Sisyphean position where one lawsuit seems to follow the next.

“For too long, powerful technology companies have acted as if their size and influence put them beyond the reach of the law,” said Raúl Torrez, New Mexico’s attorney general. “Today’s outcome makes it clear that no company is too powerful to be held accountable.”

CJ Mahoney, Meta’s chief legal officer, disagreed and vowed to win the appeal. “This ruling and the Attorney General’s approach to this enforcement make it nearly impossible to do business in the state of New Mexico,” he said in a statement. “At its core, this lawsuit seeks to impose a speech tax to enforce new rules for what people can say online.”

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