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Meta Ordered to Pay $567 Million and Redesign Instagram, Facebook in New Mexico Ruling

A New Mexico judge ordered Meta to pay $567 million to fund treatment, prevent harm, and redesign Facebook and Instagram to protect young users. It's the first ruling to require platform design changes, not just financial penalties, in the youth social media mental health litigation.

A therapist has a discussion with a teenaged girl in his office

Over the past several years, tech giants have been tied up in court over claims that platforms like Instagram, Snapchat, and TikTok cause youth mental health issues and exploit children.

Since these social media addiction lawsuits began, settlements with and jury awards against Meta, Snap, Google, and others amount to hundreds of millions of dollars. The general legal argument is that tech companies intentionally designed addictive platforms that hurt younger users.

Though numerous lawsuits have been successful, one crucial issue remained: None of the landmark social media verdicts or settlements involved platform design changes to protect young users from harm. Until yesterday.

A New Mexico judge ordered Meta to pay $567 million to fund youth treatment, prevention and screening programs, but there’s more. For the first time ever, the ruling also included that Meta must make design changes to its platforms, Facebook and Instagram.

While other verdicts and settlement have been substantial and largely celebrated, what happened in the latest social media case is about more than financial penalties.

The ruling aims to fix the damage Meta’s platforms have caused children and teens, while addressing what thousands of lawsuits allege – that the intentional, addictive design of social media causes depression, anxiety, body dysmorphia, suicidal ideation, child exploitation, and other harmful effects to youth.

The judgment in New Mexico followed a $375 million jury verdict against Meta earlier this year, bringing the company’s total financial liability in the state’s case to $942 million.

Perhaps most importantly, the lawsuit may influence thousands of other lawsuits alleging that social media companies designed their platforms in ways that harmed children’s mental health.

Phase 1 of New Mexico’s Social Media Case

Back in March, the first part of the New Mexico social media case resulted in $375 million in civil penalties against Meta after the jury determined they violated the state’s Unfair Practices Act.

According to the New Mexico Department of Justice, the evidence showed the company’s platforms exposed children to dangerous content, including material involving eating disorders and self-harm. They argued that addictive design features encouraged children and teens to spend more time on the platforms.

The state also presented evidence of child sexual exploitation and allegations that Meta had been warned about problems involving young users.

Ultimately, the first part of the New Mexico social media case found Meta liable for misleading consumers about the safety of its platforms and engaging in practices that endangered children.

Shortly after that win, the state attorney general announced a second phase to the case, one aimed at achieving much more than financial penalties.

How New Mexico’s $567 Million Social Media Judgment is Different

While the first phase of the case against Meta primarily punished the company for violations of New Mexico’s consumer protection laws, Thursday’s ruling is very, very different.

During the second phase of the lawsuit, the state argued that Meta’s platforms constituted a public nuisance. The goal was for Meta to be part of the solution for the alleged harm Facebook and Instagram has caused younger users, and the state was successful in doing so.

The Judge ordered Meta to pay $567 million into an abatement fund – a fund that sets aside money to fix and reduce the negative effects that Facebook and Instagram have had on youth mental health.

About $420 million will go toward treatment services for children and teens. The remaining money will support prevention, awareness, screening, and related harm-reduction efforts over five years. But, as already noted, the more than half a billion dollars is just one part of the ruling.

The judge also ordered Meta to implement a series of youth safety measures and report its progress twice a year.

What Design Changes Does Meta Have to Make to Facebook and Instagram?

The social media ruling in New Mexico could change what Meta’s platforms look like and how they operate for young users in the state.

The tech giant was ordered to:

  • Improve age-assurance technology, including the continued use of AI to identify potentially underage users.
  • Delete data relating to users under 13 when those users are identified.
  • Provide more prominent information about its safety tools and protections.
  • Address how young people interact with their platforms, including measures involving screen time, notifications, privacy and content moderation for a five-year period.

More specifically, Facebook and Instagram will have to display banners and informational screens explaining safety features, best practices and tools for dealing with inappropriate comments. The state will review those changes and an accompanying educational campaign.

Some proposed measures to prevent youth mental health harm and better protect young users weren’t granted because they raised concerns about tech feasibility, the First Amendment, and federal privacy restrictions.

While the $567 million ruling against Meta isn’t a blanket order that requires the removal of every feature claimed to be addictive, New Mexico pulled off a huge win. Given research has shown that excessive social media use is linked to increased risks of mental health disorders among youth, these types of changes and funding is a step in the right direction.

What Parents and Schools Should Take Away from the Latest Social Media Ruling

Though the impact on the first generation to grow up online is glaringly obvious, not to mention serious, parents are struggling with how to protect kids online. And they can’t do it alone.

That’s why the latest social media ruling is so significant, even though it only applies in New Mexico; the case is important beyond the state’s borders. Here’s why.

There are thousands youth social media addiction and child exploitation lawsuits against not just Meta, but owners of Snapchat, TikTok, and YouTube. Those cases involve families, children, and teenagers who allege social media was designed to encourage compulsive use and exposes young users to harmful content.

Over 1,000 school districts are also suing, claiming the platforms have contributed to a youth mental health crisis that’s depleted their resources. In May, a Kentucky school district reached a $27 million social media settlement with several companies, which was a solid victory that’s given hope to others.

Then there are the dozens of state attorneys general that are suing social media companies, many of which are seeking design changes and reparations to help youth who developed mental health issues.

With the sheer number of social media lawsuits that grow each week, the $567 million judgment in New Mexico could strengthen current cases and put pressure on tech companies to consider platform changes.

These changes are something that advocates, government officials, parents, and users have repeatedly said are needed; without altering what contributes to depression, anxiety, body dysmorphia, and suicidal ideation among youth, the nationwide social media addiction and risks of online child sexual exploitation go unchanged.

If the requirements the judge ordered Meta prove effective, other states, school districts, and plaintiffs could point to them when asking courts for something similar. The case suggests that courts may have the power to require tech companies to change their products.

And if other lawsuits reach similar conclusions, the way America’s children use social media could look very different in the years to come.

Legal Examiner Staffer

Legal Examiner Staffer

Legal Examiner staff writers come from diverse journalism and communications backgrounds. They contribute news and insights to inform readers on legal issues, public safety, consumer protection, and other national topics.

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