Meta Platforms has been ordered to pay New Mexico $25 billion after a court ruled that the social media giant misled users about the privacy of their personal information. The staggering penalty ranks among the largest financial punishments imposed on a company in US history.
The decision follows a jury verdict in September that found Meta had made misleading statements about data privacy and other issues affecting its platforms. The ruling marks a major setback for the company as it continues to face growing scrutiny over its handling of user information and online safety.
The case traces back to the Cambridge Analytica scandal, in which a British political consulting firm obtained personal data from millions of Facebook users without their consent. The firm later used the information to build voter profiles and target political audiences, including during Donald Trump’s 2016 presidential campaign.
New Mexico’s authorities accused Meta of misleading residents about who could access their information and how the company dealt with hate speech and misinformation. The state also alleged that Meta knew third parties had extensive access to user data and allowed harmful content to persist when doing so served its commercial interests.
Court slashes potential penalty but delivers a major blow
In his ruling, Judge Francis Mathew said the company’s conduct had continued for years and was closely tied to the way Facebook operated its business. He determined that state law could support penalties exceeding $219 billion, but ultimately reduced the amount to $25 billion.
The ruling came more than three weeks after the jury delivered its verdict.
Meta has rejected the outcome and intends to challenge the decision on appeal. The company argues that the state’s approach threatens its ability to operate in New Mexico and effectively imposes financial punishment on online speech.
Meta’s chief legal officer, C.J. Mahoney, said the company believes it will prevail in the appeals process. The company has also maintained that it does not sell users’ personal data and argued that the state failed to demonstrate that consumers were actually deceived.
Millions of alleged violations drive the judgment
The September verdict found that 26 of 29 statements examined during the case were misleading. Jurors linked those statements to more than 43 million alleged violations of New Mexico’s consumer protection laws, calculating the potential reach of the claims across the company’s audience.
During a hearing earlier this month, the state’s legal team sought a penalty ranging from $35 billion to $40 billion, arguing that a substantial financial punishment was necessary to hold Meta accountable.
The company, meanwhile, urged the judge to limit the penalties to $3.45 billion.
New Mexico Attorney General Raúl Torrez described the decision as a turning point in efforts to hold major technology companies responsible for their conduct. He said the judgment sends a warning to businesses that consumer protection will remain a priority for the state.
Cambridge Analytica scandal continues to haunt Meta
New Mexico filed the lawsuit in 2021 after revelations that Cambridge Analytica had collected information from as many as 87 million Facebook users through a third-party application.
The controversy triggered widespread concern over how personal information was shared, handled and used for political purposes. Meta had already paid a $5 billion penalty to the US Federal Trade Commission in 2019 over the scandal.
Six other states later resolved their related claims against the company for $459.2 million as part of a broader multistate settlement reached in August. That agreement addressed allegations that Meta’s platforms had harmed teenagers’ mental health.
New Mexico, however, pursued its own case, which has now resulted in a far larger financial judgment.
Pressure mounts over social media safety
The latest ruling arrives as Meta confronts thousands of lawsuits and increasing political pressure over the effects of Facebook and Instagram on young users.
New Mexico has already secured $942 million in two separate cases against the company this year. Those proceedings concerned allegations involving the sexual exploitation of young people on its platforms and claims that Meta misled consumers about online safety.
Another trial related to the wider wave of litigation was expected to begin the following week, adding to the company’s legal challenges.
Despite the size of the latest penalty, some market analysts believe the financial consequences may be limited if Meta succeeds in extending the dispute through the appeals process.
Gil Luria, head of technology research at D.A. Davidson & Co., said the ruling was costly but unlikely to materially affect the company’s overall valuation, given its market value of nearly $2 trillion.
A lengthy legal battle lies ahead
The $25 billion judgment is unlikely to end the dispute. Meta’s planned appeal could prolong the case, leaving the final financial consequences uncertain.
For New Mexico, the decision represents a significant victory in its campaign to hold a major technology company accountable for alleged consumer protection violations. For Meta, it adds another substantial legal challenge to a growing list of disputes over privacy, platform safety and the responsibilities that come with operating some of the world’s largest social networks.
The case could also become a closely watched test of how far state consumer protection laws can reach when technology companies make claims about the privacy and safety of their services.
