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Settlements may lack the drama of trials, but they can still be landmark legal wins in their own right. After Meta agreed on Wednesday to settle claims that it designed Facebook and Instagram to addict and harm young users, a debate is already brewing about whether this one qualifies.
Monetarily, it certainly seems to. In unadjusted dollar figures, the roughly $18 billion Meta agreed to pay after a coalition of states sued it in federal court appears to be among the largest civil settlements in U.S. history, behind the $206 billion Big Tobacco forked over starting in the 1990s and the $21 billion BP paid out after the 2010 Deepwater Horizon oil rig explosion.
On the other hand, that sum is a pittance for a company with a current market capitalization of about $1.5 trillion, and some of the new rules the social media giant agreed to implement to protect users under 18 appear to have loopholes.
Let’s dive in.
Back up. What prompted the lawsuit in the first place?
In 2023, four states—California, Colorado, Kentucky, and New Jersey—led a lawsuit against Meta. They alleged that the company’s platforms harmed kids in violation of both state-level rules and a federal law called the Children’s Online Privacy Protection Act, which bans companies from collecting data from children under the age of 13 without their parents’ approval. The case, which began as a coordinated, bipartisan effort involving attorneys general from 29 states, eventually expanded to encompass 47, as well as the District of Columbia and three U.S. territories.
What do the states say Meta actually did to hurt kids?
The case, which initially sought about $200 billion in damages, employed a relatively novel legal argument. Rather than trying to hold Meta accountable for the content users might see on its platforms—a strategy that has failed in the past—the states alleged that the company knowingly designed Facebook and Instagram to be addictive even as it publicly claimed they weren’t. The plaintiffs further argued that those addictive features, which include things like recommendation algorithms and push notifications, have fueled depression, eating disorders, self-harm, and other bad outcomes among kids. The strategy recalls the successful legal approach states took to rein in tobacco companies over health issues linked to cigarettes.
I assume Meta doesn’t agree with those claims. So why did it settle?
When the trial started in the U.S. District Court for the Northern District of California last week, the company argued that there’s no proof that its products are addictive. It noted too that federal law protects it from being held liable for what users post on its platforms. But the company may have wanted to avoid the public spectacle of a drawn-out trial, which could have forced its CEO, Mark Zuckerberg, to take the stand. At the same time, legal experts who have been following the proceedings note that the company might also have been genuinely worried about losing. “Meta wouldn’t settle unless it sees the writing on the wall and feels really exposed,” Nora Freeman Engstrom, a Stanford University law professor, told the New York Times.
What exactly did Meta agree to as part of the settlement?
The settlement still needs to pass muster with the judge who was overseeing the trial. But assuming it does, Meta pledged to pay the states and territories up to $17.1 billion over the next decade, plus an additional $1 billion to the state of Texas to settle separate but similar claims. As part of the deal, the company also agreed to implement new limits on some of its platforms’ allegedly addictive features. Those limits include a stricter process to verify a user’s age that requires Meta to meet a certain threshold of accuracy, and a two-hour daily limit on its platforms if a user is under 18. The company is additionally putting in place features it’s calling “night mode,” which will prevent younger users from accessing the platforms overnight, and “school mode,” which will block most push notifications during school hours—features only a child’s parent will be able to disable.
How big a deal is this?
“I think it’s a genuinely important settlement, but the $17 billion headline is probably the least interesting part of it,” Stanford’s Engstrom told me by email. “What matters more is that Meta has accepted enforceable constraints on the design of its products—and that the states have produced a regulatory template they can now take to the rest of the industry.” Although the settlement didn’t include any admission of wrongdoing, it may encourage similar suits against the company and its competitors. In truth, those floodgates had already begun to open. In March, a California jury awarded $6 million to a woman who alleged that Meta’s and YouTube’s addictive features caused her anxiety and depression. And Meta already owes New Mexico nearly $1 billion for misleading users about its platforms’ safety. (Meta has said it plans to appeal.) The company is also staring down lawsuits from people and school districts that predated the settlement and are set to go to trial soon, the Times reports.
OK, then what’s on the “not such a big deal” side of the ledger?
Meta is spinning the settlement as a meeting of the minds. “What we have now for the first time is alignment between one of the major social-media platforms and regulators from all over the country about how to deal with this issue,” the company’s top lawyer told the Wall Street Journal Wednesday. But Meta may also benefit from stopping the trial where it was. Most significantly, both the financial penalty and the new protections it agreed to have some major caveats. Meta won’t have to pay $5.3 billion—about 30 percent of the total payout—unless its main competitors, YouTube and TikTok, implement similar limits for users under 18 and pay the states another $5.3 billion. “Night” and “school” modes still leave plenty of hours in the day for kids to doomscroll. And time spent watching longer videos and messaging other people doesn’t count toward younger users’ two-hour limit, which could just push them to spend their time on Meta’s platforms in other ways. To revisit the Big Tobacco analogy, it would be akin to declaring that kids can’t smoke cigarettes unless they do it between the hours of 3 p.m. and midnight or smoke only menthols. There may be ancillary benefits for Meta too. The settlement could take the pressure off Congress to design broader regulations that might subject Meta and its competitors to even tougher restrictions.
Speaking of, what does this settlement mean for social media companies other than Meta?
The settlement doesn’t directly apply to YouTube, TikTok, or any other platform, but it does give litigants a blueprint for how to pressure those platforms using a similar playbook. “States now have a negotiated menu of age assurance, time limits, nighttime restrictions, parental controls, auditing, and monetary relief that they can put on the table,” Engstrom told me. And in a surprising twist, the settlement may turn Meta itself into yet another pressure point on the social media industry writ large. On Wednesday, the company unveiled an ad it plans to take out in major newspapers urging its competitors to adopt similar protections for users under 18. On the one hand, the move is transparently self-interested: “Meta plainly did not want to be the only platform competing with one hand tied behind its back,” Engstrom said. But it may also end up making Meta an unlikely ally in the broader push to regulate the industry.
If you’re no longer a teenager but still don’t want to spend your whole night trawling Instagram, my Slate colleagues suggest:
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A dispatch from the Survivor cruise: Why are people still so obsessed with America’s most successful reality show 50 seasons in? Earlier this year, Slate’s Hillary Frey went to the only place where you can really understand the show’s spell on its very loyal audience: the Survivor cruise, where she had surreal encounters with infamous former contestants, and came away with more insight into what the show reveals about the American psyche.
Take a bite out of history: In Part 2 of its series on McGruff the Crime Dog, Slate’s Decoder Ring podcast asks the question: Did a trench-coat-wearing dog’s catchy anti-drug anthems actually work? (And if you missed Part 1, on McGruff’s unlikely origins, you can catch up here.)
OK, all done! Enjoy your (Facebook-free?) night, and see you tomorrow.