Meta Fined $25 Billion in New Mexico for Misleading Users over Data Privacy

A judge in New Mexico has ordered Meta Platforms to pay the US state $25bn after a court found the company intentionally misled consumers about the privacy of their data. The ruling against Facebook's parent company is being described as one of the largest single-state verdicts against a company in United States history.

Judge Francis Mathew wrote in his order, which came more than three weeks after the verdict, that Facebook's wrongdoing — carried out over years and systematically broadcast to the public — goes to the heart of the company's core business practices. The judge found that a penalty of more than $219bn would have been warranted under state law, but reduced the figure to $25bn.

New Mexico Attorney General Raul Torrez said it was one of the largest, if not the largest, single state verdict against a company in US history. In his view, the judgment should be an unambiguous signal to Silicon Valley.

Meta responded through its chief legal officer, CJ Mahoney, who said the company was confident it would win on appeal. He said the ruling, and the attorney general's approach to enforcement, makes it all but impossible to do business in New Mexico. At its core, Mahoney argued, the lawsuit seeks to impose a tax on speech to enforce new rules for what people can say online.

The case dates back to 2021, when New Mexico's attorney general sued Meta following revelations that Cambridge Analytica had harvested personal data from as many as 87 million Facebook users through a third-party app.

Cambridge Analytica, a now-defunct British political consulting firm, used the harvested Facebook data to generate targeted political advertisements during the 2016 election season, when it worked for Donald Trump's successful presidential campaign.

The state accused Meta of lying to Facebook users in New Mexico about who had access to their data and about its handling of hate speech and misinformation on the platform. Lawyers for the state cited a 2010 Washington Post op-ed in which Facebook CEO Mark Zuckerberg wrote that the company did not sell user data.

They alleged the company knew third parties had broad access to users' data and tolerated hate speech or other harmful content when it benefited the company's bottom line. It was on allegations of this kind that the court based its finding that consumers had been misled.

This case is not Meta's only legal pressure. The company is facing thousands of lawsuits and pressure from lawmakers over the impact of Instagram and Facebook on teen mental health.

A trial brought by a coalition of state attorneys general in a California federal court began in August, over claims the company engineered Facebook and Instagram to be addictive to children. That case could expose the company to huge damages and force sweeping changes to its platforms. It will also address claims by 29 states that the company illegally collected and used children's data in violation of federal law.

Six other states previously settled their Cambridge Analytica-related lawsuits for $459m, as part of a $17bn multistate settlement Meta reached in August to resolve states' claims that its platforms had harmed teen mental health.

Earlier this year, New Mexico won $942m in two trials against Meta over claims it facilitated sexual exploitation of young people on Instagram and Facebook and misled consumers about the platforms' safety. The legal fight between this state and Meta is therefore running on several fronts, and the new verdict multiplies that pressure.

The American Economic Liberties Project, a nonprofit supporting stronger policies towards corporations, said the $25bn fine is a drop in the bucket for Meta but demonstrates that people want accountability. Its executive director, Nidhi Hegde, noted that the company is now rolling out Muse, an AI assistant encouraging people to trust it with everything from bank accounts to medical information — which, she argued, is why more enforcers with courage and laws with actual teeth are needed. Whether this historic fine survives will now be decided on appeal.