Facebook, Instagram parent Meta to pay $16.7 billion over child social media addiction lawsuit

Meta, the parent company of Facebook and Instagram, has agreed to a settlement of nearly $16.7 billion in a lawsuit concerning the social media addiction of children. The agreement was reached with U.S. states, territories, and the District of Columbia, according to court documents.

The lawsuit accused Meta's platforms of deliberately encouraging excessive use among minors and concealing associated risks from parents and the public. While Meta has consistently denied these allegations, the company previously stated in court documents that the penalties sought by the states could amount to $1.4 trillion, potentially jeopardizing its existence. Plaintiffs' attorneys, however, estimated the potential figure to be around $200 billion.

The settlement aims to resolve the legal dispute without further court proceedings. The trial, led by California, began with opening statements last week in Oakland. The states sought fines and changes to Meta's business model.

This settlement follows a series of setbacks for Meta in U.S. courts. The company was ordered in New Mexico to pay over half a billion dollars for harm caused to children through social media use and faces restrictions on usage for users under 18. Meta plans to appeal these decisions. Additionally, in March, Meta and YouTube lost a significant case regarding the addictive nature of online services, with a jury finding the platforms negligent in informing users about risks.