The Meta Corporation was sentenced to a $25 billion fine

A federal judge in New Mexico has ordered Meta Platforms Inc. to pay a civil penalty of $25 billion, a sum equivalent to approximately 22.3 billion euros. The ruling, issued on Wednesday, stems from a jury’s determination that Facebook, owned by Meta, violated state consumer protection laws by misleading users regarding data privacy and content moderation. The case is directly linked to the Cambridge Analytica scandal, in which a British political consulting firm improperly accessed personal data from millions of Facebook users. Judge Francis Mathew set the final penalty amount following a September verdict in which jurors found the company guilty of more than 43 million individual violations of New Mexico law. The judge noted that Facebook had falsely promised users that they retained control over their personal data. “Facebook promised users that they (the users) controlled their data. This was false,” Mathew wrote in his order. The $25 billion figure falls below the range of $35 billion to $40 billion requested by New Mexico prosecutors but significantly exceeds the maximum of $3.45 billion proposed by Meta’s defense team. The legal dispute traces back to 2021, when New Mexico Attorney General Raul Torrez filed suit against the technology giant. The core issue involves the Cambridge Analytica incident, where a third-party application known as “thisisyourdigitallife” harvested data from approximately 87 million Facebook profiles. Although the app was installed by only about 270,000 users, it collected information on their friends as well. Cambridge Analytica utilized this data to create targeted political advertisements ahead of the 2016 U.S. presidential election, serving clients that included Donald Trump’s campaign. Facebook became aware of the data acquisition in December 2015 but did not disclose the breach publicly until 2018, after a whistleblower revealed the misconduct. During the trial, jurors examined 34 specific instances of allegedly deceptive statements made by Facebook concerning user privacy and the removal of harmful content, such as pandemic disinformation and hate speech. They concluded that these misleading practices affected the entire population of New Mexico, which numbers more than 2.1 million residents, rather than just active users of the social network. Consequently, the jury calculated the number of violations based on the state’s total resident count for each deceptive claim. New Mexico was the only state to pursue litigation in this matter; 48 other states settled with Meta in August for a combined $18 billion, a deal that included a release from future liability regarding the Cambridge Analytica breach. Florida also declined to join that settlement. Meta has announced its intention to appeal the decision. Company representatives characterized the lawsuit as a “tax on speech” and stated that the ruling makes it nearly impossible to conduct business in New Mexico. A spokesperson said the company disagrees with the verdict and intends to challenge both the evidence presented and the methodology used to calculate the number of violations. Defense attorneys argued that consumer protection statutes should not apply to residents who were not using Facebook at the time of the alleged infractions. During the proceedings, Meta contended that the state’s evidence was outdated and highlighted that only one additional data security violation was discovered during five years of document collection. Despite the broad findings against the company, the jury sided with Meta on one specific point. Jurors determined that the state failed to prove Facebook falsely claimed to remove harmful content, specifically regarding disinformation about the COVID-19 pandemic. This partial victory for the defense contrasts with the overwhelming majority of charges where liability was established. New Mexico Attorney General Raul Torrez described the outcome as a historic victory, emphasizing that the case addressed whether corporations could mislead consumers about their personal information without facing substantial consequences. Torrez stated that the state stood its ground against corporate power. He further specified that the funds received will be directed into a special fund dedicated to the state’s education system. State law mandates that penalties in such cases flow to the school system, with potential fines reaching up to $5,000 per violation. This judgment represents the second major financial penalty imposed on Meta in New Mexico within six months. Earlier this year, in a separate proceeding focused on child safety, a jury ordered Meta to pay $375 million after finding the company liable for endangering minors by making them vulnerable to predators on its platforms. That earlier case resulted in nearly $1 billion in combined penalties against the tech firm. Meta previously paid $5 billion in 2019 to resolve a case with the U.S. Federal Trade Commission related to privacy practices and agreed to pay $725 million in 2022 to settle a class-action lawsuit connected to the Cambridge Analytica scandal. Prosecutors during the trial urged the court to impose a severe financial burden, arguing that money is the only language Meta understands. Randi McGinn, a New Mexico attorney, told the court that the value of the company’s stock price and its cash reserves necessitated a substantial penalty. As the appeal process begins, the focus will shift to whether higher courts uphold the jury’s calculation method and the applicability of consumer protection laws to non-users of the platform. The immediate consequence is the transfer of billions of dollars to the state’s educational budget, pending any successful appeals by the defendant.