In Landmark Verdict, Jury Holds Meta Responsible For Its Platform's Content

Until yesterday, no plaintiff had ever been able prevail in trial against the extremely wealthy tech companies about whether they could be held responsible for the content on their platforms. That changed with the verdict in New Mexico. There are thousands of similar lawsuits pending in California and in federal courts. 

This is significant both due to the outcome which focused on one of the world's red-lines - child abuse - and to the timing. The combination of wealth-flaunting tech bros dabbling in politics primarily for their own benefit and the rise of AI, which has captured the public's ire for its proponents' casual disregard (not to mention outright lies) about the impact on jobs, incomes and personal data, has arguably brought to an end a generation's worth of public support for unfettered technology. The public and many of its elected representatives increasingly see the tech industry and its leaders as self-serving and greedy. This means that juries are likely to increasingly find for the people suing tech. And though it would be premature to count out the heavily funded tech companies and their battalions of well-compensated lawyers, this verdict may mark the beginning of a shift in liability which has far-reaching financial consequences not just for responsibility, but for issues such as ownership of intellectual property on the free access to which the tech business model is significantly based. JL

Erin Mulvaney and Meghan Bobrowsky report in the Wall Street Journal:

The jury found Meta liable for misleading consumers about the safety of its platforms and endangering children. The case was among the first to test whether social-media  companies should be held responsible for content posted on their platforms. This is the first time a state has prevailed at trial against a major tech company for harming young people. The case was one of dozens of similar lawsuits filed by state attorneys general against Meta and other platforms. Separately, a jury is deliberating in a similar case in a Los Angeles court,  one of thousands of similar individual lawsuits consolidated in a California court. Additionally, more than 2,000 lawsuits are pending in federal court by individuals and school districts.

A New Mexico jury on Tuesday found that Meta Platforms META -1.84%decrease; red down pointing triangle, which runs Facebook and Instagram, was liable for failing to protect young people from online dangers, including sexually explicit content, solicitation and human trafficking.

The jury found Meta liable for misleading consumers about the safety of its platforms and endangering children, under the state’s consumer protection laws. The jury ordered a maximum penalty for each violation, totaling $375 million in civil penalties. Meta made 160 times that amount of revenue in its most recent quarter.

The case was among the first to test questions about whether social-media companies should be held responsible for the content posted on their platforms. New Mexico Attorney General Raúl Torrez said this is the first time a state has prevailed at trial against a major tech company for harming young people.

“The jury’s verdict is a historic victory for every child and family who has paid the price for Meta’s choice to put profits over kids’ safety,” Torrez said. “Today the jury joined families, educators, and child safety experts in saying enough is enough.”

The case was one of dozens of similar lawsuits filed by state attorneys general against Meta and other platforms. Separately, a jury is deliberating in a similar case in a Los Angeles court, in which a young woman alleges that social-media companies, including Meta, designed intentionally addictive products that led to her mental health issues.

That case is one of thousands of similar individual lawsuits consolidated in a California court. Additionally, more than 2,000 lawsuits are pending in federal court by individuals and school districts.

In 2023, Torrez sued Meta alleging that the social media giant’s platform failed to protect children from sexual abuse, online solicitation, and human trafficking. The lawsuit was the result of an undercover investigation into Meta’s platforms that created decoy profiles posing as children aged 14 years and younger.

The lawsuit said Meta was proactively serving and directing underage users toward sexually explicit images, allowed adults to contact children for pornographic images, and let users find, share and sell enormous volumes of illegal child porn.

Meta disagrees with the verdict and plans to appeal, a company spokesman said Tuesday. 

“We work hard to keep people safe on our platforms and are clear about the challenges of identifying and removing bad actors or harmful content,” Meta spokesman Andy Stone said. “We will continue to defend ourselves vigorously, and we remain confident in our record of protecting teens online.”

During the weekslong trial, New Mexico prosecutors presented internal Meta documents and testimony that it said showed the company ignored warnings about the dangers of its platforms. They alleged design features let pedophiles engage with children, and that the sites were designed to intentionally addict children to using them.

Meta denied the allegations and says that it has been investing money for years to make its platforms safer at the expense of audience growth. 

In May, the New Mexico trial court judge will hear additional arguments from state prosecutors, who will ask for Meta to pay additional damages. They will also ask for Meta to change its platform, including enacting effective age verification, removing predators from its sites, and protecting minors from encrypted communications that can shield bad actors.

In the case underway in Los Angeles, a jury has been deliberating for eight days over social media harm allegations against Meta and YouTube after several weeks of testimony and arguments. On Monday, that jury indicated to the judge that they were having trouble reaching consensus with their verdict.

During that trial, jurors heard from Meta executives Mark Zuckerberg and Adam Mosseri and the plaintiff, a 20-year-old woman named Kaley G.M., who testified that social media use had contributed to mental health issues including anxiety, depression and body dysmorphia. 

Kaley’s case was the first of more than 3,000 lawsuits filed against Meta, YouTube, TikTok and Snapchat in California. TikTok and Snapchat settled with Kaley before the trial began in February.