Meta, the parent company of Facebook and Instagram, has agreed to pay up to $17.1 billion ($AU23.8 billion)* to settle a social media addiction lawsuit.
Along with the payment, Meta is required to make changes to its platforms to reduce social media addiction for children and teenagers.
The settlement was announced by attorneys-general from most U.S. states and territories.
It doesn't require Meta to admit fault, wrongdoing, or liability.
*From this point, all amounts are in USD
Background
In 2023, a bipartisan coalition of U.S. states filed lawsuits against Meta.
They alleged Meta:
- Illegally collected and used the data of children under 13
- Designed its platforms so that it drove excessive usage and put young users at risk
- Lied to users, their families and the public about the safety of Facebook and Instagram.
In doing so, the coalition alleged Meta violated several state and federal laws.
Settlement
If approved by a judge, Meta will pay up to $16.7 billion to settle the social media addiction lawsuit.
It will also pay $459 million to settle a separate lawsuit involving a consulting firm called Cambridge Analytica's use of Facebook data.
Several states have stated that they plan to use their settlement distribution for mental health services.
Meta is valued at $1.47 trillion and generated revenues of $60.8 billion from April to June 2026.
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Approximately 70% of the settlement is guaranteed and will be paid in instalments over 10 years.
The remaining 30% will be conditional on YouTube and TikTok implementing one-hour daily limits, night mode and age assurance features.
It's also contingent on YouTube and TikTok paying billions to the U.S. states and territories.
Meta has openly reached out to both companies to agree to these terms.
Separately, Meta has settled with Texas for $1 billion.
New Mexico won a $942 million court case on 7 August, and Florida is suing Meta separately.
The changes
Meta is required to implement:
- Daily time limits and prompts after 15 minutes of use for children across Facebook and Instagram
- Restricted access for children between 12am and 6am, and silent notifications between 10pm and 7am
- No notifications on weekdays between 8am and 3pm
- Age assurance measures and age-appropriate content controls.
TDA reached out to Meta, which did not confirm whether these changes would extend beyond the U.S, but said it would monitor the impacts and engage with other governments.
Other cases
Thousands of similar cases against Google, Meta, TikTok, and Snap are due in courts across the U.S. this year.
Earlier in the year, a U.S. jury found YouTube and Meta negligent in their design and operation that contributed to a 20-year-old woman's social media addiction and worsened mental health.
She was awarded $6 million.
