Meta brokers $17B settlement nearly one week after California trial begins

The parent company of Facebook and Instagram reached a $17 billion settlement deal on Wednesday, ending the multistate lawsuit over Meta's role in teen social media addiction. Several dozen states sued the social media giant in 2023, accusing it of harming children by using addictive algorithms on its platforms, effectively exploiting young users for financial gain.

The coalition specifically accused Meta of violating the Children’s Online Privacy Protection Act, or COPPA, which regulates websites and online services directed towards children. The settlement came nearly a week after the trial began, with California Attorney General Rob Bonta leading the multistate coalition. This settlement will make social media less dangerous for kids and bring a world of difference to families, Bonta said in a Wednesday statement.

What’s the settlement breakdown? The proposed settlement, which still needs formal approval from the presiding judge, outlined up to $17 billion in monetary payments made across 10 years to the suing states. Each state will receive differing amounts, with California expected to receive $1.5 billion at minimum, Bonta’s office reported.

Virginia would receive at least $353 million, New Jersey would receive between $525 million and $752 million, and New Hampshire would receive up to $224 million, state officials reported on Wednesday. Dozens more states would receive payouts, along with several U.S. territories like Puerto Rico and Guam. The District of Columbia would receive up to $129 million in payouts, according to district officials.

Meta also agreed to enact various safeguards to minimize harm to young users within a matter of months, according to Bonta. Safeguards included default time limits, silencing platform notifications during school hours, and banning plastic surgery filters, he said. Meta also agreed to block young users from accessing platforms between midnight and 6 a.m., Bonta said. Users under the age of 18 will not be allowed to see numbers of likes and reactions to posts. The company also agreed to maintain and improve existing teen safety measures and enact robust age detection tools to shut down accounts for underage users, Bonta’s office reported.

What is Meta saying about the deal? Meta released a statement summarizing the agreement and reporting total payouts to reach about $18 billion. The agreement’s safety measures aimed to spur industry change with hopes of other platforms adopting similar safeguards, according to Meta’s release.

The negotiated framework will empower parents to easily manage child access to social media, while setting the social media industry as a whole on the right path, according to Meta's Chief Legal Officer C.J. Mahoney. Mahoney voiced pride in the steps Meta took to protect children and said he hoped other social media platforms would follow.