New Mexico Judge Orders Meta to Pay $25 Billion for Misleading Users About Data Privacy
A jury found Meta committed more than 43 million violations of New Mexico's consumer protection laws in a case stemming from the Cambridge Analytica scandal. The judge found an even larger penalty was warranted but reduced it to $25 billion.
A New Mexico judge on Wednesday ordered Meta Platforms to pay $25 billion to the state after a jury found the company misled Facebook users about the privacy of their data, one of the largest financial penalties ever imposed on a U.S. company.
State District Court Judge Francis Mathew wrote in his order: “Facebook’s wrongdoing — over the course of years and systematically broadcast to the public — goes to the heart of Facebook’s core business practices.” He found a penalty of more than $219 billion was warranted under state law but reduced it to $25 billion.
The case stems from revelations that Cambridge Analytica, a British political consulting firm that worked on Donald Trump’s 2016 presidential campaign, harvested personal data from as many as 87 million Facebook users through a third-party app. New Mexico sued Meta in 2021, accusing the company of lying to Facebook users in the state about who had access to their data, how it handles hate speech and misinformation, and other internal policies.
On Sept. 25, jurors found that 26 of 29 statements made by the company and its leaders on those issues were misleading. They said the company committed more than 43 million violations of New Mexico’s consumer protection laws, based on the number of Facebook users or state residents who were the audience for each misleading statement. State law allows a penalty of up to $5,000 per violation, and the money goes to New Mexico’s school system, Attorney General Raul Torrez told reporters after the verdict.
The state wanted more; Meta says it will appeal
At an Oct. 1 hearing, Randi McGinn, a lawyer for New Mexico, had asked Mathew to award between $35 billion and $40 billion. “This court should speak to Meta in the only language it understands, which is money, and the value of its stock price,” McGinn said.
Meta urged the judge to cap the penalties at $3.45 billion, saying a higher penalty risked scaring businesses out of the state. In court filings, the company argued the evidence showed it does not sell user data and that New Mexico did not prove any consumer had actually been misled.
After the ruling, Meta said it will appeal. “This ruling, and the Attorney General’s approach to this enforcement, makes it all but impossible to do business in the state of New Mexico,” Chief Legal Officer C.J. Mahoney said in a statement. “At its core, this lawsuit seeks to impose a tax on speech to enforce new rules for what people can say online. We are confident we will prevail on appeal.”
Second New Mexico verdict against Meta in six months
Wednesday’s decision was the second Santa Fe jury verdict against Meta in six months in a lawsuit brought by the state. In the first trial, which ended in March, a jury found Meta misled users about the safety of young users on Facebook, Instagram and WhatsApp and ordered $375 million in civil penalties. After a second phase of that trial, a judge ordered the company to pay $567 million into a New Mexico fund for teen mental health and to put measures in place to protect teen Facebook and Instagram users in the state.
Reporting based on coverage by Reuters and CNN.
