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Meta will pay up to $16.68 billion and impose daily limits and nighttime blocks for teen Facebook and Instagram users to settle claims states said platforms harmed children.
Meta Platforms agreed to pay up to $16.68 billion and enact major product changes to resolve a sweeping set of claims that Facebook and Instagram harmed children, the company and state prosecutors said Wednesday. The settlement ends a high profile federal trial in Oakland that tested allegations the social networks were designed to addict young users and harvested children’s data without consent.
Under the deal, Meta will impose daily usage limits and restrict nighttime usage for teenage accounts, and strengthen safeguards to block minors from age restricted content, court filings show. The company denied wrongdoing in agreeing to the settlement, calling the resolution a way to address litigation risk while continuing to invest in safety features.
The agreement settles claims from 29 states that Meta violated the federal Children’s Online Privacy Protection Act by collecting data from users it knew were under 13, and used that information to train machine learning systems. Four states had also accused Meta of violating state consumer protection laws by designing features to encourage prolonged use among teens.
Shares of Meta rose on the news, reflecting investor relief that one of the most damaging legal exposures has been capped. Earlier in the month, juries and judges in separate cases found Meta liable in rulings that ordered multi million dollar payments and required youth safety measures, decisions the company has said it will appeal.
“Meta will pay up to $16.68 billion and make changes to Facebook and Instagram,” court papers said, summarizing the settlement that also resolves privacy claims tied to earlier data scandals, including Cambridge Analytica. A subset of states will receive $459.3 million linked to those privacy suits.
Legal experts say the settlement removes a major immediate risk but does not end broader litigation against social media companies. Meta, Snap, Alphabet’s YouTube and ByteDance’s TikTok still face thousands of claims from states, school districts and individuals alleging platforms contribute to a youth mental health crisis.
The Oakland trial, overseen by the U.S. District Judge Yvonne Gonzalez Rogers, brought testimony from current and former Meta employees and Instagram leadership as attorneys sought to show product design choices encouraged compulsive use. Meta has argued that “social media addiction” is not a recognized psychiatric condition, a defense it maintained during the proceedings.
