Meta Agrees to Up to 23 Trillion Won Settlement in Teen Addiction Lawsuits
Meta has agreed to pay up to 23 trillion won (approximately $16.7 billion) to settle teen addiction lawsuits brought by 29 U.S. states. This legal battle, centered on claims that social media addicted teenagers, has thus effectively concluded, though it requires judicial approval to become final.
Under the settlement, Meta has agreed to restrict teenagers' use of Facebook and Instagram. The company will block access between midnight and 6 a.m. and limit daily usage to two hours. Measures to prevent access to age-restricted content will be strengthened, and the agreement includes provisions preventing teenagers from disabling certain safety settings without parental consent.
Meta denied any wrongdoing or legal liability regarding allegations of violating consumer protection laws or collecting children's personal data. However, the settlement amount will be paid in installments over 10 years, and an independent auditor will monitor compliance with the agreement over the next decade.
The settlement also includes privacy lawsuits related to the Cambridge Analytica scandal, which involved the collection of personal data from millions of Facebook users. California, Illinois, New Mexico, and Washington, D.C. will receive $459.3 million from this portion.
The trial had begun on the 18th at the federal court in Oakland, California, and was in its second week. California, Colorado, Kentucky, and New Jersey alleged that Meta violated consumer protection laws. All 29 states viewed the actions as a violation of the federal Children's Online Privacy Protection Act (COPPA), arguing that Meta collected minors' personal data without parental notice or consent to use for training machine learning and generative AI models.
Meta has lost two lawsuits in New Mexico this year. In March, a jury found that Meta misled consumers regarding platform safety and ordered a payment of $375 million. On the 6th of this month, a judge imposed an additional $567 million in damages for public nuisance and ordered the implementation of youth protection measures. A verdict in the first individual trial also ruled in favor of the plaintiff. In March, a Los Angeles jury held Meta and Google liable for the plaintiff's depression and anxiety, awarding $6 million in damages. Both companies plan to appeal.
This settlement only resolves the lawsuits brought by the 29 states. According to the Judicial Panel on Multidistrict Litigation, as of the 3rd of this month, there are 3,137 consolidated teen social media addiction lawsuits in the Northern District of California, up from 557 in August 2024. Plaintiffs include individuals, school districts, and state governments, with school districts alone exceeding 1,200; proceedings separately underway in California state courts are excluded from this count. Meta is not the only target. Snap, YouTube, TikTok, and their respective parent companies also continue to face similar large-scale litigation.
Meta shares rose 0.61% to $573.50 as of 10:09 a.m. today, compared to the previous trading day.
