Meta's $25 Billion Judgment Is 1.5% of Its Market Value

A New Mexico jury found Meta liable for misleading users about data handling, and the court set the penalty at $25 billion.

New Mexico filed the case in 2021 under the state's Unfair Practices Act, with claims tracing to the Cambridge Analytica scandal. The state asked Judge Francis Mathew for $35 billion to $45 billion. The maximum allowed was $219 billion, calculated at $5,000 for each of 43 million violations. The judge reduced that figure to $25 billion. Meta is valued at about $1.7 trillion, so the penalty equals roughly 1.5% of its market value.

Meta chief legal officer C.J. Mahoney said the company will appeal. He said the ruling and the attorney general's approach make it "all but impossible to do business in the state of New Mexico." He called the lawsuit an attempt to "impose a tax on speech" and said Meta is "confident we will prevail on appeal."

Other courts have also ruled against the company. A New Mexico jury ordered $375 million in a child safety trial, and a second phase added $567 million. A Los Angeles County superior court found Meta and Google-owned YouTube liable for harming a young woman's mental health through app design, awarding $6 million, most of it Meta's. In August, Meta settled a federal case brought by most US states over features alleged to harm children, agreeing to pay $17 billion to $18 billion over 10 years.

Corban Rhodes, a partner at DiCello Levitt, which represents New Mexico, said each case Meta declines to settle puts trial evidence on the public record for future litigation. The New Mexico trial placed more than 100 exhibits into the record, material kept secret for over a decade. One is a 2018 email from then-COO Sheryl Sandberg, sent days after Cambridge Analytica broke. She wrote that the biggest issue was that "there were a MILLION developers with access to the data," and warned of "many, many, many more moments like this in the next month and year."

A March ruling in Delaware held that insurers have no duty to defend Meta against the lawsuits it faces. Brian Quinn, a Boston College law professor who studies corporate law, said pressure could rise if shareholders focus on individual directors and officers. Under indemnification law, a finding that someone violated the law does not automatically make them liable if they acted in good faith. But if the same people keep appearing in the same set of facts, Quinn said, shareholders might demand that the company stop indemnifying them, leaving Meta's executives less protected. Rhodes said the next wave of litigation will center on AI.