Could Meta Go Under Because of Alleged Shaping of Instagram and Facebook to Attract and Keep Kids?
The biggest story to me is that Meta, the parent company of Facebooks and Instagram, is being sued by four states - California, Colorado, Kentucky, and New Jersey - over claims that those two platforms have caused harm to children. The California trial starts this week in Oakland. These four states are part of a group of 29 (!) states that filed a lawsuit in 2023 over child privacy laws.
This trial would also cover allegations by all 29 states that Meta violated a federal law called Children’s Online Privacy Protection Act, or COPPA by illegally collecting children’s data.
Here's an interesting twist:
Eight people were selected last week as part of the jury. They will play an advisory role, while the US District Judge Yvonne Gonzalez Rogers will make the final ruling.
During jury selection last week, prospective jurors were asked whether and how much they believe Meta has contributed to the youth mental health crisis. While many agreed that it did, they also put responsibility on parents, and said things like climate change and the state of the world are also causing children’s and teenagers’ mental health issues.
It is expected that Mark Zuckerberg and head of Instagram Adam Mosseri will be testifying.
The trial is part of the social media adolescent-addiction multidistrict litigation (MDL), which has gathered thousands of cases from around the country since 2022. Among the alleged concerns are that Meta designed its apps to keep minors hooked to them and did that despite knowing from its own researchers that its products cause serious mental health issues for kids.
During the trial, states will show evidence they say demonstrates how the apps were designed to be addictive and Meta’s awareness of it, rather than focusing on the content on these platforms. That’s a deliberate strategy, since social media companies can invoke Section 230 of the Communications Decency Act, which shields them from liability for most third-party content posted on their platforms. The states hope to frame the case around product design and alleged deception.
I seem to recall that there was previous evidence of Meta, from within Meta, was trying to shape those platforms to get kids hooked.
From the AP:
For Meta, which already lost two pivotal cases over harms to children and teensthis year, the stakes are high. The company reported a rare profit decline last month, in part due to $2.4 billion in legal expenses.
The $1.4 trillion figure, which Meta disclosed in a legal filing, is almost as high as the Menlo Park, California, company’s entire market capitalization — that is, the value of all its outstanding shares on the stock market. Paying it would inevitably put Meta Platforms in bankruptcy and perhaps put the company under state ownership.
If Meta loses the trial, the court would have wide discretion over the size of any financial penalty, and legal experts say anything close to $1.4 trillion would be unlikely.
The current case is about Meta violating state and federal statutes. On other hand:
The federal trial this week is more complex than one earlier this year, in Los Angeles, where a state court awarded $6 million in damages from Meta and Google’s YouTube to a single plaintiff, a young woman who testified she became addicted to social media as a child.
That case was a bellwether, or test case, picked from thousands of similar civil tort lawsuits to give both plaintiffs and the defendants an idea of how their arguments fare in court. The jury determined that Meta and YouTube were negligent in the design or operation of their respective platforms, and that the negligence was a substantial factor in causing harm to the plaintiff. They also determined each company knew their platforms could be dangerous when used by a minor and that they failed to adequately warn of that danger.
Meta has put in new features to try to protect teen accounts. However,
Safety advocates have called on the company to do more. A New Mexico judge earlier this month ordered new safety measures on the platforms including time limits for minors, AI chatbot restrictions, and mandatory warnings on the platforms, but his order applied only to users in the state.
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