Meta Platforms (NASDAQ:META) is heading to trial in California federal court on Tuesday as a coalition of 29 U.S. states pursues allegations that Facebook and Instagram were designed in ways that harmed the mental health of children and teenagers.
Attorneys representing Colorado, California, New Jersey and Kentucky are leading the bipartisan group and will deliver opening statements before an eight-person jury in Oakland. The jury will serve in an advisory capacity, with U.S. District Judge Yvonne Gonzalez Rogers ultimately responsible for deciding the case.
States Challenge Meta Over Platform Design and Children’s Data
The proceedings will examine allegations from the four lead states that Meta deliberately designed Facebook and Instagram with features that could make the platforms addictive to children and teenagers while misleading consumers about their safety for younger users.
The wider group of 29 states is also accusing Meta of improperly collecting and using children’s personal information through its platforms in violation of federal law.
Meta is expected to argue that it has invested extensively in protecting younger users online. The company maintains that it did not make misleading representations about platform safety and says the states have failed to produce evidence demonstrating actual harm to their residents.
Meta founder and CEO Mark Zuckerberg is expected to testify during the multiweek proceedings, alongside Instagram chief Adam Mosseri.
Trial Could Become Biggest Test Yet for Youth Social Media Litigation
Legal experts have described the case as potentially the most significant test so far of litigation concerning social media and young users, both because of the possible financial consequences for Meta and the potential implications for how its platforms operate.
The proceedings also arrive amid increasing global scrutiny of the effects that social media platforms can have on children and teenagers.
Meta has said potential penalties could reach as much as $1.4 trillion, an amount approaching its approximately $1.5 trillion market capitalisation. The state attorneys general have not formally specified the penalties they are seeking, although they indicated at a hearing last week that the figure could be closer to $200 billion.
Colorado, Kentucky, California and New Jersey are additionally asking the court to require Meta to introduce age restrictions, remove infinite scrolling and implement other changes across its platforms nationwide.
Meta Rejects States’ Allegations
Ahead of opening arguments, Meta strongly disputed the states’ case and defended the protections it has developed for teenage users.
“The AGs offer no proof anyone in their states was misled, claim benign features like having an additional Instagram account somehow harmed their residents, and attempt to penalize Meta for industry-wide challenges like age verification,” a Meta spokesperson said. “Rather than sticking to the facts or the law, the states have instead decided to chase an outlandish payout.”
The company is therefore expected to challenge both the factual basis of the allegations and the scale of the remedies being sought.
Lawsuit Followed Multistate Investigation Into Instagram and Facebook
The lawsuit was filed in 2023 following a multistate investigation into the impact of Instagram and Facebook on younger users.
That investigation was announced after disclosures from former Meta employee and whistleblower Frances Haugen. In testimony before a U.S. Senate committee in 2021, Haugen alleged that Meta knew its products could negatively affect young people and understood how to make them safer but chose not to implement certain changes because of concerns about profits.
During the trial, the states are expected to introduce extensive internal Meta documents and research, together with testimony from former employees and outside experts.
Social Media Industry Faces Growing Legal Pressure
Meta is not alone in facing heightened scrutiny over the impact of social media on younger audiences. Snap Inc, TikTok parent ByteDance and YouTube parent Alphabet are also dealing with mounting pressure from lawmakers and courts.
Thousands of cases have been brought against social media companies by states, municipalities, school districts and individuals alleging that their products have harmed children and teenagers.
For Meta Platforms (NASDAQ:META), the California proceedings could have particularly significant consequences. Beyond the possibility of substantial financial penalties, the states are seeking changes to features and age-related protections that could affect how Facebook and Instagram operate across the United States.
Meta has warned that the broader wave of litigation surrounding youth social media use could have a material impact on its business and financial performance.
Meta stock price
