Meta to pay up to $16.7bn to settle children’s social media harm case

Meta Platforms Inc shares surged more than 4% in pre-market trading on Wednesday after the company agreed to a significant settlement with states over claims that its platforms negatively impacted children, according to a Reuters report based on a court filing. The settlement, which requires Meta to pay a maximum of $16.68 billion to the states, stipulates that the company must implement nationwide changes to protect teen users of Instagram and Facebook.

Despite acknowledging the settlement, Meta denies any wrongdoing. The agreement mandates the establishment of default daily limits and nighttime blocks for teenage users of Meta's social media platforms across the country. This settlement resolves all state claims, originating from 29 U.S. states, concerning allegations that Facebook and Instagram were intentionally engineered to boost engagement among children and teenagers, with the states contending that Meta had knowledge of the potential mental-health and safety risks associated with its platforms.