Meta hit with $25 billion fine for deceiving users on privacy

Meta Platforms Inc. has been ordered to pay a hefty $25 billion fine following a jury's ruling that the company had deceived its users about how it handles and utilizes their data. This is one of the most substantial penalties ever imposed on a tech behemoth. The case, spanning a decade, centers on the Cambridge Analytica scandal, which erupted when Meta was Facebook Inc. A two-week trial concluded with the jury finding Meta guilty of 43 million violations of the state’s unfair practices act.

Initially, the state was awarded $219.5 billion, but Judge Francis Mathew reduced the fine to $25 billion based on the severity of the violations, the duration and repetition of the conduct, the breadth of subjects affected, the involvement of senior Facebook leadership, and the sheer number of New Mexico users. Judge Mathew wrote that the evidence presented in the trial supported the highest level of penalty under the New Mexico Unfair Practices Act - $5,000 per violation.

Meta is facing a significant financial burden due to allegations that its platforms pose risks to public welfare. Late last year, the company settled with multiple U.S. states for $17.1 billion, accusing Meta of intentionally making its products addictive. Another $9.9 billion settlement further impacted Meta's latest quarterly profits, which fell below Wall Street expectations.

However, despite the financial setback, Meta's revenue continued to grow by 26%, reaching $64.6 billion. The penalty is set to increase by 15% for each year it remains unpaid. With numerous court cases pending, particularly related to child safety, privacy, and social media addiction, Meta finds itself in a challenging position, seemingly trapped in a cycle of lawsuits.

New Mexico Attorney General Raúl Torrez emphasized that the verdict sends a clear message that no corporation is above the law. Meta's Chief Legal Officer, C.J. Mahoney, countered the ruling, threatening to appeal the decision. He argued that the judgment essentially imposes a tax on speech, aiming to enforce new rules for online content.