A New Mexico jury on Friday found Facebook liable for deceiving users about privacy protections on the platform in the latest legal setback against the social media giant that has already cost it billions of dollars.
The jury found over 43 million violations of state consumer protection law and it is now up to the judge to determine how much the company would pay, with attorneys representing the state asking for the maximum $5,000 penalty per violation.
“The verdict marks a significant victory for New Mexico consumers and holds one of the world’s largest technology companies accountable for its conduct,” the New Mexico Department of Justice said in a statement.
The two-week trial in Santa Fe centered on accusations that Facebook, owned by Meta, deceived users about a data breach stemming from a third-party personality quiz that harvested data from roughly 87 million profiles and sold it to a political consulting firm, Cambridge Analytica, to generate targeted ads. The now-defunct firm’s clients included the 2016 campaign for Donald Trump.
Jurors sided with prosecutors, finding Facebook made deceptive statements about protecting users’ data that affected New Mexico’s entire population of more than two million people. The jury also found Facebook misled the public about investigations into third-party app developers that harvest user data following the Cambridge Analytica scandal.
Facebook claims state’s evidence was ‘outdated’
“We disagree with the verdict and will continue to defend ourselves against efforts to distort our record,” said Alex Burgos, a spokesperson for Meta in an email.
During closing arguments, lawyers for Facebook claimed the state’s evidence was outdated and that despite having five years to gather material, New Mexico found only one other instance of a data breach.
In one of the few wins for the defense, jurors found the state didn’t prove that Facebook made false claims about removing harmful content, including misinformation about the COVID-19 pandemic.
The state claimed the company favored certain accounts and allowed for violent or inaccurate content to proliferate. During closing arguments, Randi McGinn, an attorney representing the state, argued that Facebook profited off harmful content.
Facebook denied the claims, arguing the company has adapted its policies since the state’s lawsuit was filed in 2021 and that it removes 99% of content that violates standards. In a deposition played for jurors, CEO Mark Zuckerberg said the company had robust systems to determine whether content should be taken down.
“Meta’s platforms are forums for free expression. We have a First Amendment right to manage those platforms in a way we believe best serves the interests of our community. This means prioritizing free speech, protecting our users’ information and giving them control over their data,” Burgos said in a statement after the verdict.
Expert says impact on the company remains unclear
Despite jurors finding millions of violations, it’s unclear how much of an impact the case will have on the company’s bottom line, given how profitable Meta is.
“It’s unlikely that this is going to be the case that effectively penalizes the company in a meaningful way,” said Peter Ormerod, an associate professor of law at Villanova University.
Ormerod said the social media company has very high margins and previously skirted regulatory actions on its platforms.
If the state successfully persuades the judge to award the maximum civil penalties for every violation, the company could owe over $200 billion, with interest accruing if it decides to appeal. The judge will have to weigh complex arguments from both sides about what penalties are fair. In a previous case, New Mexico secured $942 million over the platform’s policies to protect minors.
Ormerod commended the state’s “dogged prosecution” of the social media giant, but isn’t sure the judgment will be significant enough to change Meta’s ways.
“There’s been a lot of criticism that none of these amounts of money are enough to discipline the company,” Ormerod said.
Judge will decide penalties at later date
The judge will decide on penalties during a hearing on Oct. 1. Attorney General Raúl Torrez told reporters following the verdict that all money awarded will go into a fund for the state’s education system. The state is also seeking an injunction to stop similar practices in the future.
Friday’s verdict follows several others against Meta recently.
In August, Meta agreed to pay up to $18 billion to settle a multistate lawsuit involving child safety issues. Buried in the 130-page settlement was an agreement to release Meta from future liability related to the Cambridge Analytica privacy breach, making New Mexico the only state to decide to pursue a case on its own. Florida was the only other state that did not sign the settlement, saying it was not tough enough on Meta, leaving the door open for future litigation.
Also this year, New Mexico won judgments totaling $942 million from Meta in a two-phase trial about the company’s safety protections for minors. The court ordered Meta to implement new safeguards, including age-verification technology and time limits on its platforms.
