Photo: REUTERS/Francis Mascarenhas
The main lawsuits are being brought by California, Colorado, New Jersey, and Kentucky. The states are seeking not only financial penalties but also sweeping changes to how the platforms operate—ranging from the deletion of data belonging to users under the age of 13 to the removal of certain features, including infinite scrolling, autoplay, and algorithms optimized for maximum engagement.
The potential payouts are estimated at tens or even hundreds of billions of dollars, according to Reuters. Meta’s lawyers previously estimated potential payouts from the consolidated lawsuit at $1.4 trillion. State representatives recently cited a more likely figure of around $200 billion. These are merely estimates by the parties to the lawsuit, not the amount of a potential court ruling.
The stakes are particularly high for California—Meta’s home state and the largest technology market in the U.S. According to New Mexico Attorney General Raúl Torres, if the approach used in his state were applied in California, the consequences could be “astronomical” and affect Meta’s business model itself.
In early August, Meta had already lost a case in New Mexico. The company was ordered to pay $567 million into a compensation fund, and earlier, a jury had awarded an additional $375 million for violating state law. Meta intends to appeal the rulings.
For the company, the potential threat extends far beyond fines. Demands to change algorithms and platform design could affect Meta’s advertising model—a key source of funding for its multibillion-dollar investments in artificial intelligence.
That is precisely why the California lawsuit could become more than just another dispute over child safety for Meta—it could be a test that determines just how significantly the state can influence the company’s platforms and business model.
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