Meta Settles Youth Addiction Lawsuits for Up to $18 Billion

Following a federal trial in Oakland, Meta Platforms Inc. agreed to a landmark settlement with a bipartisan coalition of 52 U.S. jurisdictions, including 47 states, the District of Columbia, and several territories. The agreement resolves allegations that Meta designed Facebook and Instagram with addictive features that harmed youth mental health and violated federal child privacy laws by collecting data from users under 13.

Financial terms vary across reports, with the total payout estimated between $16.7 billion and $18 billion over ten years. Approximately $12.7 billion is guaranteed, while up to $5.3 billion is contingent upon competitors TikTok and YouTube adopting similar safety frameworks and making matching payments. Separate agreements include a $1 billion payout to Texas and $459.3 million to resolve privacy claims related to the Cambridge Analytica scandal. Florida and New Mexico remained separate from the primary deal.

As part of the settlement, Meta must implement sweeping product changes for users under 18, including a default two-hour daily time limit, a "Night Mode" block from midnight to 6 a.m., and a "School Mode" that mutes notifications during school hours. The company will also remove beauty filters and "like" counts for minors, enhance age verification, and appoint an independent auditor to monitor compliance for five years.

During the trial, Instagram head Adam Mosseri testified that the "Take a Break" feature had adoption rates as low as 1.8 percent in 2021. While Meta denies any wrongdoing or liability, the settlement averts the expected testimony of CEO Mark Zuckerberg and resolves a legal threat that some analysts viewed as existential.