A New Mexico judge mandated that Meta pay $25 billion on Oct. 21 after a jury concluded the company misled Facebook users regarding its data practices. Judge Francis Mathew issued the decision following findings of more than 43 million breaches of the state's consumer-protection law.
The lawsuit stems from the 2018 Cambridge Analytica scandal, where a UK firm harvested data from as many as 87 million Facebook accounts via a third-party quiz app and used it to create voter profiles for Donald Trump's 2016 campaign. Facebook became aware of the data transfer in Dec. 2015 but did not disclose it for over two years.
In September, the jury determined that 26 of 29 statements made by Meta and its executives were deceptive. Judge Mathew said senior leaders, including CEO Mark Zuckerberg and former COO Sheryl Sandberg, followed a "calculated strategy to mislead consumers," and that Facebook's promised probe of the breach was "willfully ineffective."
Under New Mexico law, each violation can attract a fine up to $5,000, which would have summed to more than $219 billion. The judge reduced the total to $25 billion after weighing constitutional limits on excessive fines. The state had sought $35-$40 billion, while Meta's counsel argued for a ceiling of $3.45 billion.
All of the money is earmarked for the state's school system. Attorney General Raul Torrez said the payout could "fund school construction for the next 100 years" and noted it may be the largest single-state verdict against a corporation in U.S. history.
Meta intends to appeal. Chief Legal Officer C.J. Mahoney called the decision "all but impossible to do business in the state of New Mexico," labeled the lawsuit a "tax on speech," and expressed confidence in winning on appeal.
The penalty adds to a string of fines Meta has faced for its data handling. In 2019, the FTC imposed a $5 billion fine for the same controversy, and 48 states settled related claims in an $18 billion agreement in Aug. 2022. New Mexico and Florida opted out of that settlement.
