In a significant legal development, a New Mexico court has mandated that Meta, the parent company of Instagram and Facebook, shell out $567 million. This substantial sum aims to address the negative effects that its social media platforms have had on young users, marking the second phase of a pivotal trial.
Judge Bryan Biedscheid, in a decision delivered late Thursday, specified that a significant portion of the funds—$420 million—will be allocated to providing treatment services aimed at supporting young individuals. The remaining funds are earmarked for initiatives such as awareness campaigns, prevention efforts, and screening services, all to be executed over the coming five years.
This new financial penalty comes on top of $375 million in civil fines levied against Meta in March. Back then, a jury concluded that the company had knowingly compromised children’s mental health while withholding critical information about child sexual exploitation on its platforms. In the ongoing second phase, prosecutors have urged the judge to enforce substantial reforms at Meta. These changes include curbing addictive platform features, enhancing age verification protocols, and preventing child sexual exploitation through default privacy settings and improved oversight.
The cumulative financial responsibility now resting on Meta—with a total of $942 million—is relatively small compared to its annual profits of roughly $60 billion in 2025. Despite this substantial ruling, investors appeared largely unfazed during Thursday’s after-hours trading, with Meta’s stock experiencing a slight dip of less than half a percent, closing at $589.44.
Nevertheless, this ruling signifies yet another challenge for Meta, which is currently grappling with a wave of lawsuits initiated by thousands of families alleging harm to their children due to social media exposure.
New Mexico Attorney General Raúl Torrez said it sends an unmistakable message that companies will be held accountable when their product designs knowingly put children at risk.
“Today’s decision is a victory for every parent who has worried about what social media is doing to their child and every child who deserves to grow up safer online,” he said in a statement.
Meta vowed to appeal.
“We work hard to keep people safe on our platforms and have been transparent about the challenges of identifying and removing bad actors and harmful content,” the company said in a statement. “We remain confident in our record of protecting teens online and will continue to defend ourselves against claims that misrepresent the facts.”
The look of Meta’s platforms could change
The judge ordered Facebook and Instagram to build banner and informational screens to clearly explain its protection features, best practices and tools to address inappropriate comment, for example, and display them regularly. Those changes and an educational campaign in New Mexico would be subject to review by the state.
The court said federal children’s privacy laws prevent Meta from applying age-verification tools to children under 13. The Children’s Online Privacy Protection Act, or COPPA, means it cannot order Meta to request children to submit personal data or be passively tracked online, even for age verification purposes.
The court also noted that ordering verification of children’s ages only for Meta and not other social media companies would be “inequitable and unduly injurious” to the company.
Instead, the court ordered Meta to continue to improve its age assurance tools in New Mexico, which include using artificial intelligence to determine people’s age based on signals such as who their friends are and what types of content they post and consume. Meta must also attempt to develop a dedicated “under-13-years-of-age prediction model” in the next two years.
Additionally, Meta should also request proof of age for Instagram and Facebook users in New Mexico it estimates to be under 13. If it determines a user to be under 13, or under 18 but without being able to estimate a specific age, Meta must treat the user as under 13 or under 18 until the user verifies their age.
The company must also partner with schools or a child safety organization to create a reporting portal where school staff can flag users who may be under 13. And it must delete personal information it has collected on users under 13. The court also ordered Meta to report on its progress twice a year on how it’s complying with the abatement measures.
Meta is gearing up for a trial this month in California amid flood of lawsuits
Meta is also gearing up for a trial later this month in federal court in Oakland, California. Here, Meta will face the first four of 29 states that sued it in a federal multi-district lawsuit filed in 2023 for contributing to the youth mental health crisis by knowingly designing features on Instagram and Facebook that addict children to its platforms.
Eight states, including Tennessee, where a trial is currently ongoing, filed lawsuits in their own state courts.
And late last month, Meta, along with TikTok, Snap and Google’s YouTube, were sued by the families of four teenagers who died by suicide over what they describe as “years of escalating harms” from using their platforms that eventually resulted in their deaths.
What comes out of New Mexico is the first of many dominoes that will fall for Meta, said Laura Edelson, an assistant professor at Northeastern University focusing on social media and cybersecurity.
“America is not going to pass a law that bans social media,” Edelson said. “But if companies like Meta know they’re causing harm to users by product design, the states are finally finding a way to rein this in.”
This story has been updated to correct the judge’s last name to Biedscheid, not Biedcheid. ___
Ortutay reported from Oakland, California, and Yu from Phoenix. Associated Press writer Mikella Schuettler in Phoenix contributed. Schuettler is a corps member for The Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.