Why must Meta pay New Mexico a record $25 billion fine?

Users of Meta platforms in New Mexico are the subject of a landmark legal ruling that has imposed a $25 billion fine on the technology company. A state jury determined that Meta committed nearly 44 million violations of consumer protection laws, marking the largest financial penalty ever assessed against the firm.

The ruling stems from a decision by New Mexico Attorney General Raúl Torrez to reject an $18 billion settlement agreement that Meta had previously reached with attorneys general from almost every other US state. By opting out of the multistate deal, the state pursued its own litigation, which resulted in a significantly higher verdict than the national agreement would have required.

The basis for the penalty

US District Court Judge Francis J. Mathew issued the opinion on Wednesday, stating there is no strict limit for penalties involving repeated and willful deception. The court found that Meta misled users since 2010 regarding their control over personal data, third-party data misuse, and the enforcement of rules against misinformation and hate speech.

Judge Mathew noted that the trial record showed top leadership, including Mark Zuckerberg, was aware of the misleading public representations made by the company, then known as Facebook. The judge concluded that these actions supported the highest level of penalty allowed under the New Mexico Unfair Practices Act.

Scope of the violations

The jury found that Facebook systematically misled the public and took advantage of users' lack of knowledge about the platform's practices to a grossly unfair degree. The violations were not isolated incidents but arose from repeated public representations over more than 11 years concerning core aspects of the platform and business model.

Meta had hoped the penalty would align with a $5 billion settlement paid to the Federal Trade Commission following the Cambridge Analytica scandal. The company argued that anything more than $3.4 billion would be unconstitutional, but the court rejected this comparison, noting that previous penalties had not deterred deceptive trade practices.

Our take on the response

Meta has announced plans to appeal the ruling, which represents the largest fine Mark Zuckerberg has ever seen. The company had argued that the FTC settlement should serve as a benchmark, but the court emphasized that prior consent agreements and decrees failed to stop the deceptive practices.

New Mexico had initially sought fines up to $40 billion, arguing that the entire state population of two million people was harmed. The state contended that only a penalty impacting Meta's stock price would force meaningful changes in corporate behaviour.

What affected people can do

Security teams should monitor for phishing campaigns that exploit this high-profile news to trick users into revealing credentials. Attackers often create fake news alerts or legal notices to prompt immediate action. Users should verify the source of any communication claiming to be from Meta or legal authorities before clicking links. Check browser history for unusual activity and ensure multi-factor authentication is enabled on all social media accounts to protect against potential account takeover attempts following such widespread data concerns.