The week spanning from August 18- 25 was a huge one for the American Big Tech. A coalition of 29 states sued the Mark Zuckerberg-led Meta with a damning claim: Facebook and Instagram were harming young users’ mental health.
The lawsuit rotated around these questions: Did Meta design Facebook and Instagram to be addictive to children and teens? Did the social media conglomerate mislead consumers about the safety of its platforms for young users? Most importantly, what about the allegations about the platforms improperly collecting and using children’s personal data, in violation of federal law?
The hi-profile hearing at the Californian Federal Court had an EU link. In 2024, European regulators opened a formal investigation into Meta on the similar issue, citing potential breaches of online content rules related to child safety on Facebook and Instagram.
The European Commission (EC), back then, expressed concerns over the algorithmic systems used by the popular social media platforms, that was allegedly recommending videos and posts that could “exploit the weaknesses and inexperience of children and stimulate addictive behaviour.”
In 2026, the EC published preliminary findings of that two-year investigation, finding the Meta in breach of the DSA. The tech giant was asked to implement several design changes to curb its platforms’ “compulsive use.”
A self-inflicted wound for Meta
During the hearing, four lead states, California, Colorado, Kentucky and New Jersey, hit out at the social media conglomerate for designing Facebook and Instagram to hook young users, apart from fuelling anxiety, depression and even suicide, and most importantly, misleading consumers about the platforms’ safety.
All 29 states accused Meta of violating federal law by improperly collecting and using children’s personal data.
Meta’s lawyer Paul Schmidt countered the charges by mentioning that there was “no dispute” that some social media users face struggles, but that research showed no clear link between adolescents’ social media use and a lack of well-being.
Former Meta safety engineer Arturo Bejar, a vocal critique of the defective nature of Meta’s child safety tools, also testified.
He said, “move fast and break things was a mantra at Meta, which took a don’t ask, don’t tell approach to monitoring whether children under 13 were online. Many products were shipped into the world, such as Reels short-form videos, and safety was not a consideration in how it was initially deployed.”
Meta saved its piggy bank, somehow
Meta finally winked, on August 25, by agreeing to cough up to $18 billion to the 29 states. It also agreed to introduce nationwide changes to its services for teenage users.
Meta has also agreed to implement teen safeguards, including a default two-hour daily limit across Facebook and Instagram, overnight blocks from midnight to morning 6 am, age-checking measures and disabling push notifications during school hours of 8 am to 3 pm for teen users.
The social media conglomerate will be paying the 70% of the settlement, or roughly $12.7 billion, over a decade.
The remaining amount, around $5 billion, will only be released if rivals Snap, TikTok and YouTube adopt similar measures. Meta has also added the condition of the rival platforms agreeing to make similar payments to the states.
Likes and reactions will be hidden from teens by default, including on their own posts and those of others.
The $18 billion figure, despite being among the largest ever settlements paid by a technology company, won’t strain a business that earned more than $60 billion in 2025. The settlement also left untouched the personalized feeds and ad targeting, known as Meta’s profit-making machines.
The spike in Meta’s shares after the news coming out suggested that investors welcomed an outcome that will cost the company far less than the $1.4 trillion in penalties it said the states were seeking before trial.
The 2021 Whistleblower Testimony That Started the Saga
The hearing in the Californian court and the multistate investigation into Instagram and Facebook’s impact on young users were the follow-up actions of the 2021 testimony by Meta whistleblower Frances Haugen.
Haugen, back then, informed the Senate committee that the company knew its products could harm young users and how to make them safer, but chose not to make those changes in favour of pursuing higher profits.
Haugen came armed with “internal documents,” that revealed how Meta knowingly prioritized high profits and user engagement over children’s safety.
The papers contained Meta’s own internal studies showing how Instagram worsened mental health and self-esteem issues for a significant percentage of teenage girls.
Known as the “Facebook Papers” and reported exclusively by The Wall Street Journal, the documents also showed Meta downplaying these findings publicly.
“The platform’s engagement-driven algorithms actively steered young users toward harmful ‘rabbit hole’ content relating to eating disorders and toxic comparisons,” reported the WSJ back then.
While the company executives took note of the negative psychological footprint of their products, they declined to implement safety-first structural changes over the alleged worries about the reforms “reducing” user screen time and ad revenue.
Meta also turned a blind eye to underage accounts (those below 13), failing to implement strict and verifiable age controls.
Plethora of lawsuits
By 2022, hundreds of personal injury lawsuits from parents and over 200 US school districts got filed against Meta. They alleged Instagram of causing severe youth depression, anxiety, eating disorders, and self-harm, forcing schools to expend massive resources on mental health counselling.
By 2023, states’ allegations against Meta got further specific: developing algorithms intended to keep users on the platform as long as possible, even compulsively; creating visual filters it knows can contribute to body dysmorphia; and presenting content in an “infinite scroll” format that makes it hard for children to disengage.
The legal luminaries found overwhelming support among the educators, who raised alarms over social media’s negative impacts on kids’ mental health, especially the ability to learn.
Noted Physician and the then US Surgeon General Vivek Murthy too came out against Meta.
In an opinion piece published in The Washington Post, he said, “We do not have enough evidence to conclude that social media is sufficiently safe for our kids. In fact, there is increasing evidence that social media use during adolescence—a critical stage of brain development—is associated with harm to mental health and well-being.”
Seattle and New Mexico pleas changed the game
In fact, in January 2023, Seattle Public Schools became the first-ever educational institution to file a lawsuit on the above-mentioned constraint.
The district claimed that the number of students in the school system reporting that they feel “so sad or hopeless almost every day for two weeks or more in a row that they stopped doing some usual activities” rose 30% since 2009.
The district asked for the social media companies named in its suit to pay for damages as well as preventative education and treatment for problematic social media use, among other remedies.
Meta, Snap, ByteDance and Alphabet were accused of designing and operating their respective platforms “in ways that exploit the psychology and neurophysiology of their users into spending more and more time on their platforms.”
Seattle’s lawsuit stated that as a result of social media usage issues, the district’s educational set-ups were forced to “take steps to mitigate the harm and disruption caused by defendants’ conduct,” including hiring additional personnel to address mental, emotional, and social health issues, apart from increasing training for teachers and staff to identify students exhibiting symptoms affecting their mental, emotional, and social health.
New Mexico followed it up with its own lawsuit, with Attorney General Raul Torrez charging the social media conglomerate of creating a “breeding ground” for child sexual exploitation and ignoring safety gaps on Instagram.
Judge Bryan Biedscheid, in August 2026, ordered Meta to pay another $567 million for its failure to warn the public about dangers its platforms posed to children. The amount was an add on to the previous figure of $375 million, that the social media conglomerate was already ordered to pay in the case.
The grand total came at $942 million; the largest fine imposed on the company in the lead-up to the California trial.
Throughout 2024 and 2025, federal courts were consolidating thousands of individual, school, and state cases into a massive Multi-District Litigation (MDL) block in the Northern District of California.
Meta attempted to dismiss the lawsuits multiple times, arguing its algorithms are protected by Section 230 and the First Amendment.
In March 2026, a Los Angeles court found Meta and Google liable for the social media addiction, anxiety, and depression of a young girl, awarding her $6 million in damages.
Then a month after, Meta agreed to a bellwether settlement with the Brevard County School District in Kentucky to avoid a massive public trial, helping set a precedent for thousands of pending school district claims.
And then came the moment of reckoning at the Californian Federal Court, where the social media conglomerate had to bow down to the combined might of 29 states and give the promise of implementing changes that will address the concerns related with the mental health of the vulnerable young users.
Countries are watching
South Korea’s media regulator, while reacting to the news of Meta reaching a settlement in the California court, observed that measures proposed by the social media conglomerate to curb potentially addictive features for young users should ideally be applied worldwide.
Seoul’s stand is clear: Not only Meta, every social media company operating within its territory needs to take greater responsibility for protecting children and teenagers.
Australian Communications Minister Anika Wells said that social media companies “have the tools at their disposal to protect young people from their addictive features but have chosen not to use them.”
Philippines Department of Information and Communications Technology Secretary Henry Aguda told Reuters about both Meta and gaming platform Roblox pledging in a meeting on August 27 about tightening age verification processes in the Southeast Asian country, apart from expanding parental controls and implementing time limits on the social media.
Meta has also given hints to Brazil’s National Data Protection Authority about discussing children’s safety online. Both United Kingdom and European Commission will keep their eyes on the social media conglomerate’s next set of actions.
The social media conglomerate might have successfully saved its bank balances, but the message from the Californian court has been sent in a crystal-clear manner: Big Tech is not big enough to escape legal glare, especially when it comes to protecting the mental well-being of teenagers.