Judge orders Meta to pay New Mexico $25 billion for misleading Facebook users about their data

Meta now owes New Mexico $25 billion. A state judge in Santa Fe set the penalty on Wednesday after jurors found that the company spent years misleading Facebook users about who could see their personal data. It is the biggest penalty the tech giant has ever been handed.

Judge Francis Mathew wrote that the deception was intentional and that it reached the very core of how Facebook makes its money. He said the conduct ran for more than 11 years from 2010 to 2021 and that messages among senior executives including Mark Zuckerberg were meant to mislead the public.

Meta says it will fight the ruling. Chief legal officer C.J. Mahoney said the company is confident it will win on appeal. He argued that the ruling makes it nearly impossible to do business in New Mexico and that the case amounts to a tax on speech.

How the judge got to $25 billion

In September a Santa Fe jury found that 26 of 29 statements made by the company and its leaders were misleading. The jurors counted more than 43 million violations of the state's consumer protection law based on how many people heard each statement.

New Mexico law allows up to $5,000 for every violation. By that math the judge said the state could have collected about $219.5 billion. He cut the figure to $25 billion instead. Lawyers for the state had asked for $35 billion to $40 billion while Meta wanted the total capped at about $3.45 billion.

The judge also attached interest of 15% a year until the money is paid. State Attorney General Raúl Torrez has said state law sends the money to New Mexico's schools. The penalty is larger than the general fund revenue the state expects to take in during a full year.

Where the case came from

The lawsuit goes back to the Cambridge Analytica scandal. That political consulting firm, which worked on Donald Trump's 2016 campaign, used an outside app to scoop up data from as many as 87 million Facebook users without their consent so it could profile and target voters.

New Mexico sued in 2021. The state said Facebook told users they controlled their own data even though outside parties had wide access to it. It also said the company misled people about how it policed hate speech and misinformation. New Mexico was the only state to take these claims to trial after the others settled.

Torrez told reporters in Albuquerque that the ruling was a warning to Silicon Valley and beyond. He said no corporation is too powerful to be held to account.

A costly year for Meta in court

The ruling tops the $5 billion the Federal Trade Commission imposed on the company in 2019 over the same scandal. It is New Mexico's second big win over Meta in six months. In March another Santa Fe jury found the company misled users about the safety of young people on its apps. That case led to a $375 million penalty plus a $567 million payment into a fund for teen mental health.

Legal experts and analysts expect a long fight on appeal. One analyst noted that Meta is worth close to $2 trillion. Its shares were up on Wednesday afternoon after the ruling.