Instagram and Facebook parent company Meta has been ordered by a New Mexico court to pay $567 million to address harms to young people from its platforms in the second phase of a landmark trial.
Judge Bryan Biedscheid said in a ruling late Thursday that the bulk of the money – $420 million – will be used for treatment services for young people. The rest will go toward awareness and prevention, screening services and other costs over the next five years.
The new penalty is in addition to the $375 million in civil penalties that jurors ordered against Meta in March after determining the company knowingly harmed children's mental health and concealed what it knew about child sexual exploitation on its platforms.
In the second phase, prosecutors asked the judge to impose fundamental changes at Meta aimed at reining in addictive features, improving age verification and preventing child sexual exploitation through default privacy settings and closer oversight.
The total amount Meta is responsible for – $942 million – is a small fraction of its annual profit, which was about $60 billion in 2025. Investors seemed to shrug off the New Mexico ruling in after-hours trading Thursday, sending Meta's stock down less than half a percent to $589.44.
Still, the ruling is another setback for Meta, which faces an avalanche of lawsuits from thousands of families of children harmed by social media.
New Mexico Attorney General Raul 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 judge ordered Facebook and Instagram to build banner and informational screens to clearly explain its protection features, best practices and tools to address inappropriate comments, 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 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."
