Meta has agreed to pay up to $17.1 billion to settle claims from 47 states, the District of Columbia, and several US territories. The lawsuit alleged that Facebook and Instagram were designed with addictive features that negatively impact the mental health of minors.
The agreement, finalized on August 26, mandates significant platform changes for users under 18. These include a combined two-hour daily time limit across Facebook and Instagram, a usage block between midnight and 6 a.m., and silenced notifications during school hours.
The financial structure stipulates that 70% of the settlement is guaranteed, while the remaining 30% depends on whether rival social media platforms reach similar agreements. Additionally, Texas secured a separate deal adding approximately $1 billion to the total.
The settlement concluded a federal trial in Oakland, California, overseen by Judge Yvonne Gonzalez Rogers. Litigation began in 2023 with lawsuits from roughly 29 states regarding violations of consumer protection laws and the Children’s Online Privacy Protection Act.
Following the announcement, Meta shares rose by 1.1% at the close of the trading day, after an intraday peak of 4.1%. The funds from the settlement are designated for youth safety and mental health initiatives across the participating jurisdictions.