Meta Platforms disclosed in a court filing that four U.S. states are seeking $1.4 trillion in penalties. California, Colorado, Kentucky, and New Jersey allege the company designed Facebook and Instagram to be addictive to minors. The states claim Meta misled the public regarding the safety of its platforms ahead of an August trial in Oakland, California.
Meta argues the requested sanction is unsupported by evidence and lacks legal precedent. The company denies the allegations and disputes that social media addiction is a recognized psychiatric condition. This case is part of a broader legal challenge involving 29 states alleging child safety violations.
Meta stock rose in pre-market trading despite the potential penalties. Erste Group upgraded the company’s rating from Hold to Buy. Investor optimism also remains high due to Meta’s significant investments in artificial intelligence.