Facebook owner Meta reaches US$18 billion settlement

Meta agreed on Wednesday to pay up to US$18 billion (approximately J$2.8 trillion) and add stronger child-safety measures to its Facebook and Instagram platforms as part of a landmark legal settlement.

The settlement resolved a pivotal case years in the making that sought to hold the tech giant accountable for the role its platforms played in undermining children’s mental health. The effort targeted features designed to hook young people’s attention. The agreement “institutes real change, real transparency, real protections for children and teens across the country”, California Attorney General Rob Bonta said.

If approved by the court, the deal will stop an avalanche of litigation by states against Meta although the company still faces lawsuits from individuals and school districts throughout the US. For the states, the settlement delivers money for mental-health programmes for kids, including after-school or summer activities and digital literacy counsellors. Advocates cheered the new protections, including default time limits and the disabling of features such as ‘like’ counts.

But “we cannot truly protect all children and teens until these protections are required on every platform and are permanent — that’s something only Congress can do”, said Sacha Haworth, executive director of The Tech Oversight Project.

The settlement will be paid out over 10 years. California will get the largest sum of at least $1.5 billion, but several other states will still collect hundreds of millions of dollars each over the decade. The settlement “will put an end to these dangerous practices and deliver meaningful relief that will protect children from online harm”, Virginia Attorney General Jay Jones said.

Meta said in a blog post that it was “building on our longstanding efforts to empower parents and support teens”.

“Ensuring teens have a safe and productive experience on our platforms is an absolute imperative for Meta,” the company said. “We want to get this right for parents and teens, and that’s why we partnered with state attorneys general to set a new industry standard.” The company urged competitors TikTok and YouTube to adopt similar safety measures.

The $18 billion settlement is a fraction of Meta’s 2025 revenue of $201 billion. Meta shares were up about 1.5 per cent by midday Wednesday, hours after the deal was announced. The agreement cuts short an ongoing court case involving California, Colorado, Kentucky, and New Jersey, which were among 29 states that sued Meta in 2023. The federal trial kicked off last week in Oakland, California, where Meta CEO Mark Zuckerberg had been among the witnesses expected to take the stand.