Meta to pay New Mexico $25 billion for data violations

Meta must pay $25 billion to the state of New Mexico, a penalty that stands as the largest fine the company has ever faced. A state judge issued the order this week after a jury determined that Meta violated the New Mexico Unfair Practices Act. The ruling concludes a legal dispute that began when the state filed charges in 2021.

The lawsuit originally alleged that Meta misled users about how the company handled their personal data. The case traces its roots to the Cambridge Analytica scandal. The attorney general later expanded the claims to include the company's content moderation policies. A jury sided with the state in September, leading to the multibillion dollar penalty.

Meta has stated it will contest the outcome. C.J. Mahoney, the company's chief legal officer, described the ruling as making it "all but impossible to do business in the state of New Mexico." He characterized the lawsuit as an attempt to "impose a tax on speech" and expressed confidence that the company will win on appeal.

This loss follows a string of legal setbacks for Meta in 2026. Earlier this year, a New Mexico jury ordered the company to pay $375 million for violations tied to child safety. A second phase of that same case resulted in another $567 million order. In Los Angeles, a court found Meta and YouTube liable for harming a young woman's mental health through addictive app design. Meta must cover most of the $6 million award in that case.

In August, Meta agreed to pay between $17 billion and $18 billion over 10 years to settle a federal case brought by most U.S. states. That dispute centered on features alleged to harm children. Despite these substantial sums, legal experts note that the amounts remain small relative to the company's overall value. Meta is currently valued at approximately $1.7 trillion.

The $25 billion figure is far below the maximum possible penalty. Reuters reported that New Mexico attorneys initially requested $35 billion to $45 billion. The judge calculated a theoretical maximum of $219 billion based on $5,000 for each of 43 million violations before reducing the total. Meta's shares fell on Thursday, though the drop reflected a mix of factors including its earnings report and heavy spending on artificial intelligence.

Corban Rhodes, a partner at the law firm representing New Mexico, said the trial placed more than 100 exhibits on the public record. This material had been kept secret for over a decade. One exhibit is a 2018 email from then-COO Sheryl Sandberg. She warned that "there were a MILLION developers with access to the data" and predicted "many, many, many more moments like this in the next month and year."

Pressure may also come from insurers. A Delaware judge ruled in March that insurers have no duty to defend Meta against thousands of lawsuits. Some experts argue that insurers could influence corporate behavior by making responsible design a condition of coverage. Brian Quinn, a Boston College law professor, said shareholders might demand that the company stop indemnifying directors who keep appearing in the same legal facts. That would leave executives less protected. Rhodes expects the next wave of litigation to center on AI.