The sanction has been handed down, and its amount is unprecedented for a tech giant.
More than three weeks after the jury’s verdict, Judge Francis Mathew, of the Santa Fe district court, delivered his ruling.
In a 20-page decision, he finds that the statements Facebook is accused of making in the Cambridge Analytica case strike at the very core of its business model, and that their reiteration over several years justifies the highest level of penalty.
The proceedings date back to 2021. The New Mexico Attorney General sued Meta following revelations about Cambridge Analytica, the British political consulting firm now defunct.
That entity had, via a third-party app, seized data from up to 87 million Facebook users, used for profiling and targeting voters. According to the state, Meta misled New Mexican users about third-party access to their data.
43 Million Violations
Following roughly two weeks of trial in September, the jury found that Meta and its executives had made 26 misleading statements, out of 29 examined. They mainly concerned users’ privacy.
To quantify the violations, the jurors multiplied each of these statements by the number of people who could have seen or heard it. They thus arrived at more than 43 million breaches of the New Mexico Consumer Protection Act, each carrying penalties of up to $5,000.
The jury, however, found that the state had not proven that Meta lied about removing harmful content, including misinformation about Covid-19, according to the Boston Globe.
During the trial, prosecutors confronted public statements by Mark Zuckerberg and Sheryl Sandberg, then Chief Operating Officer, with internal emails. Zuckerberg did not testify in person: the jurors watched a filmed deposition of him lasting about an hour and a half.
In his ruling, the judge relies on an email from Mark Zuckerberg to show that Facebook knew its users were not well informed about their privacy settings and took advantage of that. He describes a “systematic pattern of deception” at the heart of the network’s business model.
The judge deemed that a penalty exceeding $219 billion would be legally justified, but he reduced it to $25 billion. At a hearing on October 1, New Mexico had asked for between $35 and $40 billion. Meta argued for a cap of $3.45 billion.
New Mexico says the amount will fund a public-education fund. Several American outlets, including Reuters, describe this fine as one of the heaviest ever imposed on a U.S. company.
According to the New York Times, legal experts say this could be the largest jury verdict ever handed down.
The Meta Defense: “A Tax on Speech”
Meta said it will appeal. Its general counsel, C.J. Mahoney, argues that the ruling makes operating in the state practically impossible and denounces the process as tantamount to “imposing a tax on speech.”
Meta contends that it does not sell its users’ data and that New Mexico has failed to demonstrate that any consumer was actually deceived by any of the executives’ statements.
According to the Boston Globe, Meta also challenges the calculation method. The 43 million breaches were tallied based on the number of people who could have seen or heard the statements deemed deceptive by the jury—a novel approach, the company says, with no precedent.
An Isolated State in the Cambridge Analytica Case
New Mexico is the only state to proceed to trial over Cambridge Analytica.
In August, Meta reached a multi-state settlement worth up to $17.1 billion to address protections for minors, including $459 million to resolve Cambridge Analytica-related claims. S
According to the Boston Globe, Florida is the only other state that did not sign the agreement.
New Mexico had already secured $942 million this year in two separate lawsuits against Meta focusing on the sexual exploitation of minors and platform safety: $375 million in March, followed by $567 million in August.
In 2019, the Federal Trade Commission had levied a $5 billion penalty against Facebook for the same case.
