Leadership2 publishers3 min readPublished
New Mexico jury turns 31 misleading Meta statements into 43 million violations
Santa Fe jurors counted 31 misleading Meta statements on privacy and moderation as about 43 million violations of New Mexico law. Judge Francis Matthew sets the rate on Oct. 1, and at the $5,000 cap the state wants, one statement carries up to $10.5 billion.
The Board Room · Leadership desk
What happened
- A Santa Fe County jury found Meta committed about 43 million violations of New Mexico's Unfair Practices Act through false or misleading statements on privacy, misinformation and hate speech.
- Jurors ruled against Meta on 31 of the 34 statements they were asked to consider.
- The state justice department wants the $5,000 maximum per violation, a total Attorney General Raul Torrez said could reach about $219 billion in theory.
- District Judge Francis Matthew will decide the amount per violation at a hearing set for Oct. 1.
- Meta's August multistate child-safety settlement released it from future Cambridge Analytica liability, leaving New Mexico the only state pursuing that case.
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Why it matters
- cost The penalty base scales with the audience for each claim, so a widely heard executive promise carries far more exposure than a narrowly read one.
- decision Companies now have to decide whether executives' public remarks on privacy and moderation go through legal review before they are published or spoken.
- constraint States that signed the August settlement cannot bring the Cambridge Analytica claims, so any copycat case would have to rest on different statements.
The count starts with a multiplier. For each statement it found misleading, the jury recorded either 2.1 million violations, roughly New Mexico's population, or about 1.36 million, the approximate number of Facebook users in the state in 2020 [3]. At the $5,000 maximum the state is seeking, one statement is worth $10.5 billion on the first basis and $6.8 billion on the second [18]. Jurors were not asked to fix a number in every instance, and the 43 million total is the state justice department's estimate [2].
The board-deck figure is $219 billion, and Attorney General Raul Torrez put "in theory" in front of it himself [4]. The jury set the counts. The judge sets the price [5]. New Mexico's other win against Meta this year, a two-phase trial over protections for minors, produced judgments totaling $942 million along with court-ordered age verification and time limits [15]. The theoretical maximum here is roughly 230 times that total [20].
The losing statements quoted in the verdict forms are absolute, and they came from executives and company communications spanning about a decade [7]. Mark Zuckerberg wrote in a 2010 Washington Post op-ed, "We do not, and never will, sell any of your information to anyone" [8]. On a 2020 earnings call he said, "We do not profit from misinformation or hate" [9]. Two of the three statements that survived are quoted in coverage: a 2021 company post saying Meta removes content "when it poses a real risk of harm," and a claim of "10 fact-checking partners in the US to address viral misinformation" [10][11]. Each describes a practice someone could check. Three survivors is a small sample, and the reporting does not say why jurors set them apart.
Meta treats the case as one about speech. "We have a First Amendment right to manage those platforms in a way we believe best serves the interests of our community," a spokesperson wrote [12]. According to CBS News, Meta's lawyers told jurors the state's evidence was outdated and that New Mexico, with five years to look, found no more than one other data breach [13]. Those arguments concern how Meta runs its platforms and how old the record is. The Unfair Practices Act claim concerns what Meta told consumers about those platforms, and the jury accepted it [1].
The August settlement keeps most states out of this particular case [14]. "Let this be a warning to every technology company doing business in our state," Torrez said [17]. I'd expect other attorneys general to try per-resident counting under their own consumer statutes, on a timescale of years. The near-term question is narrower and has a date: what Judge Matthew sets per violation on Oct. 1 [5].
For a company that speaks publicly about data and moderation, the trade-off is between reassurance and defensibility. On this jury's record, the absolute promises lost and the two quoted survivors described specific practices [8][9][10][11]. Legal review of executive remarks this quarter buys defensibility. The cost shows up next quarter, in privacy and moderation statements that promise users less than Zuckerberg's 2010 op-ed did [8].
What to watch
- How far below the $5,000 cap Judge Matthew sets the penalty on Oct. 1, since each $1,000 per violation moves the total by about $43 billion.
- Whether Meta carries its First Amendment argument about managing its platforms into post-trial challenges to the verdict.
- Whether another state attorney general applies a per-resident count to public privacy or moderation statements outside the Cambridge Analytica release.