Meta has been ordered to put $567 million into a New Mexico fund addressing harms to young people, while also changing how Facebook, Instagram and its artificial intelligence chatbots operate for minors for the next five years.
Reuters reported that Judge Bryan Biedscheid of Santa Fe ruled Meta had created a “public nuisance” in New Mexico and was responsible for harming children’s wellbeing.
$567 Million Fund Targets Mental Health Harm
The Washington Post reported that most of the $567 million will finance mental health treatment and education intended to address harms linked to Meta’s platforms.
The new payment follows another major loss for the company. CNN reported that a New Mexico jury in March had already found Meta liable on all counts, including for willfully engaging in “unfair and deceptive” and “unconscionable” trade practices, and ordered it to pay $375 million.
Reuters said the earlier $375 million judgment involved findings that Meta misrepresented the safety of Facebook and Instagram for young users, bringing the financial consequences from the two phases of the New Mexico litigation to $942 million.
Facebook and Instagram Face Five Years of Restrictions
The ruling goes substantially beyond financial penalties.
Meta must impose monthly limits on teenage use of Facebook and Instagram, restrict notifications, strengthen protections against adults contacting minors, improve review of child sexual abuse reports and introduce safeguards for AI chatbots. Those requirements will remain under a court decree for five years.
The judge also ordered Meta to “delete the accounts and all personal information” belonging to users the company identifies as being under 13.
AI is also explicitly covered. Meta must prevent children in New Mexico from having romantic or sexualized conversations with its AI chatbots and prevent adults from using those systems to simulate or discuss sexualized interactions with children.
Judge Links Engagement Design to Teen Mental Health
The decision directly challenged how Meta designs its platforms to keep users engaged.
The Washington Post quoted Biedscheid as finding that Meta’s platforms create a public nuisance because their “purpose and effect is to optimize engagement,” including in ways harmful to teenage health and safety.
Biedscheid compared the effects of Meta’s products to pollution that spreads beyond its original source, arguing that the consequences reach children, families, schools, hospitals and law enforcement.
New Mexico Attorney General Raúl Torrez brought the lawsuit after an undercover investigation. Investigators posed as children to test allegations that Facebook and Instagram algorithms could connect young users with potential abusers.
Torrez originally sued Meta in 2023, alleging that Facebook and Instagram had become a “breeding ground” for child predators.
Meta Plans to Appeal Landmark Ruling
Meta rejected the court’s conclusions and said it would challenge the decision.
Meta maintained it works to keep people safe, acknowledged the difficulties of identifying harmful content and bad actors, and said it remains confident in its record of protecting teenagers online.
Meta had also argued that New Mexico’s claims were barred by Section 230 of the Communications Decency Act, but Biedscheid rejected that defense because the state was challenging Meta’s platform features rather than treating it as the publisher of users’ content.
The judge did not grant everything New Mexico requested. Biedscheid declined to order some changes involving algorithms, infinite scroll and autoplay because they could conflict with Meta’s First Amendment rights, harm its competitive position or create Section 230 problems.
Torrez nevertheless characterized the judgment as something larger than one state’s victory. He called the ruling a “blueprint” and said other states and countries confronting similar concerns now have a roadmap to follow.
With more than 40 states and over 1,300 school districts already pursuing public-nuisance lawsuits against social media companies. The New Mexico judgment could become an important test of whether courts can force platforms to redesign products—not merely pay damages—when their features are found to endanger young users.
