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Highlights:

• On Tuesday, Meta (the owner of Facebook, Instagram, and Whatsapp) was ordered by a New Mexico court to pay $375M for failing to protect its users (including children). Some children have committed suicide after being harmed on social media platforms.
• On Wednesday, Meta, along with Alphabet, Inc. (the owner of Google and YouTube), was ordered to pay $3M in compensatory damages and $3M in punitive damages to one plaintiff.
• TikTok and Snap, Inc. (the parent of Snapchat) settled with that same plaintiff early on.
• Other lawsuits are pending all over the country against Meta. Attorneys were waiting for rulings in these two cases before proceeding. I estimate that thousands of plaintiffs will be filing similar lawsuits across the country, and around the globe.
• Did Meta know their customers were being harmed, and yet kept allowing those harms to happen in order to protect their billions in annual revenues? Yes, they did!
• So, how are things going for Meta’s stock today? NOT WELL!

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On Tuesday and Wednesday of this week, two distinctive shots rang out across the expanse of California known as Silicon Valley. Touted as the driving force for our future U.S. economy, and achieving unprecedented trillionaire market capitalization status, its inhabitants (denizens) have a cataclysmic problem. Meta Platforms, Inc. is feeling the brunt of impending doom and gloom. Meta appears to be outflanked by a barrage of contentious lawsuits. And, in my estimation, rightfully so.

There are currently a number of significant lawsuits against Meta Platforms, Inc. The four horsemen include the thirty-three State Attorneys General in the Northern District of California, K.G.M. (Kaley) in Los Angeles County, the Attorney General’s civil action in New Mexico, and Calise v. Meta Platforms, Inc., also in the Northern District of California. Calise is unique in that it is a contract-based claim insofar as it contends that Meta failed to abide by its own Terms of Service by not protecting platform users from fraud. Meta is currently appealing that decision.

I was never a fan of the California courts; they are almost always a political wild card thrown into the mix of majority and minority nationwide legal opinions. Nevertheless, the California District Court’s opinion in Calise is rock solid and airtight. Meta will be held to account.

Just this week, the juries in both the matter of K.G.M., a single plaintiff, and the New Mexico Department of Justice suit have resoundingly delivered watershed verdicts holding Meta Platforms, Inc. accountable for its mendacity and failure to provide adequate safeguards to protect its young users.

“The jury agreed with allegations that Meta made false or misleading statements and also agreed that Meta engaged in ‘unconscionable’ trade practices that unfairly took advantage of the vulnerabilities of and inexperience of children.” – PBS News

It is beyond noteworthy that, in the matter of K.G.M., jurors found that Instagram’s parent company Meta, and Alphabet, Inc., the owner of Google and YouTube, acted with “malice, oppression, or fraud,” meaning punitive damages would also be assessed on top of the $3 million total in compensatory damages.” Late yesterday, the same jury assessed an additional $3 million in punitive damages. While Google must pay a portion of that, Meta will be required to pay most of it. Remember, that was just one Plaintiff!

The jury in New Mexico awarded $375 million in compensatory damages for countless violations of state law.

Tens of thousands (if not more) plaintiffs are waiting their turn. Their attorneys were waiting to see how the juries would rule on these cases. The floodgates against Meta are about to be opened!

Based on bombshell inside information obtained by Reuters, Meta played a dangerous game, putting profits above everything else, including children’s safety. Meta believed their billions in profits (including from countless paid ads placed by known scammers targeting Meta’s users) would be able to withstand a few lawsuits. That’s not going to work out well for them. And, you can bet that they’ll be sued by users and government entities in other countries as well.

Compared to the Big Tobacco litigation of yesteryear, Meta’s monetary liability will undoubtedly and easily dwarf the tobacco settlements. In fact, I believe the monetary sums will be unprecedented.

“The substantial damages the jury ordered Meta to pay should send a clear message to big tech executives that no company is beyond the reach of the law. Policymakers and law enforcement officials across the country can help make this verdict a turning point in the fight for children’s safety. This is a watershed moment for every parent concerned about what could happen to their kids when they go online – and this victory belongs to them.” – New Mexico Attorney General Raúl Torrez

THE PERCEIVED CLOAK OF ABSOLUTE IMMUNITY AFFORDED BY § 230 HAS BEEN REMOVED

Meta Platforms, Inc. has been clinging to the mistaken belief that Section 230 of the Communications Decency Act confers upon it blanket immunity from liability. It does not. While the Act was intended to grow and expand interstate commerce or internet commerce during the internet’s infancy, Meta, among other tech behemoths, perceived Section 230 as a get out of jail free card. Meta intentionally exploited teens and its advertisers, and has created platform cesspools by attempting to embrace the perceived absolute immunity under Section 230.

TikTok and Snap, Inc., the parent company of Snapchat, sagely recognized the inherent limitations of  liability afforded under Section 230 and, at least implicitly, acknowledged that the algorithms employed by big tech internet platforms could, in fact, be a product defect and give rise to civil liability.  They settled before trial. Meta and Alphabet, Inc., the parent company of Google and YouTube, did not.

Meta rolled the dice and they lost the game. Moreover, it went so far as to seek judicial determination as to whether or not its liability insurance carriers would be forced to pay for impending mountainous verdicts. A Delaware Court denied coverage under Meta’s Commercial General Liabilities Coverage (CGL). “Meta’s intentional platform design choices precluded the alleged harms from qualifying as an ‘accident…'”

This means that, absent a successful appeal of that court’s opinion, Meta must pay forthcoming verdicts out of its own cash flow. Their insurance company is off the hook. That could very well prove deleterious to its venture into AI, which has demanded gargantuan sums of investment capital.

THE SOCIAL MEDIA VICTIMS LAW CENTER

If you or a family member has been harmed by a social media platform, I encourage you to contact Matthew Bergman, Esq. at the Social Media Victims Law Center (SMVLC).

I was never a proponent of big government but, as effectively demonstrated by the Titans of Tech in Silicon Valley and their unbridled greed and temerity, it is high time that we revisit Section 230 and bridle these broken Titans of Tech.  They’ve opened Pandora’s box.

The Securities & Exchange Commission (SEC) has been beyond remiss in holding Meta Platforms, Inc. accountable for its gross understatement of legal liability and exposure in its most recent 10K filing.

While I expect Meta to appeal all of the decisions, I don’t expect those appeals will be successful. We just might be witnessing the beginning of the end of the largest social media platform.

So, Meta, was endangering your users, including children, worth it?

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JAMES M. WALSH, ESQ. is a former Navy JAGC officer and a recipient of the American Bar Association’s coveted LAMP Award for excellence in military legal assistance practice. A rolling stone, J.M. has globetrotted most of his adult life. After the military, J.M. pursued commercial real estate development, leasing, and asset management. He resides in Catania, Sicily. He spent almost twenty years in the Commonwealth of Pennsylvania’s Luzerne, Erie & Lackawanna Counties. His handiwork as an editor and author is interspersed throughout this novel. Leo A. Murray fondly refers to J.M. as his collaborative, literary ‘Coach’ or ‘Lieutenant.’ Agnes claims that he has gypsy in his heart and rabbit in his feet.

James’ thriller, Maximum Impact, written with co-author Leo Murray, was published by Abuzz Press.

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