Meta agrees to pay up to $17 billion to US States and to remove worst addictive designs for teens

In a landmark case, Meta agrees to pay up to $17 billion to US States and to remove worst addictive designs for teens

Introduction

On 26 August 2026, Meta Platforms, Inc (Meta) reached a historic settlement under which it agreed to make substantial changes to Instagram and Facebook design and to pay up to $17 billion over a decade to several US States and territories. This is the largest Big Tech settlement in American history.

Reached amid growing concerns about the harmful effects of social media platforms on young users (I), this settlement sets out financial and commitments agreed upon between Meta and U.S. state attorneys general (II). Its implications extend beyond the United States (III), particularly in light of the ongoing legal proceedings against Meta in the EU (IV).

I – Background

Against a backdrop of growing concerns about increasing rates of poor mental health and suicide among young people, a coalition of 29 US States attorneys general brought an action against Meta, following a nationwide investigation launched in 2021.

The lawsuit, filed in 2023, alleged that Meta violated laws, including the US Children’s Online Privacy Protection Act (COPPA), California’s False Advertising Law and Unfair Competition Law, by maximizing young users’ time spent on its social platforms (in particular Instagram and Facebook)  as it monetizes young users’ attention through data harvesting and targeted advertising. The complaint alleged that Meta deployed psychologically manipulative product features to induce young users’ compulsive platform use such as engagement-based feeds, infinite scroll, push notifications, use of social comparison features or promotion of visual filters known to promote eating disorders and body dysmorphia, while being aware of the harm caused by these features to young users’ developing brains. The trial began on 18 August 2026 in the U.S. District Court for the Northern District of California, and ended two weeks later with the settlement agreed upon between Meta and the attorneys general of 47 States and US territories (the “settling States”).

II – Content of the settlement

The agreement includes both payments to the settling States (1) and commitments aimed at redesigning Instagram and Facebook features to better protect adolescent users (2).

1 – Payment

The agreement includes a payment of approximately $17 billion to the settling States which will be distributed in annual installments over a 10-year period and will be used to fund youth-only safety initiatives, among other priorities.

However, 30% of this amount will only be released if Snapchat, TikTok and Youtube adopt equivalent protections.

2  – Commitments

While denying any liability, Meta agreed to redesign several default settings in order to protect “Teen Users”[1], including:

• Time-management measures, in order to minimise interference with school and sleep hours: night access mode denying Teen Users access to its social media platforms from 12 am to 6 am; disabling of push notifications during school hours, maximum daily usage limit of two hours across all Meta social platforms; breaks at 60 minutes and 90 minutes of cumulative daily usage. Furthermore, Meta agreed to extend the duration of night access mode and to impose stricter daily usage limits if equivalent obligations are adopted across the industry;
• Options for teens to select a feed that is a non-personalised as their default home feed;
• Social comparison: by default, Teen Users will be prevented from seeing the number of likes or reactions displayed on Meta social media platforms and from applying cosmetic procedure filters to their content;
• Teen content safety: Meta commits to implement content policies designed to help limit Teen Users’ exposure to inappropriate content and to help prevent Teen Users from being targeted with such content and to report illegal, unwanted, offensive or concerning content, including bullying and harassment, violence and incitement, nudity and sexual activity, child sexual exploitation, hate speech, and suicide and self-injury;
• Exposure to harmful experiences and people: Meta commits to limit account discoverability between Teen Users and potentially suspicious accounts;
• Parental tools: Meta commits to provide “Supervising Parents[2]” with several information, such as the amount of time their Teen User is spending on its social media platforms or the first time a Teen User communicates directly with an adult user.

III – Key takeaways

While social media platforms have long been largely shielded from legal liability on the content they host, this settlement constitutes an important step forward towards holding online platforms accountable for the design of their platforms.

Furthermore, this settlement provides a blueprint for potential action against other platforms, such as TikTok and Youtube, particularly as several of Meta’s obligations under the settlement are conditional on the application of equivalent obligations to other platforms.

The amount to be paid by Meta is unprecedented although well below the $1.4 trillion dollars in potential penalties originally asserted by the attorneys general and Meta’s $200 billion turnover.

In addition, the settlement does not resolve several pending claims against Meta brought by private individuals, school districts, municipalities and other government entities.

IV – Proceedings in the Europe Union

In the European Union, the Commission has opened proceedings in May 2024, to investigate Meta’s compliance with the Digital Services Act (“DSA”), after Facebook and Instagram[3] were designated as Very Large Online Platforms. On 10 July 2026, the European Commission issued preliminary findings that Meta had failed to adequately assess the risks that its addictive design features pose to users’ well-being and to take effective mitigation measures. These features include infinite scroll, autoplay and engagement-driven algorithms.

If the Commission ultimately finds Meta non-compliant, it may impose a fine of up to 6% of Meta’s total worldwide annual turnover, that is approx. 13 billion dollars and order Meta to take the corrective measures.

As the ongoing EU proceedings cover similar facts than those addressed by the US complaints, it will most likely be largely influenced by the US settlement. In this respect, on 17 September 2026, the European Commission published a proposal for EU Kids Act. which would set a minimum age of 15 for minors to open an account on social networks and ban addictive features, such as infinite scrolling and push notifications during sleeping hours. This directly echoes the commitments undertaken by Meta in the US Settlement.

[1] “Teen users” are defined as users of Meta Social Media Platforms with a predicted or stated age from 13 through 17 years old.

[2] A “Supervising Parent” refers, in the text of the settlement, to an adult who is formally linked to a Teen User through a Meta Social Media Platform’s parental supervision controls

[3] See the List of designated Very Large Online Platforms under the DSA.

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