Why Meta started losing in court

0:00This is The Guardian.

0:07Today, could Meta's legal headaches mean the end of social media as we know it?

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0:58Like billions of people around the world, over the past five years, journalist Katie McHugh has spent a lot of time on Facebook and Instagram. But instead of seeking out the usual dopamine hits of FOMO over your neighbor's summer holidays or get ready with me videos, Katie has been investigating the darker edges of these social media platforms.

1:21Katy McQue:The last five years or so, I have been reporting on issues related to meta and child safety and child sex trafficking that has taken place using the platforms. And over these five years, Katie, along with many other journalists, campaigners, parents and prosecutors, has uncovered mountains of evidence about the potential risks that meta platforms posed to children.

1:50Yet for decades, all attempts to hold the company responsible for this in court have failed.

1:58Katy McQue:They've not been held to account for activities that have been facilitated on their platforms. These companies are huge and they've been able to develop in a certain way to capture as many users as possible. But now this could be changing. And what could prove to be a bellwether case for Meta and other social media companies. 29 U.S. states have sued the big tech giant. They argue Meta designed its platforms to be addictive, much like cigarettes. From a business perspective, this is a big tobacco moment for big tech in America. And it is time that the public see what the executives at Meta have known all along.

2:39This year, Meta's faced three major legal battles over child safety. And just a few weeks ago, the company agreed to settle a huge federal case brought by multiple US states. It could pay up to$18 billion. And crucially, has agreed to make significant changes to the way that children and young people can access its social media and messaging apps. And for Katie, this has all come as a huge shock.

3:12Katy McQue:I was particularly surprised to see the settlement last month because up until then, just in response to reporting, but also in response to the other trials, Meta has always denied any wrongdoing and they've always maintained that they are doing their best to protect children on their platforms. So are we on the brink of a new era of reckoning for Meta and other tech companies? From The Guardian, I'm Annie Kelly. Today on Focus, could the wheel of justice finally be turning against Meta?

3:51Katy McQue:One day I got a tip from a source that Meta's platforms were being used by child sex traffickers to advertise, buy and sell children. For years, journalist Katie McHugh investigated human trafficking around the world for The Guardian and other publications. In 2021, she was contacted by prosecutors in the US who were concerned that they couldn't get Meta to cooperate in helping them investigate evidence that they believed showed that children were being trafficked for sex on Meta's social media platforms. She began to dig into what was going on. And for two years, Katie and I, along with another journalist, Mayling McNamara, worked on an investigation into how meta platforms, in particular Facebook and Instagram, were effectively working as marketplaces for child sex trafficking in the United States.

4:45Reporting the story was complex, and it involved Katie spending weeks trawling through hundreds of court documents of sex trafficking trials involving children.

4:56Katy McQue:One thing that emerged from the pandemic was a lot of human trafficking, including child sex trafficking, went online. There was an explosion of this activity, especially on social media platforms and especially on platforms that a lot of people regularly use and access, such as Facebook and Instagram. I found Facebook Messenger exchange that was entered into evidence that discussed the potential sale of three girls. I think they were aged between 12 and 15 for sex. And so literally the conversation was between a buyer and a seller saying, how much for this one? How much for this one? And the conversation ended in the evidence with the buyer messaging from a motel room saying, we're done, you can pick her up, essentially.

5:41Katy McQue:And that was one of the first times where it really hit home how serious these crimes are and what's taking place on this platform, on Facebook Messenger at the time. This was almost four years ago that we did this investigation. At the time we published, Meta denied any wrongdoing. It said it was doing everything it could to keep crimes like human trafficking off its platforms and also to keep children safe. but you know for a long time now Meta and other social media companies have been presented with evidence like this of how children have been harmed and really negatively impacted by their social media platforms you know not just by terrible crimes like sexual exploitation but by other things like bullying addiction being fed self-harm and anorexia materials you know the list goes on.

6:36And we've also seen, you know, extraordinary scenes of Mark Zuckerberg being confronted by parents holding up posters of their dead children in Congress. Mr. Zuckerberg, you and the companies before us, I know you don't mean it to be so, but you have blood on your hands. You have a product. You have a product that's killing people.

7:01Katy McQue:Yeah, I was there at that Senate hearing. Show them the pictures. Would you like to apologize for what you've done to these good people?

7:12I'm sorry.

7:15Katy McQue:And I spoke to many of those parents that were holding up those signs. And just the frustration and the pain in that room was palpable. world. And this is why we invest so much and are going to continue doing industry-leading efforts to make sure that no one has to go through the types of things that your families have had to suffer. Only a few years ago now, Meta and other social media companies in the US seemed untouchable. Why is it that up until now, these companies have never faced any kind of legal reckoning? so in the US there is a law called section 230 that was passed in 1996 when the internet was still in its infancy and that law aimed to protect internet service providers from being liable for content that was published on their platforms and obviously this law was passed way before social media was even in existence so a lot of critics have campaigned that it's not for purpose anymore But what it did do was create a liability shield that companies could invoke to if there was any challenge to anything that's taking place on their platforms.

8:28And Section 230 is kind of wild, isn't it? I mean, I think it's so significant. It's even called the Section 230, the 26 words that created the Internet, because it essentially was put in place to try and protect this burgeoning tech industry from being stifled by litigation. but it's it's just the way that companies have been able to successfully argue that the way that section 230 is phrased gives them almost blanket immunity from anything that's published on their platforms that they are not a publisher they're just a platform and so anything posted by a third party they cannot face prosecution from i mean that's essentially the way it's played out right

9:07Katy McQue:yeah exactly so between section 230 and also arguing first amendment free speech rights companies have successfully avoided any kind of legal action up until quite recently.

9:32But earlier this year, we've seen something shift a bit, haven't we? Because Meta did finally find itself in front of a jury in this trial in New Mexico, where our Guardian investigation was actually cited. What was different about the approach taken by prosecutors in this case, compared to what had come before?

9:53Katy McQue:Yeah, this case is very, very interesting. And it began in February. And this was a case that was brought by the New Mexico Attorney General's office. The lawsuit accusing the company of enabling child sexual exploitation on the platforms, meta-violating then New Mexico's consumer protection law. And what it did was instead of looking at the harms that were published on the platforms, it looked at the design features on Facebook and Instagram that facilitated these harms. And the harms that were the focus of the trial included child sexual exploitation, the publication of child sexual abuse imagery, and also the addictive features that impact children's mental health on these platforms.

10:37Katy McQue:And the design features include things like the people you may know functions that bring possibly adults into contact with children that they don't know. The ability for stranger adults to contact children via direct messages. Infinite scroll to keep users on the platform, making it more addictive. Push notifications and a vast amount of other design issues that were discussed during this trial. And so what this trial did was not look at the publication of certain harmful material, but look at the way that these platforms are designed, maybe facilitating these harms and these crimes. They were essentially circumnavigating Section 230 and the immunity that companies had established under that clause.

11:27So they were basically pivoting from you've got content on your platforms that potentially harm children to you have created a product that enables this content to reach children.

11:39Katy McQue:Yeah, you've created a product that allows this to happen or facilitates these harms. When I was thinking about this, I was thinking it's almost like prosecutors have kind of dug a tunnel and approach it from a different way. Yeah, they've definitely found an angle that it seems to be that that angle is now being replicated in other cases. Meta did try to argue Section 230 and First Amendment rights in the various hearings leading up to the trial. So that was something that they did try to do, but in this case, it did not work. This was the first case where Meta was subjected to a jury trial. You were there covering it for The Guardian.

12:15How did this whole thing play out?

12:18Katy McQue:It was so interesting because internal emails was a huge part of the prosecution's case. And what they showed is in a lot of cases, the companies, the senior staff members, did know a lot about the harms that were taking place in the platform. A study conducted by Meta titled The Young Ones Are The Best Ones, accusing the company of exploiting the vulnerabilities of its youngest users in order to encourage compulsive use under a teen time spent company-wide initiative for Instagram, an operation that lawyers described as hook, hold, harvest and hide. There were other warnings about teen mental health.

13:00Katy McQue:People were discussing these in emails. And it was so interesting to see a lot of the issues that we've been reporting about that we'd faced a lot of pushback from the company during the right to reply process, just laid out there in black and white. And we did hear testimony in person from the head of Instagram, Adam Mosseri. And the general message from him, and also there was testimony from Mark Zuckerberg that was played, a taped testimony, was that obviously they care a lot about child safety on their platforms. But the platforms are so big that some of these harms are inevitable. But you know, in that case, it turns out the judge didn't agree, right?

13:43So tell me what happened in that judgment.

13:46Katy McQue:In that judgment in New Mexico, which came in in March, the judge found that Meta had misled its consumers over the safety of its products and that it had failed to notify its consumers about the harms. Those products could be facilitating, including child sex trafficking and child sexual abuse imagery. Breaking news just into us, everybody. A jury in New Mexico deciding social media giant Meta violated state law there in this landmark lawsuit over child sexual exploitation and user safety, ordering Meta to pay$375 million. Prosecutors had argued that Meta, which owns Instagram, Facebook and WhatsApp, prioritized profits and failed to safeguard young users against child predators.

14:30Meta says it will appeal.

14:31Katy McQue:But this trial was a part of two phases. And then in May, the next phase of the trial initiated and the judge's ruling came in. Meta in New Mexico is now being fined a total of$942 million. And they are required to implement certain design alterations, their platforms, which New Mexico says will make those platforms safer for children. The judgment was so strong, wasn't it? Basically, the judge saying that that Meta was found to have kind of violated New Mexico's laws by essentially steering young users towards harmful content and contacts and designing features that were knowingly harmful. Despite all of the evidence that was presented in the trial, I still found it quite shocking.

15:22Katy McQue:This was the first jury trial that Meta had lost. And soon after, there was another ruling in a case in California. That plaintiff, identified by her initials KGM, is now 20 years old. She was just a young child when she began using Instagram and YouTube. She says her addiction to the platforms exacerbated depression and suicidal thoughts. The boss of Meta, Mark Zuckerberg, has taken the stand in a landmark court case in Los Angeles to face accusations that his company's social media platforms cause addiction. It's the first time that the billionaire founder of Facebook has testified in court about Instagram's effect on the mental health of young users.

16:04Katy McQue:They lost two trials in the space of, I think it was one week. Families crying tears of joy outside a Los Angeles courthouse today after a jury returned a historic verdict against tech giants Meta and YouTube. Big tech, your gig is over. It focused on one victim. The claims were that the platforms were addictive and it created mental health implications that were ongoing for her. And the jury found Metta liable in that trial as well.

16:47you know now there's been a third legal case that meta has been fighting this year this time a big federal case including many different states across the u.s that were taking legal action against META. So this trial wasn't about mental health harms or sexual exploitation specifically. It was more about how addictive these products that they've created are. That's right, isn't it?

17:15Katy McQue:Yeah, addictive and harmful to children. That's what the prosecutor said. So features that included filters that could alter children's faces to make it look like they've had plastic surgery, which obviously has body image implications. Other features like doom scrolling, infinite scrolls so children can refresh their feed consistently looking for new information and things that mean that they are kind of addicted to the platform, push notifications so that maybe they don't have the apps open, but there are notifications flashing up on their screen, information related to likes and things like that that are particularly important to children, that children may be sensitive to, that may be creating mental health issues amongst some children and maybe lasting mental health issues.

18:01So again, it's that pivot, isn't it, to prosecutors arguing that these platforms are kind of defective and dangerous and facilitating harm, but not actually focusing on the content that's creating that harm to children directly?

18:17Katy McQue:Yeah, these arguments that these prosecutors are putting forward is that these platforms are designed in certain ways that increase user time, make people addicted and possibly bring into contact children with strange adults that they do not know that may be looking to enact some harm on them. You know one thing that really struck me about this most recent case you know it was just the scale of it, right? I mean, I think it was initially jointly filed by 29 states. You know, it was huge, wasn't it? This was the biggest case that Meta's ever faced. And potentially, the company themselves said that it could have been on the hook for a much larger penalty than they ended up paying in the settlement.

19:05Katy McQue:So it could have gone to$1.4 trillion, which is about the market cap of the company. So the company potentially she faced an existential threat if they really lost this case. At the beginning they claimed they would fight it right through to the bitter end but that didn't happen did it? What ended up happening? Yeah a little while into the case Meta came to the table and a settlement was agreed. The global tech giant Meta has agreed to pay up to 18 billion dollars in a landmark settlement. The most substantial provisions of the settlement, though, are not financial, but a long list of new safeguards for young people.

19:46Katy McQue:It's surprising in a way that Meta agreed to a settlement because of the messaging that they put out for years. And the very defensive stance after the New Mexico cases that they would be appealing these cases. They didn't agree with these rulings or the jury's verdict. so to come to the table in this case quite early on in the trial was quite surprising because they came to the table and agreed to a settlement I think they also had input in what safety features they could possibly implement so they had a role in that discussion instead of that just being imposed on them by the judge. And what what were those features that they agreed to change?

20:30Katy McQue:So it has agreed to limit children to using its platforms for only two hours per day only. Nighttime blocking so that there will be mechanisms so that children can't access Facebook and Instagram between certain hours at nighttime. Like count changes so children can't always see the amount of likes that their posts get which is an issue related to child mental health. The strict removal of accounts for users under the age of 13 was another and school mode is something that they've asked for, which is restrictions of use of these platforms within school hours. You know, I mean, they're pretty significant changes, aren't they?