Meta’s annus horribilis: Why it was hit with the largest fine ever imposed on a tech company

2026 has not been a good year for Meta. On Wednesday, a judge in New Mexico ordered the parent company of Facebook, Instagram and WhatsApp to pay a fine of about $25 billion after finding it guilty of misleading Facebook users about its data privacy policies.

The state of New Mexico sued Meta in 2021 in the wake of the Cambridge Analytica scandal, which came to light in 2018 through reporting by The Guardian and The New York Times. Their investigations revealed that political consulting firm Cambridge Analytica had gained access to the profiles of 50 million Facebook users without their consent and that the data was used to support Donald Trump during the presidential campaign that led to his arrival in the White House in January 2017.

The ruling comes two months after the company led by Mark Zuckerberg reached a settlement with the attorneys general of 52 states, agreeing to pay about $17 billion over a 10-year period in exchange for the withdrawal of a lawsuit accusing the company of designing and operating products (its social media platforms), despite knowing they could harm young people’s mental health.

The new fine imposed on Meta has revived the Cambridge Analytica scandal just as attention had shifted to the legal cases concerning the impact of social media on minors. Why now? Is it the largest fine in history? And why New Mexico again? These are some of the key questions raised by the ruling.

Why such a large fine?

A jury in the Santa Fe District Court in New Mexico found that Meta had committed 43 million violations of the state’s consumer protection laws and that each violation carried a potential fine of up to $5,000. Had the judge opted to impose the maximum penalty, the total would have reached $215 billion.

That did not happen. The final amount, $25 billion, is still enormous, an unaffordable sum for most companies. In Meta’s case, however, it amounts to less than half of the $52.5 billion in profit the company generated between January and September of this year, according to figures released by the company on Thursday.

Why now?

The Cambridge Analytica scandal came to light in 2018, when Donald Trump was already in the White House. Three years later, in 2021, after compiling its evidence, the state of New Mexico filed its lawsuit against Facebook. The ruling has taken five years to arrive. Why?

First, New Mexico, like a number of other states, spent years negotiating with Meta. “But the deal did not satisfy them, so they decided to proceed to trial. Bear in mind that these negotiations can take a long time,” explains Rodrigo Cetina, a professor of law and public policy at the Barcelona School of Management of Universitat Pompeu Fabra and a specialist in the legal challenges of digital technologies.

Second, the lawsuit involves an alleged 43 million violations of state privacy laws. Compiling and reviewing the evidence needed to substantiate such a vast number of alleged infractions is a lengthy and complex process.

Is it the largest fine in history?

The $25 billion fine is the largest single sanction ever imposed on one of the major technology companies. However, even larger settlements and fines have been handed down in other industries. In 1998, the four largest U.S. tobacco companies agreed to pay more than $200 billion over 25 years for having concealed the harmful effects of smoking.

Meta’s fine surpasses those imposed on Bank of America and JPMorgan Chase, which between 2013 and 2014 agreed to pay more than $30 billion combined over the fraudulent sale of subprime mortgages that helped trigger the Great Recession.

Meta will also pay more than BP, which in 2015 was ordered to pay $20.8 billion for the Deepwater Horizon oil spill in the Gulf of Mexico, still regarded as the worst marine environmental disaster in history.

Why in New Mexico?

Alongside California, New Mexico has been at the forefront of legal challenges against major technology companies. Much of that is due to the state’s attorney general, Democrat Raúl Torrez, who has been deeply involved in efforts to protect his constituents’ digital rights.

In August, a New Mexico judge ordered Meta to pay $567 million after finding the company responsible for harming the well-being and mental health of minors through its social media platforms. A few months earlier, in March, another New Mexico court fined the company $375 million for its failure to protect minors’ safety.

In both cases, Meta was accused of violating state consumer protection laws. Some analysts argue that this legal strategy has proved effective in challenging big tech companies when they invoke free speech protections to argue that they are not responsible for content shared on their platforms.

What does Meta say?

Meta argues that the fine is disproportionate and has framed its defense around free speech concerns. “This ruling, and the Attorney General’s approach to this enforcement, makes it all but impossible to do business in the state of New Mexico,” C. J. Mahoney, the company’s chief legal officer, said in a statement. “At its core, this lawsuit seeks ​to impose a tax on speech to enforce new rules for what people can say online."

Could Meta face more fines?

When Meta reached its settlement with the 52 state attorneys general over claims related to the impact of social media on minors’ mental health, it also agreed to pay $459 million to resolve potential privacy-related claims stemming from the Cambridge Analytica scandal. New Mexico did not join that settlement and instead chose to continue pursuing its case in court.

The legal battle over the effects of social media on minors, however, is far from over. In the coming weeks, trials are expected to begin involving families and school districts that have sued the company, alleging that its platforms have harmed students’ mental health and academic performance.

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