Meta and YouTube were found responsible in a groundbreaking trial related to social media addiction.

      Mark Lanier, the folksy Texas attorney who also serves as a part-time pastor, presented a jar of M&Ms to the jury in Los Angeles, explaining that each candy represented a billion dollars of Meta's market capitalization. By that calculation, there were about 1,400 candies in the jar, and the jury awarded his client six of them. Now, the looming question in Silicon Valley is what will happen as other jars begin to deplete.

      On Wednesday, March 25, a California jury found Meta and Google liable on all counts in the first bellwether trial that evaluated whether social media platforms can be classified as defective products, akin to a faulty car seat or contaminated drug that causes harm. The plaintiff, a 20-year-old woman referred to only as K.G.M., who was called Kaley in court, recounted to the jury her experience of using YouTube since age six and Instagram since age nine. She stated that these platforms had intensified her personal challenges, leading to body dysmorphia, depression, and suicidal thoughts. After nine days and a total of 43 hours of deliberation, the jurors reached a unanimous decision.

      In terms of damages, the jury awarded a relatively modest sum by big tech standards: $3 million in compensatory damages and $3 million in punitive damages, divided 70-30 between Meta and Google. Meta's portion translates to $4.2 million for a company whose market capitalization was around $1.4 trillion at the time of the verdict. However, the ruling's financial implications are less about the awarded amount and more about what it signifies. There are over 10,000 individual claims and approximately 800 school district lawsuits waiting in federal multidistrict litigation, with eight additional bellwether trials planned for the coming months. This verdict marks a significant milestone, as it establishes that a jury can accept the legal argument that social media apps are products with inherently defective designs.

      The ruling followed closely after another jury in Santa Fe, New Mexico, ordered Meta to pay $375 million in civil penalties—$5,000 for each violation—after determining that the company had breached state consumer-protection laws by facilitating child sexual exploitation on Facebook and Instagram. New Mexico became the first state to win a trial against a social media company over child safety issues. Evidence from that six-week trial included internal Meta documents and testimony from former employees demonstrating that the platform's design enabled predators to target minors. A bench trial regarding the state's remaining claims against Meta is set to begin on May 4.

      The combination of these verdicts caused Meta's stock to experience its sharpest drop in over two years. Shares fell 6.8 percent the day following the Los Angeles ruling, continued to decline to an 8 percent drop the next day, and ultimately fell 11 percent by the end of the week. By the end of the month, Meta's stock was down 19 percent, translating to a loss of approximately $310 billion in market value. Analysts at JPMorgan and Goldman Sachs responded by adjusting their price targets, citing what they referred to as unquantifiable risks stemming from the wave of litigation now using this verdict as a benchmark.

      Internally, Meta views the verdict as a disappointment rather than a full-blown crisis—at least in public. The company entered the trial confident in its defense, claiming that Kaley's issues with family and school existed before her use of Instagram and arguing that attributing such complex issues as teen mental health to a single source could overlook broader concerns. A spokesperson informed the BBC that many teens rely on digital communities to find a sense of belonging. Meta announced plans to appeal and offered no indication it would settle future cases or change its product design.

      Google took a different approach, contending that YouTube was misrepresented during the trial. The company stated that YouTube is “a responsibly built streaming platform, not a social media site,” a distinction that the jury apparently did not find convincing. Both companies will have the chance to refine their legal defenses as additional bellwether trials proceed, but the evidentiary record from Kaley’s case, which included internal documents about Meta's efforts to attract and retain young users, can be referenced in future legal proceedings.

      TikTok and the parent company of Snapchat, Snap Inc., were co-defendants in the case but settled before the trial began. The details of the settlement remain undisclosed, and neither company admitted liability; however, their choice to resolve their legal exposure before a jury could indicate that their legal teams made different calculations than those at Meta. Both companies are still facing multiple upcoming bellwether trials.

      The wider implications extend beyond courtroom damages. Eric Goldman, an associate dean and law professor at Santa Clara University, expressed to the BBC that he views the social media addiction cases as a potentially existential threat to the current business model of the industry. He noted that the social media sector “faces existential legal liability and will inevitably need to reconfigure