Silicon Valley is reeling from a major verdict delivered by a Los Angeles jury on March 25. Tech giants Meta and YouTube were found guilty of having addictive platform designs that have harmed the mental health of a 20-year-old.

The central plaintiff in this case is known only to the public as "Kelly," and after nine days of deliberation, the jury supported her claims on all charges. Some in the tech industry are trying to downplay the impact of the case, while others are deeply concerned, believing it marks the beginning of a public purge of social media companies, threatening not only American social media giants but potentially their very survival.

An unnamed insider told the media, "We're in a very special time."

From Meta’s Internal Perspective

This verdict forces Meta insiders to confront the fact that public perception of them is far less positive than their own self-assessment. For a company once hailed as a key player "connecting people, providing entertainment, and even contributing to the global spread of democracy," accepting this reality is no easy task.

Both Meta and Google, YouTube's parent company, have stated they will appeal the jury's verdict. The verdict includes $3 million (approximately £2.3 million) in damages and an additional $3 million in punitive damages, intended to punish the two tech companies.

There is widespread disappointment within Meta regarding the verdict. Before the trial began, the company was confident in its position, arguing that Kylie's conflicts with her family and challenges at school predated her use of Meta's Instagram account at age nine.

Kylie, on the other hand, claimed that the platforms exacerbated her personal difficulties, leading to body dysmorphic disorder, depression, and suicidal thoughts.

“This is a definitive verdict in terms of Google and Meta’s liability,” lawyer Jayne Conroy told the media after the verdict. “This will have a significant impact.”

She added, “I’m sure there was a lot of math going on in the boardrooms of Meta, Google, Snap, and TikTok, assessing what it would have meant if they had known there would be thousands of cases flooding in.”

TikTok and Snapchat’s parent company, Snap Inc., were originally also defendants in the case but reached a settlement with the plaintiffs before the trial began. However, they are not entirely out of the woods, as they will still appear as defendants in several upcoming landmark trials.

These cases will continue to test a new legal theory: social media companies, in pursuit of profit, deliberately design their products to be addictive, thereby causing physical harm to users.

Meta has not yet indicated whether it will change its stance or seek settlements in future cases. The company stated on the 25th, "We will continue to actively defend our rights because each case is different, and we remain confident in our track record of protecting teenagers online."

A Meta spokesperson told the media that simplifying the complex issue of teenage mental health to a single cause could leave many broader problems facing teenagers unresolved. "Many teenagers rely on digital communities to connect and find a sense of belonging," Meta stated.

A Google spokesperson told the media that its video platform YouTube has been misunderstood in this court case. The company stated that YouTube is a "responsibly built streaming platform, not a social media website." Clearly, these tech companies will not compromise.

Former Twitter executive Bruce Dasley pointed out that the value of most large tech companies stems from their growth rate exceeding that of other companies on the stock market. After more than 20 years of development, this means "what you're really seeing is a company designed to force people to spend more and more time on its apps." Any regulatory action that jeopardizes this core objective, or a lawsuit like this one, is seen as an issue that needs to be addressed.

"Tech companies spend more on lobbying and public relations than any other industry in the world," Daisley told the media. "They're obsessed with winning the soft power battle, trying to persuade politicians to be more lenient with them."

This Is Just the Beginning

In seeking punitive damages for Kelly, her lawyer, Mark Lanier (a mild-mannered Texas litigator), showed the jury a jar of M&M's. He argued that each M&M represented $1 billion in company value, visually demonstrating the immense wealth of these tech companies. Meta's current market capitalization is approximately $1.4 trillion, equivalent to 1,400 M&Ms.

"I thought we'd get a much larger settlement," Lanier told reporters outside the courthouse after the court announced a total of $6 million in damages. But for the personal injury lawyers involved in the case, the fact that the jury upheld Lanier's core arguments was a significant victory in itself. They believe this outcome foreshadows positive progress in the eight landmark trials to come in the coming months.

Furthermore, Meta suffered another blow from a ruling announced on the 24th—the company was ordered to pay $375 million in damages after New Mexico prosecutors successfully persuaded a jury to prove that Meta facilitated the exploitation of children on its platform. Meta spokesperson Andy Stone subsequently posted on social media that the New Mexico penalty "is only a small fraction of the amount the state sought," with prosecutors reportedly seeking over $2 billion in damages.

Besides the substantial damages awarded in the Los Angeles ruling, Meta's defense lawyers also pointed out that the jury's decision was not unanimous and the deliberation process lasted nearly two weeks. One observer stated, "Let's not jump to conclusions."

"Downplaying the overall financial risk is reasonable so that investors don't withdraw their funds," Eric Goldman, associate dean and professor at Santa Clara University School of Law in Silicon Valley, told the media. “I don’t think any social media service can afford to pay $6 million in damages for each injured user,” he added, stating that he believes social media addiction-related cases could pose an existential threat to the industry. However, Goldman also pointed out that it remains uncertain whether the jury’s verdict will be upheld on appeal.

As these tech companies face numerous liability claims, the evidence and testimony presented in the Kelly case may be re-cited in upcoming trials. With related cases brought by individuals, school districts, and state governments being heard in court, all parties will have the opportunity to refine their legal arguments, potentially leading to significant changes in the legal landscape of the social media industry.