Meta Platforms (META) is heading into a new trial in New Mexico that could bring more legal risk for the owner of Facebook, Instagram, and WhatsApp. The case centers on claims that Meta harmed young users and failed to keep kids safe from abuse on its apps.
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New Mexico Attorney General Raúl Torrez is seeking steep fines and big changes to Meta’s apps. His office may ask for billions in added damages, along with steps such as age checks, changes to how content is shown to minors, and an end to autoplay and scroll feeds for young users.
The case follows a March jury ruling that found Meta broke New Mexico’s consumer law by giving a false view of how safe Facebook and Instagram were for young users. That jury ordered Meta to pay $375 million in damages.
Meanwhile, META shares dropped slightly on Friday, closing at $608.75.
Why Investors Should Watch
This next phase will be decided by a judge in Santa Fe. The judge will rule on whether Facebook and Instagram created a “public nuisance” under New Mexico law. If the judge agrees, Meta could face court-ordered changes that may affect how its apps work in the state.
Meta says it has taken broad steps to keep young users safe. The company also argues there is no clear proof that social media caused youth mental health harm. In a court filing, Meta said some of the changes sought by the state may be hard to carry out and could even lead the firm to leave New Mexico.
Still, the case adds to a wider wave of lawsuits against Meta and other social media firms over youth safety. Meta also warned last week that legal and rule-based pressure in the U.S. and the European Union “could significantly impact our business and financial results.”
For investors, the key issue is not just one state case. Rather, it is whether courts and rule-makers start to force larger changes to social media design, ads, and youth use. That could raise costs, limit user growth, and add more risk to Meta’s long-term outlook.
Is Meta a Good Stock to Buy Now?
Turning to the Street, Meta Platforms boasts a Strong Buy consensus. Out of 38 ratings issued over the past three months, 31 analysts rate the stock a Buy, while seven rate it a Hold. The average META stock price target is $826.66, implying a 35.80% upside from the current price.
