Meta challenges New Mexico's proposed privacy penalty on constitutional grounds

State’s lawyer linked lower request to excessive fines and due process on appeal

Meta’s lawyer Matt Nicholson told Judge Francis Mathew that New Mexico’s request for a $35 billion to $40 billion privacy penalty was “blatantly unconstitutional” and “wildly out of proportion.” Nicholson said the penalty should instead be closer to a range of $345 million to $3.5 billion. He added that even those numbers were problematic but would at least “lessen the extreme aberration the state’s proposition would create.”

Nicholson said the request dwarfed the $20.8 billion settlement tied to the 2016 BP Deepwater Horizon spill. He also said there was no evidence that any New Mexican was harmed by Meta’s actions. New Mexico’s lawyer Randi McGinn proposed $35 billion to $40 billion at a hearing earlier this month. The state described that range as “far lower than the maximum” but said it still would have been the largest judgment in history. The state had previously said it would not seek more than $62 billion.

McGinn said: “The court should speak to Meta in the only language it understands, which is money and the value of its stock price.” She said her suggestion to lower the total would help prevent constitutional concerns about excessive fines and due process on appeal.

The proposals followed a jury’s findings last month. Jurors found Meta liable under New Mexico’s unfair practices law for deceiving users about data privacy, its efforts to fight hate speech and misinformation, and its handling of a third-party app tied to the 2018 Cambridge Analytica data breach. In that breach, a consulting firm harvested tens of millions of Facebook users’ data without their consent.

The jury found about 44 million violations tied to Meta’s public statements made over more than a decade, including statements by Chief Executive Mark Zuckerberg. Under state law, the maximum penalty was $5,000 per violation. Mathew said New Mexico was entitled as a matter of law to the maximum, which would have been more than $200 billion, but courts had discretion to set amounts they deemed fair and appropriate.

Mathew’s Oct. 21 order set the penalty at $25 billion. In the order, Mathew wrote: “The harm in this matter is difficult to overstate, and goes to the heart of Facebook’s basic business proposition.” He added: “To induce users to provide their personal information to Facebook, Facebook made many false promises respecting the security and control of that data over the course of more than a decade.” He also said: “The violations the jury found were not the product of a single mistake statement or isolated incident.” A representative for Meta did not immediately respond to a request for comment.

Meta shares rose 1.35% on Wednesday, hours before the company was scheduled to report its third-quarter financial results. New Mexico called the $25 billion decision one of the largest verdicts in U.S. history.

The New Mexico lawsuit, filed in 2021, alleged that the Cambridge Analytica scandal reflected a broader pattern of misleading consumers about privacy practices, content moderation and the misuse of data. The state said it would also ask Mathew in later proceedings to require Meta to make changes to its platforms based on the jury’s verdict.

New Mexico opted out of a broader multistate settlement with Meta earlier this year that ended similar lawsuits. The $17 billion agreement reached with 48 states centered on social-media-addiction claims. It also ended the states’ consumer-protection claims related to Cambridge Analytica for $459 million. California settled its related case for $50 million last year.

This was the second verdict New Mexico won against Meta in 2026. In August, another state judge ordered the company to pay $942 million after it lost a trial over whether its platform protected young people from online predators and caused mental-health issues. Meta said it would appeal the child-safety ruling.