Meta will pay up to $18 billion and cap teens at two hours a day

Meta agreed on 26 August to pay up to about $18 billion over ten years and to rebuild how people under 18 use Facebook and Instagram. The deal was filed in the U.S. District Court for the Northern District of California while a trial that opened on 18 August was still in its first days. Adam Mosseri, the head of Instagram, was due back on the stand.

The main settlement covers 47 states, the District of Columbia, Puerto Rico, American Samoa and the Northern Mariana Islands, for up to $16.7 billion. Texas struck a separate deal above $1 billion. California's range is $1.5 billion to $2.2 billion. Washington State was told it would get $237 million guaranteed and up to about $339 million. New Mexico is out because it already won its own case. Florida's attorney general called the money "peanuts" and refused to sign.

About $12.7 billion is described as the floor. The rest is written to shrink if Snap, TikTok and YouTube do not accept similar teen limits. If they do, Meta's daily cap on each platform drops from two hours to one hour and runs for ten years instead of five.

What changes on the apps

Users under 18 get a default two-hour limit across Facebook and Instagram together. They need a verified parent to turn it off. The apps block them from midnight to 6 a.m. unless a parent overrides that too. Notifications mute by default from 8 a.m. to 3 p.m. Like counts on teen posts go off by default. Mandatory pauses kick in after 15 minutes of continuous use and again at 60 and 90 minutes. Meta must use stronger age-assurance tools to find under-18s and to keep under-13s off the services. An independent auditor watches compliance.

The states alleged that Meta designed the products for compulsive use, collected preteen data without parents, and misled the public. Four states had spoken of penalties near $1.4 trillion. Meta shares rose as much as 4.1 percent on the day and closed up 1.1 percent. The consent judgment still needs a judge.