How a Legal Backlash Against Big Tech Is Forcing Big Changes
A series of lawsuits has created a new de facto regulatory regime as courts order companies like Meta and Google to change their business practices — and pay up.
A series of lawsuits has created a new de facto regulatory regime as courts order companies like Meta and Google to change their business practices — and pay up.
For decades, tech giants grew at breakneck speeds as Congress struggled to keep pace with the consequences of the companies’ rapidly booming businesses.
But a new de facto regulatory regime has emerged over the past year as courts clobber the biggest internet companies. And for the first time, their product designs and advertising models — which critics say treat users as products — are costing the companies serious money.
The latest blow came on Wednesday, when a New Mexico judge ordered Meta, which owns Facebook, Instagram and WhatsApp, to pay a record $25 billion penalty for abusing consumer privacy. In a 20-page ruling, the judge scolded the company for deceiving consumers and allowing their data to be harvested by the political consulting firm Cambridge Analytica.
“Facebook’s misrepresentations about users’ control of their data were not isolated incidents, but rather a systematic pattern of deception at the core of Facebook’s business model,” wrote Judge Francis J. Mathew of the State District Court in Santa Fe.
The decision, and others like it, amounts to a comeuppance for tech behemoths, whose fortunes have been built on the business model of winning the attention — and data — of users. Now, trials and court decisions have laid bare many of the allegations over deceptive and harmful business practices that critics have said long propelled the companies’ growth.
New consumer guardrails are emerging through the courts’ record financial penalties and orders of changes to designs of the companies’ technologies, legal experts said.
