Social media companies including Meta are gripped by fear after a U.S. court ruled for the first time that SNS operators bear responsibility for minors' social media addiction. A jury verdict ordering $6 million (9 billion won) in damages to the plaintiff has revived memories of the tobacco litigation saga 28 years ago. Observers say Big Tech firms, which have reaped massive advertising revenue, could follow the same path as tobacco companies that were saddled with enormous damages and stringent regulations.
On May 26 (local time), following the jury verdict in the social media addiction trial the previous day, legal and tech industry circles assessed that "Big Tech could face the same situation tobacco companies experienced in the past," foreign media reported. Kaley, a 20-year-old American woman, filed a damages lawsuit against Meta and Google, claiming she suffered depression and physical disabilities from social media use during childhood. A California trial court jury ruled that Meta (Instagram) and Google (YouTube) must pay the plaintiff a total of $6 million. If the verdict is finalized, Meta would bear 70% and Google the remaining 30% of the damages.
Why were tobacco companies invoked in a social media lawsuit? In 1994, after internal documents were revealed showing that major tobacco manufacturers including Philip Morris and R.J. Reynolds had concealed the dangers of smoking, state governments sued four tobacco companies demanding reimbursement of smoking-related medical costs. In Congress, a bill was introduced requiring $516 billion in damages and granting the Food and Drug Administration (FDA) authority to regulate nicotine. The sponsor was Republican Senator John McCain, who later ran against Democratic candidate Barack Obama in the 2008 presidential election. When President Bill Clinton, despite being from a different party, actively supported the bill, tobacco companies ultimately agreed to pay state governments $206 billion over 25 years.
With the signing of the Master Settlement Agreement (MSA) between state governments and tobacco companies, manufacturers also agreed to overhaul their advertising practices. Key provisions of the MSA included: ▲ cigarette price increases ▲ a ban on marketing targeting minors ▲ a ban on cartoon imagery ▲ a ban on distribution using product brand names ▲ a ban on payments for media promotion on TV and other outlets ▲ a ban on sponsoring youth events and sports competitions ▲ measures to stop concealing the dangers of tobacco. State governments also required manufacturers to spend $1.45 billion over five years on smoking cessation programs and anti-youth smoking advertisements, and to contribute $25 million annually over 10 years to a foundation researching ways to reduce youth smoking.
Before such restrictions were imposed, indiscriminate tobacco advertising was a serious problem. Manufacturers emblazoned familiar figures and cartoon characters such as the "Marlboro Man" and "Joe Camel" on cigarette packs as well as T-shirts, hats, and bags, packaging cigarettes with a friendly image. Joe Camel from the Camel cartoon was singled out as a primary culprit in encouraging minors to smoke. The camel character, as familiar to children and teenagers as Disney's Mickey Mouse, holding a cigarette in its mouth was more than enough to spark curiosity.
Tobacco companies ignored pressure from the government and politicians. U.S. Surgeon General Antonia Novello urged R.J. Reynolds in 1992 to withdraw the Joe Camel character, calling it excessively provocative for minors, and asked media outlets not to run the advertisements, but to little effect. An R.J. Reynolds spokesperson said, "There is no reason to believe advertising induces people to start smoking," and continued the campaigns.
But the tide turned in 1994 as criticism mounted that tobacco manufacturers were deliberately adding nicotine during the manufacturing process to foster addiction. FDA Commissioner David Kessler presented evidence in February 1994 that the companies were intentionally manipulating nicotine levels. Two months later, seven tobacco company CEOs testified before Congress that nicotine was not addictive, but they were subjected to a federal investigation for perjury and all eventually resigned, taking responsibility for their companies' management crises.
Although Meta and Google have expressed their intention to appeal, some observers say they could move toward a settlement, just as tobacco companies did 28 years ago. With thousands of similar lawsuits pending, this verdict will inevitably have an impact. Even if they appeal, unless the ruling is overturned, they may have to pay damages amounting to billions of dollars.
Big Tech firms are pinning their hopes on President Donald Trump, who is known to dislike regulation, but state governments are pressuring social media companies through litigation, just as they did with tobacco manufacturers in the past. California Attorney General Rob Bonta said in a statement on X, "California will hold Meta accountable at the trial set for August."
Some observers predict that unlike the tobacco litigation, legal battles will continue, given that advertising revenue is vital for Big Tech. Although social media's addictive nature has been acknowledged, platforms could avoid liability if immunity provisions apply. Section 230 of the Communications Decency Act grants platform operators immunity from liability for illegal or harmful content posted by users. Reuters reported that while the plaintiff prevailed at trial by targeting the design of the platforms rather than the content itself, Big Tech could take the issue to the Supreme Court to contest the scope of that immunity.
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