Appeals court rules Meta can't dodge $1.4 trillion states' lawsuit before trial

US District Judge Yvonne Gonzalez Rogers had already narrowed the states' claims against Meta, finding that Section 230 shields the company from liability over most features alleged to be unfair or unconscionable. However, she declined to dismiss claims accusing Meta of failing to warn users about known addiction risks tied to platform features and their overall design.

Because her ruling was not a final judgment, it is classified as an interlocutory order, which normally cannot be appealed right away. Meta argued its case qualified for an exception, claiming that decisions denying Section 230 protection count as "collateral orders" that can be appealed before a final judgment is reached.

Appeals court sides against Meta

Meta pointed to past 9th Circuit rulings that used the word "immunity" when discussing Section 230. The appeals panel acknowledged the term had been used loosely but said this wasn't binding, since the court had never directly ruled on whether denying a Section 230 defense counts as a collateral order.

The judges cited the 10th Circuit's earlier conclusion that Section 230 offers a defense against liability rather than immunity from being sued, meaning such denials can be properly reviewed only after a final judgment. The 9th Circuit agreed, noting the law contains no explicit guarantee against facing trial, and that immunity from lawsuits is typically reserved for government officials rather than private companies.

New Mexico case adds pressure

In a separate case brought by New Mexico's attorney general, a state court judge last week ordered Meta to pay $567 million toward youth mental health services to address harm linked to its social media platforms. Earlier in that case, a jury had already ordered Meta to pay $375 million in civil penalties.