Social media companies lose key appeal in U.S. court

Stock Market News

10 August 2026, 21:22

A U.S. appeals court allowed thousands of lawsuits against the largest social networks to proceed, in which the companies are accused of enabling addiction and harming the mental health of children and teenagers. The decision dealt a serious blow to Meta Platforms, Snap, TikTok and other technology companies that had sought to have a significant portion of such cases dismissed.

The U.S. Ninth Circuit ruled that plaintiffs may continue their lawsuits because, in a number of cases, their claims are based not merely on content posted by users, but on features of social networks’ design itself. This includes, in particular, recommendation algorithms, infinite scrolling mechanisms, notifications and other elements that, according to the plaintiffs, encourage users to spend more time on the platforms.

Technology companies pointed to legislation that limits their liability for user-generated content. They argued that the allegations against them are effectively tied to users’ posts and therefore should be dismissed. However, the court found that in some cases liability can be considered separately from the content of user posts if the claims relate directly to the platform’s structure and operation.

The ruling is of particular importance for Meta, the owner of Facebook and Instagram, as well as for Snap, TikTok and other platforms. If such cases are able to move through further stages of litigation, companies will have to defend themselves not only against claims tied to individual posts, but also against allegations that the very architecture of their services may create potentially harmful incentives for users. Plaintiffs still have to prove a causal link between the companies’ actions and specific harm, while the technology platforms will need to present their own defense.

 

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