Meta’s harmful effects on children is one issue that unites Republicans and Democrats
Facebook co-founder and Meta CEO Mark Zuckerberg sits in his seat inside a bipartisan Artificial Intelligence Insight Forum for all U.S. senators hosted by Senate Majority Leader Chuck Schumer at the U.S. Capitol in Washington, D.C., on Sept. 13, 2023.
Leah Millis | Reuters
While Republican and Democratic lawmakers appear more incapable than ever of working together to pass legislation, they largely agree on one thing: Meta’s negative impact on children and teens.
A bipartisan coalition of 33 attorneys general filed a joint federal lawsuit on Tuesday, accusing Faceboook‘s parent of knowingly implementing addictive features across its family of apps that have detrimental effects on children’s mental health and contribute to problems like teenage eating disorders.
Another nine attorneys general are also filing lawsuits in their respective states.
“Kids and teenagers are suffering from record levels of poor mental health and social media companies like Meta are to blame,” Attorney General Letitia James, a Democrat, said in a statement. “Meta has profited from children’s pain by intentionally designing its platforms with manipulative features that make children addicted to their platforms while lowering their self-esteem.
Meanwhile, Tennessee’s Republican Attorney General Jonathan Skrmetti noted that polarization in politics is unlike anything this country has seen “since the Civil War.” Yet Skrmetti is firmly in James’s camp when it comes to Meta.
“For all of the attorneys general from both parties, people who frequently disagree very vocally and very publicly, to all come together and to move in the same direction, I think that says something,” Skrmetti said at a press conference after the lawsuit was filed.
The political dysfunction is most acute right now in the House of Representatives, which has been without a Speaker for three weeks after a small band of eight hardline conservative Republicans joined all Democrats to approve a “motion to vacate” introduced by GOP Rep. Matt Gaetz of Florida.
California’s Kevin McCarthy, who was booted as speaker, angered some members of his party by working with Democrats to avoid a government shutdown, even though he bowed down to many of those same lawmakers in September in instructing Republican-led committees to open an impeachment inquiry into President Joe Biden.
U.S. Rep. Matt Gaetz (R-FL) sits with fellow lawmakers as the House of Representatives votes for the third time on whether to elevate Rep. Jim Jordan (R-OH) to Speaker of the House in the U.S. Capitol on October 20, 2023 in Washington, DC.
Chip Somodevilla | Getty Images
When it comes to Mark Zuckerberg, legislators seem to find common ground. In 2020, for instance, a group of attorneys general from 48 states and territories filed two separate antitrust-related lawsuits against the company.
Despite their general disapproval of Facebook, Instagram and company leadership, party leaders don’t necessarily have the same specific criticisms of Meta.
Democrats like to focus on the company’s history of data privacy scandals. In July, for example, Sen. Elizabeth Warren of Massachusetts and other Democratic lawmakers called on the Biden administration to follow up on their probe showing how tax-preparation companies share sensitive taxpayer data with tech giants like Meta and Google.
“The sharing of taxpayer data with Meta has put taxpayer privacy at risk and appears to represent a violation of taxpayer privacy laws,” the Warren-led group wrote in a report titled “Attacks on Tax Privacy.”
Leading Republicans have focused more on Meta’s content moderation policies, which they say unfairly censor conservative views. House Judiciary Committee Chairman Jim Jordan, R-Ohio, has accused Zuckerberg and Meta of working with the White House to censor voices and posts that expressed disagreement with the Biden Administration.
Jordan’s committee was even considering holding Zuckerberg in contempt of Congress until Meta provided the lawmakers with documents they were seeking as part of their censorship investigation. Democrats were notably silent over the Republicans’ censorship claims.
Where the parties converge is in seeing the harmful effects on kids.
Dave Yost, Ohio’s Republican attorney general, said in a statement that the bipartisan lawsuit is needed to “compel the company to change its ways” because parents are letting kids use Meta’s apps.
“Given that children, when they’re on these platforms, become vulnerable to cyberbullying and online predators, Meta has added insult to injury, further injuring our children,” Yost said.
On the other side of the aisle, Pennsylvania’s Democratic AG Michelle Henry said, “The time has come for social media giants to stop trading in our children’s mental health for big profits.”
In citing the lawsuit, Henry said in a press release that “Meta not only targets young minds with addictive, harmful, trap-door content – it also lies to the public and parents about how their platforms are safe.”
Andy Stone, a Meta spokesperson, said in a statement that the company has introduced more than 30 tools “to support teens and their families.”
“We’re disappointed that instead of working productively with companies across the industry to create clear, age-appropriate standards for the many apps teens use, the attorneys general have chosen this path,” he said.
Additional reporting by Lauren Feiner
WATCH: Dozens of bipartisan state attorneys general sue Meta for addictive features targeting kids
Technology
Google leads monster week for tech, pushing megacaps to combined $21 trillion in market cap
Alphabet and Google CEO Sundar Pichai meets with Polish Prime Minister Donald Tusk at Google for Startups in Warsaw, Poland, on February 13, 2025.
Klaudia Radecka | Nurphoto | Getty Images
From the courtroom to the boardroom, it was a big week for tech investors.
The resolution of Google’s antitrust case led to sharp rallies for Alphabet and Apple. Broadcom shareholders cheered a new $10 billion customer. And Tesla’s stock was buoyed by a freshly proposed pay package for CEO Elon Musk.
Add it up, and the U.S. tech industry’s eight trillion-dollar companies gained a combined $420 billion in market cap this week, lifting their total value to $21 trillion, despite a slide in Nvidia shares.
Those companies now account for roughly 36% of the S&P 500, a proportion so great by historical standards that Howard Silverblatt, senior index analyst at S&P Dow Jones Indices, told CNBC by email, “there are no comparisons.”
There was a certain irony to this week’s gains.
Alphabet’s 9% jump on Wednesday was directly tied to the U.S. government effort to diminish the search giant’s market control, which was part of a years-long campaign to break up Big Tech. Since 2020, Google, Apple, Amazon and Meta have all been hit with antitrust allegations by the Department of Justice or Federal Trade Commission.
A year ago, Google lost to the DOJ, a result viewed by many as the most-significant antitrust decision for the tech industry since the case against Microsoft more than two decades earlier. But in the remedies ruling this week, U.S. District Judge Amit Mehta said Google won’t be forced to sell its Chrome browser despite its loss in court and instead handed down a more limited punishment, including a requirement to share search data with competitors.
The decision lifted Apple along with Alphabet, because the companies can stick with an arrangement that involves Google paying Apple billions of dollars per year to be the default search engine on iPhones. Alphabet rose more than 10% for the week and Apple added 3.2%, helping boost the Nasdaq 1.1%.
Analysts at Wedbush Securities wrote in a note after the decision that the ruling “removed a huge overhang” on Google’s stock and a “black cloud worry” that hung over Apple. Further, they said it clears the path for the companies to pursue a bigger artificial intelligence deal involving Gemini, Google’s AI models.
“This now lays the groundwork for Apple to continue its deal and ultimately likely double down on more AI related partnerships with Google Gemini down the road,” the analysts wrote.
Mehta explained that a major factor in his decision was the emergence of generative AI, which has become a much more competitive market than traditional search and has dramatically changed the market dynamics.
New players like OpenAI, Anthropic and Perplexity have altered Google’s dominance, Mehta said, noting that generative AI technologies “may yet prove to be game changers.”
On Friday, Alphabet investors shrugged off a separate antitrust matter out of Europe. The company was hit with a 2.95-billion-euro ($3.45 billion) fine from European Union regulators for anti-competitive practices in its advertising technology business.
Broadcom pops
While OpenAI was an indirect catalyst for Google and Apple this week, it was more directly tied to the huge rally in Broadcom’s stock.
Following Broadcom’s better-than-expected earnings report on Thursday, CEO Hock Tan told analysts that his chipmaker had secured a $10 billion contract with a new customer, which would be the company’s fourth large AI client.
Several analysts said the new customer is OpenAI, and the Financial Times reported on a partnership between the two companies.
Broadcom is the newest entrant into the trillion-dollar club, thanks to the company’s custom chips for AI, already used by Google, Meta and TikTok parent ByteDance. With Its 13% jump this week, the stock is now up 120% in the past year, lifting Broadcom’s market cap to around $1.6 trillion.
“The company is firing on all cylinders with clear line of sight for growth supported by significant backlog,” analysts at Barclays wrote in a note, maintaining their buy recommendation and lifting their price target on the stock.
For the other giant AI chipmaker, the past week wasn’t so good.
Nvidia shares fell more than 4% in the holiday-shortened week, the worst performance among the megacaps. There was no apparent negative news for Nvidia, but the stock has now dropped for four consecutive weeks.
Still, Nvidia remains the largest company by market cap, valued at over $4 trillion, with its stock up 56% in the past 12 months.
Microsoft also fell this week and is on an extended slide, dropping for five straight weeks. Shares are still up 21% over the last 12 months.
On the flipside, Tesla has been the laggard in the group. Shares of the electric vehicle maker are down 13% this year due to a multi-quarter sales slump that reflects rising competition from lower-cost Chinese manufacturers and an aging lineup of EVs.
But Tesla shares climbed 5% this week, sparked mostly by gains on Friday after the company said it wants investors to approve a pay plan for Musk that could be worth up to almost $1 trillion.
The payouts, split into 12 tranches, would require Tesla to see significant value appreciation, starting with the first award that won’t kick in until the company almost doubles its market cap to $2 trillion.
Tesla Chairwoman Robyn Denholm told CNBC’s Andrew Ross Sorkin the plan was designed to keep Musk, the world’s richest person, “motivated and focused on delivering for the company.”
Jaque Silva | Nurphoto | Getty Images
Anthropic has agreed to pay at least $1.5 billion to settle a class action lawsuit with a group of authors, who claimed the artificial intelligence startup had illegally accessed their books.
The company will pay roughly $3,000 per book plus interest, and agreed to destroy the datasets containing the allegedly pirated material, according to a filing on Friday.
The lawsuit against Anthropic has been closely watched by AI startups and media companies that have been trying to determine what copyright infringement means in the AI era. If Anthropic’s settlement is approved, it will be the largest publicly reported copyright recovery in history, according to the filing.
“This settlement sends a powerful message to AI companies and creators alike that taking copyrighted works from these pirate websites is wrong,” Justin Nelson, the attorney for the plaintiffs, told CNBC in a statement.
Anthropic didn’t immediately respond to CNBC’s request for comment.
The lawsuit, filed in the U.S. District Court for the Northern District of California, was brought last year by authors Andrea Bartz, Charles Graeber and Kirk Wallace Johnson. The suit alleged that Anthropic had carried out “largescale copyright infringement by downloading and commercially exploiting books that it obtained from allegedly pirated datasets,” the filing said.
In June, a judge ruled that Anthropic’s use of books to train its AI models was “fair use,” but ordered a trial to assess whether the company infringed on copyright by obtaining works from the databases Library Genesis and Pirate Library Mirror. The case was slated to proceed to trial in December, according to Friday’s filing.
Earlier this week, Anthropic said it closed a $13 billion funding round that valued the company at $183 billion. The financing was led by Iconiq, Fidelity Management and Lightspeed Venture Partners.
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