Soros-backed New Mexico AG behind $25B Meta lawsuit accused of seeking ‘tax on speech’

The jaw-dropping $25 billion penalty Meta was slapped with on Oct. 21 is raising questions about New Mexico Attorney General Raúl Torrez’s crackdown on the company’s privacy and content-moderation practices. The massive fine could have a chilling effect on companies doing business in the state, as well as on free speech.

Torrez — who entered into politics with a 2016 run for district attorney backed by more than $100,000 in spending from a George Soros-funded super PAC — has faced criticism during his tenure for prosecuting just half the criminal cases referred by law enforcement. But he has taken a far more aggressive approach to tech companies than violent criminals according to local reports.

The Meta case, which was initially filed in 2021, came following the Cambridge Analytica scandal, in which data from millions of Facebook users was harvested by a third party without their knowledge. Last month, a jury found Meta liable for misleading users about its privacy and content-moderation practices and the staggering fine was announced this week.

Meta plans to appeal the decision.”The jury didn’t make findings that any New Mexican heard or saw these statements, or was harmed by them,” Meta attorney Matthew Nicholson argued at the trial

Meta’s chief legal officer, C.J. Mahoney said in a statement Wednesday, “This ruling, and the Attorney General’s approach to this enforcement, makes it all but impossible to do business in the state of New Mexico. At its core, this lawsuit seeks to impose a tax on speech to enforce new rules for what people can say online. We are confident we will prevail on appeal.”

The violations carried penalties of up to $5,000 per violation, resulting in a calculation of more than $219 billion before the judge reduced the penalty to $25 billion. The staggering judgment would be a huge windfall for the state — given New Mexico’s $11 billion annual budget is less than half that.

“For too long, powerful technology companies have operated as though their size and influence put them beyond the reach of the law,” Torrez said in a statement following news of the judgment.

But the state’s arguments during the two-week trial raised questions about whether its aims went beyond consumer protection — and whether Torrez targeted Meta in part because it rolled back aggressive fact-checking measures.

The case highlighted not just concerns about data privacy, but also how Meta policed content and speech.

During the trial, the state’s lawyers slammed Facebook for replacing third-party fact-checkers with Community Notes after Donald Trump won the election, suggesting the change was intended to curry favor with the president.

The state told jurors that when Trump “came into office for the second time in January of last year, January 2025, and he was one of the people who didn’t like having his information removed or flagged, [Meta CEO Mark] Zuckerberg announced they were canceling the third-party fact checkers and firing all of them.”

The state also highlighted Facebook’s caution before taking action against Joe Rogan’s account. Jurors were shown a September 2023 email in which Zuckerberg asked for Rogan to be put on “a list of accounts that we double review before taking action on them”— a step Meta says was intended to prevent mistaken enforcement. But the state tried to use that as an example Meta wasn’t aggressive enough in enforcing fact-checking.

In the trial, Meta pointed to its stated commitment to balancing free expression with safety. “There are really two core principles at play here,” one of the company’s lawyers argued. “There’s giving people a voice, so that people can express their opinions. Then, there’s keeping the community safe, which I think is really important. We’re not gonna let people plan violence or attack each other or do bad things.”

But with the jury drawn from a county that voted roughly 75% Democratic in the most recent presidential election, some free speech advocates note that message may have fallen on deaf ears. 

“New Mexico cannot be allowed to accomplish through the threat of crushing financial penalties what the First Amendment forbids it from doing directly: coercing the suppression of lawful speech,” Jordan Sekulow, president of the American Center for Law and Justice told The Post.

“This decision is a major threat to free speech. It would allow a few lawyers in a few states to regulate speech online in violation of federal law and the First Amendment,” Casey Mattox, a First Amendment lawyer based in Washington, DC, told The Post. “I hope Meta sticks to its guns and appeals this decision to protect not only its own rights, but everyone’s.”

The prospect of such an onerous penalty could scare some companies away from choosing to operate in New Mexico.

“This opinion demonstrates the need for smaller government. We cannot permit a state AG to ruin entrepreneurs because he disagrees with their politics,” Sekulow said. “Thank goodness we live in a country with appellate courts.”