3RD Strike For Meta; No Sec. 230 Protection

WASHINGTON - March 27, 2026 - PRLog -- After having been found liable for $6M in Los Angeles for having a defective and arguably addictive product, and in New Mexico for $375M for enabling child exploitation, Meta now has a third strike; a judge ruled that it is not protected by Section 230 from a lawsuit charging it with creating and promoting fraudulent ads involving a pump-and-dump scheme.

It looks like attorneys have found still a third way to get around Section 230 which many - including the social media giants - thought offered them protection from liability, says public interest law professor John Banzhaf.

The Los Angeles lawsuit was often compared to the litigation against cigarette makers who likewise denied that their product was addictive, and thought that the Surgeon General's warning likewise protected them from liability.

But Banzhaf - who has been called "The Law Professor Who Masterminded Litigation Against the Tobacco Industry" and "a Driving Force Behind the Lawsuits That Have Cost Tobacco Companies Billions of Dollars - points out that plaintiffs in the tobacco cases used clever tactics to overcome the presumed immunity, and it looks like they are doing the same with regard to social media companies.

He has predicted a virtual avalanche of additional lawsuits - far more than ever brought against tobacco companies - will be filed as a result of these bellwether cases:
How a Teen's Instagram Addiction Led to Landmark Verdict Against Meta and Google (https://www.firstpost.com/explainers/teen-instagram-addic...)
(Banzhaf - "There's almost certainly going to be a vast avalanche of our lawsuits. In the tobacco cases, you only had a limited number of potential plaintiffs")

Banzhaf also predicted that, like big tobacco, social media companies with ask Congress for national immunity:
Social Media Giants May Seek 'Immunity' After $6M Payout (https://businessplus.ie/news/social-media-giants-immunity...) ("George Washington University Law School professor John Banzhaf described the ruling as 'social media's Big Tobacco moment", referring to the 1990s scandal when tobacco firms faced a series of trials that held them accountable for knowingly selling harmful products.")

Plaintiff in this third litigation successfully pleaded "that Meta contributed materially to the fraudulent ads through three tools offered in its Ads Manager suite": "Flexible Format," "Dynamic Creative," and "Advantage+ Creative."

"Therefore, if Meta was sufficiently involved in the 'creation or development' of the fraudulent ads, then those ads were not just 'provided by' the scammers—they were also provided by Meta…." the court ruled.

JOHN F. BANZHAF III, B.S.E.E., J.D., Sc.D.
Professor of Public Interest Law
George Washington University Law School
"The Man Behind The Ban on Cigarette Commercials"
FAMRI Dr. William Cahan Distinguished Professor,
Fellow, World Technology Network,
Creator of the "Banzhaf Index"
Founder, Action on Smoking and Health (ASH),
(703) 527-8418
http://banzhaf.net/   jbanzhaf3ATgmail.com   @profbanzhaf