Meta Platforms is heading into one of the most consequential legal battles in its history as a coalition of U.S. states prepares to challenge the company over allegations that Facebook and Instagram were deliberately designed to encourage addictive use among children.

Opening arguments are scheduled for Tuesday, August 18, in federal court in Oakland, California, in a case brought by attorneys general from 29 states. The litigation represents one of the largest legal challenges yet to the business practices of a major social-media company.

The case could have consequences far beyond Meta.

A ruling against the company could encourage additional lawsuits, force changes to platform design and increase regulatory pressure on the wider technology industry.

Prosecutors allege that Meta designed Facebook and Instagram with features intended to maximize engagement among young users, while misleading consumers and authorities about the potential risks.

The states are challenging features and practices associated with prolonged engagement, including mechanisms that can encourage users to continue scrolling and interacting with the platforms.

They also allege that Meta collected and used children's data in ways that violated federal privacy protections.

Meta strongly disputes the allegations.

The company has argued that the states' claims are unsubstantiated and has rejected the characterization of its platforms as intentionally designed to harm children.

The company has also argued that “social media addiction” is not formally recognized as a psychiatric diagnosis, a position that it says undermines the legal theory being used against it.

The potential financial exposure is one of the most striking elements of the case.

Meta has said the four states leading the consumer-protection portion of the lawsuit could seek penalties totaling approximately $1.4 trillion.

That figure is close to the company's entire market value and would represent an extraordinary financial penalty if such an amount were ever imposed.

The states' calculations reportedly involve multiplying alleged violations by maximum penalties permitted under applicable state laws.

Meta has argued that the proposed amount has no reasonable basis and would be unprecedented.

The actual outcome could be dramatically smaller, and the litigation is expected to involve extensive legal arguments over liability, damages and the appropriate remedies.

The proceedings are also unusual because the jury will be advisory rather than binding.

Judge Yvonne Gonzalez Rogers has empaneled an advisory jury consisting of eight people. Its conclusions will not determine the final legal outcome; the judge will ultimately decide the case.

That structure reflects the extraordinary public importance of the dispute.

The jury can provide an assessment of the evidence and public standards surrounding the allegations, while the judge retains authority over the final decision.

The trial is expected to last roughly six weeks.

The Oakland case is not occurring in isolation.

Meta is already facing thousands of lawsuits involving allegations that its platforms can cause harm to young users.

The company and other technology firms have attempted to limit such cases, including through arguments involving federal protections for online platforms.

But recent court decisions have allowed many of the lawsuits to continue.

A federal appeals court recently rejected efforts by Meta and TikTok to halt thousands of social-media addiction lawsuits, adding to the legal pressure facing the industry.

Recent courtroom results have made the new trial even more significant.

Earlier this year, a California jury found Meta and Google's YouTube liable in a landmark case involving claims of social-media addiction and harm to a young user.

Meta has appealed that verdict.

New Mexico has also obtained a major judgment against Meta, with the state previously securing hundreds of millions of dollars in penalties and damages following litigation concerning the company's treatment of young users.

Those outcomes provide plaintiffs in the Oakland case with examples that they can point to when arguing that Meta's conduct deserves significant scrutiny.

The biggest risk for Meta may not be the immediate financial penalty.

A court ruling that establishes liability for particular platform-design practices could force changes in how social-media companies develop products for minors.

States are seeking remedies that could include restrictions on features such as infinite scrolling, changes to algorithms using children's data and stronger safeguards for younger users.

Such measures could affect engagement, advertising and product development.

That could make the case important not only for Meta but also for TikTok, YouTube, Snap and other platforms facing similar allegations.

For shareholders, the trial introduces a new source of uncertainty at a company that is simultaneously spending heavily on artificial intelligence.

Meta's advertising business remains the foundation of its financial model, while AI investment has become increasingly central to its future strategy.

A major legal setback could therefore create additional costs at a time when the company is already committing enormous resources to technology and infrastructure.

However, investors should also recognize that the $1.4 trillion figure represents a claimed potential penalty, not a prediction that Meta will actually pay that amount.

The legal process could produce a much smaller financial outcome, a different remedy or a ruling in Meta's favor.

The Oakland trial nevertheless represents a pivotal moment.

For years, social-media companies have argued that users, parents and society share responsibility for how platforms are used.

Regulators and prosecutors are increasingly challenging that idea, arguing that technology companies should be held accountable for product decisions that may encourage harmful behavior among children.

The outcome could help define where that legal boundary lies.

If Meta wins, the company could gain important protection against a growing wave of youth-safety litigation.

If the states prevail, the decision could encourage governments across the country to pursue similar claims and could force social-media companies to redesign some of their most engagement-driven features.

Either way, the trial has the potential to reshape the relationship between technology companies, regulators and young users.

As opening arguments begin Tuesday, Meta is therefore facing much more than another lawsuit.

It is facing a legal test that could influence how the entire social-media industry designs, monetizes and regulates its platforms for the next generation.