Meta is facing a legal number so large that it can be difficult to put into perspective.

New Mexico is asking a state judge to impose between $35 billion and $40 billion in penalties on the company after a jury found Meta had misled Facebook users about data privacy and certain platform policies.

The requested amount would be extraordinary even for one of the world's most valuable technology companies.

But it is important to understand what has—and has not—happened.

The jury did not order Meta to pay $40 billion.

New Mexico's lawyers requested that amount from Judge Francis Mathew during an October 1 hearing. The judge is expected to decide the final penalty later this month, according to Reuters. Meta has argued that the penalty should be dramatically lower, proposing a cap of about $3.45 billion.

The case therefore enters a new and potentially decisive phase.

The underlying lawsuit was filed by New Mexico after the Cambridge Analytica scandal brought Facebook's data practices under intense scrutiny.

The state argued that Meta made misleading statements about users' control over their data and about the company's handling of third-party applications, misinformation and hate speech.

A Santa Fe jury returned its verdict on September 25.

Jurors found that Meta had violated New Mexico's consumer-protection law more than 43 million times. Specifically, the jury found 26 of 29 statements at issue to be misleading.

Under New Mexico law, penalties can reach as much as $5,000 per violation.

Multiply that by more than 43 million violations and the theoretical maximum becomes enormous—more than $200 billion.

But that theoretical figure is not what the state ultimately requested.

Instead, New Mexico's attorneys asked Judge Mathew for $35 billion to $40 billion.

This is where the case becomes legally interesting.

New Mexico's lawyers argued that imposing the full $5,000 penalty for every violation could create constitutional due-process issues.

So rather than asking the court to apply the maximum amount mechanically, the state proposed a smaller—but still enormous—award.

Reuters reported that attorney Randi McGinn said the $35 billion to $40 billion range represented roughly 20% of the maximum amount theoretically available after the jury verdict.

The state's argument is effectively that the court needs to impose a sufficiently large penalty to have a meaningful deterrent effect while avoiding a penalty that could fail constitutional review.

That makes the eventual judgment more complicated than simply counting violations and multiplying by a statutory maximum.

Meta's legal team has taken the opposite position.

The company has characterized the requested penalty as “astronomical” and argued that the evidence did not establish that users were actually misled or harmed in the way New Mexico claimed.

In court filings, Meta urged Judge Mathew to cap the penalty at approximately $3.45 billion.

Meta has also disputed the state's interpretation of the individual statements presented to the jury, arguing that New Mexico selected statements out of context and that the company had acknowledged limitations in its handling of privacy and misinformation.

Those arguments now become important because the judge must determine the appropriate relationship between the jury's factual findings and the financial penalty.

A jury verdict establishes liability under the court's instructions.

The judge determines how the statutory penalty applies.

The origins of the lawsuit stretch back to the controversy surrounding Cambridge Analytica.

The British political consulting company obtained data associated with as many as 87 million Facebook users through a third-party application without their consent, according to reporting on the case.

That scandal transformed public understanding of social-media data.

Before 2018, many users were only dimly aware of how extensively third-party applications could interact with platform data.

Afterward, questions about privacy controls, app permissions and data governance became central to the regulatory debate surrounding social media.

New Mexico's lawsuit has now become one of the state-level legal efforts attempting to hold Meta accountable for statements made around those practices.

The latest case is broader than simply asking what happened to user data during the Cambridge Analytica episode.

The jury also considered statements concerning Meta's policies around misinformation and hate speech.

Reuters reported that the state argued Meta sometimes failed to enforce its platform rules consistently, while Meta said the state's presentation selectively extracted statements and did not accurately represent the company's overall policies.

That makes the potential penalty particularly interesting.

The financial consequences are tied to consumer-protection law, but the underlying conduct involves the wider governance of a social-media platform.

The judge's eventual decision could therefore be watched well beyond New Mexico.

Even if the judge ultimately awards substantially less than $40 billion, the size of the state's request makes the case unusual.

Meta generated tens of billions of dollars in annual profit and has a market value measured in hundreds of billions of dollars, meaning the company is financially capable of absorbing larger legal expenses than most businesses.

But scale does not make a legal judgment economically irrelevant.

A $35 billion to $40 billion payment would represent a material financial event.

It would also create a major precedent question.

State consumer-protection authorities could look at the case when considering how aggressively to pursue large technology platforms over privacy representations.

Companies, in turn, could become more cautious about how they describe their data practices.

That potential precedent may matter almost as much as the dollar amount.

Technology companies routinely make promises about privacy.

They tell users that data is protected.

They explain how information is shared.

They describe how third-party applications interact with accounts.

Those statements sound like ordinary product messaging.

But the New Mexico case demonstrates that such statements can eventually become evidence in a consumer-protection lawsuit.

For large platforms, that creates a compliance challenge.

Marketing language has to be both understandable and legally defensible.

A statement that seems harmless in isolation can become consequential if a regulator or plaintiff later argues that consumers relied on it.

That is particularly relevant for AI products, where companies are now making equally broad claims about data handling, safety, model training and user controls.

Perhaps the most surprising market reaction has been how little immediate drama there has been around Meta's shares.

Meta closed Thursday at roughly $725.93, while after-hours trading showed only a modest move, according to Yahoo Finance's coverage of the case.

That may reflect the difference between a requested penalty and an actual judgment.

Investors know the court has not yet decided what Meta will pay.

They also know that the final amount could be substantially below New Mexico's request and that additional appeals could follow.

The market is therefore treating the $40 billion figure as a legal exposure scenario rather than a booked expense.

That distinction will remain important until Judge Mathew issues his ruling.

The court must ultimately consider the appropriate penalty for the violations established by the jury while accounting for constitutional limits.

New Mexico is arguing for a figure large enough to materially affect Meta and deter similar conduct.

Meta is arguing that such an award would be disproportionate and constitutionally problematic.

The judge has said he expects to issue a decision later in October, after giving the parties additional time for briefing.

That means the $40 billion headline is only the beginning.

The more important number will eventually be the number the court actually chooses.

The biggest significance of the New Mexico dispute is not simply the size of the potential fine.

It is the legal theory behind it.

A state jury has found that a major technology platform violated consumer-protection law millions of times through statements relating to privacy and content policies.

The judge must now translate those findings into a financial remedy.

The result could influence how companies think about privacy disclosures, how states pursue large technology platforms and how courts approach enormous statutory penalty calculations.

It could also become another chapter in the broader shift toward treating digital platforms as businesses subject to increasingly intensive scrutiny over how they collect, describe and use consumer data.

For Meta, the immediate question is straightforward:

How much will the judge order it to pay?

For the technology industry, the larger question is harder:

How expensive can misleading users about privacy become when regulators and courts decide that each affected interaction counts as a separate violation?

The answer will begin to emerge later this month.