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August 2026 Quarterly Client Update

Dear Superintendent and Board Members,

We are writing to provide an update on your district’s case against Facebook, Instagram, Snapchat, TikTok, and YouTube. This update covers recent case results, the major risks that remain, and what may happen next.

The overall news is very encouraging. Cases brought by school districts, state attorneys general, and individuals have moved beyond early court rulings and now include settlements, jury verdicts, active trials, and appeals.

However, these cases are not over. Further developments in appeals, new laws, future trials, and settlement negotiations will affect the outcome. While the case is currently going very well, it still remains possible that the litigation could change course and result in little to no recovery for districts.

Attorney Client Privileged Communication - This email contains confidential legal advice and litigation strategy intended only for school district clients. Please do not share it with the public or non-client districts or discuss it during an open board meeting. Any board discussion should occur only in a properly convened executive session.

Further information

Trials and Legislative Hearings Move Forward in Texas and Across the Country

One major development is the settlement involving Breathitt County School District, a rural Kentucky district. Breathitt was the first school district test case scheduled for trial and settled shortly before trial for a combined $27 million from Meta, Google/YouTube, Snap, and TikTok.

This is a positive result because it shows that the companies were willing to pay a substantial amount rather than take the first school district case to a jury. But the Breathitt settlement should not be used as a formula for estimating the value of another district’s case. Breathitt’s position as the first test case gave it unique pressure and value, and districts should not expect the same amount per student or the same overall result.

There have also been important developments in cases brought by state attorneys general. In New Mexico’s case against Meta, a jury first imposed a $375 million statutory penalty for violations of the state's consumer protection laws. On August 7, the court required Meta to pay another $567 million into a fund designated to fix social-media-related harm to New Mexico youth, bringing Meta’s total exposure in that case to nearly $1 billion.

The New Mexico court also ordered changes to Facebook and Instagram, including stronger protections for teenagers, limits on overnight and school day notifications, additional privacy protections for minors, and improved reporting resources for law enforcement.

Other state cases are moving forward:

• Tennessee’s Attorney General is trying a case against Meta in Nashville involving claims that Instagram harmed young users and that Meta concealed known dangers from parents and the public.

• California, Colorado, Kentucky, and New Jersey are participating in a combined test trial against Meta in Oakland that began in mid-August and is expected to last approximately seven weeks.

• Texas Attorney General Ken Paxton’s case against TikTok is scheduled for trial in Austin in October 2026.

  
  

The Texas House of Representatives Committee on Public Health had an excellent hearing last week receiving invited testimony from experts that laid the groundwork for state laws to address the social media problem. The discussion in the link above is a great primer for anyone interested in more deeply understanding the issues. We attended the hearing and conferenced with two of the three panel members afterward and will be collaborating with them in the future.

The next school district cases are set for February 2027 in Oakland.

All these proceedings will increase pressure on the social media companies, as long as state attorneys general and school districts and individual plaintiffs and their families continue to win at the trial court level and in the court of public opinion.

Remaining Case Risk Factors

Despite this progress, two major risks remain. First, an appeals court or the United States Supreme Court could rule that Section 230 blocks some or all of the districts’ claims. Section 230 is a federal law that social media companies use to argue that they are not responsible for content posted by users. The companies contend that user content is too closely connected to challenged platform features such as algorithms, endless scrolling, and repeated notifications. Reminder, our cases focus on the addictive design to children, regardless of content.

Meta and TikTok recently attempted to bring an immediate Section 230 appeal that could have delayed or stopped parts of the litigation before trial. On August 10, the Ninth Circuit rejected that effort, but ruled the companies may raise the issue again in later appeals. The ruling is helpful, but Section 230 remains a significant risk.

Second, Congress could pass a federal law that limits or overrides the state-law claims brought by school districts. This is sometimes called “federal preemption.” The House has passed its version of the Kids Online Safety Act and the Senate has passed its version out of committee and both versions currently do not contain language that would threaten the districts’ cases. That could change, however, because harmful language may still be added to this or other legislation before the end of the year. We may contact districts in the coming months about targeted communications intended to help protect their cases.

Next Steps

From here, the litigation could follow one of two general paths. The first is a possible nationwide settlement. Recent verdicts, court rulings, and upcoming trials have increased pressure on the companies to discuss a broader resolution. A settlement could include financial support for school districts and changes to how social media platforms operate, but no settlement is guaranteed. Even if an agreement is reached, it could take a year or more to put into effect.

The second path is continued litigation. If there is no broader settlement, additional school district test cases may proceed, appeals will continue, and individual district cases may eventually return to their original courts for trial in local federal courts here in Texas. An unfavorable appeal could end or significantly limit the districts’ cases.

The bottom line is that the Breathitt settlement, the New Mexico Attorney General result, other impending verdicts, and the recent Ninth Circuit ruling show meaningful progress. At the same time, the outcome and value of the litigation remain uncertain, and the process may take several more years.

We will continue preparing your district’s case, monitoring settlement opportunities, and working toward fair compensation and platform changes that help protect students. Please contact us with any questions.

Sincerely,