Snap reaches settlement with 2 teenagers in trial over social media and mental health
Snapchat's parent company signed the agreement during the trial in Los Angeles, the second of its kind in the city's state court.
BY THE X-TRADER NEWS NEWSROOM · REPORTING FROM INFOMONEY · 3 MIN
Snap, Snapchat's parent company, reached a settlement with two teenagers in the middle of a trial in Los Angeles. According to InfoMoney, based on Reuters, the agreement was reached on November 2, after the jury had been selected the previous week.
The action was filed by the two young people, who attribute to the platform a design capable of causing addiction, as well as depression, anxiety and eating disorders. The thesis is based on the product itself. Investing.com summarizes the claim in a similar way, saying that social media has caused depression and eating disorders.
The case is part of a series of similar processes. In this type of action, Snap, Meta, TikTok and YouTube, the latter linked to Alphabet, appear as defendants. The same authors had already closed agreements with Meta, TikTok and YouTube. With Snap, the four aforementioned defendants now have an understanding with these authors.
What is at stake goes beyond two individual processes. This is the second trial of its kind in the Los Angeles state court, where the actions of young people who allege addiction to social networks are being discussed. Each decision made in this process tends to weigh on subsequent cases.
The terms of the agreement are not included in the information obtained. A Snap spokesperson did not respond to Reuters' request for comment.
From a liberal perspective, the discussion has another layer: to what extent should Justice hold technology companies responsible for the way they design their products, and whether this path does not end up increasing costs that fall on innovation and competition. A single agreement doesn't answer that question, but precedent matters.
What changes for the investor
In the short term, the agreement ends uncertainty about this specific Snap lawsuit. The risk that remains is that of new actions with the same thesis and court decisions that require changes to the design of applications. This could affect screen time, advertising revenue and legal costs for listed companies such as Snap, Meta and Alphabet. As settlement values have not been disclosed, there is no basis for estimating a financial impact. Those who follow these actions tend to observe upcoming judgments and quarterly balance sheets, which show whether disputes already appear in the accounts.
Automatically translated from Portuguese.
