In another major blow to Meta, a New Mexico judge ordered the social media giant pay $567 million and take actions to make its platform safer for young people.

The latest penalty is in addition to the $375 million that a New Mexico jury ordered Meta to pay after finding that the company violated state consumer protection laws for enabling the mental health harms and sexual exploitation of adolescents.

The case stems from a lawsuit that New Mexico Atty. Gen. Raúl Torrez filed against Meta in 2023. The lawsuit accused the California social media company of failing to remove child sexual abuse material and prioritizing engagement and ad revenue over safety.

The ruling adds to the growing scrutiny Meta and other platforms are facing over how social media affects the mental health and safety of young people. In March, a Los Angeles jury found that Meta-owned Instagram and Google-owned YouTube were negligent for designing addictive features that harmed the mental health of a California woman. Another youth safety case involving Meta is also headed to trial this month in California.

In the New Mexico case, the First Judicial Court in Santa Fe determined that Meta’s conduct created a “public nuisance” and ordered the company to create a fund to remedy harms.

“Meta’s platforms create a public nuisance because their purpose and effect is to optimize engagement, including in ways that are detrimental to teenagers’ health and safety,” Judge Bryan Biedscheid wrote in the more than 60-page ruling on Thursday.

The court compared Meta to a factory and child sexual exploitation and harm to pollution.

“Just as noxious pollution produced by the factory can harm the common public right to reasonably clean air, the harmful effects of Meta’s platforms on children do not stay contained by its platforms and, instead, migrate to the internet as a whole and, perhaps most concerning, to the real world,” Biedscheid wrote.

The judge outlined steps that Meta must take to mitigate harms including preventing New Mexico minors from engaging in romantic or sexualized interactions with its AI chatbots, eliminating push notifications during certain hours and building a banner screen with resources that’s displayed at least once a week for minors.

The court, though, did acknowledge that social media also has benefits and didn’t go as far as ordering Meta to change its algorithm and recommendations because it affects content on the platform. Measures that would impact Meta’s algorithm would likely violate the 1st Amendment and Section 230, which protects platforms for being legally liable for content posted by its users.

Meta, the parent company of Instagram and Facebook, said it disagreed with the ruling and would appeal.

“We work hard to keep people safe on our platforms and have been transparent about the challenges of identifying and removing bad actors and harmful content,” a Meta spokesperson said. “We remain confident in our record of protecting teens online and will continue to defend ourselves against claims that misrepresent the facts.”

Torrez, the New Mexico attorney general, said in a statement Meta knew for years that its platforms were harming kids and now it’s paying for choosing “engagement and profit over their safety.”

“This is not just a judgment against one company. It is a blueprint,” Torrez said. “For the first time, a court has ruled that a social media giant can be held liable for building products that endanger children and has ordered the structural changes needed to fix it. New Mexico led the way in the courtroom. Now other states, and other countries confronting the same crisis, have a roadmap they can follow.”

Independent filmmaker Sylvia Ray always wanted to shoot her first feature film, “The Middle,” in California — as it’s set in Barstow, where she grew up.

Instead, she shot it in Mexico.

The math made the decision for her. Grants and incentives from the municipality of Torreón and the state of Coahuila covered 30%-40% of her production budget, which came in under a million dollars, Ray said, adding that she didn’t have to pay for film permits, on-site security or local hotel accommodations. Over 21 days in March and April, the production hired 75 local crew members and college students.

“All I needed was a desert landscape and American homes. I could have definitely shot it in L.A. comfortably. Had I gotten more support and made it make sense for us financially,” Ray said. “But it just didn’t.”

Her budget was too small to qualify for any California film incentive at the time, as the state’s program doesn’t reach projects costing under $1 million. Low-budget filmmakers and producers say that gap is a major problem. California’s incentives, even after the recent expansion, are built for productions several rungs above them.

Los Angeles County has plans to change that. Supervisors Lindsey Horvath and Kathryn Barger are developing an Entertainment Evergreen Fund, first introduced last July, which would channel money to productions the state’s tax credit doesn’t reach. The fund would distribute grants rather than tax credits.

No dollar amount has been attached and the county has not committed funding. The board intends to explore a public-private model, with funding sources, amounts and any cost sharing determined only after an outside consultant completes an analysis and presents recommendations to the board of supervisors.

“Like every County initiative, this work must be balanced with our current fiscal realities,” Barger said in a statement, adding that she hopes to build “a sustainable … partnership” that helps keep L.A. as “the global leader in entertainment production.”

“State tax credits have been the most instrumental tool to keep production local, and we want to amplify their success to make clear to the industry: LA County wants you here,” Horvath added.

Why L.A. got expensive for small films

Many small-budget filmmakers struggle with location and permitting costs in L.A., said Philip Sokoloski, vice president of communications at FilmLA, the nonprofit that coordinates permits and tracks local production.

“Many property owners inclined to rent out their homes or places of business for filming are used to an era where there was a lot of money to go around … It’s not true anymore,” Sokoloski said. “Until that message is widely understood, there’s a certain priced-out-of-the-market feeling that many indies are experiencing.”

A fund, he said, could help offset those costs.

The film grant proposal comes amid a bleak period for local film and TV production, which has struggled to rebound after the pandemic.

Director Vanna James on set for the film “The Seed” in a residential neighborhood in North Hollywood on Tuesday

Despite improvements attributed to an expansion of the state’s film tax credit program, feature film shoot days in the L.A. region dropped 20% in the second quarter compared to last year, while shoot days for TV productions plummeted 30%, according to a recent report from FilmLA.

Making an indie movie is harder than it has ever been, said Steven Wolfe, a producer whose credits include “(500) Days of Summer” and more than 45 other films. Companies are less willing to finance independent projects, buyers are spending less and the exhibition market is harder to navigate. Yet “there’s an audience that’s very hungry for them,” he said.

Wolfe is developing what he calls a passion project with a first-time feature director, set to shoot in Los Angeles. Whether it gets made, he said, depends on whether the fund materializes.

“All of us recognize the need to take extreme action and soon on trying to rebuild Los Angeles as the film capital of the world,” he said.

What’s being proposed

The fund is being shaped with input from the Indie Film Task Force, a group of industry voices led by the nonprofit NewFilmmakers Los Angeles. The task force pushed for grants rather than a tax credit, arguing that small budgets don’t generate enough tax liability for a credit to be worth much.

“We see this as a foundational level investment. It is a trickle-up incentive that’s going to feed into the studios,” said NFMLA Executive Director Larry Laboe. “This is a way to invest very little money in a lot of different productions and hope for some big wins from those productions that can trickle up.”

Laboe cites Curry Barker’s box office underdog “Obsession” as the latest example of a major low-budget indie success. The horror flick, which hit theaters in May, was made in Los Angeles for a budget of $750,000 and has since grossed nearly $475 million worldwide.

Laboe, one of the proposal’s leading advocates, has projected the fund’s ceiling could reach $100 million, depending on fundraising. NFMLA isn’t positioned to administer it, though he’s open to a role.

Actor Celestino Camille works on a scene for the film “The Seed” in a residential neighborhood in North Hollywood on Tuesday.

Barger said her conversations with filmmakers, labor representatives and production companies have surfaced “several promising ways an Evergreen Fund could strengthen our local industry,” including “grant incentives that encourage productions of all sizes — including independent filmmakers — to choose Los Angeles County.”

The case against film grants

Film and TV production incentives rarely deliver the economic benefit that justifies them and only occasionally change where a project shoots, said Patrick Button, an associate professor of economics at Tulane University who studies the programs. He sees a particular problem with targeting small productions: Indie filmmakers, already working on thin budgets, are the least likely to relocate in pursuit of a subsidy. Chasing incentives across jurisdictions is largely the province of major studios.

“Despite the goal with these incentives being to attract filmmaking and lead to economic stimulus, that’s not materialized in the data,” Button said. “In general, these incentives don’t have a good return on investment for the states and their counties.”

He also noted “a lot of stress on the L.A. County budget right now, and a lot of other things that the money could be spent on,” and expects the fund’s effect to be “very small.”

Laboe countered that covering even 10% of an indie production budget would help keep work local, adding that filmmakers may be able to layer a county grant with the state credit where it applies.

Who it would reach?

Independent productions are a meaningful share of SAG-AFTRA members’ income, particularly as major studios chase incentives abroad. More small films shot locally would mean more roles, said SAG-AFTRA L.A. Local President Joely Fisher.

“People are rolling up their sleeves, raising money and going to make a movie for under a million bucks,” Fisher said. “But also they’re able to take more chances. People are being discovered in these indie movies, and I think that that’s a great thing for our newer members, who can cut their teeth on something indie.”

Making the film is only half of it. The fund also should address marketing costs, or the films won’t get seen, said Jackie Brenneman, president of the Independent Film & Television Alliance. Those budgets traditionally come from distributors, but more independent films now go directly to theaters without one.

“You have to be able to exploit the thing you make,” Brenneman said. “If we want to be able to access theaters, the theater’s first question is going to be, what’s your marketing plan? What’s your marketing budget?” .

Ray is still editing “The Middle.” Whatever happens with the fund, it won’t reach her first feature. But she’s already thinking about her next one.

“After this film is done, I’ll have my next one to worry about,” she said. “As a filmmaker here, there are so many hurdles, and it would just be nicer to have a clear pipeline, a scaling budget for all of these things and [provide] access to people who want to support emerging talent and artists, not just the studio system.”

Back in February, hours after the Supreme Court overturned most of President Trump’s tariffs, Treasury Secretary Scott Bessent joshed about whether consumers would get a piece of the refunds when the government refunded the illegal duties.

Responding to a question about that at an economics conference, Bessent stated — with “a condescending smirk,” I reported at the time — “I get a feeling the American people won’t see it.”

Now that the refunds have begun, with hundreds of millions of dollars — in some cases more than a billion — going out to major retailers and manufacturers, we can test Bessent’s conclusion against reality. As it turns out, and to no one’s real surprise, he had a point.

Big companies have been exceedingly cagey about how they’re going to spend the refunded money. But sending checks to customers who paid higher prices because of the tariffs doesn’t seem to be in the offing. Some companies have implied that they might reduce prices, but they haven’t been very specific.

The closest any has come to clarity may be Walmart, whose top executives told investors in May that they had instituted price “rollbacks” on 7,200 items, 20% more than last year. Although they said they would devote the refund to “price investment,” which sounds like lowering prices. They said the wholesale prices on some incoming merchandise were lower than they were during the tariff period and therefore customers would pay less.

But they implied that the rollbacks reflected Walmart’s general practice of squeezing prices lower wherever they can. Anyway, Walmart announces price rollbacks on various items all the time.

Before examining what other companies are planning, here’s some background.

The duties at issue were the so-called “liberation day” tariffs Trump imposed across the globe in April last year. For months, Trump dangled the prospect of tariff refunds — actually, tariff “dividend” checks of $2,000 — in front of taxpayers. In effect, that would mean returning to taxpayers the money that his tariffs have cost them, since it’s black-letter economics that tariffs are a burden on domestic consumers, equivalent to a tax.

In his 6-3 ruling invalidating levies imposed on imports under the International Emergency Economic Powers Act of 1977, or IEEPA, Chief Justice John G. Roberts Jr. made clear that those tariffs were unconstitutional and illegal from their inception. He left no doubt that those who paid the tariffs are entitled to refunds, though he didn’t weigh in on how that should be done.

Numerous companies, including Costco, filed lawsuits or claims with the government demanding repayment. Several have announced or hinted at how much they’re getting. Apple, for example, indicated on its most recent quarterly earnings conference call that in the second quarter that ended June 31 it received more than $1.6 billion, or about half of the $3.3 billion it had previously marked as its tariff cost.

But Apple didn’t say that it would refund any portion of that sum directly to consumers, perhaps because it had never said the tariffs had prompted it to raise prices in the first place. Chief Executive Tim Cook said only that Apple plans to reinvest the refund “into the U.S.”

It’s worth noting that Apple recently raised prices on many products, but the company ascribed those increases to higher costs for memory chips, driven up by intense demand from AI firms. A company spokesman referred me to Cook’s comments on the conference call.

Amazon, which disclosed refunds of $600 million in the second quarter, says it might pass on refunds to specific customers in “a limited set of circumstances where we can trace that we passed specific import charges on to customers,” Chief Financial Officer Brian Olsavsky told investment analysts on July 30. “When we receive those refunds, we will proactively contact affected customers and automatically issue refunds to them.”

Olsavsky meant what he said when he used the term “limited.” On the July 30 earnings conference call, he said it wasn’t Amazon that paid the tariffs on most goods sold on its website.

“We are not the importer of record for the large majority of items…. given suppliers typically handle imports and pay relevant tariffs.” In other words, if you want a refund, talk to them.

As for merchandise that Amazon sold itself, Olsavsky said the company “did a lot of work forward buying and pre-positioning inventory to avoid tariff costs.” (He was trying to explain why Amazon’s tariff refund seemed so measly.) When I asked Amazon for more details on its tariff plans, its spokesperson simply referred me to Olsavsky’s remarks.

Other companies have said they’ll use tariff refunds to cover other inflationary effects, such as those due to the Iran war. They include PepsiCo and the spice merchant McCormick & Co., which both cited nontariff price increases as a target of the refunds.

Some retailers may have chosen to “eat” the tariffs without directly passing them on to customers, but it would not be surprising to learn that the charges got covered through some other corporate dollar-shifting to preserve profits — you may not have detected it at the kitchen table, but you can be sure it was there, somehow.

The invalidated tariffs cost American households $1,000 each last year and $900 each this year, the nonprofit Tax Foundation reckoned. But the components of that cost are varied and murky, making it hard to determine the best way to return the costs to consumers.

Some of the tariff effect has shown up in higher retail prices for foreign goods or domestic goods made wholly or partially from tariffed imported parts. Higher prices have a more generalized effect on economic growth, which can’t be attributed to specific products.

Trump’s disorganized tariff policies, including his on-again, off-again threats to use them to punish trade partners for actions that have nothing to do with trade, have prompted some companies to defer decisions on plant construction or other capital-intensive efforts. That has created economic headwinds, resulting in fewer jobs.

The Trump administration still seems to resent having to refund tariffs. Appearing on a webcast Tuesday hosted by right-wing figure Steve Bannon, Bessent tried to blame Democrats for pressure to refund the tariffs, even though the order came down from the Supreme Court.

“When the Democrats scream, ‘Oh, the refunds should go back to the American people,’ well, the American people had it,” Bessent said, scowling. “It was in the Treasury and it was paying down the debt.”

Is that so? The $168 billion Bessent cited as the government’s tariff take was a tax on consumers, as pretty much every qualified economist knows. It was charged to domestic importers, not to foreign exporters, and one way or another it was likely to show up at the kitchen table, often by higher prices or reduced availability of manufactured goods but sometimes in less obvious ways. I asked the Treasury Department to clarify, but it declined to comment.

According to Bessent, the tariff income was being used to “pay down the [federal] debt.” If he was implying that the money was specifically pigeonholed for an accelerated retirement of government securities, that’s untrue. The money was swept into the general fund, where it amounted to a relative pittance — one-fourteenth of the amount collected from personal income taxes in fiscal 2025.

Like any other government receipts, the tariff income was used to cover everything the government pays for, including healthcare and national security. Even if the tariff money were specifically directed at debt service, it wouldn’t have done much to defray the roughly $1 trillion in interest the government will incur this year.

By the way, what drives the national debt? To a significant extent, it’s the tax cuts that Trump signed into law in 2017, most of which went to corporations and rich Americans. To follow Bessent’s reasoning, then, ordinary American consumers got charged billions of dollars to pay for a tax cut that put pennies in their pockets.

None of this should obscure that the confusion over tariff refunds stems from federal judges’ willingness to allow Trump to collect the duties even while their legality was a live issue. Nor should anyone think that the issue has gone away: Trump has responded to the Supreme Court’s decision by conjuring up new legal rationales for new tariffs.

One unchanging feature of this battle is Trump’s determination to use tariffs to satisfy his personal pique at one trade partner or another, on grounds that have nothing at all to do with what U.S. industries, if any, need protection from foreign competition and which countries have an unduly large trade surplus with the U.S.

Refunds or not, Trump’s tariff policies will be a continuing weight on the economy, and for most Americans, that weight won’t be lifted anytime soon.