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Can Tech Lawsuit Settlement Dollars Back Youth Mental Health?

Connie Matthiessen | June 5, 2025

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Credit: Khosro/Shutterstock

Many experts point to a cause-and-effect link between social media and the youth mental health crisis — unsurprising, given how much time we all spend these days, young and old, staring at screens. While a number of funders have attempted to tackle the problem, its scale and sheer pervasiveness in modern life is daunting. But there is some good news for youth mental health advocates: An initiative by the Children’s Funding Project seeks to ensure that the tech companies that have both fueled and profited from our collective screen obsessions will help pay for an antidote. 

The antidote? Positive youth development programs — including afterschool and summer programs — which are chronically underfunded and often unavailable, despite their benefits. In partnership with the Afterschool Alliance, the Children’s Funding Project is leading a national coalition of advocates that is pushing to see potential tech lawsuit settlement dollars used to create and increase access to positive experiences for young people. 

The amount of money that could come from these settlements is significant. To date, 47 states and the District of Columbia, as well as hundreds of school districts, local governments and individual plaintiffs, have filed lawsuits against tech giants, including Meta (Instagram and Facebook), Alphabet (YouTube and Google), Snap (Snapchat) and ByteDance (TikTok). The plaintiffs allege the companies designed their social media platforms to maximize screentime, resulting in emotional and physical harms to young people — from anxiety to attempted suicide and even death, in some cases. 

The Children’s Funding Project, started in 2018, aims to help communities identify and develop funding sources for children and youth programs. Since its founding, the organization has helped communities and states secure $1 billion in new public funding for children and youth. Its affiliate 501c4, the Children’s Funding Accelerator, supports campaigns promoting public funding for early childhood. 

The Children’s Funding Project has so far been backed by a number of prominent philanthropic funders, including the Ballmer Group, the Bezos Family Foundation, the Eli and Edythe Broad Foundation, the Heising-Simons Foundation, the Hellman Foundation, the W.K. Kellogg Foundation, Yield Giving, the Wallace Foundation, the Ralph C. Wilson, Jr. Foundation and others (see a complete list). 

This new effort to steer tech settlement dollars to youth development programs is just getting off the ground, but coalition leaders want to be ready when the social media lawsuits get underway, likely next year. 

“We are starting to reach out to some key attorneys general; they’re the ones who are filing the suits,” said Elizabeth Gaines, the co-founder and CEO of the Children’s Funding Project. “We want to let them know that we have an antidote. Afterschool programs and enrichment programs — getting young people outside and getting them engaging with peers and caring adults — all of the things that we do in youth development are the antidote.”

Why out-of-school programs are important for mental health

Increasing access to quality youth development programs may seem like a simple antidote to the complex problem of tech’s adverse effects on youth mental health. Yet it makes sense: When young people have access to quality afterschool and summer activities, they are less likely to spend time glued to a screen. The converse was evident during the pandemic: Research found that when schools, day care centers and other kids’ programs shut down, kids’ screentime shot up. 

We also know that out-of-school programs provide tremendous benefits. This was underscored in a recent report by the National Academies of Sciences Engineering and Medicine. According to the report, these programs “offer opportunities to develop social and emotional skills and capabilities, foster positive relationships with mentors and peers, and build interests in academic domains that can contribute to school success.” The Afterschool Alliance has put together a comprehensive look at the evidence base for the many benefits of afterschool and summer programs, including boosting students’ grades and school attendance, reducing risky behaviors, and improving overall health and wellbeing.

Despite the evidence, out-of-school programs have been consistently underfunded, and disadvantaged children often don’t have the opportunity to participate. In 2020, according to the National Academies report, “an estimated 24.6 million children wanted to participate in [out-of-school] programs but could not due to various barriers. Among low-income families, 11 million children were unable to enroll in programs, suggesting that barriers to participation in [out-of-school time] are not evenly distributed.” 

In fact, according to the Afterschool Alliance, “families in the highest income bracket spend more than five times as much on out-of-school-time activities annually than families in the lowest income bracket.”

Greater funding — including from tech settlement dollars — could provide many more kids with the opportunity to participate. As Gaines wrote in a recent blog post, “There are dynamic, creative, evidence-based youth development programs working on shoestring budgets that require resources to make their programs available to all kids and to treat those programs as a public good.”

Tech lawsuit settlement dollars: A powerful potential funding source

Using funds from tech lawsuits to support kids echoes earlier efforts to marshal tobacco and opioid settlement funds toward communities that have been harmed (see IP’s coverage of philanthropy’s role in the distribution of opioid settlement dollars). The idea first began to percolate for Elizabeth Gaines about eight years ago, when she noticed her three teen sons’ preoccupation with social media and their digital devices — and her own, as well. Since then, a growing number of tech employees have come forward to reveal some of the manipulative practices social media companies deploy to attract and hold on to their audiences. 

“All that stuff started coming out, the whistleblowers talking about how the companies were intentionally hiring behavioral scientists and making the platforms as addictive as possible, and targeting our young people,” Gaines said. “I thought, it seems like a reckoning is coming, and we should be doing something about it. But back then, I’d bring it up at a cocktail party and people would look at me like I had eight heads.”

Gaines already had experience holding big corporations accountable. Earlier in her career, as an advocate in her home state of Missouri, she worked to get tobacco settlement dollars directed to child and youth development programs in that state. The effort was successful initially, but then the governor diverted the funds to fill a budget hole. Still, that seemed like a pitfall that could be avoided with careful planning, and a year and a half ago, Gaines got started. 

Related Inside Philanthropy Resources:

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“I thought, ‘Why don’t we get ahead of it?’” Gaines said. “Let’s get organized so that, should there be a settlement of major proportions, we’ve already built the coalition of people to communicate to attorneys general, communicate to state legislatures, communicate with the experts that are going to be testifying in these cases, to let them know that we have an antidote for social media misuse.”

The Children’s Funding Project and the Afterschool Alliance are in the process of creating a website; they have also developed a strategy group, including representatives of National Summer Learning Association, the National Urban League, Camp Fire, Boys & Girls Clubs of America and other organizations that foster youth development.

Philanthropic funding is an important piece of the puzzle, of course. Funders supporting the effort to direct any potential funds from the social media lawsuits toward positive youth development programs include the Eli and Edythe Broad Foundation, the Hellman Foundation, the Wallace Foundation and the Ralph C. Wilson, Jr. Foundation.

“Although the timeline and outcome of the litigation is long and uncertain, these funders see the immediate benefit of convening our field around this new, concrete, hopeful funding opportunity, as well as the potential to hold social media companies accountable for the harms they’ve caused,” Gaines said. “Social media companies have profited off our young people for too long, and now it’s time for our young people to benefit from an investment in their future.”

More philanthropies are leaning into youth mental health

The Children’s Funding Project’s campaign is an innovative approach to the youth mental health crisis — an issue that has gained increasing attention from philanthropy in recent years. More funders are taking on mental health, with support from Mindful Philanthropy, which has challenged the sector to invest $35 billion in annual mental health funding by the year 2035 “through greater collaboration and bigger and bolder bets.” 

Several funders have zeroed in specifically on young people. The Morgan Stanley Foundation, for example, focuses on very young children, while a newer organization, The Goodness Web, prioritizes youth mental health. Melinda French Gates’ Pivotal Ventures and the Susan Crown Exchange were both early funders of Harvard’s Center for Digital Thriving, as well as Young Futures, which works to help teens safely navigate the digital age. The Arthur M. Blank Family Foundation has also made the impact of technology on youth mental health a part of its funding portfolio. 

Some major funders also recognize the value of out-of-school learning; the Wallace Foundation, for example, has been a leader in this area, and Bloomberg Philanthropies and the Ballmer Group are both backing regional summer programs to combat learning loss. 

But support for mental health, as well as robust youth development programs, is still fairly miniscule next to philanthropic funding overall, despite the need. And that need will only increase under Trump: Just last month, the administration slashed $1 billion in funding for school mental health services. And, as the Afterschool Alliance has reported, Trump’s proposed budget eliminates funding for 21st Century Community Learning Centers, which the Afterschool Alliance describes as “the only federal funding stream dedicated to afterschool and summer programs.” 

For Gaines, it makes sense that the companies that have profited so handsomely from social media should support efforts to improve the wellbeing of children and youth. 

“There’s a lot of drama around whether social media is addictive and whether it’s causing the youth mental health crisis and all of this, but we’re not even getting into that. We’re just trying to say, should these cases bear fruit in terms of a settlement, it needs to go back into youth development. And when I say youth development, I don’t care if they’re learning to play the trumpet, they’re making crepes, they’re building a trail — whatever it is. We want to have plentiful opportunities for young people to engage in ways that we have completely underinvested in for years.”


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Filed Under: IP Articles Tagged With: Alliance for Aging, Arthur M. Blank Family Foundation, Ballmer Group, Child Welfare, Children & Youth, Eli and Edythe Broad Foundation, Front Page Most Recent, FrontPageMore, Health, Heising-Simons Foundation, Mental Health, Pivotal, Simons Foundation, The Wallace Foundation, W.K. Kellogg Foundation, Yield Giving

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