The San Francisco-based 9th US Circuit Court of Appeals rejected an appeal by Meta and TikTok seeking to overturn a lower court ruling requiring them to face more than 3000 lawsuits filed in federal court, saying the companies had appealed too early.
The companies had argued that Section 230 of the Communications Decency Act of 1996 - which generally shields online companies from claims over content posted by their users - also bars lawsuits claiming they failed to warn the public about the addictive nature of their platforms.
Most appeals come after a case has concluded with a ruling or a verdict. The companies contended they should not have to wait until the litigation ends to challenge the lower court's rejection of their immunity defence. But the 9th Circuit said Section 230 provides a defence to liability, not immunity from lawsuits, so the appeal was premature.
The court also denied Meta's bid to postpone a trial beginning on Wednesday in a lawsuit brought by 29 state attorneys general alleging the tech giant illegally collected and used children's data, designed its social media platforms to keep young users hooked, and misled consumers about their safety.
The company had argued the trial couldn't go forward while the appeal had been outstanding.
The news comes days after a New Mexico judge found Meta had created a public nuisance in the state and ordered it to pay $US567 million into a teen mental health fund and implement youth-safety measures.
A spokesperson for Meta declined to comment.
Representatives for TikTok did not immediately respond to requests for comment.
In a statement, Lexi Hazam and Previn Warren, the lawyers representing the plaintiffs, said the ruling was Meta's last "procedural off-ramp" before the trial starting this week.
"A trial is how the public finds out what Meta knew about its products' impact on children, when it knew it, and what it chose to do with that knowledge," the lawyers said. "Meta has fought to keep that evidence from the public."
Filed by US states, municipalities, school districts and individuals, the lawsuits allege that social media companies intentionally addicted young users, contributing to surging depression, anxiety and body-image issues and a broader mental health crisis among American youth in recent years.
Parents, school districts, states and other plaintiffs had argued that the trial court's ruling was not final and therefore could not be appealed. But they also objected to the companies' arguments about Section 230, saying it does not cover claims related to how they operate and design their products.
The cases, which have been centralised before US District Judge Yvonne Gonzalez Rogers in Oakland, California, seek damages, penalties and restitution from the companies.
The companies are facing hundreds of additional lawsuits over similar claims in state court, with approximately 3300 of them in a consolidated proceeding in California state court.
In the first lawsuit to go to trial in the California litigation, and a closely watched test of how juries might respond to similar claims, a Los Angeles jury in March found Meta and Google negligent for designing social media platforms that harm young people. The jury awarded $US6 million to a young woman who says she became addicted to Instagram and YouTube as a child.
The New Mexico public nuisance ruling against Meta followed an earlier phase in the trial, in which a jury in March ordered it to pay $US375 million after finding it had misled consumers about the safety of its platforms.
Both Meta and Google, which have denied the claims in those cases, said they would appeal.
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