U.S. court bars NSO Group from targeting WhatsApp, warns business could collapse

A federal court in California has banned Israeli surveillance firm NSO Group from ever trying to breach WhatsApp, in a ruling that the company itself says could destroy its entire operation.

The decision came on Friday, October 18, from U.S. District Judge Phyllis Hamilton, who signed a 25-page order laying out the permanent injunction. According to Reuters, the court’s order shuts down any attempt by NSO to use its spyware tools on Meta-owned WhatsApp, a platform used by over two billion people around the world.

The spyware in question is Pegasus, NSO’s main product, which is designed to exploit vulnerabilities in everyday apps and secretly monitor phones. That includes grabbing texts, calls, and location data. For years, Pegasus has used WhatsApp as a key entry point. That ends now. In court filings, NSO warned that if the judge blocked them from going after WhatsApp, it would “put NSO’s entire enterprise at risk” and potentially “force NSO out of business.”

Judge reduces damages from $167 million to $4 million

While the injunction hit hard, Judge Phyllis Hamilton also gave NSO a financial break. A previous jury decision had slapped the company with $167 million in punitive damages owed to Meta, but the judge cut that figure down to just $4 million. That’s a 97% reduction, which NSO said it “welcomed.” Still, the legal blow from the permanent ban on targeting WhatsApp outweighed the financial relief.

NSO, based in Israel, released a statement saying the ban doesn’t apply to their clients. The company said its customers “will continue using the company’s technology to help protect public safety.” NSO also said it’s still reviewing the judge’s ruling and “will determine its next steps accordingly.” No timeline was given.

Meanwhile, Meta executives responded to the ruling with satisfaction. Will Cathcart, head of WhatsApp, posted on X (formerly Twitter): “Today’s ruling bans spyware maker NSO from ever targeting WhatsApp and our global users again. We applaud this decision that comes after six years of litigation to hold NSO accountable for targeting members of civil society.”

This judgment comes just weeks after reports surfaced that NSO was bought by a group led by Hollywood producer Robert Simonds. The acquisition was reported by TechCrunch, though Simonds has not responded to requests for comment.

Meta updates WhatsApp API terms to block AI chatbot developers

While dealing with the NSO ruling, Meta quietly made another major move. The company changed WhatsApp’s Business API policy this week to ban general-purpose AI chatbot developers from the platform. That change will affect developers behind OpenAI, Perplexity, Luzia (backed by Khosla Ventures), and Poke (backed by General Catalyst).

The updated policy adds a new section aimed directly at “AI Providers.” That includes companies developing or distributing large language models, generative AI platforms, or any tool considered a general-purpose AI assistant. Under the new rules, these AI providers are forbidden from accessing or using the WhatsApp Business Solution, whether they’re doing so directly or indirectly.

Meta made it clear that the ban is only on AI companies where chatbot services are the main offering. Businesses using AI for basic customer support tasks won’t be affected. A travel company, for example, can still run a simple customer service bot.

The new rules will go into effect on January 15th, as Meta explained in its press release, adding that the original intent of the Business API was for business-to-customer communications, not as a launchpad for third-party chatbots. The company said it noticed more developers using the API for general-purpose chatbots recently—something it never intended when building the system.

The entire update shows Meta trying to tighten control over how WhatsApp is used. That includes shutting out AI assistants that don’t align with its vision for the platform.

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