The European Commission is preparing to fight a legal challenge against a 120 million euro fine imposed on X. This follows an unusual move by the US Justice Department to support Elon Musk's effort to have the penalty overturned.
The 120 million euro penalty for deceptive blue checkmarks
The European Commission issued a 120 million euro (approximately US$137 million) fine against X following a two-year investigation into the platform's compliance with regional laws. According to the report, this penalty marks the first time the bloc has issued a fine under its digital regulations governing online content.
Regulators specifically targeted the use of blue checkmarks on X, claiming the system employed deceptive design practices. The European Commission argues that these practices could leave users vulnerable to manipulation and scams, violating the standards set by the Digital Services Act (DSA).
Brett Shumate and the US Justice Department's fight against 'regulatory overreach'
The US Justice Department has formally intervened in the case, filing an application with the European Union's General Court to support Elon Musk's bid for annulment. Assistant Attorney General Brett Shumate of the Justice Department's Civil Division stated that the European Commission has inappropriately tried to extend its regulatory reach to American companies that do not operate within its jurisdiction.
As the source reported, the US government views the fine as a form of regulatory overreach designed to control "American engines of innovation and economic growth." US officials have further criticized the Digital Services Act, suggesting that the EU's enforcement mechanisms may amount to online censorship of American platforms.
A pattern of intervention from the EU to Mississippi's $20 billion AI hub
The Justice Department's support for Elon Musk is not an isolated incident, as it has intervened twice in three months to defend his ventures. In July, the US government filed a motion to intervene in a civil rights lawsuit involving xAI and its $20 billion AI data center located in Mississippi.
That specific legal battle involves claims from the NAACP and other organizations alleging that xAI illegally operated dozens of natural gas turbines to power the facility . The lawsuit claims the power plant was built without proper permits near schools and homes, potentially violating the federal Clean Air Act and creating health risks for residents in North Mississippi and Memphis.
Will the Digital Services Act clash derail Trump-EU tariff negotiations?
European Commission spokesperson Thomas Regnier has maintained that the EU is enforcing its legislation objectively and transparently, asserting the bloc's sovereign right to protect its citizens. While the US Justice Department views the DSA as a tool for censorship, Regnier told reporters that the commission does not expect the legal battle to damage broader diplomatic relations between Brussels and Washington.
However , this friction arrives at a sensitive time as the two powers engage in talks to mitigate the impact of tariffs imposed by the Trump administration . The alignment between the US government and Elon Musk—highlighted by Musk's attendance at a state dinner honoring China's leader Xi Jinping—suggests that the US may now treat the protection of its tech titans as a core component of its foreign policy and trade strategy.
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