A federal judge has denied Elon Musk-owned SpaceXAI’s motion to dismiss a lawsuit brought by the NAACP over its use of gas turbines to power data centers in Southaven and Memphis.
The lawsuit alleges that the artificial intelligence company’s turbines require a state air permit from the Mississippi Environmental Quality to operate and are “a major source of hazardous air pollutants” that are harming residents.
SpaceXAI, previously known as xAI, argued in its motion to dismiss that the turbines do not require permits because they fall under an exception for “mobile sources,” which the Mississippi Department of Environmental Quality said in a letter to the company last year.
However, on Friday, U.S. District Judge Debra Brown found that turbines are “not a ‘mobile source’ according to the federal regulations” and require permits. She added in her ruling that “the letter does not alter the Court’s determination that the defendants’ turbines are not mobile sources”
The company also argued that the NAACP could not sue under the federal Clean Air Act and that lawsuits brought by the NAACP and other groups are unconstitutional. Brown found that the NAACP does have standing to sue and the case can continue.
Two weeks ago, Brown denied a separate motion to dismiss the case filed by the U.S. Department of Justice. The DOJ said it intervened in the case because Grok, the company’s artificial-intelligence chatbot, is vital for national security.
“This decision is another important victory in our effort to hold xAI accountable,” said Abre’ Conner, NAACP director of environmental and climate justice in a statement. “The courts have repeatedly rejected attempts by xAI and the DOJ to dismiss the NAACP’s Clean Air Act case, affirming our right to pursue justice for communities impacted by pollution. Our position has been clear: xAI cannot operate gas turbines without the required permits,”
In March, the state permit board unanimously approved the company’s air permit application to build 41 permanent turbines in Southaven to power its expanding data center presence in the area. Southaven residents appealed that decision and a hearing is scheduled for Nov. 9.
The project has faced stiff opposition from residents who are concerned about noise and pollution. Some residents have brought a separate class action lawsuit against the company over the “pervasive and inescapable” noise created by the temporary turbines.
SpaceXAI is constructing six data centers in the Memphis area according to a social media post by Elon Musk on Saturday. The company has said its Southaven operations could amount to an over $45 billion investment. When the project was announced in Jan. 2026, Gov. Tate Reeves said it was the largest economic development in the state’s history and would “transform the region and bring amazing opportunities to its residents for generations.”
The NAACP has requested the court order SpaceXAI to stop operating its mobile turbines until it gets them permitted. The court has not yet ruled on that request. In response, Reeves wrote to the court that such a move would create an “immediate and substantial disruption to the state’s economy.”
SpaceXAI did not respond to a request for comment.
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