A US federal judge has rejected the Trump administration’s attempt to dismiss an environmental lawsuit brought by the NAACP against Elon Musk’s artificial intelligence company xAI, allowing the Clean Air Act case to continue.
US District Judge Debra Brown in Mississippi ruled that the Environmental Protection Agency could intervene in the litigation but did not have authority to unilaterally terminate the private enforcement action under the circumstances.
The lawsuit was filed in April by the National Association for the Advancement of Colored People and the Mississippi State Conference of the NAACP.
It alleges that xAI and its subsidiary MZX Tech violated federal law and state regulations by constructing and operating a gas-fired power plant in Southaven, Mississippi, without the required environmental permits.
The plant supplies power for xAI’s Colossus 2 data centre infrastructure.
The Trump administration became involved in the litigation in June, when it sought to intervene on behalf of the EPA.
Federal lawyers argued that the agency could dismiss the lawsuit because federal regulators have primary authority over enforcement of the Clean Air Act.
Brown rejected that interpretation.
Although the EPA has a right to intervene in private Clean Air Act enforcement proceedings, the judge found nothing in the legislation allowing the agency to dismiss such a lawsuit unless it is pursuing a related enforcement action itself.
The decision leaves the NAACP’s underlying case against xAI in place.
It does not determine whether xAI or MZX Tech violated the Clean Air Act or other environmental requirements.
Instead, the ruling addresses the federal government’s power to terminate a private enforcement action after intervening in the proceedings.
Citizen suits are an established feature of US environmental law and allow private individuals and organisations to seek enforcement of environmental legislation in certain circumstances.
The NAACP alleges that xAI and MZX Tech operated dozens of gas turbines without the necessary air permits.
The organisation has also sought injunctive relief aimed at stopping the operation of turbines it alleges are unpermitted.
In its original complaint, the NAACP asked the court to declare that the companies violated the Clean Air Act, prevent operation of the turbines except in compliance with environmental requirements, require pollution-control measures and impose civil penalties.
Those allegations remain contested and have not been finally determined by the court.
The case has developed into a broader dispute over the relationship between federal enforcement powers and the rights granted to private litigants under environmental legislation.
The Trump administration argued that the executive branch’s responsibility for enforcing federal environmental law gave the EPA authority to bring the NAACP’s action to an end.
Brown’s ruling rejected that position in this case, finding that the EPA’s status as the primary enforcer of the Clean Air Act does not give the federal government complete control over all litigation brought under the legislation.
The dispute comes as the rapid expansion of artificial intelligence infrastructure increases demand for electricity and places the environmental impact of data centres under greater scrutiny.
Large AI computing facilities require substantial and reliable power supplies, leading some operators to develop or use dedicated generation capacity.
For xAI, the litigation means the environmental claims surrounding the infrastructure supporting Colossus 2 will continue through the federal courts.
The company also faces other litigation connected with data centres and power consumption.
The significance of Brown’s ruling, however, extends beyond the allegations against xAI.
The decision preserves the NAACP’s ability to pursue its Clean Air Act claims despite the federal government’s intervention and provides an important test of the limits of executive authority over environmental citizen suits.
The underlying question of whether xAI and MZX Tech breached environmental law remains unresolved and will continue to be contested as the case proceeds.