xAI subsidiary proposes buying 418 homes to settle Mississippi noise lawsuit

A subsidiary of Elon Musk's xAI is offering to buy 418 homes in Southaven, Mississippi, with the condition that residents drop their legal challenges against the company's nearby infrastructure. According to a report from The Guardian, a realtor canvassing the area told one resident that xAI intends to purchase these properties. Eighteen homeowners have already arranged to sell their houses to the company.

The offer comes with specific legal requirements. A letter sent by MZX, the xAI subsidiary, states that accepting the bid requires homeowners to sign a real estate contract. At the closing of the sale, sellers must also sign a separate release agreement. This document waives any claims related to the Southaven Plant, including those tied to the Haley lawsuit.

The release agreement prevents homeowners from recovering damages or seeking other relief from the Haley lawsuit. It also removes their right to bring independent claims on their own behalf. MZX denied all allegations made against it but explained that the purchase offers are necessary because the company requires property for its business operations.

The dispute stems from a lawsuit filed by three local residents. These plaintiffs accuse the company's data center and gas-fired turbines of producing constant noise and vibrations. xAI has expanded its footprint in the region, building two large facilities in Memphis known as Colossus. The company also established the Macrohardrr data center and a power plant in Southaven, just over the Tennessee border.

Renters in the area face additional pressure. Several report that landlords are providing 60 days' notice to move out after agreeing to sell their properties to xAI. This situation creates tension between rapid AI infrastructure development and local residential communities.

Opposition to AI data centers is increasing ahead of the midterm elections. Last week, the Memphis City Council rejected a proposed one-year moratorium on AI data center development. Instead, the council adopted an ordinance that pauses construction for 135 days.

Financial stakes have risen for xAI in the region. Mississippi's governor highlighted the company's plan to invest more than $20 billion in the area earlier this year. However, xAI faces potential civil penalties of up to $6.1 million for environmental law violations. There are also claims of more than $220 million in unpaid bills for work at the Memphis and Southaven sites. The NAACP is suing the company for operating dozens of unpermitted methane gas turbines in Southaven. A federal judge allowed this case to proceed earlier this month.