The legal battle revolves around the AI company's operations in southern Memphis. A federal judge's latest ruling has denied xAI's request to dismiss a lawsuit that alleges its data center campus in Memphis, Tennessee is running turbines without proper permits and violating the Clean Air Act. The decision, from US District Judge Debra M. Brown, allows the lawsuit, which was filed by the NAACP, to move forward. The organization filed its legal action against xAI in April, accusing the company that's now known as SpaceXSI of using unpermitted methane gas turbines to power data centers in the Memphis area. Despite the ongoing lawsuit that also claimed it's violating the Clear Air Act, Elon Musk's company continued to add more gas turbines to another AI data center site in the nearby Southhaven, Mississippi community.

Jason Haley looks on near one of the xAI datacenters close to his home in Southaven, Mississippi, on 25 October 2026. Jason Haley looks on near one of the xAI datacenters close to his home in Southaven, Mississippi, on 25 October 2026. 'Elonville': US residents say Musk's xAI offered to buy homes if they don't sue over datacenter noise People in a Mississippi neighborhood, many of whom dislike a nearby power plant central to Elon Musk's artificial intelligence ambitions, have received a stark offer - to sell their houses to his company and make way. Real estate agents have been going door to door in Southaven, Mississippi, on behalf of xAI, Musk's AI company that was folded into the SpaceX entity in February, touting a deal to purchase houses as long as the owners agree to not join a lawsuit against the company over the power plant's noise. This plan could potentially swallow up almost the entire neighborhood of Colonial Hills, on the western flank of Southaven.

Back to School Mashable's Best: E-readers, robovacs, laptops, earbuds, smart home and more Mashable Selects Say More Look Up Trending Now Good Connection: Uplifting stories for a digital age Creator Playbook Switch Off Mashable Voices Safety Net Versus All Series Minnesota'nudification' law survives xAI's request for a legal injunction Minnesota has temporarily won the right to sue companies for up to $500,000 for every nudification enabled by artificial intelligence. The District Court of Minnesota has rejected the efforts of Elon Musk's xAI to seek an injunction to suspend the law until a court could hear its constitutional challenge to the law itself, according to a report by Reuters . Judge Donovan W. Frank, in his Conclusion, argued that xAI has not demonstrated irreparable harm and the balance of harms tips steeply in favor of the State. The bill Musk is trying to fight was recently passed into law by Minnesota, becoming the nation's first anti-nudification law . Companies found in violation of this law would be subject to fines of up to $500,000 every time artificial intelligence is used to alter images to depict the intimate parts of a person in such a way that a reasonable person would believe that the intimate part belongs to the identifiable individual.

ChatGPT, Claude, and Grok all suffered outages at nearly the exact same time for reasons that remain murky. Frontier models from Anthropic, OpenAI, and xAI all experienced rare outages on Thursday morning, creating downtime for their corresponding AI chatbots. SpaceX, xAI's parent company, said on Thursday afternoon that the issues with Grok resulted from "an outage at our Memphis compute center this morning." The issues initially appeared to be linked because they coincided--perhaps the result of a shared third-party service provider--but neither OpenAI nor Anthropic cited an external source in comments to WIRED on Thursday. SpaceX, xAI's parent company, did not respond to WIRED's request for comment.

OpenAI is planning to cut off Cursor's access from its models, following the AI coding assistant's acquisition by SpaceXAI. In a post on its website, the company said it's giving Cursor users as much time as it could based on its contract. It intends to pull its models from the service on November 12, 2026, but it said that Cursor could choose an earlier termination date. The company explained that it's making this choice because it can't be confident that SpaceX will use its technology within its terms of services, based on its "experience with Elon Musk's companies violating contracts." OpenAI and Musk have a long and troubled history, with the SpaceXAI chief being one of the company's earliest investors.

A fourth party is pursuing legal action against xAI, alleging that Grok was used to create child sexual abuse material (CSAM) based on her childhood photos. As first reported by Washington Post, the woman, named as Jane Doe 4 in the lawsuit, said that her stepfather used Grok to create "thousands of sexually explicit images of her as a child and traded them online." According to the the lawsuit, the stepfather created more than 7,000 "fake explicit images of her using the AI chatbot Grok," including converting a photo taken of her when she was 11 into a sexually explicit image. Eventually, state and local law enforcement raided her stepfather's electronic devices for CSAM and two days after, he was found dead by suicide in his car, according to the report. Jane Doe 4 joins three other teenagers, who filed the original lawsuit that alleged that Grok was used to create sexually explicit deepfake images of them.

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The defendant used Grok to create sexualized images of adults and children, xAI says. SpaceXAI (as xAI) has filed a lawsuit against Terry Wayne Harwood, a 67-year-old man from South Carolina whom the company has accused of using Grok to generate sexual images of real people without their consent. In the complaint that xAI filed in Texas, it said that the defendant uploaded non-sexual images of numerous adults and minors to his two xAI accounts from December 8, 2025 until February 18, 2026. He then asked Grok to alter the photos or to create new images and videos depicting the adults and children in them in a pornographic manner or otherwise sexualizing them. The company said that Grok refused to follow his prompts on numerous occasions but that he repeatedly submitted edited prompts to circumvent the AI's safeguards. In one example mentioned in the filing, xAI said Harwood uploaded the photo of a fully dressed girl around 10 to 11 years old and then asked Grok to remove all of her clothing and make her do a Playboy model impression as she laid in bed.

The company's latest recall of 3,871 vehicles follows incidents of its autonomous cars "prioritizing other hazards" or failing to recognize closed construction zones altogether. Waymo has filed its fourth safety recall since February 2024, after its driverless cars were caught entering closed freeway-construction zones. The recall, filed with the National Highway Traffic Safety Administration (NHTSA) on June 17, appears to affect Waymo's entire US fleet, covering 3,871 vehicles running Waymo's 5th Generation automated driving system (ADS). NHTSA estimates 100 precent of the affected units carry the defect, which is outlined in the filed safety recall report as "under certain circumstances, the AV may enter and drive at speed in freeway-construction zones due to inappropriately prioritizing the avoidance of other freeway hazards and/or failing to recognize the construction zone." Waymo started offering highway rides in late 2025, and the underlying problem appears to be a failure of priority logic.

This week only, every donation is doubled! Halfway through our Summer Membership Drive, we're still well behind where we need to be. But there's good news: This week, every donation will be doubled up, to $50,000 We need you right now. We need you right now. Trump's Justice Department Backs Elon Musk in Data Center Lawsuit DOJ urges judge to throw NAACP's legal action over xAI's gas turbines in Mississippi.