Luxembourg (Brussels Morning Newspaper) September 26, 2026 – The United States government has formally requested to intervene in support of Elon Musk and the social media platform X in legal proceedings challenging a €120 million ($136 million) penalty imposed by the European Commission. The U.S. Department of Justice argued that the regulatory action represents improper extraterritorial overreach, while the European Union maintained that it is fully prepared to defend its enforcement of digital transparency rules.
Department of Justice Files Application at the European Union General Court
The U.S. Department of Justice announced that it submitted a formal application to the General Court of the Court of Justice of the European Union in Luxembourg. The intervention targets two separate pending cases: X Internet and X Holdings v. Commission (Case T-114/26) and Musk v. Commission (Case T-121/26). Both lawsuits seek the full annulment of the European Commission’s decision issued on December 5, 2025, which found the platform and associated entities in breach of the European Union’s Digital Services Act (DSA).
Under Article 40 of the Statute of the Court of Justice of the European Union, a sovereign state or external legal person may request to intervene in an ongoing dispute by demonstrating a direct interest in the outcome. The Department of Justice stated that its application was coordinated directly with the U.S. Department of State due to the broad implications for bilateral relations and American technology companies operating overseas. The General Court must now evaluate the application and determine whether to accept the U.S. government’s participation in the proceedings.
Core Arguments Concerning Regulatory Jurisdiction and Corporate Liability
Representing the U.S. government position, Brett Shumate, assistant attorney general for the Justice Department’s Civil Division, stated that the European Commission had inappropriately attempted to expand its regulatory jurisdiction to reach American entities not physically present or operating inside the bloc. Washington’s legal filings contend that upholding the Commission’s methodology could expose numerous other U.S.-based digital companies to foreign enforcement actions.
Furthermore, the U.S. administration objected to the European Commission’s calculation of liability. Regulators based the €120 million fine on the aggregate worldwide annual turnover of the single economic unit controlled by Elon Musk or X Holdings Corp., effectively piercing the corporate veil. The Justice Department argued that this approach improperly targets Elon Musk as a private individual and incorporates separate U.S. corporate entities that maintain no direct legal connection to the digital services in question.
European Commission Enforcement of the Digital Services Act
The underlying dispute stems from a multi-year regulatory investigation launched under the Digital Services Act, which became broadly applicable in February 2024. On December 5, 2025, the European Commission issued its first-ever non-compliance penalty under the legislation, fining X €120 million jointly and severally.
The European Commission’s decision identified three distinct violations of transparency obligations under the DSA:
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Deceptive Design in Account Verification: Regulators found that the blue checkmark system employed deceptive design practices, allowing users to purchase verified status without proper identity authentication.
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Advertising Repository Deficiencies: The Commission concluded that X’s public advertising database lacked sufficient data concerning advertisements and sponsors, thereby hindering public scrutiny of potential scams and coordinated influence operations.
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Public Data Access Barriers: The platform’s terms and operational procedures were found to impose unnecessary restrictions on accredited researchers investigating systemic platform risks.
Following the penalty, X filed formal appeals at the General Court in February 2026, alleging severe procedural errors and a flawed investigation. In parallel, the platform engaged with regulators regarding compliance measures, and the Commission accepted an action plan in July 2026 aimed at modifying its advertising repository and providing researchers with authorized application programming interface (API) access.
European Union Response and Broader Diplomatic Context
In response to the U.S. intervention filing, European Commission spokesperson Thomas Regnier addressed reporters in Brussels, stating that the development changes nothing regarding the bloc’s legal stance. The Commission asserted that it maintains a solid legal foundation and remains fully prepared to defend its enforcement decisions in court.
Regnier clarified that the European Commission does not fine individuals under the framework of the Digital Services Act, but is legally mandated to identify the overarching corporate structure—including majority shareholders—when establishing corporate liability.
The ongoing litigation marks the first time that an enforcement action under the Digital Services Act has faced judicial review at the EU General Court, establishing a critical legal precedent for the regulatory oversight of multinational technology enterprises.
