The European Commission declared on Friday that it will proceed with enforcing a €120 million ($137 million) penalty against the social media platform X, despite the United States government intervening to support Elon Musk’s legal challenge to dismiss the case.
The fine, imposed late last year, marks the first penalty issued under the EU’s Digital Services Act (DSA), a landmark regulatory framework governing online content. The investigation, which spanned two years, concluded that X’s system of paid blue checkmarks violated transparency obligations within the bloc.
“On X, anyone can pay to obtain the ‘verified’ status without the company meaningfully verifying who is behind the account,” the European Commission stated in its initial press release outlining the penalty.
In response, the US Department of Justice filed an application on Thursday to support X’s motion at the General Court of the European Union to annul the fine. This marks the second instance in three months that the Justice Department has intervened on behalf of a company owned by Musk. In July, it filed a motion in a civil rights lawsuit alleging that Musk’s xAI illegally operated natural gas turbines to power a $20 billion AI data center in Mississippi.
Brett Shumate, Assistant Attorney General for the Civil Division, warned that upholding the fine could have “significant implications” for US online platforms operating in the EU. He accused the European Commission of overreach, stating, “We will not tolerate the European Commission engaging in regulatory overreach to try and control American engines of innovation and economic growth.”
The dispute highlights growing tensions between Brussels and the Trump administration. While US officials have criticized the DSA as a form of online censorship, European Commission spokesperson Thomas Regnier defended the enforcement as an exercise of sovereign rights.
“We are enforcing our legislation objectively, transparently and with a solid case,” Regnier told reporters. “We are ready to defend our position in court. We have a lot of evidence at our disposal, and it will be for the court to decide, as always.”
Regnier expressed confidence that the legal battle would not disrupt broader transatlantic relations, particularly negotiations aimed at mitigating the impact of Trump administration tariffs. “From our perspective, nothing will change because of a DSA case,” he added.
The episode occurs against a backdrop of a recent thaw in relations between Musk and President Donald Trump. Last year, the tech billionaire had publicly attacked Trump’s tax policies, calling them a “disgusting abomination.” However, the two appear to have reconciled, with Musk attending a state dinner hosted by Trump for Chinese leader Xi Jinping alongside other technology executives earlier this week.
The US intervening here is bold. Can Brussels really defy Washington’s stance on innovation regulation without diplomatic fallout?
Transparency matters! People deserve to know if a verified badge is earned or bought. Finally, accountability for tech giants.