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You can't outrun the law forever

In Brazil, Elon Musk finally has a case worth fighting — but he has to do it in the courts

Casey Newton

Starlink, the satellite broadband company led by Elon Musk, said on Tuesday that it would comply with a court order and block access to X in Brazil. It marked yet another surprising twist in a wild saga that has been simmering all year but boiled over this weekend when a Brazilian judge single-handedly moved to ban X in the country.

Today let’s talk about how a personality clash between two powerful men led to tens of millions of Brazilians being prevented from accessing X — and how the move could be used to justify further restrictions on internet freedom around the world.  

In April, I wrote about how Musk had decided to risk a ban of X in Brazil over a court’s order that the platform ban a number of accounts belonging to right-wing users. Musk decided to restore the accounts in defiance of a powerful Supreme Court justice named Alexandre de Moraes, who subsequently opened an inquiry into the billionaire.

Musk, who has said he bought Twitter to turn the platform into a bulwark of free speech, positioned the move as a defense of liberty against an extremist government. Moraes, for his part, called Musk an “outlaw” whose X would “allow the massive spread of disinformation, hate speech and attacks on the democratic rule of law, violating the free choice of the electorate, by keeping voters away from real and accurate information.”

After Musk’s April outburst, X quickly reversed course, and said it would comply with the judge’s order. But the accounts that Moraes sought to terminate remained active, and last month X said he threatened to arrest a local employee for the platform’s failure to comply with his order. (The court wouldn’t comment, but threatening platform employees with jail time is an increasingly common and typically quite effective means of allowing government agents to moderate content as they see fit.) 

Typically, threatening an employee with jail is all it takes to get a company to reverse course. Musk, on the other hand, said X would close its offices in Brazil.

On Friday, Moraes met that dramatic escalation with one of his own. Here are Jack Nicas and Kate Conger in the New York Times:

In a highly unusual move, Justice Moraes also said that any person in Brazil who tried to still use X via common privacy software called a virtual private network, or VPN, could be fined nearly $9,000 a day.

Justice Moraes also froze the finances of a second Musk business in Brazil, SpaceX's Starlink satellite-internet service, to try to collect $3 million in fines he has levied against X. Starlink — which has recently exploded in popularity in Brazil, with more than 250,000 customers — said that it planned to fight the order and would make its service free in Brazil if necessary.

Moreover, while he quickly reversed course, Moraes initially ordered Apple and Google to block X at the level of the app store in Brazil, as well as blocking VPN apps that let users circumvent geographic barriers to app usage.

While moves like these are common in authoritarian countries such as Russia or China, they are extraordinary to see in democracies, which typically place a higher value on free expression.

In any case, the fallout from Moraes’ ban was swift. Countless fan and meme pages went silent. Bluesky added 2 million users, and Threads saw some lift as well. (They are currently the No. 1 and 2 apps respectively in the Brazilian App Store, per Similarweb.) 

And depending on how long the ban lasts, it will likely degrade even further the value of X, which a new analysis over the weekend found had lost an estimated $24 billion in value since Musk acquired Twitter in 2022.

What makes the story of Brazil and X such an unusual tech policy story is the way it has been driven almost entirely by two people. 

On one side is Musk, who has often claimed the mantle of free speech warrior in public while capitulating to government requests in private. One analysis last year found that under Musk, X had given into 83 percent of requests from authoritarian governments to remove content. And he appears more willing to accede to the requests of right-wing governments, such as India’s.

In 2021, it seemed possible that India would be the first democracy to ban Twitter, after the company fought court orders to remove political dissent — including from left-wing opponents to the government of Narendra Modi. But relations have warmed between Musk and the Modi government since he stopped fighting those battles.

“The rules in India for what can appear on social media are quite strict, and we can’t go beyond the laws of a country,” Musk told the BBC last year. “If we have a choice of either our people go to prison or we comply with the laws, we will comply with the laws.” At another point in the interview, Musk said: “If people of a given country are against a certain type of speech, they should talk to their elected representatives and pass a law to prevent it.”

Brazil once again gave Musk the choice of sending an employee to prison or complying with its laws. This time, he chose not to comply.

Musk’s defiance likely would have sparked a backlash in most countries where X operates. But he has found a particularly pugnacious opponent in Moraes, a hugely powerful and controversial figure within Brazilian politics who came to prominence during the tenure of former president Jair Bolsonaro. Bolsonaro, a Trump-like figure who threatened to undermine Brazil’s democracy, lost the 2022 election and left office after a violent riot at the capitol by his supporters last year.

Both during and since Bolsonaro’s presidency, Moraes has used the unusual powers of his office to order people arrested over their social media posts, account bans on the platforms where they posted, and even temporarily removing a governor from office. At X, he has sought the removal of at least 140 accounts, the Times reported, and often delivers his orders in sealed documents that do not specify any rationale for his decision.

Moraes is not the first government agent to make overbroad legal requests of a tech platform. Google, Meta, and other companies receive thousands of requests like these every year, and disclose them in aggregate in annual transparency reports. The reason they publish those reports is to serve as a check on governments that seek to abuse their power by seeking information from platforms for surveillance and other potentially problematic uses.

Crucially, Google and Meta also fight against overbroad requests in court. Sometimes, they win. The result is a kind of dance between platforms and governments that leaves everyone at least somewhat disappointed but is also the reason that so many people around the world can speak freely online.

I don’t post on X any more myself, and I will not lament its passing when it disappears. But whatever role the 140 X accounts in question in Brazil may have played in threatening Brazil’s democracy, they cannot have threatened it more than silencing the 20 million or so Brazilians who have been using it regularly. Particularly when Brazil’s move will be seen by autocracies as justification to enact ever more onerous speech restrictions of their own.

Like Pavel Durov before him, Musk appears to have thought he could escape the reach of regulators indefinitely. This weekend, he began to learn the same lesson Durov has: you can’t outrun the legal system forever. Had Musk fought for his users in court earlier, he might have avoided a ban. Instead, as he has before in so many other things, Musk chose to do it the hard way.

Casey Newton writes Platformer, a daily guide to understanding social networks and their relationships with the world. This piece was originally published on Platformer.

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WSJ: DOJ approved the Paramount-Warner Bros. deal even as investigators were leaning toward suing to stop it

The Justice Department’s approval of Paramount’s $111 billion acquisition of rival Warner Bros. Discovery Friday came as a surprise to the agency’s antitrust investigators, according to Wall Street Journal reporting.

Per the WSJ, a team of lawyers who’d scrutinized the merger were leaning toward recommending a lawsuit to block the deal, but hadn’t gotten to make their final recommendation, before they were told that it had been approved on Friday.

Antitrust investigators typically make a final recommendation to the agency in the review process — and that recommendation is often followed by the agency — but that step was reportedly skipped in this instance. Last month, Semafor reported that senior DOJ antitrust officials appeared likely to approve the Paramount-WBD combo.

The deal could still face antitrust challenges from a collection of states led by California, and EU regulators.

Per the WSJ, a team of lawyers who’d scrutinized the merger were leaning toward recommending a lawsuit to block the deal, but hadn’t gotten to make their final recommendation, before they were told that it had been approved on Friday.

Antitrust investigators typically make a final recommendation to the agency in the review process — and that recommendation is often followed by the agency — but that step was reportedly skipped in this instance. Last month, Semafor reported that senior DOJ antitrust officials appeared likely to approve the Paramount-WBD combo.

The deal could still face antitrust challenges from a collection of states led by California, and EU regulators.

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Jake Lahut

Strait of Hormuz is closed to all oil tankers and commercial ships, Iran military says

In retaliation to US strikes, the Islamic Republic of Iran announced that the Strait of Hormuz is fully closed as of early Thursday morning in Tehran. The attacks from the US were separate from a series of retaliatory drone and missile launches overnight Tuesday into Wednesday.

President Donald Trump told Fox News in a phone interview on Wednesday night that “the bombing will stop soon,” but if Iran doesn’t sign the agreement put forward by special envoys Steve Witkoff and Jared Kushner, “we’ll bomb the shit out of them tomorrow night.”

When asked whether the ceasefire still stands, Trump described it as “the most violated ceasefire in the history of the world,” per Fox News.

According to Al Jazeerah, Iran’s Mehr news agency reported that Iran’s joint military command specified that any oil tankers or other commercial vessels will be attacked if they attempt to cross the strait.

This is the second day in a row hostilities have resumed to a level not seen since the early April ceasefire was announced.

US CENTCOM announced the series of strikes beginning at 5:15 p.m. ET on Wednesday, which Secretary of Defense Pete Hegseth previewed in on-camera remarks, promising to “strike ’em hard tonight” before later saying he would not broadcast whether the military would take any action.

Shortly after the announcement on the closure of the Strait of Hormuz to all commercial vessel traffic, Iranian state media reported that two ships attempting to cross were attacked.

This story is developing.

President Donald Trump told Fox News in a phone interview on Wednesday night that “the bombing will stop soon,” but if Iran doesn’t sign the agreement put forward by special envoys Steve Witkoff and Jared Kushner, “we’ll bomb the shit out of them tomorrow night.”

When asked whether the ceasefire still stands, Trump described it as “the most violated ceasefire in the history of the world,” per Fox News.

According to Al Jazeerah, Iran’s Mehr news agency reported that Iran’s joint military command specified that any oil tankers or other commercial vessels will be attacked if they attempt to cross the strait.

This is the second day in a row hostilities have resumed to a level not seen since the early April ceasefire was announced.

US CENTCOM announced the series of strikes beginning at 5:15 p.m. ET on Wednesday, which Secretary of Defense Pete Hegseth previewed in on-camera remarks, promising to “strike ’em hard tonight” before later saying he would not broadcast whether the military would take any action.

Shortly after the announcement on the closure of the Strait of Hormuz to all commercial vessel traffic, Iranian state media reported that two ships attempting to cross were attacked.

This story is developing.

power
Jake Lahut

United States and Iran trade retaliatory strikes, escalating war and rattling ceasefire

The war in Iran is heating back up. Overnight, both sides have been trading hostilities in a series of retaliations to other retaliations.

It marks the most robust escalation in combat since the April 8 ceasefire announcement.

Oil prices were little changed, with Brent crude futures down 0.48% as of 5:30 a.m. ET. At the same time, S&P 500 futures were down nearly 0.7% and the tech-heavy Nasdaq Composite had slipped 1.18%, as the escalations compounded a broader AI sell-off.

Travel stocks, like United Airlines and Royal Caribbean, which got a boost on Tuesday as oil prices fell, lost some of those gains in premarket trading. Meanwhile, oil giants such as Chevron and Exxon ticked higher and chipmakers such as Arm Holdings and Micron continued to slip.

The escalation ladder began ratcheting back up when Iran shot down an American helicopter with a drone while it was patrolling the Strait of Hormuz, a US official told NBC News. US forces then conducted strikes in Iran’s Qeshm Island, Sirik, Jask, and Bandar Abbas, according to Al Jazeera. In response, Iran attacked a US fleet in Bahrain, Al Jazeera also reported.

“The Iranians are trying to make clear that any attack on them would be responded to, regardless of the size and the scope,” Trita Parsi of the Quincy Institute for Responsible Statecraft in the US told Al Jazeera. “Now, of course, whether they are seeking to escalate the situation or de-escalate remains to be seen, and it will be very much measured by how they calibrated their response by attacking these US bases.”

The scope of the strikes and counterstrikes broadened out as of early Wednesday morning in Iran. Kuwait activated its air defense systems to intercept strikes, its army announced.

Mohamed Vall, a reporter for Al Jazeera reporting from inside Iran, described “a lot of activity in terms of air defence by the Iranians, and they talked about the downing of a helicopter, an American MQ-9 [drone] over Bushehr. So that gives you an idea about the scope of these attacks and counterattacks, or these retaliations across the Strait of Hormuz and the Gulf region tonight.”

Iran’s IRGC also reported targeting a hangar for American F-35 jets in Jordan, Al Jazeera reported.

Oil prices were little changed, with Brent crude futures down 0.48% as of 5:30 a.m. ET. At the same time, S&P 500 futures were down nearly 0.7% and the tech-heavy Nasdaq Composite had slipped 1.18%, as the escalations compounded a broader AI sell-off.

Travel stocks, like United Airlines and Royal Caribbean, which got a boost on Tuesday as oil prices fell, lost some of those gains in premarket trading. Meanwhile, oil giants such as Chevron and Exxon ticked higher and chipmakers such as Arm Holdings and Micron continued to slip.

The escalation ladder began ratcheting back up when Iran shot down an American helicopter with a drone while it was patrolling the Strait of Hormuz, a US official told NBC News. US forces then conducted strikes in Iran’s Qeshm Island, Sirik, Jask, and Bandar Abbas, according to Al Jazeera. In response, Iran attacked a US fleet in Bahrain, Al Jazeera also reported.

“The Iranians are trying to make clear that any attack on them would be responded to, regardless of the size and the scope,” Trita Parsi of the Quincy Institute for Responsible Statecraft in the US told Al Jazeera. “Now, of course, whether they are seeking to escalate the situation or de-escalate remains to be seen, and it will be very much measured by how they calibrated their response by attacking these US bases.”

The scope of the strikes and counterstrikes broadened out as of early Wednesday morning in Iran. Kuwait activated its air defense systems to intercept strikes, its army announced.

Mohamed Vall, a reporter for Al Jazeera reporting from inside Iran, described “a lot of activity in terms of air defence by the Iranians, and they talked about the downing of a helicopter, an American MQ-9 [drone] over Bushehr. So that gives you an idea about the scope of these attacks and counterattacks, or these retaliations across the Strait of Hormuz and the Gulf region tonight.”

Iran’s IRGC also reported targeting a hangar for American F-35 jets in Jordan, Al Jazeera reported.

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New York legislature passes 1-year data center moratorium

The New York state legislature has passed a one-year ban on large data centers in the state.

The bill now heads to Gov. Kathy Hochul’s desk, where it faces an uncertain fate. If Hochul signs the bill, it would become the first such statewide ban to succeed in becoming law.

That’s far from certain, as Hochul has opposed state-level legislation over data centers. In May, Hochul said, “This is a local decision for municipalities, its land use, which is the purview of local governments. It’s not a statewide approach necessarily, but its something Im looking at intensely.”

In April, Maine Gov. Janet Mills vetoed a similar statewide moratorium on data centers.

Opposition to data centers is growing rapidly across the US. A federal data center moratorium bill was introduced in March, and at least 14 states have proposed pauses on data center construction, according to the National Conference of State Legislatures.

That’s far from certain, as Hochul has opposed state-level legislation over data centers. In May, Hochul said, “This is a local decision for municipalities, its land use, which is the purview of local governments. It’s not a statewide approach necessarily, but its something Im looking at intensely.”

In April, Maine Gov. Janet Mills vetoed a similar statewide moratorium on data centers.

Opposition to data centers is growing rapidly across the US. A federal data center moratorium bill was introduced in March, and at least 14 states have proposed pauses on data center construction, according to the National Conference of State Legislatures.

EU Commission Vice-President Virkkunen and Commissioner Jorgensen hold press conference

EU proposes “tech sovereignty package” to bolster domestic AI and chip industries

Europe is hastening its breakup with US tech as the Trump administration’s grip on American tech companies tightens.

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