Mississippi Data Center Dispute: xAI Unit Proposes 418 Home Buyouts

Residents in Southaven, Mississippi, face a financial proposition tied directly to their legal rights. A realtor told one local homeowner that an xAI subsidiary intends to acquire 418 homes in the neighborhood. Eighteen owners have already agreed to sell their properties to the company.

The purchase offers include specific legal conditions for the sellers. MZX, the xAI unit handling the transactions, requires homeowners to sign a real estate contract. Upon closing, sellers must also execute a separate release agreement. This document waives all claims related to the Southaven Plant, including those part of the Haley lawsuit. Once signed, homeowners cannot recover damages or seek other relief from that specific legal action. They also lose the right to bring independent claims on their own behalf.

The underlying dispute stems from noise and vibrations generated by the company’s infrastructure. Three local residents filed a lawsuit accusing the data center and gas-fired turbines of creating near-constant sound. MZX denies all allegations but states it needs property for business operations. The company has expanded its footprint in recent years, building two large facilities nicknamed Colossus in Memphis. It also established the Macrohardrr data center and an accompanying power plant in Southaven, just over the Tennessee border.

Renters in the area report feeling the pressure of these developments. Several stated they are being forced to move out because landlords provided 60 days’ notice after agreeing to sell to xAI. This situation reflects tension between rapid AI infrastructure development and local residential communities. Opposition to these centers is increasing, placing pressure on politicians ahead of the midterm elections. Last week, the Memphis City Council voted down a proposed one-year moratorium. Instead, the council adopted an ordinance that pauses construction for 135 days.

Financial stakes have risen for the company in the region. Mississippi’s governor previously highlighted xAI’s plan to invest more than $20 billion in the area. Recent reports indicate the company 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 performed at the Memphis and Southaven sites. Beyond the resident lawsuit, xAI faces legal action from the National Association for the Advancement of Colored People. The NAACP accuses the company of operating dozens of unpermitted methane gas turbines. A federal judge blocked the Trump administration’s attempt to dismiss this lawsuit earlier this month, allowing the case to proceed.