Artificial intelligence giant xAI is offering to buy out residents of Southaven, Mississippi, if they agree not to join a class-action lawsuit accusing the company of “nuisance-level harms,” a letter shared with the Mississippi Free Press shows.
The letter, which multiple households have received in recent weeks, comes three months after a group of residents sued xAI and subsidiary MZX Tech, alleging that persistent noise and vibrations from the company’s energy plant in Southaven are degrading their quality of life. The complaint lists three plaintiffs—Jason Haley, Preston Herrington and Taylor Logsdon—but notes that over 10,000 “class members” live in the affected area, creating a path for other residents to join the suit.
“MZX denies all of the allegations against it,” the undated letter states. “However, because MZX also requires property for its business purposes, MZX, through its real estate broker, is offering to purchase real estate in Southaven in exchange for, among other things, a release of all claims related to the lawsuit.”
The letter doesn’t specify how much residents can expect to receive for their properties, though xAI appears to be basing its offers on appraisal values listed on real estate websites like Zillow, residents tell the Mississippi Free Press. Residents declined to provide their names due to their potential involvement in the litigation.
xAI’s Southaven energy plant powers its data centers in neighboring Tennessee, which in turn power Grok, the company’s controversial AI supercomputer. Since last summer, Mississippi has allowed the facility to operate a growing number of gas-fired turbines without permits, sparking widespread backlash and complaints about air and noise pollution. As of July 31, a total of 69 unpermitted turbines were housed at the site, according to documents from state regulators.
In their June lawsuit, Southaven residents claim that the near-constant noise from xAI’s turbines has disrupted their daily lives, preventing them from enjoying their properties and impeding activities like sleep. Residents are seeking compensation for the physical and emotional damage inflicted by the machines, as well as for declining property values linked to the plant’s operations, the complaint states.
“The noise generated by the Southaven Plant includes a combination of high-pitched squealing, continuous engine roaring, low-frequency rumbling, and tonal humming or whining that travels across property lines and into area homes,” the lawsuit reads. “As a result of Defendants’ ongoing and continuous operation of the Southaven Plant, Plaintiffs and class members have suffered and continue to suffer harm including substantial and unreasonable interference with the use and enjoyment of their property.”
Per MZX Tech’s letter, residents who accept the company’s offer will be asked to sign an initial real estate contract and a separate release agreement once the buyout is finalized. This second agreement will void “any possible claims” the resident might have against the Southaven power plant, including those associated with the class-action lawsuit, the document explains.
“After executing the Release Agreement, you will be unable to recover any damages or other relief from the … lawsuit, and you will also be unable to bring claims on your own behalf,” the letter states.
The Mississippi Free Press reached out to xAI for comment on the buyout offers but did not hear back by press time. Attorneys representing the plaintiffs in the lawsuit declined to comment on the letters, citing the active litigation.
The class-action lawsuit is one of multiple complaints currently pending against xAI, which is growing its presence in Mississippi and building multiple new data centers in Southaven. In April, the NAACP sued the company over its use of unpermitted turbines at the energy plant, accusing it of violating the Clean Air Act and endangering public health. The organization later requested a preliminary injunction to stop the turbines from operating, claiming that they pose an immediate threat.
In June, the Trump administration intervened in the NAACP lawsuit on behalf of xAI, arguing that the company’s operations in Southaven are vital to national security. An initial court hearing set for Aug. 24 was postponed and has yet to be rescheduled.
Follow the Mississippi Free Press’ coverage of data centers and read past stories here.
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