Brazilian Court Makes One Musk Company Pay Fines of Another

RIO DE JANEIRO — Brazil’s Supreme Court had a problem: X, the social network owned by Elon Musk, was not paying fines and had already been blocked across the nation.

So the court looked elsewhere: It made a different Musk-controlled company help settle the bill.

On Friday, Brazil’s Supreme Court said two banks in Brazil had complied with its orders to deduct $3.3 million in fines from the Brazilian accounts of X and Starlink, two companies controlled by Musk.

One of the court’s justices, Alexandre de Moraes, had issued the fines and blocked X across Brazil last month because Musk had defied his orders to block certain accounts on the social network and then closed the company’s office in Brazil to avoid any consequences.

In an effort to collect on the fines against X, de Moraes froze the local assets of Starlink, a satellite-internet service controlled by Musk that has surged in popularity in Brazil.

On Friday, the court said the banks had transferred to the Brazilian government $1.3 million from X’s local accounts and $2 million from Starlink’s. The court said the companies’ assets were no longer frozen in Brazil.

The development signaled an end to one of the more unusual aspects of the monthslong dispute between de Moraes and Musk. The two have battled over what can be said on X, with de Moraes arguing that certain accounts were illegally attacking Brazilian institutions and Musk responding that the judge was illegally censoring voices. The social network remains blocked in Brazil.

De Moraes determined that Starlink could be responsible for X’s fines because they were from the same “de facto economic group.” Some legal experts in Brazil questioned that interpretation, but the court said the two companies had missed the deadline to appeal.

Starlink had asked the court to unfreeze its assets, but another Brazilian Supreme Court justice quickly rejected the request.

Musk called the move to freeze Starlink’s assets “absolutely illegal,” noting that Starlink is owned by the private space company SpaceX. Musk said he owns 40% of SpaceX. Company filings show he also controls a majority of voting shares.

Starlink had previously supported X in its dispute. After de Moraes ordered the site to be blocked, Starlink told regulators it would not comply and would allow its 250,000 users in Brazil to keep using X. But two days later, faced with potentially losing its license in the country, Starlink agreed to block the site.

This article originally appeared in The New York Times .