Well, for sure they can pressure them but I highly doubt Hetzner would break the law in Europe to satisfy the US government, they are a lot more to lose here than there. I realize that that is not proof.
I dont share your optimism: The US can just say: let us access this one customer or we will ruin your vpcs in the US.
What can you do about it? FDE? Can you keep the keys away from Hetzner? How much hacking would they need to do to get them? Can US government break SecureBoot?
Hetzner US would have no power over Hetzner EU, that's the point. All they can do is beg their parent company the same way law enforcement could beg them directly.
Sorry I wasn't clear. I meant I would expect US government to approach Hetzner EU and say "nice Hetzner US business you got going over here, it would be a shame if got hit by a tax inspection. Businesses make tax mistakes all the time you know? We could make sure that doesn't happen if you help us with this law-breaking customer of yours"
the alternative being hetzner giving away EU based information to the US? which would absolutely destroy their reputation in the EU. (which is a far larger market for them).
The only way to spin this as hetzner is to go public with this and make it a political point for geopolitics between the EU and the US, and take the loss /call the bluff on the US threat.
Let me tell you about that time when I walked around in a DC in NL and ran into an unaccompanied FBI liaison officer...
I don't think any of us have the total picture, but the bits that I do have are sufficient to worry me about the degree to which I am automatically breaking the NDAs I sign by using a computer, email, online data rooms and so on.