This is all WhatsApp's and the US's problem, not Brazil's. In fact, it's kind of insensitive for foreigners to suggest that a judge of a sovereign nation must consider US law in his rulings. If anything, I think this would justify ruling against WhatsApp more harshly, as it sends the message to the US that policies which don't respect the sovereignty of Brazil will hurt US economic interests in Brazil.
That said:
> Second, apparently, the data does not exist. WhatsApp publicly stated, including in testimony before the Brazilian Congressional Committee on Cyber Crimes[2], that it does not and has not retained any message content once messages are delivered, even before the recent full roll-out of E2E. Based on these statements, it would seem that WhatsApp is indeed unable to comply with the court's request, regardless of any jurisdictional arguments.
If this is true, that's a solid argument and stands on its own.