Data Center Foes’ Newest Tack: Sue Locals Over Approval Process
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Skeptical homeowners are spurring a wave of legal disputes over the approval of data centers. This property is about 50 miles from Hill County, Texas, where local officials passed, then rescinded, a temporary data center ban. Photo: The Dallas Morning News/Hearst Newspapers<br>Deep Dive<br>Data Center Foes’ Newest Tack: Sue Locals Over Approval Process<br>August 10, 2026, 9:07 AM<br>By Mallory Culhane
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Data center opponents aiming to delay or halt development of the hulking server warehouses are relying less on arguments over potential community harm and more on claims that projects were secretly or illegally approved by local officials.<br>From Festus, Mo., to Doña Ana County, N.M., dozens of lawsuits claim data center approvals violated public notice laws or zoning regulations. Local officials, in turn, are defending their processes and boasting about the potential economic benefits, while developers fight to keep their multibillion-dollar projects alive.
“We have rules in place that don’t really fit what is happening on the ground in this moment,” said Amanda Garcia, senior attorney and head of the data center project at the legal advocacy group Southern Environmental Law Center. The lawsuits, she said, “put a fine point on the problems that are occurring under the existing system.”<br>The wave of litigation mirrors the race to build data centers, which have become the most glaring example of how artificial intelligence is poised to reshape the physical and economic landscapes of some communities. One local official said the pushback reminded him of how some groups rose up to fight the rapid expansion of fracking operations and solar energy farms.<br>Data center foes — concerned about energy use, environmental impact, tax breaks and even aesthetics — delayed or blocked at least 75 projects from moving forward in just the first three months of this year, according to a report from the consulting firm Data Center Watch. In some cases, developers and companies have been forced to restart the yearslong process to get to the operating stage.<br>As opposition mounts, more communities are temporarily banning data center development or pulling their tax incentives. New York in July became the first to impose a statewide, yearlong ban on hyperscale data centers.<br>“A lot of folks who challenge any kind of development project, they think developers and the nefarious lawyers like us want to come in and just bulldoze people,” said Robert Loftin, a partner at McGuireWoods LLP who represented a data center builder in a Northern Virginia dispute. “But everybody recognizes there needs to be an approval process.”<br>In that case, a state court held that Prince William County officials failed to properly notify the public of a meeting during which the Board of Supervisors approved converting more than 1,500 acres of agricultural and semi-rural land for data centers. Blackstone’s QTS and Compass Datacenters have since abandoned their project plans.<br>Dozens of cases with similar allegations have popped up across the country, stalling developments at the same time the tech industry and China hawks in Washington assert the US needs to stay competitive on AI and other technologies. The law often favors the discretion of government officials, lawyers say, so picking apart the process is a stronger strategy.<br>”I have seen the procedural challenges against other jurisdictions,” said Leo Rogers, attorney for Loudoun County, Va., home to the highest concentration of data centers globally. “You can always learn from the mistakes of others.”<br>Sharing Legal Advice<br>After a Utah county made headlines over the backlash to a proposed data center, the project’s opponents got a flood of calls from people in other states asking for advice.<br>“Especially when they’re in the beginning stages, where they’re just finding out about it, they don’t know what to do,” Brenna Williams, one of the residents leading the charge there, told Bloomberg Law.<br>Williams’ group is appealing Box Elder County’s refusal to put a referendum on the November ballot that would allow voters to weigh in on what started as a $100 billion proposal, known as the Stratos Project, that’s backed by media personality and businessman Kevin O’Leary.<br>They’re also challenging the constitutionality of the state entity that initially greenlit the project.
Demonstrators gathered outside the Utah State Capitol in May to protest the construction of the Stratos data center. Photographer: Natalie Behring/Getty Images
That case, like most, is proceeding in state court. In one of the only federal cases, a group of Ohio homeowners is suing the officials who approved a proposed $4 billion Amazon Web Services Inc. data center complex in Wilmington, about 50 miles northeast of Cincinnati.<br>The lawsuit, filed in March, alleges that officials held...