Judge dismisses data center lawsuit against Birmingham zoning board
It’s unclear why Nebius decided not to pursue its lawsuit over recent zoning decisions tied to its AI factory plans.
Chloe Mitchell 
A Jefferson County Circuit Court judge has officially dismissed the legal challenge against Birmingham’s zoning board brought by the tech firm behind a massive, multibillion-dollar AI data center project.
Case Dismissed
Judge Shera Grant signed off on the dismissal Thursday afternoon after a request was filed by Nebius Inc. It remains unclear why the company, which is developing the AI factory in the Oxmoor Valley area, decided to walk away from the litigation it initiated on May 11 alongside partners Alabama ADC Holdings, LLC and DPR Construction.
Neither spokespeople for Nebius, the firm’s attorneys from Fortif Law Partners LLC, nor city representatives have provided comment regarding the closure of the case.
Tracing the Conflict
The lawsuit followed a volatile period where city officials revisited zoning decisions regarding power infrastructure planned for Milan Parkway. At a March 26 meeting, the zoning board initially appeared to approve a power substation, only for city attorney Nicole King to later issue a memo on April 9 classifying the result as a denial based on board rules. The board also denied a separate special exception request for a switching substation during the same session.
Ultimately, the city shifted its stance, with King noting in the April 9 memo that the proposed facilities do not meet the legal definition of a 'utility substation' because they are designed for the data center's private use rather than serving local neighborhoods. Consequently, the city determined these structures did not require special exceptions and should not have appeared before the Board of Adjustments.
Looking Ahead
Nebius has committed to covering the costs for all necessary power infrastructure. Alabama Power has verified that it can accommodate the facility's 300-megawatt demand—an energy load roughly equivalent to powering 385,000 homes during peak demand periods. Both parties maintain that the project will not impact utility bills for local residents.
Headquartered in Amsterdam, Nebius secured 75 acres in Oxmoor Corporate Park last fall. While the land was already zoned for data centers, the project was submitted to the city just before officials instituted a six-month moratorium on new data center developments.
