Jun 29, 2026
New Lawsuit: Nebius AI Mega Factory Violates Zoning Ordinance
Two Oxmoor Valley homeowners filed suit on June 29 to stop construction of the 300-megawatt Nebius AI Mega Factory, the second lawsuit brought against the project since April.
Robert Sansome and John Hilley, next-door neighbors on Sydney Trail, filed their verified complaint in the Circuit Court of Jefferson County. Their homes sit just across Lakeshore Parkway from the site, Sansome’s about 800 feet from the work and Hilley’s about 970 feet.
The suit names Hoar Construction, Lakeshore Data Center, Nebius, Inc., and the City of Birmingham as defendants. It requests a temporary restraining order to halt work while the case proceeds.
The complaint turns on Birmingham’s own zoning rules.
The site is zoned MXD, a Planned Mixed-Use District, and under the city’s ordinance a use is allowed only if the ordinance affirmatively lists it. The ordinance does not list, define, or authorize a data center, a hyperscale data center, or an AI factory anywhere in the city, the suit states.
Placing a use of this character on the MXD site required assigning it to a use group and amending the Council-approved Conceptual Plan, both only after public hearings before the Zoning Advisory Committee and the City Council. According to the complaint, no such proceedings occurred and the public hearings the ordinance guarantees were never held.
The filing also focuses on the substation and switching station the project cannot operate without. Each required a special exception from the Zoning Board of Adjustment, the complaint states, and the board denied both applications on March 26.
The developers appealed, then dismissed their own appeal, leaving the denials final.
Even so, the city issued a permit for the substation on June 3, more than two months after the denial, under a fee of $622,711.46.
In an April memo, the City Attorney claimed the ZBA had no jurisdiction over the facilities. The suit argues the memo cannot override the board’s denials.
The plaintiffs describe jackhammering and caisson drilling that begins before 7:30 a.m., dust, low-frequency noise and vibration they can feel inside their homes, and heavy truck traffic.
Plaintiff Hilley reports cracking that has appeared in his home since the work began.
Once the AI Mega Factory is operating, the complaint states, the two families face continuous noise, generator exhaust, light, and heat. Alongside the zoning claims, the suit brings counts for private nuisance and trespass and asks for compensatory and punitive damages.
“My home is the closest to this project, and the disruption has become part of daily life,” Sansome said in the filing, adding that the rules meant to protect a residential neighborhood should be followed before a 300-megawatt industrial facility goes up across the street.
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