BIRMINGHAM, Ala. — Construction at the massive Nebius AI data center in Birmingham’s Oxmoor Valley can continue for now under a judge’s order that restricts work hours, while a hearing set for Tuesday will decide whether to halt the project entirely until a lawsuit by nearby residents is resolved.
Circuit Judge Javan Patton Crayton ruled Friday that two Oxmoor Valley homeowners may proceed with their lawsuit alleging the facility is being built illegally and causing noise, dust and vibration that harm their properties. The judge denied defense arguments that the neighbors should have first challenged the project through the city’s Zoning Board of Adjustment, saying the case presents a legal question for the court.
After a contempt filing over alleged early-morning work, Crayton also ordered that construction cannot begin before 8 a.m. on weekdays and that Saturday work cannot start before 9 a.m., a partial work restriction that has been described in reports as a limited work stoppage during early hours. A preliminary injunction hearing is scheduled to begin Tuesday, July 14, at noon and continue through Thursday, July 16, where plaintiffs will ask the court to impose a full temporary halt to construction.
The dispute centers on a roughly 75-acre site in the Oxmoor Corporate Park, where Amsterdam-based Nebius is building what it calls an “AI factory” — a hyperscale data center campus expected to operate through 2028. The project, valued in the tens of billions of dollars, would draw up to 300 megawatts of power and include multiple emergency generators, according to city filings and company statements.
The site, formerly a Regions Bank back-office facility, was already zoned to allow data centers, and Nebius submitted its initial permit applications in January 2026, before the Birmingham City Council adopted a six-month moratorium in March on new or expanding data centers larger than 20 megawatts. City officials have said the moratorium does not apply retroactively to projects that had already begun the permitting process, and Mayor Randall Woodfin has stated his administration cannot legally stop a project that started before the pause.
In June, the council’s moratorium expired and was replaced by a new data center ordinance that imposes additional conditions on hyperscale facilities. Nebius subsequently withdrew a permit modification request for its second building after the new rules took effect, with a company representative saying the proposed design change did not affect the project’s footprint, power or computing capacity.
The legal challenge has grown more complex in recent months. Homeowners Madelyn Greene and David Butler, seeking class-action status, filed suit in May alleging zoning violations and arguing the project should not have been allowed to move forward. In an amended filing, they accused a network of related entities of rapidly flipping the land in a series of quick transactions that allegedly inflated the project’s stated investment from about $20 million to roughly $90 million in roughly 25 hours.
On July 2, a different Jefferson County judge, Tamara Harris Johnson, recused herself from an earlier phase of the litigation after a defense attorney raised concerns about her prior professional relationship with the plaintiffs’ lawyer, abruptly ending a three-day trial and forcing the case to restart before a new judge.
On July 10, the same day Crayton ruled the residents’ case can proceed, the Greater Birmingham Humane Society filed a separate lawsuit seeking judicial review of the permits and approvals for the Nebius project. The Humane Society, which is developing an animal campus adjacent to the data center site, argues there are unresolved questions about operational noise, heat and lighting impacts on its future facility.
Neighbors have held multiple protests and voiced concerns about noise, dust, vibrations and the broader effects of a large industrial facility in a residential and mixed-use area. Aerial images from July show dozens of excavators and heavy construction equipment spread across the nearly 80-acre property, with work continuing under the judge’s time restrictions.
City officials have maintained that they cannot intervene in the ongoing plans for the Nebius campus, despite resident and advocate objections, noting that decisions about infrastructure and zoning exceptions fall under the independent Zoning Board of Adjustment. The city has said it does not comment on pending litigation.
Nebius has said in past statements that it is moving forward “openly and transparently” and has pointed to planned sound abatement measures to minimize noise. The company has indicated the project would generate significant tax revenue, with one report stating it anticipates nearly $87 million in annual school taxes.
If the judge grants a temporary injunction at the July 14–16 hearing, construction would stop until the underlying lawsuit is resolved, though plaintiffs would likely have to post a bond to cover the developers’ losses if they ultimately lose the case. If the injunction is denied, work is expected to continue under the current weekday and Saturday hour limits while the trial proceeds.
The outcome of the hearing could shape not only the future of the Oxmoor Valley project but also how Birmingham regulates future hyperscale data center developments under its new ordinance.