Chancellor John Rambo issued a judgement Monday ruling that a bitcoin operation on property owned by BrightRidge in the Limestone area does not conform with the proper use allowed under Washington County’s zoning regulations.
He ruled that Red Dog Technologies LLC “blockchain verification data” operation at 144 Bailey Road does not meet the definition of a public utility as outlined in the county’s zoning rules.
The zoning resolution defines such a use as a “public service owned or authorized by a municipal, county, state or federal government in the provision of such services as transportation, water supply, sewerage treatment, electricity, natural gas and telephone, telegraph and microwave transmission.”
“They’re a user, not a provider,” the chancellor said in ruling on a motion for a summary judgement. “They are using electricity and the internet.”
Rambo also agreed to hear a motion to set a bond that Red Dog must pay to the county while his decision is being heard in the appellate courts. The zoning issue had been set for an expedited three-day trial this week.
The chancellor said the appeal of his his ruling Monday “doesn’t dispense” with all the issues of the case.
At the request of officials from BrightRidge, Washington County commissioners voted in February 2020 to rezone the tract from A-1 general agriculture district to A-3 agriculture/business district. The county says BrightRidge submitted a commercial zoning compliance permit in May 2020 for a “data center” on its newly rezoned property near its Phipps substation.
Washington County alleges county commissioners first became aware that BrightRidge was in violation of the permitted zoning use for its Limestone property when residents in the neighborhood appeared during the public comment segment of their monthly meeting to voice their concerns about loud noise coming from the bitcoin operation.
Commissioners voted in September to ask their legal counsel to send a letter to officials at BrightRidge, informing them they have 30 days to discontinue the current use of their property. Two months later, Washington County filed motion asking the Chancery Court to issue an injunction in the case.
Rambo issued an order in December setting “expedited litigation schedule” to hold a trial in Chancery Court.
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