Data center developer Raeden has filed a lawsuit against the city of Gibraltar, Michigan, arguing that a recently imposed moratorium on data center development unlawfully stopped its proposed 100MW data center.

In a lawsuit supported by the current landowner, Cal Realty, Raeden claimed the proposed 100MW facility at 27800 W. Jefferson, the location of a former steel plant owned and operated by McLouth Steel, was permitted under the city’s existing zoning ordinance.

Raeden had submitted its application to the city in mid-February 2026, to which the city responded by asking for additional details.

On March 9, city councilors approved the moratorium, prohibiting the establishment, permitting, consideration, approval, location, construction, and installation of any data centers in the city.

According to reporting from CBS News, the lawsuit claims that the “timing, text, and surrounding circumstances establish that the moratorium was adopted specifically to suspend or defeat review of plaintiffs’ pending application.”

“The moratorium purports to amend the zoning ordinance by prohibiting the ‘establishment and use’ of data centers within the city, thereby designating that no zoning district is appropriate for such use. There is nothing in the city’s charter that requires or permits zoning ordinance amendment by resolution.”

The lawsuit goes on to argue that the moratorium is in direct contravention of the city’s ordinance as, under the Michigan Zoning Enabling Act, local ordinances are not allowed to totally prohibit the establishment of a land use within a local unit of government, unless it is deemed unlawful.

There has been considerable opposition to data centers in the city, with Gibraltar residents organizing protests against the facility.

Raeden had organized an agreement to receive power from energy company DTE, but had also planned to install 35 backup diesel generators for the site.

In response to opposition, Raeden claimed the facility would use between 200 and 500 gallons of water per day, and pay for all energy infrastructure and other costs related to obtaining power, refurbishing the building, remediating all the existing conditions, and making the facility ready for data center use.

Michigan is currently considering whether to implement a statewide data center moratorium through House Bill 5594, which is currently in committee.