A new lawsuit has added another legal challenge to Nebiusβ controversial artificial intelligence data center in Birmingham, Alabama, with allegations involving the former Regions Bank property that is now being developed for the project.
James M. Anderson, a shareholder of Regions Financial Corp., filed a derivative lawsuit in Jefferson County Circuit Court on Sept. 5, alleging that Regions Bank sold the property for substantially less than its eventual resale value.
According to the complaint, the approximately 80-acre site changed hands three times on Sept. 30, 2025, beginning with a $17.2 million sale by Regions Bank and ending with an $83.5 million sale to Alabama ADC Holdings, a Nebius affiliate.
The lawsuit alleges Regions suffered roughly $66 million in damages and accuses certain bank officials and other defendants of negligence, wantonness, breach of fiduciary duty, conspiracy and fraud.
Those are allegations, and the defendants have not been found liable. Regions has declined to comment on the pending litigation.
Why the Birmingham tax incentives matter
The land dispute comes as scrutiny intensifies over Birminghamβs financial incentives for the Nebius project.
On May 29, the Birmingham Industrial Development Board approved a 30-year incentive package valued at about $3.234 billion, according to reporting and public documents reviewed by local news outlets.
The agreement provides an 80% abatement of qualifying construction-related sales and use taxes and a 65% abatement of non-education property taxes.
The incentive agreement does not provide Nebius with an upfront cash payment.
Instead, the abatements are tied to the companyβs investment and employment commitments, with provisions allowing incentives to be reduced or clawed back if certain obligations are not met.
Nebius says its Birmingham AI factory could generate approximately $85.7 million in annual tax revenue for Birmingham, Jefferson County and Alabama while creating construction and long-term employment opportunities.
The company also says it will fund necessary power infrastructure and use a closed-loop cooling system designed to limit water consumption.
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What happens next?
The shareholder lawsuit is separate from lawsuits filed by Oxmoor Valley residents challenging the legality of the data centerβs permitting and construction.
One of those cases is scheduled to proceed toward a non-jury trial in March 2027.
For Birmingham, the latest litigation puts both the Nebius land acquisition and its multibillion-dollar tax incentive package under heightened scrutiny as construction continues.
The lawsuits do not establish wrongdoing by Nebius, Regions Bank or the Birmingham Industrial Development Board. Those claims will have to be tested through the court process.
