On October 6, 2026, a federal judge in Nashville dismissed a lawsuit against the city’s pause on data center permits. The developer, DC Blox, paid about $23 million for 23.49 acres next to the Nashville Zoo before the city adopted the pause. NewsChannel 5
A moratorium is a temporary legal pause on certain government approvals. The Metro Council passed Nashville’s moratorium on July 21, and the mayor approved it on July 24. It stops the city from accepting, processing, approving or issuing zoning, building or grading permits for data center developments. Metro Council legislation A council amendment keeps the pause in place through December 1, 2026. Nashville Banner
What did the court decide?
The court dismissed all nine claims, but for different reasons and with different effects. It also denied DC Blox’s request for an early order forcing the city to process its permits, because no claims were left to support that request. Court docket
Three claims said the city violated the company’s property rights under the federal Constitution. The judge found the complaint never made clear which right it meant. DC Blox pointed to its ownership of the land, a right to build this specific AI data center, vested permit rights, an older use of the site, and a right to have applications processed. Fox 17
The judge gave the company 21 days to fix those three claims. Counted from the October 6 order, the deadline is October 27, 2026. A DC Blox spokesperson said the company will file an amended complaint. WKRN
The judge also wrote that a buyer who did not expect a moratorium passed after its purchase does not, for that reason alone, have a federal case. Nashville Banner
| Item | Before the moratorium | Under the moratorium |
|---|---|---|
| Zoning, building and grading permits for data center developments | Accepted and processed | Not accepted, processed or issued |
| DC Blox’s building and grading applications | Under city review | On hold |
| Trade permits | Issued | Still issued, because the pause does not cover them |
| End date | No pause in place | December 1, 2026 |
Why the comparison to another developer failed
Only one claim was decided on its merits. It relied on equal protection, the constitutional rule that government may not treat similar parties differently without a rational reason. DC Blox said the city let another developer, RadiusDC, receive a permit while its own applications sat on hold.
The judge found the two developers were not alike. RadiusDC received a trade permit, which is a type of permit the moratorium does not cover. DC Blox’s paused applications were for building and grading permits, which the moratorium names. Fox 17 This equal protection claim is not among the three the company may refile.
The state law questions go to state court
Five claims asked the court to declare DC Blox’s rights under Tennessee law. One said its July 17 application gave it vested rights, meaning the project must be judged under the rules in place when it applied. Another said the amended moratorium is invalid because the council never sent the amendment back to the Planning Commission. WSMV
That second argument rests on a state rule the mayor’s office has described itself. The mayor’s Executive Order 59 says Tennessee allows a moratorium only through an ordinance the local planning commission reviews and the local legislative body approves. Mayor’s executive order The Planning Commission approved a substitute version on June 25, and the council added its amendment on July 21. Metro Council legislation
The judge declined to decide any of the five state law claims. He dismissed them in a way that lets DC Blox bring them again in a Tennessee court. The ruling does not say whether the permits vested or whether the moratorium was properly adopted. Fox 17
What happens to a project caught mid-approval?
For a project already in the permit process, the moratorium delays the project but does not decide it. The question that decides it is which rules apply once the pause ends. The council passed permanent zoning rules the same night as the moratorium. The council member who sponsored those rules says they require at least a half mile between this kind of data center and the zoo. Fox 17
That makes vested rights the central issue. Under Tennessee law, a development is reviewed under the rules in place when its permitting began. Because DC Blox applied before the zoning rules passed, those rules may be too late for its project. Nashville Banner
The Board of Zoning Appeals is the city board that hears challenges to decisions by the zoning administrator. It is expected to hear two such challenges sometime after December 1. Both challenge the zoning administrator’s decision that allowed the project to go forward. Axios
The judge also noted that any new request for early relief may be hard to resolve before the moratorium expires on December 1. Fox 17 Separately, on August 4 the council approved legislation allowing Metro to take the zoo-area site through eminent domain, the government’s power to buy private land for public use. Nashville Post
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FERC’s order on PJM’s large load interconnection plan.