Crypto Mining Firm NewRays Files Lawsuit Against Arkansas Judge and Prosecutor Over Noise Regulation Enforcement
On Thursday, September 26, 2024, crypto mining company NewRays filed a complaint against an Arkansas County judge and prosecutor, alleging selective enforcement of noise regulations targeting its operations. In the lawsuit submitted to the district court of Arkansas, NewRays accused Judge Allen Dodson and prosecuting attorney Phil Murphy of unfairly applying noise legislation against its crypto mining facility.
NewRays, which acquired property in Faulkner County in October 2022 to establish a data center for cryptocurrency mining, claims it did so without any existing zoning restrictions. However, following noise complaints from local residents, the county enacted laws that impose decibel limits and criminal penalties for violations of these regulations.
The company argues that the local ordinance violates the Arkansas Data Centers Act, which was enacted in April 2023. This law is designed to protect large computing and data mining operations from discriminatory regulations. NewRays contends that the defendants coordinated their actions to enforce the ordinance, potentially to support a civil lawsuit filed by residents against the firm.
Legal challenges escalated when NewRays sought to move the civil lawsuit to federal court, but the county district court asserted its jurisdiction over the matter.
Justin Daniels, a partner at the law firm Baker Donelson, commented on the broader implications of this case, citing a pattern of targeting crypto companies due to the negative perception surrounding Bitcoin and its energy consumption.
The complaint also highlights that discussions about a specific “crypto mine ordinance” began as early as June 2023. NewRays alleges it was crafted to discriminate against its operations while allowing other businesses that generate more noise to operate without similar scrutiny.
The company is seeking both preliminary and permanent injunctive relief to prevent the enforcement of the ordinance against it.
Please contact BlockTribune for access to a copy of this filing.
