Lawsuit Challenges Effingham County’s OpenAI Data Center Deal, Alleges Open Meetings Violations
A second lawsuit related to the 1,400 acre data center site in Effingham County has been filed, with the most recent complaint accusing the Industrial Development Authority of ‘clandestinely negotiating.’
Coastal advocacy organization One Hundred Miles and five residents are the named plaintiffs in the suit against the Effingham County Industrial Development Authority. The complaint alleges that officials violated Georgia’s open government laws while negotiating and approving the OpenAI data center project announced in July.
In addition to One Hundred Miles, Inc., Amy Collins, Robert Collins, Elizabeth Fisher, Crystal Hayes and Manjusha Sheobaran are also named as plaintiffs. The IDA and Octans GA, LLC, an OpenAI affiliate, are named as defendants, though the plaintiffs state they are not asserting claims against Octans at this time.
The 3.2 gigawatt data center campus slated for the Savannah Gateway Industrial Hub is expected to include a 4.4 million square foot development and some $900 million in tax abatements through an agreement approved by the Development Authority.
At the heart of the complaint are allegations that the IDA negotiated the project outside of public view for months before announcing it as a “done deal.” The complaint alleges officials began discussions with OpenAI in fall 2025, entered into a nondisclosure agreement in October, and continued negotiations into 2026. It further alleges that Development Authority CEO Brendt Herndon publicly said in April that the agency was not actively recruiting data centers even as negotiations with OpenAI were underway.
That official admitted the cynical rationale for the Authority’s lack of transparency: “If we’d have put it out in front of the public, they’d have said ‘No data center’ based on misinformation and what Virginia looks like, or what they’re reading on social media.” – excerpt from the lawsuit
Four Alleged Open Meetings Violations
The lawsuit alleges four separate violations of Georgia’s Open Meetings Act by the IDA:
- The IDA moved the regular July meeting date, but failed to post the rescheduled meeting on its website. At this meeting, the $900 million in tax abatements were approved.
- The IDA meeting agenda concealed the nature of the matter by identifying it only as “Project Gateway,” without telling the public that the item involved the OpenAI data center and its tax incentive agreement.
- The IDA discussed the tax abatement deal during a non-public executive session, even though the Open Meetings Act does not authorize agencies to discuss such matters in executive sessions.
- The IDA sold the approximately 1,440 acres of land for OpenAI without publicly voting on the purchase and sale agreements or disclosing the identity of the property and terms of the sale, as required by the Georgia Open Meetings Act.
In a compounded complaint, the suit alleges that the IDA violated the Georgia Open Records Act when it failed to produce public records related to the sale of the property, despite repeated requests by attorneys to do so.
“The Development Authority’s stonewalling has continued to prevent Plaintiffs and the public from understanding the full contours of the DEvelopment Authority’s agreements with OpenAI,” it reads in part.
“Georgia’s Open Meetings Act and Open Records Act were enacted to protect individuals and the broader public from “closed door” politics, ensure public access to and participation in the actions of governmental bodies in Georgia, and broadly foster public confidence in government. By clandestinely negotiating the OpenAI data center deal and then refusing to disclose key public records related to that deal, the Development Authority has flouted the basic tenets of Georgia’s government transparency laws.”
The complaint also alleges an Open Records Act violation, saying attorneys for the plaintiffs requested the May and July land-sale agreements multiple times in August but the Authority had not produced them when the lawsuit was filed. Authority representatives reportedly said the documents were held by its private agent, Savannah Industrial Development, but the plaintiffs argue Georgia law requires the Authority to retrieve public records held by an entity acting on its behalf.
Plaintiffs Want Agreements Invalidated
The lawsuit asks the Superior Court to declare the IDA’s approval of the OpenAI Memorandum of Understanding nonbinding and void. It also asks the court to invalidate the purchase and sale agreements, limited warranty deed, and other documents associated with transferring the 1,440-acre property.
Also requested by the plaintiffs is a court order compelling the IDA to release land sale agreements from May and July.
The plaintiffs are represented by Zachary Hennessee of the Southern Environmental Law Center.
The case has been assigned to Superior Court Judge Michael Muldrew.
The allegations represent the plaintiffs’ claims at this stage of the litigation and have not yet been adjudicated by the court.
