JONESBOROUGH, Tenn. (WJHL) – Waiting three months for a “trial on the merits” is the quickest potential route to getting a Bitcoin mine shut down in rural Washington County, County Attorney Allyson Wilkinson told county commissioners Monday night.
Wilkinson also briefed commissioners on a counterclaim filed by the mine’s operator that seeks $41 million in damages against Washington County if the mine is ruled to violate the county’s zoning laws and gets shut down.
Wilkinson — and attorneys representing both the mine’s owners and BrightRidge, which leases land the mining equipment sits on and sells power to operate the mine’s computers — agreed to forgo a Dec. 8 temporary injunction hearing and go straight to a Chancery Court trial in March.
“It is … my opinion that it is in the best interest of the county to proceed with a full trial on the merits on an expedited basis on March 14, 2022 rather than go forward in a series of temporary remedies, which would still require a trial on the merits, but later in the year,” Wilkinson said.
Short of a court order, Wilkinson told commissioners, she doesn’t expect Red Dog Technologies to shut down of its own accord, or for BrightRidge to comply with a late September order from the county to shut the company’s operations.
That September order came four months after neighbors complained about excessive noise from the fans that cool computer servers at the operation. It was based on the use — cryptocurrency mining by a private company — not complying with the county’s A-3 zoning rules.
BrightRidge got a rezoning to A-3 for the land next to its Bailey Bridge Road substation in February 2020 with a request that said the utility would operate a “blockchain data center” there. The request didn’t mention a private company or crypto mining, and utilities are allowed to operate in the A-3 zone.
Wilkinson said she believed the issue was an important one to both the commission, which elected to sue in November after BrightRidge refused to comply with the order, and to county residents.
She said as she considered whether to agree to a delay in exchange for an earlier trial date, “I certainly did think about the people in that area. I know this is the time of year when there’s no leaves on the trees, and if there was another course of conduct that would have been better for the county we would have agreed to it.”
Wilkinson also gave commissioners details about Red Dog’s counterclaim, which asks for Judge John Rambo to rule that the mine does comply with the zoning law, or to award monetary damages if he rules the mine isn’t a permitted use.
“That claim is seeking a judgment for money damages in an amount of not less than $41 million,” Wilkinson said.
She said the claim references $5 million lost putting the operation in place “and that they’ve lost a net operating income which they allege would be $36 million over the next 18 months.”
If Red Dog succeeds, that judgment “would be paid by Washington County if they were successful, and the taxpayers,” Wilkinson said.