A South Jersey town banned data centers. A $300 million lawsuit alleging equal protections and free speech violations quickly followed.

A real estate developer sued local officials in Monroe Township for $300 million shortly after the Gloucester County municipality banned data centers. Now, the case has moved to federal court.

Hexa Builders, a Princeton-based real estate developer, has long sought to develop a property at 3043 Black Horse Pike. Hexa filed a lawsuit on June 5 in New Jersey Superior Court after Monroe officials denied its application to build a 1 million-square-foot data center and a warehouse on the property.

The ban, put in place by two ordinances approved by the township on April 22, followed months of public outcry against Hexa’s potential project. Even after the ban was passed and officially took effect on May 13, Monroe Township residents packed the room when Hexa presented its application that still included a data center at a rowdy Special Planning Board meeting on May 22.

In the filing against Monroe’s mayor, township, and planning board, Hexa claimed the application rejection and data center ban are arbitrary, violate freedom of speech rights and the 14th Amendment, and more. The Woodbury Warbler, a local news site, reported on the filing last month.

Jim Maley, Hexa’s lawyer and a partner at Maley Givens in Collingswood, said he expects the ban to be overthrown, since he believes the ban in Monroe stems from trending public disdain for data centers.

“Nobody is giving any testimonial, any scientific reasons for the good of the community. Everybody’s doing it,” Maley said. “It’s just a thing.”

Debate around data centers, which opponents claim will lead to environmental problems and noise, are not new in South Jersey. A massive data center in Vineland is set for completion by the end of the year, while Medford Township passed an ordinance banning data centers in June. Millville in Cumberland County banned large-scale data centers in May after promotions for a new 66-acre “Millville Energy & Data Center Campus” circulated online. On Monday, Cherry Hill‘s council scheduled a public hearing for July 27 to potentially adopt a ban across the township.

For now, Maley said Hexa is at a standstill. But the company still wants to complete the project, even with the public’s pushback and what could be a lengthy court process.

On July 6, the township moved for the case to be pushed to federal court, closing the Superior Court case, and no federal proceedings are on the docket yet.

“The Township is committed to vigorously and zealously defending this lawsuit while remaining steadfast in its commitment to protecting the interests of the Township, its residents, and its taxpayers,” said Sandra Graise, solicitor for Monroe Township, in an email.

Graise declined to further comment on the case or the data center ban, but the township wrote in a Facebook post last month that the lawsuit wasn’t a surprise.

Hexa, led by CEO Dipal Patel, officially obtained the property in a $5 million transfer of about 170 acres of farmland back in 2022. The township has included that land in a resolution for commercial redevelopment since 2019.

The site was previously approved for the construction of hundreds of homes when Hexa bought it, Maley said, but the township ended up moving in a different direction. In 2022, the township approved a redevelopment plan that set the grounds for Hexa to build warehouse, storage, and distribution facilities on Black Horse Pike, but not data centers.

That changed in early 2025, when the township passed an ordinance amending the redevelopment plan to allow data centers.

It didn’t take long for residents to speak out about the impact a data center could have on water quality, pollution, and noise in their neighborhoods, even before Hexa officially added a data center to their plan.

A planning board meeting in January 2026 dragged on for more than four hours because of resident objections, but the township still voted to approve a preliminary site plan for Hexa to move forward with its warehouse and distribution center project. The proposal didn’t include a data center at the time, though the lawsuit filed in June claims that Hexa had already expressed interest in developing one, and residents made it clear they weren’t fans of the possibility.

The township drafted an ordinance in March to set standards for data centers, including noise restrictions and a closed loop cooling system to avoid groundwater withdrawal, but that ordinance was tabled and never moved forward.

Instead, in April, Monroe passed two ordinances: one banning data centers altogether, and another repealing the 2025 ordinance that allowed data centers on Hexa’s property.

“At the end of the day, this Township has now banned any data center use from ever coming to Monroe Township. I thank those residents who attended the many meetings and expressed their concerns. The process worked,” Mayor Greg Wolfe wrote in a May township newsletter.

Two weeks before the ban was adopted, though, Hexa’s legal complaint claimed it submitted an amended application to the township to turn one of its proposed warehouses into a data center.

Maley said the amendment was driven by “interest from the marketplace that began before Township passed the ordinance” that allowed data centers at 3043 Black Horse Pike last year.

When Hexa sought approval for the new application on May 12, the township deemed the company’s application incomplete, prompting Hexa’s lawsuit.

The $300 million sought by Hexa Builders accounts for financial losses related to the stunted data center project, Maley said.

“The damages all come from real, actual commercial realities here. ... It’s the loss of the value of the project,” Maley said.

In its 102-page complaint, initially filed in Gloucester County court on June 5, Hexa claimed that Monroe violated the 14th Amendment by treating Hexa’s plan differently than similarly sized projects, like warehouses and other high water usage facilities, that it claims would have similar environmental and aesthetic impacts.

Hexa also claimed that banning data centers violates the First Amendment and free speech rights, since the facilities could support artificial intelligence and social media communications in the area.

Maley said the data center ban will have “an adverse effect on communications,” and the argument is an effort to adapt constitutional law to today’s tech.

“Data centers are a medium of expression and banning data centers would impose a significant burden on the free speech rights of all citizens in the United States,” the complaint reads.

Those are just some of the 20 counts alleged by Hexa, including that the township didn’t give the company ample notice of its ban as it prepared data center plans. Monroe Township officials have publicly shared their intention to keep mostly silent on the litigation as the case moves forward.

Some residents have continued to speak out at meetings and ask questions about potential loopholes in Monroe’s ordinances to ensure their neighborhoods remain data center-free.

At the township’s planning board session on July 9, Williamstown resident John Romano asked who allowed Hexa’s application to get so far in the first place, and whether Monroe will be able to hold a case against Hexa in court. He said the data center would be right in his backyard.

“I’d like to sit out in my backyard and enjoy a stogie and a cold one and not hear noise and pollution and this and that,” Romano said. “I would like to be able to stay in Monroe Township, live out my golden years here, which was the plan. This has got my wife and I really concerned.”