America’s largest tech companies are promising more money, fewer secrets and fewer tax breaks to the communities where AI data centers have been built or will be built in the near future.
Some homeowners are growing concerned about property values. Since May 2026, at least 4 proposed class actions have been filed by property owners in Michigan, New Jersey, Mississippi and Wisconsin.
These class actions claim that 24/7 noise from cooling systems, generators and gas turbines has caused their property values to drop.
The wave of lawsuits began in May, when two homeowners in Michigan sued Alliance Cloud Services, a subsidiary of Hyperscale Data, in federal court. The lawsuit was filed on behalf of all residents within 1 mile of a former Bitcoin mining data center that now also offers AI computing. The company is accused of failing to install adequate soundproofing.
That same week, two property owners near an AI data center in Vineland, New Jersey, filed a proposed class action against DataOne USA. They claimed that noise from diesel generators and cooling equipment diminished property values for about 1,013 households.
On June 8, three residents of Southaven, Mississippi filed a lawsuit against Elon Musk’s xAI, SpaceX and xAI subsidiary MZX Tech in federal court on behalf of more than 10,000 residents of Southaven and Horn Lake. The lawsuit was seeking damages for lost property values and emotional distress as a result of the noisy gas turbines.
In July, a group of three homeowners sued Microsoft in the U.S. District Court for the Eastern District of Wisconsin. They are seeking to represent more than 1,000 households within 1.5 miles of the Fairwater AI data center in Mount Pleasant who have been negatively impacted.
The Microsoft lawsuit specifically argues that facility’s 24/7 low-frequency hum fails to register on a typical A-weighted decibel meter that towns use to enforce noise ordinance regulations, according to ESG Dive. Microsoft said it is aware of the lawsuit.
Another lawsuit was filed in September by Memphis-area residents against X.AI Corp. and MZX Tech. The case involves nuisance noise and loss of use and enjoyment of their property, Law360 reported.
New research appears to support their concerns. A September 2026 working paper from UC Berkeley’s Energy Institute at Haas found that home prices within 3 miles of a data center dropped by about 3% over the following 5 years, and by an average of 7.2% within 1 mile.
The lawsuits are part of what a July 2026 American Bar Association analysis describes as a growing wave of litigation against data centers.
Homeowners who believe a nearby data center has reduced the value of their property may have legal options. A lawyer can advise them on their rights and on time limits that may apply.
Source: AI data centers turn politically toxic as tech giants court skeptical communities