Spartanburg Data Center Lawsuit Dismissed

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Spartanburg Data Center Lawsuit Dismissed: Court Enforces Standing and Administrative Review Requirements

Article Summary: The Spartanburg County Court of Common Pleas dismissed a lawsuit challenging permits associated with Valara Holdings LLC’s high-performance computing center in Spartanburg County. The court held that the plaintiffs lacked standing to pursue certain claims and, more importantly, failed to exhaust available administrative remedies before seeking judicial intervention. The ruling reinforces longstanding South Carolina law requiring parties to pursue local zoning and land-use appeals through prescribed administrative channels before turning to the courts.

We are pleased to announce a significant victory on behalf of Valara Holdings LLC in litigation concerning one of South Carolina’s largest economic development projects. On October 6, 2026, the Spartanburg County Court of Common Pleas granted motions to dismiss filed by Valara and Spartanburg County, dismissing in its entirety a lawsuit brought by Concerned Citizens of Spartanburg County challenging the permitting process for Valara’s high-performance computing center.

The lawsuit sought declaratory and injunctive relief relating to Spartanburg County’s classification and processing of permit applications associated with the project. Plaintiffs alleged that the project should have been treated as a “Major Land Development” under the County’s Unified Land Management Ordinance and further challenged both an already-issued permit and a pending permit application. Plaintiffs also sought to halt ongoing construction activities at the site.

The defendants argued that the claims could not proceed because the plaintiffs failed to follow the administrative review procedures established by South Carolina law and the local ordinance. Valara further argued that plaintiffs lacked standing to seek certain forms of relief because they failed to allege a sufficiently particularized injury.

The court agreed. In a comprehensive order, Judge J. Derham Cole, Jr. held that plaintiffs failed to exhaust their administrative remedies before filing suit. The court emphasized that South Carolina’s Planning Enabling Act and Spartanburg County’s land-use ordinance establish a specific process for challenging permitting decisions, including appeals to the Board of Zoning Appeals and enforcement mechanisms for alleged ordinance violations. Because plaintiffs did not pursue those administrative avenues before filing suit, dismissal was required. The court further held that challenges relating to a pending permit application were not ripe for judicial review because no final permitting decision had yet been made.

The court also ruled that plaintiffs lacked standing to pursue certain claims for injunctive relief. Although plaintiffs alleged concerns regarding construction activity, traffic, noise, environmental impacts, transparency, and participation in the permitting process, the court concluded that the alleged injuries were generalized grievances rather than the type of particularized injury required under South Carolina law. The court likewise declined to apply the public-importance exception to standing.

Fourth Circuit's Key Holdings:

Administrative Remedies Must Be Exhausted: Parties challenging zoning and permitting decisions generally must pursue available administrative appeals before seeking relief in court.
Ripeness Matters: Courts will not adjudicate challenges to permitting decisions that remain pending before local authorities.
Standing Requires Particularized Harm: Generalized concerns about development impacts, transparency, or public policy are insufficient to establish standing under South Carolina law.
Local Land-Use Procedures Remain the Primary Forum: The decision reinforces the role of local zoning administrators and boards of zoning appeals in resolving land-use disputes before judicial review becomes available.
Practice Implications: This decision provides important guidance for developers, local governments, and community groups involved in land-use disputes. The ruling confirms that South Carolina courts will enforce procedural requirements governing zoning and permitting challenges and will require litigants to utilize administrative review mechanisms before seeking judicial intervention. The opinion also provides a significant discussion of standing principles in the land-use context and reinforces limits on attempts to bypass established administrative processes.

Willoughby Humphrey & D’Antoni, PA represented Valara Holdings LLC in the matter. Attorneys Mitchell Willoughby, Walker Humphrey, Andrew D’Antoni, and Hunter Pope served as counsel for Valara and worked alongside Kirkland & Ellis LLP and Bannister, Wyatt & Stalvey, LLC in securing dismissal of all claims.