Proposed Bitcoin Lawsuit Settlement Gets Thumbs Down at Committee Level | WJHL

JONESBOROUGH, Tenn. (WJHL) — Members of a Washington County committee want the full county commission to reject a proposed settlement agreement that would end the county’s lawsuit against BrightRidge and Bitcoin mining operator Red Dog Technologies.

“I think it’s time we put this in the past, so I’m going to make a recommendation that we not accept this and fight in court,” First District Commissioner Richard Tucker said at Thursday’s Commercial, Industrial and Agriculture Committee meeting. The committee of five members was tasked with an initial review of the proposal.

While discussing other potential options the full commission could consider at its Nov. 28 meeting, the committee ultimately adopted Tucker’s proposal. It recommends that the 15-member commission reject the proposal, in which Red Dog promises to build a new Bitcoin mine at the Washington County Industrial Park (WCIP) in Telford and close one it has operated in Limestone since late 2020.

Should the full commission do so, the lawsuit to shut down the Limestone mine would resume in Washington County Chancery Court. The sides argued the case from November 2021 to May before the county commission presented a draft settlement agreement with Red Dog and BrightRidge at the meeting on June 9.

That draft would have Red Dog build a new mine — consisting of high-powered computers that solve complex algorithms to “mine” new cryptocurrency — in WCIP and close it in Limestone. Fans cooling the computers at the Limestone mine create significant noise, leading to complaints from people living in the rural community as of May 2021.

Almost immediately, it drew fierce opposition from many residents of the Telford area, who said they believed noise from it would affect education at nearby Grandview Elementary School, harm animals at Bright’s Zoo two miles away and disturb the peace of nearby homes. The proposed development does indeed set some noise limits at the new location, but that has not bothered the residents.

Joy Ayars was one of two residents who were allowed to speak in opposition at Thursday’s meeting and has been one of the de facto leaders of the opposition.

“We’re very pleased that our commissioner, the one who represents Jonesborough (Tucker), spoke up and said that this is not a good proposal and we hope that it goes back to litigation and that Bitcoin can be out of here altogether,” said Ayars after the meeting.

While committee members ultimately voted 4-0 (Ken Huffine is a BrightRidge board member and abstained), several seemed open to asking Red Dog and BrightRidge additional questions and wanted to potentially tweak the current proposal.

“We don’t even have enough information to consider this proposal,” Huffine said. “There are a lot of … holes in this. As this comes before the commission, I would like to ask a representative from Red Dog to be there to answer any questions that commissioners may have about what their proposal actually is.”

Huffine also said he believes BrightRidge should send a representative to that meeting.

Commissioner David Tomita said the issue was “something we should put to bed, because things like this tend to drag on for a long time.”

Tomita said he doesn’t think the commission will “ever have all the information” it needs to make a fully informed decision.

“Sometimes you have to make a decision with what you have,” he said. “And we’ve got time before the (full commission) meeting. If there’s something missing, if there’s something one side thinks we don’t know, guess what — now’s the time. We’ve got three weeks. Get it to us , we are available.”

Tomita and Lewis Wexler — who along with committee members Tucker and Larry England were elected as new commissioners in August — both acknowledged the county could lose the lawsuit, but both voted to recommend a return to court, at least at Thursday’s meeting.

Ayars sounded convinced that the county could prevail.

“It was originally brought here to Limestone with deception behind it,” she said. “That’s a good point to make. And it wasn’t seasoned correctly.”

BrightRidge requested the rezoning of the property it now leases to Red Dog next to the Bailey Bridge Road substation at the County Commission meeting in February 2020. The request mentioned a “blockchain data center” and said small fans there would not create a noise problem.

While a cryptocurrency mine is a type of blockchain data center, BrightRidge’s request never mentioned Red Dog or the prospect of a Bitcoin mine. The county’s lawsuit claims Red Dog’s use is a zoning violation and that Red Dog also began operations without applying for or obtaining a permit.

Ayars said she hopes the full commission follows Thursday’s recommendation.

“If it’s a nuisance and a noise problem in Limestone … why give them space and bring it to the Washington County Industrial Park where there’s a zoo, the school and a lot more residents,” she said.