In the 47-page complaint filed on Oct. 27 in the U.S. District Court for the Northern District of Texas, MARA accuses Hood County, County Judge Ron Massingill, County Attorney Matt Mills, and Elections Administrator Stephanie Cooper of “intentional and unconstitutional” conduct in approving a ballot initiative to create a new municipality called Mitchell Bend around MARA’s mining facility near Granbury.

MARA claims the proposed town boundaries were “drawn just to encircle” its site, giving local residents regulatory power to “tax and regulate it out of business.” The company argues the county violated multiple provisions of the Texas Local Government Code governing municipal incorporations, including requirements on population, boundaries, and pre-existing community status.

The dispute stems from neighborhood opposition to the large-scale air-cooled bitcoin mining facility, which MARA acquired in early 2024. The company began mitigating noise last summer by transitioning to immersion cooling technology, which submerges mining machines in liquid coolant to dampen sound.

At the time, MARA said it had installed a 24-foot acoustical wall, moved fan-cooled units farther from homes, and expected the new immersion containers to be fully deployed by year’s end. Despite these steps, tensions persisted. Residents, organized under a group called Citizens Concerned About Wolf Hollow and represented by the environmental law firm Earthjustice, sued the company in 2024 for private nuisance but later lost a related noise case in county court.

The new lawsuit claims that Hood County Judge Ron Massingill, County Attorney Matt Mills, and Elections Administrator Stephanie Cooper worked with the same group to fast-track the incorporation measure before the August ballot deadline. Internal emails cited in the filing show officials acknowledging defects in the petition—such as inconsistent city names and missing boundary maps—while pushing it through regardless.

“The county isn’t going to invalidate the petition at this time,” Mills wrote in an Oct. 3 email quoted in the complaint. “The courts are open for a filing for an injunction.”

Marathon argues that the incorporation effort has “no legitimate municipal purpose” and was instead designed to “regulate and tax the company out of existence.”

The case, MARA Holdings, Inc. et al. v. Hood County, Texas et al., is docketed as No. 4:25-cv-1202 in the Northern District of Texas, Fort Worth Division.