State and local officials have filed a lawsuit to stop the construction of a proposed U.S. Immigration and Customs Enforcement facility near Gilroy, alleging federal officials concealed the project’s true purpose and bypassed environmental laws.
The lawsuit, filed in U.S. District Court for the Northern District of California, challenges a federal lease and ongoing construction at 7240 Holsclaw Road, a 24.5-acre agricultural property in unincorporated Santa Clara County. According to the complaint, the site is being converted into an ICE detention facility for up to 150 people.
The facility south of San Jose, if built and opened, would be in the heart of an agricultural community that heavily relies on immigrant labor.
California Attorney General Rob Bonta joined Santa Clara County in the suit against ICE, the Department of Homeland Security, the General Services Administration and the property owner, ECG 6 LLC, which according to state records was incorporated in Beverly Hills.
The lawsuit says ECG 6 LLC is a subsidiary of the Elmwood Capital Group, a real estate investment firm also headquartered in Beverly Hills “primarily focused on acquiring industrial facilities, as well as procuring leases with the General Services Administration,” according to its website.
Attorneys for Santa Clara County and the state are seeking an injunction to stop the construction and operation of the facility.
The complaint alleges federal agencies violated the National Environmental Policy Act by approving the project and beginning demolition and construction without conducting required environmental reviews or getting public input.
The lawsuit also claims the project violates several federal laws, including the Immigration and Nationality Act, the Intergovernmental Cooperation Act, California’s Williamson Act and the Administrative Procedure Act.
Plans for the facility began in early May, but the lawsuit argues that the property has been protected for agricultural use since the Williamson Act passed in the 1960s.
The facility, according to the suit, is being built in a location that lacks adequate infrastructure and presents environmental and public health concerns. The complaint cites the property’s proximity to sensitive wildlife habitat, its location within a flood plain and the presence of hazardous materials linked to agricultural research in the area. County officials said the project includes a septic system that would be too small to support the detention facility.
County officials also said that the federal government did not consult with the state and local agencies necessary to build the project. The lawsuit says the only formal communication received by county staff was a brief 2023 memo describing the proposal as “office and operations space” without any mention of a detention facility being part of it.
Site plans obtained by the San Jose Spotlight in June showed holding cells, detainee processing areas, visitation rooms, an armory and other detention center facilities, according to the complaint. The plans indicated capacity for approximately 60 federal employees and up to 150 detainees.
The project comes amid a broader federal effort to expand immigration detention capacity and as protests across the country mount against ICE facilities like it.
The plans also come after the Chronicle revealed in April that at least 48 people died in ICE custody since President Donald Trump returned to office in January 2025, with doctors concluding at least 17 died because of a lack of proper care from the agency. The investigation also documented cases where detainees died after waiting weeks to see a doctor, or because they suffered medical emergencies.
The ACLU of Northern California has been raising alarms about a similar project at FCI Dublin federal prison in Alameda County after the federal Bureau of Prisons published an environmental review of the facility, which the ACLU says is the first step in a process to hand over the complex to ICE.
FCI Dublin closed after several prison workers, including the warden and a chaplain, were convicted or pleaded guilty to sexually assaulting inmates at the women’s prison.
The lawsuit references recent Trump administration rules that call for more detentions and deportations.
State and federal officials are asking the court to void the federal lease and stop construction, as well as require that federal agencies comply with local rules.
Federal officials had not yet filed a response to the complaint as of Tuesday.