Ousted Fermi Co-Founder Sues Company, Board Members
Fermi booted co-founder and former CEO Toby Neugebauer from its board of directors, and he responded with a lawsuit alleging wrongful termination.
The Texas-based REIT said in a filing with the Securities and Exchange Commission that it fired Neugebauer for cause on April 17 and that he had been “automatically removed” from the board.
In a lawsuit filed in Texas Business Court after the firing Friday, Neugebauer alleges that Fermi initially ousted him from the CEO position without cause before switching positions and saying the firing was with cause, a distinction that would trigger his removal from the board.
Fermi declined Bisnow's request for comment.
“These actions by the board are completely misguided. I will continue to fight vigorously to maximize value for all shareholders,” Neugebauer said in a statement Friday afternoon.
Neugebauer's suit says that only the company's shareholders can dismiss a director, under both Texas law and Fermi bylaws, and accuses Fermi's board of being misleading to investors and the public about his exit from management.
Neugebauer was fired from the CEO role at Fermi in April, he said in his complaint, at the same time that the company rolled out its Fermi 2.0 campaign. The moves came after the company lost $150M in construction funding for its flagship development, a 17-gigawatt campus spanning 7,500 acres in North Texas called Project Matador, disclosing that an unnamed tenant pulled out of a plan to help fund its construction.
After firing Neugebauer, Fermi filed a disclosure that said he “departed from his role” as CEO, which the suit says led multiple outlets to incorrectly report that he resigned. After his removal, Fermi's management held an analyst call and said they had been considering the move for at least three months.
Neugebauer said in the suit that he was raising governance concerns over that same period and said he was fired without cause in a rushed board meeting that didn't have an agenda or formal resolutions circulated in advance and wasn't recorded.
Fermi, co-founded by Rick Perry, a former Texas governor and U.S. energy secretary, went public in a high-profile initial public offering in October. Perry is still a director at the REIT, which saw shares soar on the IPO and raised $683M.
It was the only real estate firm to go public in 2025, and by January, the REIT's shares had fallen by more than 70% as questions about its only development weighed on shares along with concerns about broader overinvestment in artificial intelligence that are bouncing around the marketplace.
The REIT ended the trading day with shares up modestly from the market open, but the stock is down roughly 40% in 2026. Its share price of around $5.25 is well off its 52-week high of $36.99.
Neugebauer is also the firm's largest shareholder and said Friday he had yet to sell any shares even as he has become a vocal critic of Fermi's management. He publicly called on leadership last month to begin the process of selling the company to maximize shareholder value. Fermi's board roundly rejected the idea.
Fermi separately announced Thursday that it had appointed Rob Masson II as interim chief financial officer to temporarily replace Miles Everson, who stepped down two days after Neugebauer left as CEO.
The REIT is facing a class-action lawsuit from investors who claim it overstated the level of interest from tenants in its new development and broader questions about its future as it struggles to balance its books.
Management disclosed during the firm’s first-quarter earnings call in March that it was considering selling gas turbines it secured with help from the Trump administration to “preserve liquidity” and meet obligations to lenders. Soaring energy demand from data centers has created a development bottleneck as operators struggle to secure power, making those turbines all the more valuable.
Meanwhile, Equinix, one of the top data center REITs, reported at the end of April that it just closed its largest quarter of leasing activity in company history. The firm boosted revenue 10% year-over-year to $2.3B and lifted its full-year revenue guidance by $21M.
UPDATE, MAY 1, 5 P.M. ET: This story has been updated to include a statement from Toby Neugebauer and information about his lawsuit against Fermi and three of its board members.
