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SpaceX Sues National Labor Relations Board

— January 7, 2024

In its lawsuit, SpaceX claims that the federal agency has an “unconstitutional” structure that prevents and inhibits regulation.

SpaceX has filed a lawsuit against the National Labor Relations Board, which recently accused the company of breaking federal law by firing employees who signed an open letter calling CEO Elon Musk “a distraction and embarrassment.”

According to Reuters, the lawsuit was filed earlier this week in a Brownsville, Texas-based federal court. In its complaint, SpaceX claims that the National Labor Relations Board’s actions violate provisions of the U.S. Constitution.

The N.L.R.B., notes Reuters, had earlier initiated its own proceedings against SpaceX. However, the agency’s claim will be heard by an administrative judge and an appointed five-member board—not a trial court. If SpaceX disagrees with the panel’s finding, then it is entitled to file an appeal in the federal courts system.

Now, SpaceX claims that the N.L.R.B.’s structure is inherently unconstitutional.

Attorneys for the company allege that Board is structured in a way that permits the U.S. President to appoint and remove administrative judges and panels—yet, at the same time, deprives the Executive of the right to exercise similar authority or jurisdiction over the agency’s other employees. Furthermore, even when and where the White House is entitled to remove administrative judges and panel members, it must provide cause for doing so.

Elon Musk, grinning and at ease, wearing a dark suit and a plaid shirt with an unbuttoned collar.
Elon Musk in 2008. Photo by JD Lasica, via Flickr. CC BY 2.0

This, SpaceX alleges, affords administrative judges “at least two layers of removal protection,” which “prevents the exercise of presidential authority and thus violates Article II of the constitution.”

“But for these unlawful removal restrictions, either the [Administrative Law Judge] assigned to SpaceX’s administrative case or the N.L.R.B. Members who bear responsibility to supervise and exercise control over the [Administrative Law Judge] would face the prospect of removal by the President based on their conduct during the proceedings,” SpaceX wrote.

SpaceX’s lawsuit lists several charges, including alleged violations of Article II of the U.S. Constitution, as well as its Fifth and Seventh amendments.

“The existence of unconstitutional removal protections inflicts twofold harm. It limits the President’s constitutional authority,” of course,” the lawsuit alleges. “But it also produces an administrative bureaucracy that operates on regulated parties without the constitutionally required ‘degree of electoral accountability.’”

SpaceX is seeking an injunction to prevent the N.L.R.B. from proceeding with its case until the company’s constitutional concerns are resolved.

“If the current Members of the N.L.R.B. are asked to make a prosecutorial determination about whether SpaceX is in violation of the N.L.R.A., there is an objectively high risk that they would not later be able to provide the neutral adjudicative forum that the Constitution demands, and so would need to recuse from further participation in any agency adjudication with SpaceX,” attorneys wrote.

The National Labor Relations Board has yet to comment on SpaceX’s lawsuit.


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