SpaceX Obtains Temporary Block on NLRB Case Over Firing of 8 Engineers

SpaceX secured a temporary reprieve from an NLRB case alleging it illegally fired eight engineers who tweeted criticism of Elon Musk in 2020. The US Court of Appeals for the Fifth Circuit granted SpaceX's request to block the NLRB's administrative case pending the company's challenge.

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Bijay Laxmi
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SpaceX Obtains Temporary Block on NLRB Case Over Firing of 8 Engineers

SpaceX Obtains Temporary Block on NLRB Case Over Firing of 8 Engineers

SpaceX, the aerospace company led by CEO Elon Musk, has secured a temporary reprieve from a National Labor Relations Board (NLRB) case alleging that the company illegally fired eight engineers who tweeted criticism of Musk in 2020. The US Court of Appeals for the Fifth Circuit granted SpaceX's request to block the NLRB's administrative case pending the company's challenge to a lower court's "effective denial" of its request for an injunction.

Why this matters: The outcome of this case could have significant implications for the NLRB's authority and the constitutional rights of companies facing administrative proceedings. This dispute may set a precedent for future cases involving the rights of employees to express their opinions about their employers and the limits of administrative power.

The case stems from SpaceX's lawsuit claiming that the NLRB's structure and its administration of federal labor law violate the US Constitution. SpaceX argues that the agency's administrative law judges (ALJs) are unconstitutional because they are improperly insulated from removal by the president. The company also contends that the administrative proceedings infringe upon its Seventh Amendment right to a jury trial.

On April 17, 2024, the Fifth Circuit lifted its stay on the transfer order, leading SpaceX to request that the Texas judge either reconsider transferring the case or rule on the company's request for a preliminary injunction to block the NLRB proceeding. When the Texas judge did not act in a timely manner, SpaceX filed a notice of appeal and sought emergency relief from the Fifth Circuit, claiming it would suffer irreparable harm unless the appeals court halted the labor board case.

The Fifth Circuit's order, which contained no legal reasoning, simply announced the granting of SpaceX's emergency motion. Michael Kenneally, SpaceX's lawyer, argued that the company will prevail on both claims in light of the Fifth Circuit's 2022 decision in Jarkesy v. SEC, which disapproved of similar elements of the SEC's enforcement of securities law. SEC, which disapproved of similar elements of the SEC's enforcement ofsecurities law.

The NLRB opposed SpaceX's motion, asserting that the company's lawyers participating in a teleconference with the administrative law judge assigned to handle discovery issues in the ULP case did not constitute irreparable harm necessary for an immediate injunction. The case, Space Exploration Technologies Corp. v. NLRB, is currently before the Fifth Circuit, based in New Orleans, under case number 24-40315.

Initially filed in a Texas federal court, the case was ordered to be transferred to a California federal court. However, the Fifth Circuit's intervention has temporarily halted the NLRB's administrative proceedings against SpaceX. However, the Fifth Circuit's intervention has temporarily halted the NLRB's administrative proceedings against SpaceX. The legal battle unfolding could have significant implications for the NLRB's authority and the constitutional rights of companies facing administrative proceedings.

The controversy surrounding the firing of the eight engineers who tweeted criticism of Elon Musk in 2020 highlights the complex interplay between labor rights, freedom of speech, and the power of administrative agencies. As SpaceX continues to challenge the NLRB's case, the resolution of this dispute may set a precedent for future cases involving the rights of employees to express their opinions about their employers and the limits of administrative power.

Key Takeaways

  • SpaceX wins temporary reprieve from NLRB case alleging illegal firing of 8 engineers who criticized Elon Musk on Twitter.
  • The case may set a precedent for employee free speech and administrative power limits.
  • SpaceX argues NLRB's structure and proceedings violate the US Constitution.
  • The company claims NLRB's administrative law judges are unconstitutional and infringe on its right to a jury trial.
  • The Fifth Circuit's decision will impact the NLRB's authority and companies' constitutional rights in administrative proceedings.