SpaceX says US case alleging anti-immigrant bias is unconstitutional

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Illustration shows SpaceX logo and Elon Musk silhouette

SpaceX logo and Elon Musk silhouette are seen in this illustration taken, December 19, 2022. REUTERS/Dado Ruvic/Illustration//File Photo Acquire Licensing Rights

Sept 19 (Reuters) – Elon Musk’s SpaceX has sued the U.S. government saying that the government’s administrative case accusing the rocket and satellite company of refusing to hire refugees and asylees violates the U.S. Constitution.

SpaceX, in a lawsuit filed in Texas federal court on Friday, says the U.S. Department of Justice (DOJ) administrative judges who hear cases involving employment bias against immigrants are not properly appointed, and that keeping the case out of court deprives the company of its constitutional right to a jury trial.

The Department of Justice did not immediately respond to a request for comment on Tuesday.

DOJ in a complaint issued last month said that from 2018 to 2022, SpaceX routinely refused to hire people who were not U.S. citizens or green card holders. SpaceX wrongly claimed that federal export control laws barred it from employing foreign citizens, DOJ said.

In its lawsuit on Friday, SpaceX said it has employed hundreds of non-U.S. citizens, but that some of its projects have national security implications and it could face steep fines for employing foreign workers.

But regardless of the merits of DOJ’s claims, the administrative case is not allowed under the U.S. Constitution, SpaceX claimed.

DOJ administrative judges are appointed by the U.S. attorney general, but have powers that should be reserved only for officials appointed by the president, SpaceX said in the lawsuit.

The company cited a federal appeals court’s 2022 ruling that said in-house enforcement proceedings by the U.S. Securities and Exchange Commission were unconstitutional. The U.S. Supreme Court in June said it would review that decision.

And because the case against SpaceX seeks monetary penalties under federal employment discrimination law, it should be heard in a federal court, the company argued.

SpaceX said it would ask the court to block the administrative case from moving forward pending the outcome of its lawsuit.

Reporting by Daniel Wiessner in Albany, New York, Editing by Alexia Garamfalvi

Our Standards: The Thomson Reuters Trust Principles.

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Dan Wiessner (@danwiessner) reports on labor and employment and immigration law, including litigation and policy making. He can be reached at daniel.wiessner@thomsonreuters.com.

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