The decide indicators that will probably be tough to dam the probe’s subpoena
The SpaceX Falcon 9 rocket with astronauts Doug Hurley and Bob Behnken in the Crew Dragon capsule launches from Kennedy Space Center, Florida on Saturday, May 30, 2020. The SpaceX Demo 2 mission marks the first orbital space flight launch from the United States in nearly a decade.
Joe Burbank | Orlando Sentinel | Getty Images
A federal judge on Monday hinted that SpaceX could have a hard time blocking a subpoena for setting up documents from the U.S. Department of Justice investigating whether Elon Musk’s company illegally discriminates against foreigners in their hiring.
That strong lead came in an order from Judge Michael Wilner of the US District Court of the Central District of California, which said SpaceX attorneys and DOJ attorneys were to speak to them during a video conference next week. SpaceX has blocked the DOJ’s subpoena, according to the DOJ.
Wilner’s order took note of a prior decision he had made on an unrelated case and asked the parties to consider it. In this case, he flatly denied a company’s arguments against complying with a subpoena to discontinue information issued by the US Equal Employment Opportunity Commission.
Wilner’s order also suggests that both sides may be able to settle the dispute “shortly before full litigation”.
The DOJ asked Wilner last week to contract SpaceX to comply with a subpoena asking the space exploration company to provide information and documents related to its recruitment procedures and employability reviews.
The DOJ’s Immigration and Labor Law Department opened this investigation after a man named Fabian Hutter complained that SpaceX discriminated against him when he was asked about his citizenship status during an interview for a technical strategy position last March. Hutter is not a US citizen.
According to court records, this DOJ unit is now not only investigating Hutter’s complaint, but “may also investigate whether.” [SpaceX] engages in a pattern or practice of discrimination that is excluded by federal law.
Wilner noted in his appointment on Monday that “one issue that is likely to come up before this district court is how SpaceX is seeking to show that compliance with the subpoena would be unduly burdensome for the company.”
“I would like to discuss this (and probably others) with the parties before the formal briefing begins,” Wilner wrote in the order in which the conference call was scheduled.
Wilner also pointed to a decision from 2018 that he had made “in an analogous” summons execution measure.
In this case, Wilner ruled in favor of the EEOC summons against a janitorial company accused of discriminating against three workers.
Wilner ruled that the EEOC subpoena was relevant because its evidence “suggests a broader pattern of corporate malpractice … that could warrant a broader investigation”.
A Falcon 9 rocket will be launched in Hawthorne, California on January 28, 2021 in front of the Space Exploration Technologies Corp. headquarters. (SpaceX) issued.
Patrick T. Fallon | AFP | Getty Images
In the SpaceX case, DOJ attorney Lisa Sandoval wrote in court documents last Thursday that SpaceX refused to comply with a subpoena issued in October requesting information about companies’ hiring. SpaceX provided the DOJ with a Table I-9 of employee information, but did not provide any additional supporting documentation.
Sandoval wrote that SpaceX acknowledged the subpoena order in December but told the DOJ “that it” won’t provide any additional information in response, “according to a court case.
Musk has reportedly said in the past that he cannot hire non-U.S. Citizens or anyone who is lacking a SpaceX green card due to U.S. international arms regulations. These rules, known as ITAR, state that only Americans or foreigners with a US green card can have physical or digital access to items on the US ammunition list, which include defense-related equipment, software, and other materials.
However, it is not clear that SpaceX cannot hire a foreigner for a job with the company.
It is also unknown whether SpaceX quoted ITAR in its decision not to hire anyone whose complaint of discrimination led the DOJ to investigate the company.
SpaceX and Hutter did not immediately respond to requests for comment. The DOJ refused to comment on the probe.
Subscribe to CNBC PRO for exclusive insights and analysis as well as live business day programs from around the world.