Federal judge signals SpaceX could face tough time blocking DOJ hiring probe subpoena

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The SpaceX Falcon 9 rocket, carrying astronauts Doug Hurley and Bob Behnken in the Crew Dragon capsule, lifts off from Kennedy Space Center, Fla., on Saturday, May 30, 2020. The SpaceX Demo-2 mission is the first crewed launch of an orbital spaceflight from the U.S. in nearly a decade.
Joe Burbank | Orlando Sentinel | Getty Images

A federal judge on Monday hinted SpaceX could find it difficult to block a subpoena for hiring documents issued by the U.S. Department of Justice, which is investigating whether Elon Musk’s company illegally discriminates against foreigners in its hirings.

That strong hint came in an order by Judge Michael Wilner of U.S. District Court of the Central District of California, who told SpaceX lawyers and DOJ lawyers he wants to talk to them during a videoconference next week. SpaceX has stonewalled the DOJ’s subpoeana, according to the DOJ.

Wilner’s order noted, and told the parties to look at, a prior decision he made in an unrelated case, in which he flatly rejected a company’s arguments against complying with a subpoena for hiring information issued by the U.S. Equal Employment Opportunity Commission.

Wilner’s order also suggests that both sides might be able to resolve the dispute “short of full-on litigation.”

The DOJ last week asked Wilner to order SpaceX to comply with a subpoena demanding that the space exploration company provide information and documents related to its hiring and employment eligibility verification processes.

The DOJ’s Immigrant and Employee Rights Section opened that probe after a man named Fabian Hutter complained that SpaceX discriminated against him when he was asked about his citizenship status last March during a job interview for a technical strategy associate position. Hutter is not a U.S. citizen.

According to court records, that DOJ unit is now not only investigating Hutter’s complaint, but “also may explore whether [SpaceX] engages in any pattern or practice of discrimination” barred by federal law.

Wilner, in his order Monday, noted that “a topic that likely will come up in this district court is how SpaceX plans to prove that compliance with the subpoena would be unduly burdensome for the company.”

“I’d like to explore that topic (and probably others) with the parties before formal briefing begins,” Wilner wrote in the order scheduling the teleconference.

Wilner also pointed to a 2018 decision he made “in an analogous” subpoena enforcement action.

In that case, Wilner ruled in favor of the EEOC’s subpoena to a janitorial services company accused of discriminating against three workers.

Wilner ruled that the EEOC’s subpoena was relevant as its evidence suggested “a broader pattern of misconduct at the company … that may warrant a broader investigation.”

A Falcon 9 rocket is displayed outside the Space Exploration Technologies Corp. (SpaceX) headquarters on January 28, 2021 in Hawthorne, California.
Patrick T. Fallon | AFP | Getty Images

In the SpaceX case, DOJ attorney Lisa Sandoval last Thursday wrote in court documents that SpaceX was refusing to comply with a subpoena issued in October that requested company hiring information. SpaceX did provide DOJ with a Form I-9 spreadsheet of employee information, but would not turn over additional supporting documentation.

Sandoval wrote that SpaceX acknowledged the subpoena order in December but told the DOJ “that it ‘does not intend to produce any additional information in response,’ ” according to a court filing.

Musk reportedly has said in the past that he cannot hire non-U.S. citizens or people who lack a green card from SpaceX because of U.S. International Traffic in Arms Regulations. Those rules, known as ITAR, says that only Americans or foreigners who have U.S. green card can having physical or digital access to items on the U.S. Munitions List, which consists of defense-related equipment, software and other material.

But it is not clear that SpaceX cannot hire a foreigner for any job at the company.

Nor is it known if SpaceX had cited ITAR in its decision not to hire to the person whose complaint of discrimination led to the DOJ’s probe of the company.

SpaceX and Hutter did not immediately respond to requests for comment. The DOJ has declined to comment on the probe.

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