Elon Musk’s SpaceX Expected To Comply With DOJ Subpoena In Hiring Investigation, Judge Says

SpaceX should be forced to comply with a Justice Department subpoena as part of its investigation into whether Elon Musk’s company unlawfully discriminated against foreign applicants, a judge recommended on Monday.

The judge’s report, which described “several” federal investigations into the aerospace giant’s hiring practices, rejected SpaceX’s argument that the subpoena was “excessive government action.”

DOJ’s Immigrant and Employee Rights Section, or IER, “has demonstrated that his subpoena is relevant and enforceable for at least one ongoing investigation into the company,” Judge Michael Wilner wrote in his recommendation.

“Further, there is not sufficient basis to conclude that the subpoena is too broad or represents an undue burden on SpaceX,” the report said in California Central Federal Court.

If SpaceX does not raise any objections by April 12, Wilner’s recommendation will go to a Federal District Judge, who will render a decision and deal with all other issues in the case.

SpaceX did not immediately respond to CNBC’s request for comment on the court filing. The DOJ did not immediately comment.

The IER, which is part of the Department of Justice’s civil rights division, launched an investigation in May to determine whether SpaceX “had engaged in an individual violation, pattern or practice” of discriminating against hiring based on citizenship, in violation of US law.

The investigation was based on a complaint that “on or around March 10, 2020, during the interview with the accusing party for the position of Associate in Technology Strategy, SpaceX inquired about his citizenship status and no “ultimately failed to hire him for the position because he is not a US citizen or lawful permanent resident,” DOJ attorneys said in a legal memorandum filed in California federal court in January.

IER secured a subpoena in October for a multitude of SpaceX documents, the memo said. The company filed a petition that month to revoke the summons, but that request was revoked and SpaceX was ordered to comply.

In mid-December, SpaceX acknowledged the order, but told the IER it “did not intend to produce any additional information in response to the administrative summons,” according to the DOJ note, who asked the federal court to force compliance with the summons.

In a fiery response last month, SpaceX called the investigation “the very definition of government overbreadth.”

The company protested what it called an attempt by the IER to “bootstrap” a claimant’s “frivolous” claim in large-scale (and expanding) investigations into the models or practices it agency is currently leading. “

But Wilner Monday disagreed. “SpaceX has not convincingly assumed its burden of proving that the IER subpoena is unreasonably excessive,” he wrote in his recommendation.

Musk, the multi-billion dollar CEO of SpaceX and Tesla, has a long history of clashes with the government.

In 2018, the Securities and Exchange Commission charged Musk with fraud, alleging he misled people by tweeting that he was considering privatizing Tesla, claiming he had the “secure funding.”

Musk and Tesla, in a settlement agreement, both agreed to pay a $ 20 million fine.

In the early days of the coronavirus pandemic, Musk rang about government orders for shelter-in-place, declaiming an appeal on Tesla’s earnings over the “fascist” rules.

– Dan Mangan of CNBC contributed to this report.