In this edition of Litigation Roundup, we detail a 9-8 ruling from the Fifth Circuit that wiped out a National Labor Relations Board ruling against Tesla, offer new details on who is defending SpaceX in a fight with a neighboring South Texas landowner, and highlight a U.S. Supreme Court ruling that hits pause on a Fifth Circuit ruling in a case centered on the regulation of horseracing.
The Litigation Roundup is a weekly feature highlighting the work Texas lawyers are doing inside and outside the state. Have a development we should include next week? Please let us know at tlblitigation@texaslawbook.net.
Cameron County District Court
SpaceX Hires Counsel in Fight With Cards Against Humanity
A team of attorneys from Ahmad, Zavitsanos & Mensing will be defending SpaceX against claims it has been using as its own a parcel of land that belongs to the company that makes the popular game Cards Against Humanity.
Cards Against Humanity filed suit Sept. 19, seeking $15 million in damages from SpaceX for allegedly trespassing on and using for its business purposes a parcel of land CAH purchased in 2017 along the Texas border with Mexico.
CAH alleges SpaceX has essentially taken over the land — clearing vegetation to make way for gravel and storing heavy machinery there — that it intended to keep in its natural state purchasing the lot via a crowdsourced campaign aimed at thwarting plans to build a border wall.
“In short, SpaceX has treated the Property as its own for at least six months without regard for CAH’s property rights nor the safety of anyone entering what has become a worksite that is presumably governed by OSHA safety requirements,” the lawsuit alleges.
SpaceX filed a denial Oct. 21, arguing the lawsuit was barred because of both a lack of standing and a lack of subject matter jurisdiction.
“CAH does not own and has not owned the real property at issue in this case,” SpaceX told the court.
The case has been assigned to Cameron County District Judge Ricardo M. Adobbati, who as of Monday had yet to set a hearing in the case.
SpaceX is represented by Timothy C. Shelby, Edward B. Goolsby and Cody Watson of AZA and Michael Rodriguez of Atlas, Hall & Rodriguez in Brownsville.
Cards is represented by Kenneth E. McKay of Bellaire, Texas.
The case number is 2024-DCL-05445.
Northern District of Texas
Vax Suit Against Norton Rose Fulbright Dismissed
A lawsuit brought by a former IT support analyst at Norton Rose Fulbright against the law firm over its refusal to grant him a religious accommodation exempting him from the firm’s vaccine mandate has been disposed.
Senior U.S. District Judge Sidney A. Fitzwater signed an order Oct. 23 dismissing the lawsuit with prejudice. That move came after the parties on Oct. 22 filed a joint stipulation of dismissal.
“Plaintiff Joshua Boudreaux and defendant Norton Rose Fulbright US LLP, by and through their undersigned counsel, pursuant to Federal Rule of Civil Procedure 41(a)(1)(ii), file this Joint Stipulation of Dismissal,” the filing reads. “The parties request an order dismissing the above-styled case with prejudice along with all causes of action asserted herein.”
Boudreaux, who started working for the law firm in Dallas in 2016, filed his discrimination lawsuit suit Feb. 1. He alleged that he had a “sincerely held religious belief as a Christian that prevented him from being vaccinated.”
He was fired in October 2021 for refusing to comply with the mandate. He was seeking damages in excess of $300,000 in this lawsuit.
Judge Fitzwater had set a trial date of May 2025 in the case.
Boudreaux is represented by Paul Davis of Frisco.
Norton Rose is represented by its own Heather Sherrod, John W. Weber Jr. and Joshua Owings.
The case number is 3:24-cv-00260.
U.S. Court of Appeals for the Fifth Circuit
Full Fifth Circuit Sides with Tesla, Tosses NLRB Finding
A finding from the National Labor Relations Board that a social media post from Elon Musk constituted an unlawful threat and must be deleted has been overturned by a divided Fifth Circuit on rehearing in a 9-8 plurality ruling.
Friday’s ruling from the full Fifth Circuit also undid an NLRB finding that a Tesla employee was fired in violation of the National Labor Relations Act. An earlier three-judge panel of the court — Judges James L. Dennis, Leslie H. Southwick and Cory T. Wilson — had in March 2023 agreed with the NLRB’s findings, which stemmed from a complaint lodged by three pro-union Tesla employees and the United Auto Workers union.
The court granted rehearing en banc in July 2023.
The post that formed the basis of the complaint was one Musk sent in response to a question from a user of X asking about unions. Musk replied:
“Nothing stopping Tesla team at our car plant from voting union. Could do so tmrw if they wanted. But why pay union dues & give up stock options for nothing? Our safety record is 2X better than when plant was UAW & everybody already gets healthcare.”
UAW filed an unfair labor practice charge based on that comment alleging it constituted a threat to rescind stock options if employees unionized.
The Fifth Circuit on Friday determined the NLRB “exceeded its authority” by ordering Musk to delete the post and remanded the case back to that agency to consider “the fact that” the Tesla employee who ordered the firing of another employee “harbored no anti-union animus.”
The NLRB and the dissenting judges argued that the issue of whether anti-union animus played into the decision to fire an employee, based on that employee’s own testimony, had already been considered and rejected by the government agency.
Chief Judge Jennifer Walker Elrod and Judges Edith Jones, Jerry E. Smith, Catharina Haynes, Don R. Willett, Stuart Kyle Duncan, Kurt D. Engelhardt, Andrew S. Oldham and Cory T. Wilson joined in the plurality ruling.
Judge Dennis authored a 32-page dissent. Judge Southwick, who was on the original panel with Judge Dennis, also joined in the dissent. But Judge Wilson, who originally sided with the NLRB in the panel decision, changed his mind and joined the en banc plurality on rehearing.
“In a short opinion that is light on law and facts, the en banc plurality only reaches two of the four issues on appeal and punts on the rest,” Judge Dennis wrote of the 11-page plurality ruling. “It holds that the National Labor Relations Board (NLRB)’s order directing Elon Musk to delete a coercive tweet (a threat to take stock options away from Tesla employees if they voted to become unionized) violates the First Amendment, against the weight of four Supreme Court authorities.”
Judge Dennis argued that the “plurality’s approach is inconsistent with established First Amendment principles and with this court’s role as a court of review.”
Judges Dennis and Southwick were joined by Judges Priscila Richman, Carl E. Stewart, James E. Graves Jr., Stephen A. Higginson, Dana M. Douglas and Irma Carrillo Ramirez in dissent.
Judge James C. Ho recused and didn’t participate in the decision, and Judge Catharina Haynes concurred in the judgment only.
Tesla is represented by David Salmons, Michael E. Kenneally and David Broderdorf II of Morgan, Lewis & Bockius.
UAW is represented by Daniel E. Curry and Margo A. Feinberg of Schwartz, Steinsapir, Dohrmann & Sommers.
NLRB is represented by its own Micah Jost, Ruth Burdick, Kira Vol and Timothy Watson.
The case number is 21-60285.
Supreme Court of the United States
Stay in Horseracing Safety Case Pauses Fifth Circuit Ruling
The U.S. Supreme Court on Monday issued a stay that will momentarily pause a ruling from the U.S. Court of Appeals for the Fifth Circuit holding a federal agency created by congress to set national standards to protect racehorses unconstitutional.
On Sept. 23, Justice Samuel A. Alito Jr. had issued an administrative stay in the case that pits the federal Horseracing Integrity and Safety Authority against the National Horsemen’s Benevolent and Protective Association. Monday’s stay will pause the case until the court decides whether to grant or deny the petition for writ of certiorari.
Justice Ketanji Brown Jackson was the lone justice who dissented from the stay.
“In my view, their application fails to demonstrate any exigency that would warrant such emergency relief,” she wrote. “Indeed, applicants have also filed an unopposed petition for certiorari in this court, and it is reasonably likely that the lower courts would not do anything to change the status quo if this court granted the petition. Thus, whatever the stay factors might portend, I see no reason for us to intervene in an emergency posture.”
In July, a unanimous three-judge panel of the Fifth Circuit found the Horseracing Integrity and Safety Authority violated the Constitution’s nondelegation doctrine. The ruling marked that court’s second such ruling against the federal agency. In November 2022, a panel of that court determined the power structure of the agency unconstitutionally delegated government power to a private entity “without sufficient agency supervision.”
The July ruling created a circuit split on the issue, after the Sixth Circuit issued a ruling siding with HISA.
HISA was established in 2020 in response to numerous doping scandals and horse deaths at racetrack facilities.
The HISA is represented by Pratik A. Shah of Akin Gump Strauss Hauer & Feld.
NHBPA is represented by Fernando M. Bustos of Bustos Law Firm.
The case number is 24A287.