New Orleans, Louisiana: A divided U.S. appeals court ruled on Friday that the National Labor Relations Board (NLRB) overstepped its authority by ordering Tesla CEO Elon Musk to delete a 2018 tweet suggesting that employees could lose stock options if they chose to unionize. The decision, rendered by the New Orleans-based 5th U.S. Circuit Court of Appeals with a narrow 9-8 vote, dismissed a 2021 NLRB ruling that classified the tweet as an unlawful threat, citing it instead as protected free speech under the First Amendment.
In an unsigned opinion supported by eight of the nine judges in the majority, the court stated, “Deleting the speech of private citizens on topics of public concern is not a remedy traditionally countenanced by American law.” This finding was significant enough to invalidate the NLRB’s earlier ruling, although it refrained from determining whether the tweet actually violated the National Labor Relations Act.
The court also instructed the NLRB to reassess its decision mandating Tesla to reinstate a pro-union employee who had been terminated. U.S. Circuit Judge James Dennis, dissenting with seven other judges—many of whom were appointed by Democratic presidents—characterized the ruling as “light on law and facts.”
Neither Tesla nor the NLRB provided comments in response to requests regarding the ruling. This case predated Musk’s acquisition of Twitter, now rebranded as X, in 2022 for $44 billion, a platform Musk has used extensively.
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The controversy arose amid an organizing campaign by the United Auto Workers union at Tesla’s Fremont, California, plant, during which Musk tweeted: “Nothing stopping Tesla team at our car plant from voting union… But why pay union dues & give up stock options for nothing?” Tesla contended that the tweet did not constitute a threat, merely pointing out that unionized workers at other automakers do not receive stock options. A three-judge panel of the 5th Circuit initially disagreed in March 2023, but the full court later opted to rehear the case.
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Additionally, Musk’s rocket company, SpaceX, is currently pursuing a separate lawsuit against the NLRB, alleging that its enforcement proceedings are unconstitutional.
