U.S. Corporations Are Openly Trying to Destroy Core Public Institutions. We Should All Be Worried.

Trader Joe’s, SpaceX, and Meta are arguing in lawsuits that government agencies protecting workers and consumers—the NLRB and FTC—are “unconstitutional.”

Trader Joe’s has become the second company in a month to sue the National Labor Relations Board for being “unconstitutional,” following the lead of Elon Musk’s SpaceX, as both companies face board charges for firing employees. These two major corporations aren’t alone in attempting to protect their interests by undermining public institutions; Meta is also arguing in an ongoing lawsuit that the Federal Trade Commission is unconstitutional. 

A legal expert told Motherboard that these companies are attempting to take advantage of what they believe is a friendly Supreme Court—judges currently lean right by a six-to-three margin—while they can.

SpaceX, accused of illegally firing eight workers who were critical of Musk, filed its lawsuit one day after the Board brought charges against it, arguing that the agency lacked presidential oversight and violated the “separation of powers” provision outlined in the U.S. Constitution. Trader Joe’s, accused of union-busting, stated in a hearing that the Board was unconstitutional, and that it would “preserve the issue for further briefing and argument,” according to a transcript of the hearing shared by the Huffington Post.

These companies are not the first to bring charges of unconstitutionality against core government agencies. In November, Meta sued the Federal Trade Commission for unconstitutionality in a bid to prevent the FTC from preventing the social media giant from profiting off of data collected from minors. 

“Meta respectfully requests that this Court declare that certain fundamental aspects of the Commission’s structure violate the U.S. Constitution,” the company’s complaint stated. It argued that the FTC violated the constitution because it served as both prosecutor and judge, its commissioner could not be removed by the U.S. president, and it denied the company’s right to a trial by jury.

“My sense is that the trend is increasing both because the corporations believe they have a sympathetic audience with this Supreme Court, and because workers’ efforts to organize unions are increasing,” said Kate Andrias, a legal scholar at Columbia University who studies constitutional law and labor law. “So corporations feel more need to use all possible tools to resist.” 

In April, the Supreme Court unanimously ruled in favor of a company challenging the FTC’s constitutional authority. Axon Enterprise, a company that makes TASERs and police body cameras, acquired competitor and police camera maker Vievu in 2018. The FTC challenged the acquisition two years later. Axon sued the agency for exercising unconstitutional authority, and after losing an appeals court decision in 2021, argued the case before the Supreme Court. 

The Court ruled that the FTC Act, which established the agency and its administrative procedures in 1914, did not “displace a district court’s federal-question jurisdiction over claims challenging as unconstitutional the structure or existence” of the commission. The FTC abandoned its challenge. This means that lawsuits about the FTC’s constitutionality, such as that posed by Meta in November, are legally possible.

Laura Phillips-Sawyer, a professor of law at the University of Georgia who studies antitrust, told Motherboard that the Supreme Court’s new “major questions” doctrine made it easier for companies to challenge agencies’ authority.

Read more at Vice