Billionaire Elon Musk seems to have found a new favorite federal judge: Reed O鈥機onnor in Fort Worth, Texas.
Musk鈥檚 social media company X has filed two major lawsuits against groups he sees as antagonists, and O鈥機onnor is presiding over both of them, even though none of the parties is based in Texas.
So far, O鈥機onnor has delivered stunningly pro-Musk decisions, which have gained widespread attention.
What has garnered less attention: O鈥機onnor鈥檚 investment in Tesla, between 鈥�$15,001 and $50,000鈥� of Tesla stock, according to his
That investment has fueled questions over O鈥機onnor鈥檚 fairness as a judge, since the outcome of the suits filed by Musk鈥檚 X could impact his business empire.
鈥淚t is absolutely reasonable to question his impartiality in a case where the party and interest is a principal in a company the judge owns stock in,鈥� said James Sample, a professor who specializes in judicial ethics at Hofstra University鈥檚 law school.
Others have questioned whether Musk鈥檚 legal team intentionally aimed to take their cases to O鈥機onnor鈥檚 court 鈥� something known as 鈥渇orum shopping鈥� 鈥� in hopes of a sympathetic outcome.
The practice is controversial, but not illegal. Federal rules dictating where a lawsuit can be filed are broad, said Jennifer Ahearn, senior counsel for the Brennan Center's Judiciary Program.
鈥淭hey鈥檙e taking advantage of those openings in a way that is not common,鈥� Ahearn said. 鈥淎 reason why you don鈥檛 see that more is because you often don鈥檛 find both judges willing to accept these kinds of situations and parties willing to accept the wrath of the judges for doing that.鈥�
But this judge, according to Ahearn, appears to be the opposite: willing to take on cases in his Texas district that would not ordinarily land there.
O鈥機onnor, a member of the influential conservative legal group the Federalist Society, was appointed by former President George W. Bush in 2007. He has developed a reputation for handing down legal victories to Republicans, notably the Affordable Care Act and federal gun regulations.
Now, O鈥機onnor has taken on two cases from another conservative, who happens to be the richest person in the world who is using O鈥機onnor鈥檚 court to attack perceived enemies.
O鈥機onnor did not return multiple requests for comment. Musk did not, either.
Musk鈥檚 suit is draining Media Matters of cash
O鈥機onnor is now in charge of two of Musk鈥檚 most high-profile legal crusades.
One of the cases, filed this week by Musk鈥檚 X, claims a consortium of advertisers that yanked ads from the platform illegally conspired against the social media site.
The repercussions of the case were almost instantaneous.
Fearing that the lawsuit would drain its finances, the World Federation of Advertisers it would dissolve its brand safety initiative, known as the Global Alliance for Responsible Media.
Brands Unilever, Mars, CVS and Orsted are also named as defendants.
The second lawsuit was filed in November by Musk鈥檚 X, claiming liberal watchdog group Media Matters released a deceptive report about major advertisers appearing alongside pro-Nazi posts. The suit cited contract violations and business disparagement, a legal term for derogatory statements that harm a company.
The cost of turning over vast numbers of documents in the case, a process known as discovery, has already cost the nonprofit of about 100 people millions of dollars and forced it to lay off about 14 staffers.
Lawyers for Media Matters wrote in an email to Musk鈥檚 legal team that the document production has so far been 鈥渆xpansive and intrusive,鈥� comparing the effort to 鈥渉arassment,鈥� according to , which show Musk鈥檚 legal team requesting the personal bank records of rank-and-file employees.
Five months ago, lawyers for Media Matters asked O鈥機onnor to rule on what is often the first major hurdle of a lawsuit: a motion to dismiss determining whether Musk鈥檚 suit has any merit or not.
O鈥機onnor green-lit the discovery process, but he still has not ruled on the lawsuit鈥檚 merits.
Allegations of "forum shopping" lodged at Musk
Like with the Media Matters case, neither X, which is listed in the suits as a Nevada corporation, nor any of the defendants are based in Texas.
But Musk鈥檚 legal team justified filing the Media Matters case in Texas by saying the nonprofit 鈥渞outinely contacts鈥� Texans asking them to subscribe to the group鈥檚 content and that, in the second case, the advertisers have a 鈥渟ubstantial volume of business鈥� in Texas.
Forum shopping accusations have recently in the northern district of Texas, in part because the district is distinct.
In most parts of the country, lawsuits are randomly assigned to judges. But in northern Texas, judges take on suits based on which division of the district they are filed in. That can allow parties to almost cherry-pick a judge, according to Ahearn with the Brennan Center for Justice.
鈥淚t鈥檚 particularly extreme,鈥� Ahearn said of forum shopping in northern Texas. 鈥淚t has become a problem for the judiciary in a way that it hasn鈥檛 been in the past.鈥�
Something else that makes the cases in Texas unique is that laws that protect people and groups from meritless lawsuits do not apply in Texas鈥� federal courts, under . That effectively means that if Musk loses the cases, he will not have to pay the defendants鈥� legal fees, as he would in many states.
Records say Judge O鈥機onnor is a Tesla investor
Another issue has raised concern among legal ethics experts: O鈥機onnor appears to be an investor in Tesla, another company owned by Musk.
It is unclear whether O鈥機onnor has sold his investment of up to $50,000 in Tesla stock, because the judge鈥檚 disclosure form covering the 2023 calendar year is not publicly available. He has requested a filing extension, according to an official with the administrative office of U.S. courts who was not authorized to speak on the record.
In May, found that disclosure forms for judges are often missing, or late, for various reasons. As a result, potential conflicts of interest, like stock holdings or even gifts of luxury travel, are hidden from public view.
Media Matters lawyers have seized on O'Connor's disclosure, saying rulings on what evidence the judge allows in the case could impact Tesla's stock price. They argue that testimony or documents revealing Musk鈥檚 decision-making process could be made public.
鈥淪uch evidence has the potential to directly harm investor confidence in Musk 鈥� and thereby drive down Tesla鈥檚 share price. This is not speculation: History has shown that when Musk speaks, Tesla鈥檚 stock price responds,鈥� Media Matters lawyer Andrew LeGrand wrote in a June filing.
Josh Blackman, an adjunct scholar at the right-leaning Cato Institute, had a different view, saying the case before O鈥機onnor involves X, not Tesla.
鈥淚f the judge owned stock in X, if it were a public company, it鈥檚 an easy case,鈥� Blackman said. 鈥淚t鈥檚 a novel case because it requires a chain of inferences to get from X to Tesla.鈥�
But judicial ethics scholar Sample insists the appearance of bias alone is enough to warrant O鈥機onnor to step aside from the case.
He said: 鈥淟et another competent judge handle these cases without serious questions surrounding them.鈥�
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