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The judge ordered the lawsuit against X and xAI to be prosecuted. apple And OpenAI, which seeks to maintain its monopoly on the artificial intelligence market, must remain in federal court in Fort Worth, Texas, despite either company’s “at best minimal ties” to that geographic region.
In a sharply sarcastic four-page order Thursday, Judge Mark Pittman encouraged companies that want to hear antitrust cases in Fort Worth to move their headquarters there.
In a footnote, he even flagged the business on the Fort Worth Department of Business Services website to “begin the process” of relocating to the city.
Mr. Pittman’s order is implicitly aimed at increasing the trend of some conservative plaintiffs filing cases in the Fort Worth District of the Northern District of Texas, increasing their chances of winning favorable rulings from the district’s two sitting judges, both appointed by Republicans.
These plaintiffs have X and teslaboth controlled by billionaire Elon Musk, who until earlier this year was a top adviser to President Donald Trump.
Pittman, who was appointed by President Trump, has criticized the practice of targeting lawsuits to specific jurisdictions, known as forum shopping.
Pittman said in Thursday’s order that the Fort Worth area’s docket is two to three times busier than the Dallas area’s docket, which has more judges.
Pittman’s order notes that, outside of a few Apple Stores, neither Apple nor OpenAI have strong ties to Fort Worth.
“And, of course, based on that logic, there is no district or division in the entire United States that would not be an appropriate venue for this litigation,” Pittman wrote.
X Corp.’s headquarters are in Bastrop, Texas (about 320 miles south of Fort Worth), and Apple and OpenAI’s headquarters are both in California. Musk’s xAI acquired Musk’s social media company X in an all-stock deal in March.
“Given the current desire to have a venue in Fort Worth, the numerous high-value cases previously decided in the Fort Worth area, and the vitality of Fort Worth, the court strongly encourages the parties to consider relocating their headquarters to Fort Worth,” the judge wrote.
“Fort Worth has so much more to offer than just the unique artwork on the fourth floor of the historic federal courthouse,” Pittman said.
The judge asked the companies to explain why the case belongs in Fort Worth court.
But neither Apple nor OpenAI has asked for the case to be moved by the judge’s Oct. 9 deadline, Pittman noted in his order.
Still, Pittman chose to continue the lawsuit in the Fort Worth area.
“The fact that neither defendant filed a motion to transfer venue is a consideration for the court,” the judge wrote. “And the court will ‘respect’ the plaintiff’s choice of venue.”
“However, the court does not make its decision lightly or without reserve. This case contains, at best, minimal nexus to the Fort Worth District of the Northern District of Texas,” Pittman wrote. “Perhaps one of Plaintiffs’ strongest arguments is the mere fact that Apple sells the iPhone (and many other products) and OpenAI offers ChatGPT nationally.”
“After more than 10 years of litigating thousands of cases in three different courts, the undersigned continues to feel strongly that NUE is not a continental breakfast. Plaintiffs cannot choose where and how their lawsuits are filed based on their whims,” ​​the judge said harshly.
But Pittman said he had little, if any, choice in the decision to keep the case in court.
The U.S. Court of Appeals for the Fifth Circuit, whose jurisdiction is a federal court in Texas, has raised “the bar for moving venue to new heights,” Pittman wrote.
The Fifth Circuit twice last year reversed Mr. Pittman’s transfer order to Washington, D.C., challenging a Consumer Financial Protection Bureau rule that capped credit card late fees at $8 a month, and a trade group representing major banks filed a lawsuit.
The 5th Circuit said Pittman’s court “clearly abused its discretion” in proceeding with the lawsuit.
OpenAI declined to comment to CNBC, saying the reporter referred to the filings made public in the lawsuit. X and Apple did not immediately respond to requests for comment.
In August, Musk’s X and xAI sued Apple and OpenAI, accusing them of engaging in an “anticompetitive scheme” to maintain a monopoly on the artificial intelligence market.
The lawsuit accuses Apple of favoring OpenAI’s ChatGPT in App Store rankings and deprioritizing other competitors, such as xAI’s Grok.
Earlier this month, a Washington, D.C., judge blocked Musk’s request to move a Securities and Exchange Commission lawsuit over his alleged misdisclosure of his Twitter stock to Texas. After Musk bought the company, he changed the name of Twitter to X.
