SpaceX is facing a new legal challenge as tribal and conservation organizations filed a lawsuit to block a federal land exchange tied to the Lower Rio Grande Valley National Wildlife Refuge in Texas. The plaintiffs argue the deal would shift hundreds of acres of refuge property into SpaceX's hands and weaken protections for sensitive habitat and historic resources.

The Center for Biological Diversity reported the complaint targets the U.S. Fish and Wildlife Service’s approval of a swap that would transfer 715 acres from the refuge to SpaceX in return for 683 acres offered to the agency. The groups say federal law requires refuge exchanges to deliver an overall conservation gain, not a net loss. This proposed transaction is among the largest refuge-system land swaps outside Alaska.

Benzinga reached out to SpaceX and the South Justice Environmental Justice Network but did not receive a response at the time of publication.

"Our protected public lands are being gifted for the benefit of the world's richest man, who could trash them while playing with his exploding rockets," said Laiken Jordahl of the Center for Biological Diversity. "The Lower Rio Grande Valley National Wildlife Refuge was built by decades of conservation work and funded by millions of taxpayer dollars to protect our vulnerable wildlife like ocelots and piping plovers. We're not letting Trump and his political cronies lock the American people out of Texas' cherished public lands just to give Elon Musk another payday."

The lands being transferred to SpaceX also include parts of the Palmito Ranch Battlefield National Historic Landmark, the site of the Civil Wars final battle. They argue privatization could limit public access and leave preservation decisions to SpaceX, who could choose "not to preserve historic values."

"Elon Musk has built his explosive SpaceX facility in the middle of a major wildlife corridor home to endangered and threatened species like ocelots and wetlands. There was never supposed to be space rockets blowing up here," said Bekah Hinojosa, a Brownsville native, and co-founder of the South Texas Environmental Justice Network. "Our community opposes these latest hostile land grabs by SpaceX of our wildlife habitat and Boca Chica beach. This habitat land is meant to be preserved for future generations, not for billionaires to find later and destroy."

The proposed land exchange was first announced publicly in March, but records obtained through a Freedom of Information Act request show that internal planning at the agency began as early as April 2025, the press release noted. 

In discussions with the Fish and Wildlife Service's regional director, officials laid out "the most expedited schedule possible" for completing the transfer and recommended adding staff to meet what they described as an "optimum timeframe." The planning unfolded during a period when Musk was leading his Department of Government Efficiency and publicly threatened to dismiss federal employees who could not justify their roles.

The press release noted that in the years following SpaceX's arrival, the company has "vastly expanded" its operations around the wildlife refuge, adding a second launch pad and increasing manufacturing facilities. Last year, the Federal Aviation Administration granted SpaceX 25 Starship launches per year, a fivefold increase from the previous limit.

Launch failures have triggered wildfires and explosions on refuge lands and scattered chunks of concrete and metal more than six miles from the launch pad, the lawsuit noted.

"SpaceX has been a nightmare of a neighbor to the Lower Rio Grande Valley wildlife refuge for years, callously harming wildlife that call these special places home," said Jordahl. "It's shameful and insulting that this sweetheart deal has been rammed through just to placate another billionaire in Trump's orbit. We'll fight this outrageous sell-out of our public lands with everything we've got."

The lawsuit contends the approval violated the National Wildlife Refuge System Improvement Act of 1997 because it would permanently shrink and impair the Lower Rio Grande Valley National Wildlife Refuge. The plaintiffs also allege violations of the National Historic Preservation Act and the National Environmental Policy Act tied to the transfer.

The plaintiffs are asking the court to invalidate the U.S. Fish and Wildlife Service's approval of the Boca Chica Land Exchange, arguing it violated multiple federal laws, and to block the project from moving forward. 

They also want the agency ordered to update its management plan for the Lower Rio Grande Valley National Wildlife Refuge, which they say is out of compliance with legal requirements.  The plaintiffs are also seeking attorney's fees and any other relief the court deems appropriate.

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