Bundy lawyer Joel Hansen handed a copy of the lawsuit to U.S. District Judge Gloria Navarro in open court in Las Vegas on Tuesday, and he told her that because she's a named defendant, she should remove herself from Bundy's case.
The judge responded that case law doesn't let a defendant create such a scenario.
But Navarro invited Hansen to try to identify whether her work as a prosecutor in the Clark County district attorney's office before she was nominated to the federal bench created for her a conflict in the Bundy case. She set a May 25 date to rule whether she'll step aside.
Hansen said that Navarro is beholden to Reid because the then-Senate Democratic majority leader recommended her for the judgeship. Obama nominated her, and she was confirmed by the Senate on a 98-0 vote in May 2010.
Hansen complained also that Navarro won't let outspoken conservative attorney Larry Klayman represent Bundy in Nevada until disciplinary proceedings against Klayman are resolved in Washington, D.C.
The filing of the lawsuit came during a detention hearing at which Hansen, with Klayman in the audience, argued that Bundy's constitutional rights are being violated and that charges against the 70-year-old cattleman should be dismissed.
The judge said she'll decide that question if she remains on the case.
Bundy and 18 other defendants have pleaded not guilty to conspiracy, obstruction, weapon, threats and assault charges that could get each the equivalent of life in prison for the tense gunpoint standoff in April 2014 near Bundy's ranch outside Bunkerville, about 80 miles northeast of Las Vegas.
In court, Hansen accused Reid of tainting public opinion against Bundy by branding him a domestic terrorist after the April 2014 standoff, which Hansen alleged followed a Reid order for the federal Bureau of Land Management to round up Bundy cattle from the scenic Gold Butte area near Bundy's ranch in Bunkerville.
Reid owns property nearby, Hansen said, on which he wants Chinese interests to build a solar power plant. Hansen alleged that Reid's son, attorney Rory Reid, is negotiating that deal. Rory Reid declined to comment about the lawsuit.
In a statement, Reid spokeswoman Kristen Orthman dismissed the lawsuit as "baseless and absurd," and repeated the "domestic terrorist" label.
"Bundy, his sons and their believers have endangered the lives of federal officers, have defaced and damaged public lands and squandered public resources for their own benefit," the statement said. "They are deadly and dangerous and will be brought to justice."
Officials at the White House didn't immediately respond to messages.
Federal prosecutor Steven Myhre dismissed as "outrageous, irrelevant and offensive" the idea that there was "some grand conspiracy by political leaders to take over the land."