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Tesla Wants $137M Racial Discrimination Award Set Aside

Tesla expectedly pushed back at the $137-million verdict handed to them by a federal jury on Oct. 4.

A former contract elevator operator had sued the green energy giant for racial discrimination that occurred when he worked at its Fremont, CA factory from 2015 to 2016. According to the plaintiff, Owen Diaz, Tesla was far from the modern-thinking company it presents itself to be.

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After hearing testimony and other evidence, the federal jury awarded Diaz with what is believed to be one of the largest in U.S. history for an individual plaintiff in a racial discrimination case.

Tesla Discrimination Case Background

Diaz, who is Black, said he was routinely subjected to racial discrimination while at work. From the N-word to calls for him to “go back to Africa” and racist pictures left in bathroom stalls, Diaz endured consistent verbal attacks because of his race.

He went to human resources at Tesla as well as contracting companies Citistaff and nextSource, but nothing ever changed.

Despite his complaints, Diaz told ABC News after the verdict that, “(Tesla) decided not to follow through. They decided to kill investigations.”

Tesla has been the subject of hostile workplace claims before:

  • A class-action lawsuit was filed in 2017 in Alameda County Superior Court. That case is still pending.
  • An arbitrator ordered Tesla to pay $1 million to Melvin Berry, who is black, for being called the N-word by supervisors.

Employees, like Berry, are bound by mandatory arbitration contracts. Diaz, as a contract worker, did not have to abide by arbitration.

Diaz was awarded the following by the San Francisco jury:

  • $6.9 million for emotional distress (past and future non-economic damages)
  • $130 million in punitive damages

Punitive damages are intended to punish, and thereby deter, wrongful acts. The case was heard in the U.S. District Court, Northern District of California.

Tesla Appeals Jury Award

Tesla appealing the verdict was expected. In a Nov. 16 filing seeking the new trial, Tesla said it “abhors and condemns the use of all racial slurs” and the jury award was “without precedent in U.S. anti-discrimination law.” The company claims $600,000 would be a fair settlement.

Some experts believe the judge could reduce the award by half.

In response, Diaz said in a court filing that, “Unless the court holds Tesla fully accountable for its conduct, including by accepting the jury’s deterrent punitive damages award, Tesla will continue to engage in the same reprehensible conduct.” He added, “The singularly reprehensible nature of Tesla’s conduct fully justifies the jury’s punitive damages award,” he said.

Fighting Workplace Discrimination

At Shellist Lazarz Slobin, we believe everyone has an opportunity to work free of any kind of discrimination. Our attorneys focus on employment law and are committed to obtaining the best possible outcome for you. Whether you are an entry-level contractor or C-level employee, you have the right to work free from harassment.

Federal law prohibits workplace discrimination based on the following classifications:

  • Race
  • Color
  • Religion
  • Sex (including pregnancy, sexual orientation, and sexual identity)
  • National Origin
  • Age (40 or older)
  • Disability
  • Genetic Information (including family medical history)

These protections apply to all employer’s employment practices: hiring and firing, promotions, salaries and wages, professional development, and any other aspect of work. We fight for fair treatment in all types of discrimination, whistleblower, and wrongful termination claims.

If you believe you have been subjected to discrimination on the job, tell our legal team about your situation. Contact us online or by calling (713) 352-3433.