tesla racism

Tesla settles with Black worker after $3.2 million verdict in racism lawsuit

Policy, tesla owen diaz, tesla racism / Ari B / March 18, 2024

Owen Diaz v. Tesla —

Tesla and Owen Diaz both appealed $3.2 million verdict before deciding to settle.

Jon Brodkin – Mar 18, 2024 6: 30 pm UTC

Aerial view of Tesla cars in a parking lot at a Tesla facility. — Enlarge / Tesla cars sit in a parking lot at the company’s factory in Fremont, California on October 19, 2022.

Getty Images | Justin Sullivan

Tesla has settled with a Black former factory worker who won a $3.2 million judgment in a racial discrimination case, a court filing on Friday said.

Both sides were challenging the $3.2 million verdict in a federal appeals court but agreed to dismiss the case in the Friday filing. The joint stipulation for dismissal said that “the Parties have executed a final, binding settlement agreement that fully resolves all claims.”

Tesla presumably agreed to pay Owen Diaz some amount less than $3.2 million, ending a case in which Diaz was once slated to receive $137 million. As we’ve previously written, a jury in US District Court for the Northern District of California ruled that Tesla should pay $137 million to Diaz in October 2021.

In April 2022, US District Judge William Orrick reduced the award to $15 million, saying that was the highest amount supported by the evidence and law. Diaz rejected the $15 million award and sought a new damages trial, but a new jury awarded him $3.2 million in April 2023.

Diaz’s attorney, Lawrence Organ of the California Civil Rights Law Group, told CNBC that the parties “reached an amicable resolution of their disputes.” The settlement terms are confidential, he said.

“It took immense courage for Owen Diaz to stand up to a company the size of Tesla,” Organ said. The California Civil Rights Law Group is separately representing thousands of Black workers in a class action alleging that they faced discrimination and harassment while working at Tesla’s factory in Fremont, California.

“Tesla factory was saturated with racism”

Diaz operated a freight elevator at Tesla’s Fremont factory for less than a year beginning in June 2015. “In May 2016, he was ‘separated’ from Tesla without prior warning,” Orrick wrote in the April 2022 ruling that awarded Diaz $1.5 million in compensatory damages and $13.5 million in punitive damages.

“The evidence was disturbing,” Orrick wrote. “The jury heard that the Tesla factory was saturated with racism. Diaz faced frequent racial abuse, including the N-word and other slurs. Other employees harassed him. His supervisors and Tesla’s broader management structure did little or nothing to respond. And supervisors even joined in on the abuse, one going so far as to threaten Diaz and draw a racist caricature near his workstation.”

A Tesla filing in March 2023 argued that “no reasonable jury, properly instructed, could award any punitive damages against Tesla on the record here.” Tesla said it “enforced a policy prohibiting racially hostile conduct,” that it “took concrete and significant steps to remedy each and every racial incident Mr. Diaz reported,” and “likewise took concrete and significant steps to remedy other racially inappropriate conduct of which it was aware.”

Tesla is also facing lawsuits from the California Civil Rights Department and the US Equal Employment Opportunity Commission over alleged discrimination and harassment.

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Tesla must face racism class action from 6,000 Black workers, judge rules

Enlarge / Tesla factory in Fremont, California, on September 18, 2023.

Getty Images | Justin Sullivan

Tesla must face a class-action lawsuit from nearly 6,000 Black people who allege that they faced discrimination and harassment while working at the company’s Fremont factory, a California judge ruled.

The tentative ruling from Alameda County Superior Court “certifies a class defined as the specific approximately 5,977 persons self-identified as Black/African-American who worked at Tesla during the class period from November 9, 2016, through the date of the entry of this order to prosecute the claims in the complaint.”

The tentative ruling was issued Tuesday by Judge Noël Wise. Tesla can contest the ruling at a hearing on Friday, but tentative rulings are generally finalized without major changes.

The case started years ago. An amended complaint in 2017 alleged that Tesla “created an intimidating, hostile, and offensive work environment for Black and/or African-American employees that includes a routine use of the terms ‘Nr’ and ‘Na’ and other racially derogatory terms, and racist treatment and images at Tesla’s production facility in Fremont, California.”

The plaintiffs’ motion was not approved in its entirety. A request for class certification was denied for all people who are not on the list of class members.

However, plaintiffs will have five days to provide an updated list of class members. Anyone not on the list “may if they wish seek individual remedies through filing civil actions, through arbitration, or otherwise,” the ruling said.

Plaintiffs “heard the n-word” at factory

A class-action trial is scheduled to begin on October 14, 2024, the same day as a separate case against Tesla brought by the California Civil Rights Department (CRD).

As Wise’s ruling noted, “The CRD has filed and is pursuing a parallel law enforcement action that is alleging a pattern and practice of failing to prevent discrimination and harassment and seeking an injunction that would require Tesla to institute policies and procedures that will do a better job of preventing and redressing discrimination and harassment at Tesla. The EEOC [US Equal Employment Opportunity Commission] has filed a similar action.”

In the class action, plaintiffs submitted “declarations from 240 persons who stated that they observed discrimination or harassment at the Tesla Fremont facility and that some complained about it,” Wise wrote. “Of the 240 plaintiff declarations, all stated that they heard the n-word at the Tesla Fremont facility, 112 state that they complained to a supervisor, manager or HR about discrimination, but only 16 made written complaints.”

Tesla submitted declarations from 228 people “who generally stated that they did not observe discrimination or harassment at the Tesla Fremont facility or that if they observed it then Tesla took ‘immediate and appropriate corrective action,'” Wise wrote.

Tesla also said it “created a centralized internal tracking system to document complaints and investigations” in 2017 and will rely on this database “to demonstrate that Tesla was aware of complaints about race discrimination and harassment and how it responded to the complaints.”