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Tesla manages to get $137 million award for racial abuse slashed to $15 million

Tesla has managed to convince a judge to slash the historic $137 million award it was supposed to pay a former employee as part of a racial abuse lawsuit to $15 million.

Last year, a court ruled against Tesla in a case from plaintiff Owen Diaz, who worked at the company’s Fremont factory from June 2015 to May 2016 as a contract worker hired by a staffing company, about what was described as “racial abuse.”

The jury awarded $6.9 million in damages for emotional distress and $130 million in punitive damages.

Diaz claimed he worked in an environment where “daily racist epithets” were common, and he claims Tesla didn’t do enough to stop it.

Tesla defended itself against the claims and said that the $137 million award was not fair.

Now it managed to at least reverse the award back down to $15 million (via Silicon Valley Business Journal):

U.S. District Judge William Orrick ruled in a 43-page decision that the $137 million awarded to Owen Diaz, a former elevator operator at Tesla’s Fremont factory, would be reduced to about $15 million, calling parts of the former amount “excessive” and “unconstitutionally large.”

Though that’s not really what Tesla was aiming for, since the automaker’s lawyers were pushing to limit compensatory and punitive damages to $300,000 each.

But that might be the best Tesla can get as Diaz’s lawyers are planning to appeal the new judgment that slashed the award down to $15 million.

Though it’s not Tesla’s only issue with lawsuits related to claims of racism.

Earlier this year, Tesla released a blog post titled “The DFEH’s Misguided Lawsuit” in which it warned that the state agency was going to file a lawsuit alleging “systematic racial discrimination and harassment”.

In the post, Tesla argued that the lawsuit was based on “alleged misconduct by production associates at the Fremont factory that took place between 2015 and 2019.“ The company also argued that NFEH didn’t try to solve the issue without a lawsuit and that in each of the individual cases, they didn’t find Tesla at fault.

However, a few days later, we got access to the full lawsuit and saw that the allegations were much more serious.

The automaker is expected to be embroiled in this lawsuit for a long time.

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Avatar for Fred Lambert Fred Lambert

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