Tesla will go back to court for racial discrimination lawsuit

Owen Diaz, a former elevator operator at Tesla’s Fremont factory who accused the company of racial discrimination, will once again face off against the automaker in court. After Diaz and his lawyers rejected a $15 million payout last week, which had been slashed from a jury-awarded $137 million, a federal California judge granted Tesla’s motion for a new trial.

Diaz is seeking compensatory and punitive damages from Tesla after alleging that colleagues subjected him to racial harassment and bias, including calling him racist slurs and drawing swastikas. In October 2021, a jury awarded Diaz $137 million, but in April, U.S. District Judge William Orrick in San Francisco said that was excessive and cut the award to $15 million.

Orrick gave Diaz two weeks to accept the award. Diaz and his lawyers rejected the lower payout, saying it was unjust and undermined Diaz’s constitutional rights.

Going back to court could prove to be time-consuming and expensive, as well as risky for Diaz, who could come out the other side of this with less money. However, the most likely outcome will see Diaz getting an award somewhere in the middle of the $15 million and $137 million, according to Helen Rella, head of the employment law department at law firm Wilk Auslander.

Orrick scheduled a conference for July 12, but has not yet set a date for the new trial.

Tesla did not respond to a request for comment; the automaker has denied any wrongdoing in the past.

Tesla is facing a series of lawsuits for racial discrimination and sexual harassment. Earlier this month, a Tesla shareholder filed a lawsuit accusing Tesla’s CEO, Elon Musk, and the board of directors of neglecting worker complaints and allowing for a toxic workplace culture to flourish.