Judge Rules Tesla Must Pay $15 Million Instead of $137 Million in Racism Case

Owen Diaz has been in a legal battle with Tesla for quite a while. He and his attorneys managed to get the company convicted to pay $130 million in punitive damages. In the last update about this case, the federal judge William Orrick reduced that to a bit over 10% of the original sum: $13.5 million.
Tesla Fremont factory, where Owen Diaz worked and suffered with racism 10 photos
Photo: Tesla
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Orrick also lowered the $6.9 million compensatory damages to $1.5 million. He said it was “excessive,” while he classified the punitive damages as “unconstitutionally large.” In some countries, the law would indeed block such a large amount with the fundament that it would be unjust enrichment.

Tesla could see that as a massive victory, but it will not for two reasons. The first is that it wanted to pay Diaz only $300,000 for each of the damages, in a maximum total of $600,000. The second is that the federal judge reinforced the company did very little to curb racism in Fremont.

The former contract worker is also not happy. According to Reuters, Bernard Alexander said his client intends to appeal the decision. Although the attorney was satisfied that the judge upheld the previous decision, he thinks that $15 million does not compensate Diaz for what he went through and does not punish Tesla enough for allowing racism of that magnitude to happen on its premises.

With this legal dispute being far from over, Tesla has many more lawsuits to worry about related to the same reason that may make Diaz a rich man. The California DFEH (Department of Fair Employment and Housing) is suing Tesla for “systematic racial discrimination and harassment.” The agency mentioned hundreds of racism complaints in Tesla’s factories and said the company moved its headquarters to Texas to avoid accountability.

Apart from racism, Tesla also faces accusations of sexual harassment, with at least one female employee building shelters with cardboard boxes in her workstations to keep perpetrators away. She did that after asking the HR department to take measures and being ignored in her concerns. Owen Diaz’s lawsuit may be the tip of an iceberg of bad news from courts for the American EV maker.
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About the author: Gustavo Henrique Ruffo
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Motoring writer since 1998, Gustavo wants to write relevant stories about cars and their shift to a sustainable future.
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