Tesla ordered to pay more than $3 million to a former worker in a racism case

An aerial view shows the Tesla Fremont factory in Fremont, California on February 10, 2022.

Josh Adelson | AFP | Getty Images

A federal jury in San Francisco has ordered Tesla to pay $3 million in punitive damages and $175,000 in non-economic damages to Owen Diaz, a former elevator operator at the company’s factory in Fremont, California, after he experienced a racially hostile work environment during his tenure. In the company.

Diaz, a black man, was hired as a contract worker for Tesla in 2015 through a staffing agency.

He had previously won a $137 million judgment in 2021, including punitive damages, after the jury determined that Diaz suffered civil rights violations at Tesla, and that the electric car maker failed to take all reasonable steps to end and prevent racial harassment.

Diaz and Tesla sought a retrial to determine damages after Judge William H. Aurick reduced the amount to $15 million.

A distressed and sometimes tearful Diaz told the court again last week about how his colleagues at Tesla used racial epithets to denigrate him and other black workers, made him feel physically unsafe at work, told him to “go back to Africa” ​​and left a racist. Graffiti in the bathrooms and racist graffiti in his workplace.

The drawing left at his workplace was a rudimentary one resembling Inki the Caveman, a 1950s cartoon widely seen as racist, whose main character is a black boy depicted with large lips, wearing an apron, earrings and a bone through his hair.

Diaz also testified that while he encouraged his son to work at Tesla, he now considers this one of the greatest regrets of his life because his son was also exposed to a racially hostile workplace there.

The plaintiff’s attorney, Bernard Alexander of Morrison Alexander & Fehr, in his closing arguments urged the jury to hold Tesla accountable for its failure to stop and prevent racial harassment of employees, and for the suffering endured by Diaz.

“No black man in 2015 should be subject to the workplace of this farm mentality,” Alexander said.

Alexander also urged the jurors to decide the damages at an amount that “will come to Tesla’s attention.” He described Tesla as a company that should accuse others of lying, because they could not explain why violations of the Civil Rights Act were allowed in their factory.

Prosecutors asked the jury to consider punitive damages of about $150 million to Tesla, awarding Diaz $6.3 million in past non-economic damages, and $2 million in future non-economic damages.

Alex Spiro, a Tesla consultant, argued that Diaz should only be awarded compensation amounting to about half of his salary, in the tens of thousands of dollars, not millions. In the midst of Spiro’s closing argument last week, Judge William Orek said on Friday that Diaz did not disclose his salary during the trial.

Spiro also told jurors on Friday that Diaz “lied to you.” He described the former Tesla contract worker as a confrontational person, who repeatedly exaggerated issues in his testimony. Spiro said Diaz misrepresented the number of months he worked at Tesla. Spiro also accused Diaz of lying about his suffering to the doctor in order to claim greater financial damages from the company.

Diaz’s attorney, citing the Civil Rights Act, called on jurors to make an example of Tesla, saying that “the administration of fairness and justice is not cheap.”

Tesla has been sued more than 200 times by current or former contractors and employees since 2018 in the United States, according to Plainsite legal records database. This number does not take into account disputes that have gone directly to arbitration. As previously reported by CNBC, when it is legal to do so, Tesla has forced employees to agree to mandatory arbitration.

Last week, Tesla’s former service manager, a black man named John Goode, filed a lawsuit in Northern California alleging that the white man whose manager was in Georgia repeatedly made racist remarks in his presence, and was racially biased against him and another black colleague. , who shoots false pretenses in retaliation for Jude, who objected to this treatment.