Tesla Ordered to Pay More Than $3 Million to Black Man in Racial Harassment Case

From [HERE] Tesla Inc. TSLA -0.30%decrease; red down pointing triangle secured a financial reprieve when a jury ordered the company to pay more than $3 million to a Black former worker in a racial harassment case, a fraction of the payout the company initially owed.

It was the second time in as many years that the case was presented to a federal jury here.

In 2021, a jury found Elon Musk’s electric-vehicle maker liable for subjecting the former factory worker to a racially hostile work environment and failing to prevent racial harassment. That jury awarded the former worker, Owen Diaz, $137 million in damages. Mr. Diaz was an elevator operator at Tesla’s Fremont, Calif., factory in 2015 and 2016.

U.S. District Judge William Orrick cut that award last year to $15 million, calling the original damages excessive. Mr. Diaz rejected that reduced award.

Jurors in the second trial were asked to assume Tesla is liable and assess how much the company should pay in damages. The eight-person jury on Monday ordered Tesla to pay Mr. Diaz $175,000 in compensatory damages and $3 million in punitive damages. 

Alex Spiro, a lawyer for Tesla, declined to comment on the verdict, as did the company’s general counsel.

Attorneys for Mr. Diaz expressed disappointment with the outcome. “I don’t think that the truth drove the decisions here. I think it was a show whereby Mr. Diaz was attacked and his credibility was questioned,” said Larry Organ, one of the plaintiff’s lawyers.

Mr. Diaz’s attorneys have asked Judge Orrick to declare a mistrial, saying Tesla improperly sought to introduce evidence that prejudiced the jury against Mr. Diaz.

Bernard Alexander, another lawyer for Mr. Diaz, asked jurors last week to award more than $8 million in compensatory damages and some $150 million in punitive damages. “If Tesla refuses to protect Black employees inside the workplace, then it is unsafe for them,” Mr. Alexander said in his closing statement.

Mr. Spiro called that damages request “unwedded to law” and accused Mr. Diaz of lying repeatedly. “Justice is not lying to get an advantage,” Mr. Spiro said.

The jury in the earlier trial found Tesla liable for subjecting Mr. Diaz to a racially hostile work environment; failing to prevent him from being racially harassed; and negligently retaining and supervising one or more of Mr. Diaz’s supervisors. The San Francisco Bay Area factory where Mr. Diaz worked was Tesla’s only car assembly plant at the time.

Tesla’s then-head of human resources said in 2021 that the company believed the verdict wasn’t justified.

Tesla also is facing a lawsuit in state court from the California Civil Rights Department, which sued the company last year alleging that Tesla ignored years of complaints from Black factory workers. The U.S. Equal Employment Opportunity Commission came to similar conclusions, Tesla has said.

Tesla has criticized the California agency’s investigation and said it “strongly opposes all forms of discrimination and harassment.” The company said earlier this year that it was arranging mediation with the federal commission. [MORE]