Tesla ordered to pay $3.2 million to Black ex-worker in US race bias
case
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[April 04, 2023] By
Daniel Wiessner
(Reuters) -A federal jury in San Francisco on Monday ordered Tesla Inc
to pay about $3.2 million to a Black former employee after he won a
racial harassment lawsuit against the electric-vehicle maker, far less
than the $15 million he rejected last year in opting for a new trial.
The verdict came after a week-long retrial in the 2017 lawsuit by
plaintiff Owen Diaz, who in 2021 was awarded $137 million by a different
jury. A judge agreed with that jury that Tesla was liable but said the
award was excessive. He ordered a new trial on damages after Diaz
declined the reduced $15 million award.
Diaz had accused Tesla of failing to act when he repeatedly complained
to managers that employees at the Fremont, California, factory
frequently used racist slurs and scrawled swastikas, racist caricatures
and epithets on walls and work areas.
The jury on Monday awarded Diaz, who worked as an elevator operator,
$175,000 in damages for emotional distress and $3 million in punitive
damages designed to punish unlawful conduct and deter it in the future.
Tesla CEO Elon Musk in a tweet said "the verdict would've been zero" if
the judge had allowed the company to introduce new evidence in the
retrial.
Musk added: "Jury did the best they could with the information they had.
I respect the decision."
The company has said it does not tolerate workplace discrimination and
takes worker complaints seriously.
Bernard Alexander, a lawyer for Diaz, urged jurors during closing
statements on Friday to award him nearly $160 million in damages, and
send a message to Tesla and other large companies that they will be held
accountable for failing to address discrimination.
“Mr. Diaz’s outlook on the world has been permanently changed,”
Alexander said. “That is what happens when you take away a person’s
safety.”
Tesla's lawyer, Alex Spiro, countered that Diaz was a confrontational
worker who had exaggerated his claims of emotional distress, and said
his lawyers failed to show any serious, long-lasting damage caused by
Tesla.
“They’re just throwing numbers up on the screen like this is some kind
of game show,” Spiro said.
Lawyers for Diaz did not immediately respond to requests for comment on
the verdict.
CASE SEEN 'FAR FROM OVER'
The verdict was surprisingly low considering the egregious conduct for
which Tesla was found liable, said Ryan Saba, a Los Angeles-based
employment lawyer who was not involved in the case.
But it could be cut even further because punitive damages are typically
capped at no more than nine times the amount of damages for emotional
distress and other injuries, Saba said. The punitive damages awarded by
the jury on Monday were nearly 20 times the damages for emotional
distress.
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A Tesla vehicle drives past Tesla's
primary vehicle factory in Fremont, California, U.S. May 11, 2020.
REUTERS/Stephen Lam
“I expect both sides will appeal,” Saba said. “This case is far from
over.”
Diaz testified last week, tearfully recounting various incidents
during the nine months that he worked at the Fremont factory. Diaz
said the job made him anxious and strained his relationship with his
son, who also worked at the plant.
Lawyers for Tesla highlighted what they said were inconsistencies in
Diaz's testimony and repeatedly raised the fact that he did not
lodge written complaints to supervisors. Diaz testified that he
verbally complained to managers numerous times and discussed his
complaints with Tesla human resources officials.
The EV maker is facing similar claims of tolerating race
discrimination at the Fremont plant and other workplaces in a
pending class action by Black workers, a separate case from a
California civil rights agency, and multiple cases involving
individual workers. The company has denied wrongdoing in those
cases.
Diaz had sued Tesla for violating a California law that prohibits
employers from failing to address hostile work environments based on
race or other protected traits.
The first jury in 2021 awarded Diaz $7 million in damages for
emotional distress and a staggering $130 million in punitive
damages. The award was one of the largest in an employment
discrimination case in U.S. history.
U.S. District Judge William Orrick last year agreed with the jury
that Tesla had broken the law, but said the award was excessive and
cut it to $15 million.
Orrick said Diaz had worked at the factory for only nine months and
had not alleged any physical injury or illness warranting a higher
award.
On Friday, Orrick denied a motion by Diaz's lawyers for a mistrial.
They claimed Tesla's legal team violated Orrick's bar on introducing
new evidence in the retrial by questioning Diaz and other witnesses
about incidents where he allegedly made racist or sexual comments.
Orrick said those questions were related to other incidents
discussed in the first trial, and that Diaz's lawyers had not shown
that the questioning prejudiced the jury.
(Reporting by Daniel Wiessner in Albany, New YorkEditing by Alexia
Garamfalvi and Matthew Lewis)
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