Landmark Decision: Judge Rejects Third Trial for Former Tesla Employee’s Racial-Discrimination Lawsuit

A black former factory worker at Tesla recently faced a setback in his race discrimination lawsuit against the company. The worker, Owen Diaz, had attempted to secure a third trial by accusing Tesla’s lawyers of misconduct during the previous trials, but a California federal judge rejected his claims. US District Judge William Orrick upheld the $3.2 million verdict awarded to Diaz in April, denying his motion for a new trial. While this result prevents another lengthy trial, it draws attention to the case and the broader issue of racial harassment at Tesla’s flagship assembly plant in Fremont, California.

Diaz, a former elevator operator, alleged that he experienced daily racial slurs and graffiti, which Tesla ignored despite his complaints. Diaz’s legal team argued that Tesla’s lawyers asked inappropriate questions, unjustly accused a witness of lying, and made misleading statements to the jury during the trial. However, Judge Orrick stated that any misconduct by the company’s lawyers did not unduly influence the jury’s decision.

This is not Diaz’s first legal battle against Tesla. In 2021, a different jury awarded him $137 million, but Judge Orrick later deemed this verdict excessive. A second trial was ordered to determine appropriate damages, but when Diaz declined a lower payout of $15 million, the jury awarded him $3.2 million instead.

Although Tesla declined to comment on the matter, Diaz’s attorney, Lawrence Organ, expressed his intentions to appeal the decision. He also anticipated Tesla’s appeal to seek a reduction in the award. Despite the denial of a new trial, Organ regarded the $3.2 million award as significant in a race discrimination case, highlighting the severity of Diaz’s alleged harassment.

During the second trial, Judge Orrick prohibited both sides from presenting new evidence or testimony. However, Diaz claimed that Tesla’s lawyers violated this directive by questioning him and other witnesses about alleged altercations between Diaz and other workers, which had not been addressed in the first trial. Diaz denies the occurrence of these incidents.

Tesla maintains that it does not tolerate discrimination and treats worker complaints seriously. The company has faced multiple lawsuits alleging racial or sexual harassment at its Fremont plant and other locations. Tesla denies any wrongdoing in these cases, including a proposed class action by black workers and a lawsuit by a California state agency accusing the Fremont plant of widespread race discrimination, which Tesla asserts is politically motivated.

Last week, Tesla faced yet another lawsuit filed by the Equal Employment Opportunity Commission (EEOC), alleging that black factory workers have faced ongoing racist slurs, graffiti, and retaliation for reporting such harassment since 2015.

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