June 9, 2023

A federal jury in San Francisco on Monday ordered Tesla to pay about $3.2 million to a black man who accused the automaker of ignoring racial discrimination he faced while working at its California factory.

The award is well below the $137 million awarded by another jury two years ago, mostly in punitive damages. A judge in that trial later lowered that figure to $15 million, prompting plaintiff Owen Diaz to challenge that amount in a new trial.

But instead of getting more money, he will get less money. After a five-day trial, the jury awarded $3 million in punitive damages and $175,000 in past and future non-economic damages.

Mr. Diaz said he was repeatedly racially abused in 2015 and 2016 while working as a contractor at the Tesla factory in Fremont, near San Francisco. There, he said, a supervisor and other colleagues routinely used racist remarks, including in reference to him. Employees also wrote racial epithets and drew symbols and caricatures around the factory, he said.

Mr. Diaz said he was emotionally hurt by the offenses and that he had brought the issues to the company’s attention, but that Tesla had done little to address them. He said he tolerated the hostility until his son started working at the factory and faced similar treatment.

“The pervasive use of the N-word in the Tesla workplace shows that they don’t care about the feelings of African-American employees,” Bernard Alexander, one of Mr. Diaz’s attorneys, said in recent closing arguments. trial. “This is a total insult to every African-American in the workplace.”

Tesla’s lawyers said Mr. Diaz exaggerated the impact and extent of the racial harassment he faced, encouraging the jury to minimize damages.

But the company did not go to trial for Mr. Diaz’s responsibility for creating a hostile work environment and failing to prevent racial harassment. In instructions to jurors, Judge William H. Orrick said it had been “finalized.” Instead, the onus is on the jury to determine how much is owed to Mr. Diaz.

Judge Orrick also presided over the trial.

After the 2021 trial period ended, Tesla’s human resources chief said the company had fired two contractors and suspended another in response to Mr. Diaz’s complaint. The executive acknowledged that the company was “not perfect” in 2015 and 2016, but said it has come a long way since then.

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