Tesla argues it should pay just $600,000 to an ex-employee who was racially harassed at work — not the $137 million a court ordered

Elon Musk, chief executive of Tesla, told shareholders on Thursday that they will be moving the company's headquarters from Palo Alto, Calif., to Austin, Texas. File Photo by Terry Schmitt/UPI | License Photo

  • Tesla is challenging a $137 million verdict in a racism case filed by a former employee.
  • Owen Diaz said he faced a racist and hostile work environment at Tesla’s California factory.
  • Tesla asked a judge for a new trial and to cut back the damages it needs to pay.

Last month, a federal jury in San Francisco ordered Tesla to pay nearly $137 million to a Black former worker who said the company ignored racist harassment he faced at its California factory. Now Tesla is challenging the verdict.

In a court filing on Tuesday, Tesla called the sum “staggering” and asked a judge to step in and reconsider the decision. Alternatively, the company wants a new trial or for the $137 million in damages to be cut down significantly. Bloomberg first reported the filing.

Lawyers for Tesla argued that based on comparable workplace racial harassment cases the company should be on the hook for $600,000 at most: $300,000 in emotional distress damages and $300,000 in punitive damages. That’s a tiny fraction of the $6.9 million in emotional damages and $130 million in punitive damages the jury decided on.



“The jury award here, a staggering $136.9 million, simply cannot stand,” Tesla said. “It is an award without precedent in US antidiscrimination law. It dwarfs awards in similar — and even in the most egregious — cases. And it bears no relationship to the actual evidence at trial.”

The former worker, Owen Diaz, a contracted elevator operator from 2015 to 2016, said his coworkers called him the N-word, left racist caricatures around the workplace, and scratched a racial slur in a bathroom stall. He also said he was told to “go back to Africa.”

In the filing, Tesla maintained that it disciplined workers who Diaz complained about and that some of Diaz’s claims were uncorroborated.

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