Tesla has been at the centre of a legal battle surrounding the issue of discrimination for a while now. In 2017, a former Tesla employee Owen Diaz filed a lawsuit citing race discrimination. In October 2020, the jury awarded Mr. Diaz $137 million: $6.9 million of compensatory damages and $130 million of punitive damages. However, the presiding judge decided the payout was excessive.
Judge William Orrick lowered the payout to $15 million. Owen Diaz rejected the awarded amount. The plaintiff's lawyers indicated that "the award was unjust and would not deter future misconduct by Tesla."
What is going to happen now?
Mr. Diaz's lawyers requested a new trial. Judge Orrick granted the motion, meaning a new trial would have to occur. The trial date hasn't been set yet, but the court scheduled a conference for July 12th.
Here are a few interesting facts surrounding this trial:
1. Owen Diaz was a factory worker at Tesla in Fremont, California, for a total of 9 months.
2. He alleged (and the jury agreed with him in the first trial) racism and discrimination at the workplace, saying he had been subjected to a hostile work environment which included his former colleagues using slurs, caricatures and swastikas.
3. The electric carmaker saw more than one lawsuit at the Fremont factory, with complaints involving widespread race discrimination and sexual harassment.
4. The awarded 137-million payout, despite being struck down by the judge, is a new record for this type of court case.
I cannot believe someone won a $137 million judgement, but I'm also shocked the judge reduced the award. Nowhere did I find a state-imposed limit on the award granted by the jury. Having that said, I'm not a lawyer.
I'm looking forward to seeing what the new trial brings and whether the new jury makes a similar decision in this case.