Tesla settles years-long racial discrimination lawsuit with former worker

Owen Diaz’s long legal battle against Tesla has officially ended after both sides agreed to a settlement. Attorney Lawrence Organ, Diaz’s attorney, said CNBC that “the parties have reached an amicable resolution of their disputes” but “the terms of the settlement are confidential.” If you’ve been following this case for a while, that means you won’t be able to find out how much Diaz is getting after the whopping $137 million in damages he was originally awarded was drastically reduced to $3.2 million.

The former elevator operator is suing the automaker for creating a racist workplace, saying he faced discrimination “straight out of the Jim Crow era” as a black man. He said his co-workers left left-wing swastikas and racist graffiti, such as that of Inki the Caveman, at his workplace and around Tesla’s assembly plant in Fremont. Diaz also said he and other black workers were subjected to racial slurs and that the company failed to address their behavior despite repeated complaints.

In 2021, a court in San Francisco ordered Tesla to pay $137 million in damages to its former worker, which was one of the highest amounts awarded to a plaintiff suing on the basis of discrimination. However, a judge during subsequent appeals found the amount excessive and reduced it to $15 million, although he upheld the original jury verdict. The parties went back to trial after Diaz rejected the reduced amount, but the jury reduced the damages Tesla must pay even more to $3.2 million. At the time, Diaz’s attorney said he had been wrongly attacked by the defense and that they had already requested a new trial due to misconduct. It appears that both sides have since agreed to negotiate behind closed doors.

While Diaz’s case is closed, Organ also represents Marcus Vaughn, who filed another lawsuit against the automaker for racial harassment. Vaughn called Tesla’s Fremont plant a “hotbed for racist behavior” and last year petitioned the court to dismiss his case class action status so he could add 240 black colleagues to his complaint.

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