SAN FRANCISCO– Tesla and a Black man who worked at the company’s California factory have settled a long-running discrimination lawsuit that drew attention to the electric vehicle maker’s treatment of minorities.
Owen Diaz, who was awarded nearly $3.2 million by a federal jury last April, reached a “final, binding settlement agreement that fully resolves all claims,” according to a document filed Friday in U.S. District Court in San Francisco.
The document, which did not provide details of the agreement, said both sides agree that the matter has been resolved and the case against Elon Musk’s company can be dismissed.
Messages were left Saturday seeking details from Tesla lawyers and from Lawrence Organ, Diaz’s lawyer.
The April verdict was the second in Diaz’s case that found Tesla liable for allowing himself to be subjected to racial epithets and other abuse during his brief tenure at the Fremont, California, factory, which was run by the pioneering car manufacturer.
But the eight-member jury in the latest trial, which lasted five days, arrived at a dramatically lower damages award than the $137 million Diaz won in his first trial in 2021. U.S. District Judge William Orrick reduced that award to $15 million, which Diaz and his lawyers to seek a new trial rather than accept the lower amount.
In November, Organ filed a notice that Diaz would appeal the $3.2 million judgment, and Tesla filed a notice of cross-appeal.
The case, which dates back to 2017, centers on allegations that Tesla failed to take action to stop a racist culture at the factory located about 40 miles southeast of San Francisco. Diaz claimed he was called the “n-word” more than 30 times, shown racist cartoons and told to “go back to Africa” during his roughly nine-month tenure at Tesla, which ended in 2016.
The same Tesla factory is in the crosshairs of a racial discrimination lawsuit filed by California regulators. Tesla has firmly denied the state court allegations and hit back by accusing regulators of abusing their authority. The U.S. Equal Employment Opportunity Commission filed a similar complaint in September.
Musk, Tesla’s CEO and largest shareholder, moved the company’s headquarters from Silicon Valley to Austin, Texas, in 2021, partly due to tensions with several California agencies over practices at the Fremont factory.