Tesla and a former employee have agreed to settle a closely watched lawsuit that shed harsh light on the automaker's treatment of Black workers.
Lawyers for Tesla and Owen Diaz, who worked at the company's factory in Fremont, California, did not disclose the terms of the agreement in a legal filing on Friday. “The parties have reached an amicable resolution of their disputes,” Lawrence A. Organ, an attorney for Díaz, said in an email, adding that he could not comment further.
Last year, a jury in federal court in San Francisco awarded Diaz $3.2 million after he presented evidence that he had been subjected to repeated harassment by supervisors at the Tesla factory, including that he a racial insult was directed at him more than 30 times. A supervisor drew a racist caricature near his workplace, according to testimony in the case.
The jury concluded that Tesla did little to discipline supervisors or address widespread racism at the factory.
Mr. Diaz appealed, saying that $3.2 million was insufficient compensation for the psychological harm he suffered, including loss of sleep, depression and damaged relationships with his wife and son. Díaz's lawyers also argued that the damages were not enough to punish Tesla for failing to stop the harassment.
It was the second trial in the case. In the first, in 2021, jurors awarded Mr. Díaz $137 million, but a judge ruled the amount was excessive. The second trial last year focused solely on the amount Mr. Diaz should receive in damages.
In a decision last year, Judge William H. Orrick of the United States District Court said: “Tesla's conduct was reprehensible and repeated, and it failed to take responsibility or change its ways during Diaz's time with the company. “. But he ruled that $3.2 million was adequate compensation. Diaz's appeal of that ruling was pending when he and Tesla agreed to settle.
In court papers, Tesla's lawyers denied that the company had failed to respond to the harassment. “Tesla had clear official policies prohibiting racially discriminatory harassment and he did not condone, permit or condone such conduct,” Tesla's lawyers wrote last year. They did not respond to a request for comment on Friday.
