Tesla has settled with a former employee in a long-running racial discrimination case that drew attention to the electric carmaker’s treatment of people of colour. Owen Diaz, who was awarded nearly $3.2m by a federal jury last April, reached a “final, binding settlement agreement that fully resolves all claims”, according to a document filed Friday with the US district court in San Francisco.
The document gave no details of the agreement, but said both parties agree the matter has been resolved and the case against the company run by Elon Musk can be dismissed. Messages were left seeking details from Tesla lawyers and Diaz’s attorney, Lawrence Organ.
Diaz, a Black man, alleged 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’s Fremont, California, factory that ended in 2016. The case dates back to 2017 and centres on allegations that Tesla failed to stop a racist culture at the plant about 40 miles south-east of San Francisco.
The April verdict was the second reached in Diaz’s case. In his first trial in 2021, Diaz won $137m, but US district judge William Orrick reduced that award to $15m, prompting 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 $3.2m verdict, and Tesla filed a notice of cross-appeal.
The Fremont plant is also the subject of a racial discrimination case brought by California regulators, who have been accused by Tesla of abusing their authority. The US Equal Employment Opportunity Commission filed a similar complaint against Tesla in September.
