In a hearing over Tesla’s request for a new trial, a US district judge on Jan. 19 suggested he would reduce the size of the damages awarded to a contract worker over racial abuse in the car manufacturer’s northern California facility, The San Jose (California) Mercury News reported [1].
A jury in October awarded Owen Diaz, an African American, $137 million in his racial discrimination lawsuit against Tesla. The award included $130 million in punitive damages.
Diaz was employed by a staffing firm and assigned to Tesla’s factory in Fremont, California, according to court records. Harassment included use of racial epithets, racist drawings and caricatures, and Black workers being told to “go back to Africa,” according to court records. It also said a Tesla supervisor was aware of the harassment.
The Verge reported [2] at the time of the original award that the lawsuit was unusual because there was not an arbitration agreement in this case. “I believe that’s the largest verdict in an individual race discrimination in employment case [as opposed to a class action],” David Oppenheimer, a clinical professor of law at Berkeley Law, told Fortune [3].
During the retrial request hearing, US District Judge William Orrick said he was “troubled” that the $6.9 million jurors awarded as emotional distress damages “may be untethered to the distress to which Mr. Diaz and his witnesses testified” and said punitive damages of almost 20 times that amount are “extremely high.”
Orrick said he was inclined to deny Tesla’s request for a new trial if Diaz agrees to a reduction in damages.