Tesla Found Guilty Of Racism But Dodges $130 Million Fine

In October last year, we reported on the case ofOwen Diaz Vs. Tesla. Diaz claims he suffered daily racial slurs at the manufacturer's Fremont factory, including the n-word. The jury found in favor of Diaz and awarded him $6.9 million for emotional distress and $130 million in punitive damages.

If you're not familiar with punitive damages, it's essentially a warning to other companies, which is why the payouts are generally so huge.

Tesla appealed the process, seeking to lower the emotional damage and punitive payout to $300,000 each.

The attempt failed, as US District Judge, William Orrick, agreed with the decision made by jurors in October. Orrick lowered the payout amounts substantially, however.

The judge lowered the original $137 million payout to just $15 million. According to Reuters, Orrick handed over a 43-page decision that found Tesla guilty of "profound" emotional harm. The decision also mentions Tesla's inadequate actions to combat racism.

However, the judge found the jury's compensatory and punitive damages "excessive" and "unconstitutionally large."

Orrick reduced the compensatory amount to $1.5 million from $6.9 million, and the punitive damages decreased from $130 million to $13.5 million.

Diaz's lawyer, Bernard Alexander, said that Diaz plans to appeal the lowered awards. "We're pleased that the court upheld the jury's finding that Tesla's conduct was "absolutely reprehensible," said Alexander. "The award of $15 million is substantial but does not come close to reflecting the harm caused to Mr. Diaz or the reprehensibility of Tesla's conduct."