Tesla’s bid to dismiss racial bias suit denied in tentative ruling

Tesla won’t be able to shake itself from California’s Department of Civil Rights lawsuit for racial bias and harassment just yet.

A California judge Tuesday evening issued a tentative ruling denying Tesla’s motion to dismiss the case. Tesla had argued that DCR did not follow proper protocol in its investigations into the automaker’s Fremont factory, which the agency alleges is a racially segregated workplace where Black workers have been subject to mistreatment, harassment, unequal pay and generally a hostile work environment.

While the court tentatively denied the motion, California Superior Court Judge Evelio Grillo, who in June opposed staying the lawsuit, did impose a one-year statute of limitation on the DCR, according to a source familiar with the case. The source said the tentative ruling sets a high bar for the DCR to show that a culture of racism at Tesla’s factory is indeed systematic.

This is a tentative ruling. That means a formal ruling will follow the Wednesday hearing, giving Tesla a chance to change Grillo’s mind before going to trial.

The DCR, formerly the Department of Fair Employment and Housing, originally filed the lawsuit against Tesla in February after collecting “hundreds of complaints from workers” and evidence that there exists rampant segregation and racial harassment and discrimination at Tesla’s Fremont factory. The DCR isn’t in the business of seeking out such complaints. For an investigation to be launched, individual employees would have had to file complaints with the department.

“The issue that’s most present here is that there are repetitive claims of discrimination at the same workplace,” Helen Rella, a lawyer who specializes in commercial litigation and employment law, told TechCrunch. “That’s problematic for Tesla and for employers in general because repetitive claims of discrimination present the suggestion, whether it’s true or not, that there’s a culture of discriminatory conduct in the workplace. But critical to the entire situation is that the employer takes these claims seriously, that they conduct a thorough investigation, and that they take immediate corrective action where that’s warranted based upon the results of any investigation that they do undertake.”

Tesla did not respond to TechCrunch’s requests for comment. In the past, the automaker has denied any wrongdoing or that there is a hostile work environment at its factory. In a February blog post, the automaker called the DCR’s lawsuit “misguided” and said that the agency has declined to provide Tesla with specific allegations or factual bases for its lawsuit.

Tesla has made repeated moves to both dismiss the DCR’s case against the company and to temper the agency’s authority. In June, Tesla sent a petition to the Office of Administrative Law (OAL) accusing the DCR of failing to conduct proper investigations before filing suit against the automaker. The OAL denied that petition Monday, but said Tesla was free to continue pursuing the matter with the DCR or in court.

One of Tesla’s arguments to discredit the DCR is that the agency adopted “underground regulations,” failing to give Tesla fair notice of an investigation or to help mediate any disputes before going to court.

“It’s not unusual to see these cases mediated and that there’s some agreement that the employer reaches with these administrative bodies in terms of how they’re going to mediate the situation, but that generally involves an acknowledgement on the part of the employer that there was some wrongdoing, that there was a culture of discrimination and something that would justify entering into some sort of remedial action,” said Rella.

However, if the employer is taking the hard line that it has done nothing wrong and there is no culture of discrimination, it makes mediation efforts a bit difficult, Rella added.

“The purpose of mediation is to come to some resolution,” said Rella, noting that in the discrimination arena, that usually means a monetary resolution or the employer agreeing to institute some sort of relevant employee training. “So it’s almost counterintuitive if one side says that they’re not bending at all, because then the only purpose of the mediation would ostensibly be for the one side to convince the other that the position was incorrect.”

The DCR lawsuit isn’t the first time Tesla’s Fremont facility has come under fire for its culture of racism. In 2017, former plant worker Marcus Vaughn filed a class action lawsuit against the automaker for failing to investigate complaints that he was repeatedly called the “n-word” by managers and co-workers. That case is still pending, as is the case of Owen Diaz, a former elevator operator at Tesla who is suing for similar racial harassment. Diaz recently rejected a judge’s award of $15 million, which was a massive cut from a previous jury award of $137 million.

This story is developing. Check back for updates.